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GATT Library | qb419vp8945 | Report of Working Party 4 of Sub-Committee G Articles 91 and 92 | United Nations Conference on Trade and Employment, February 14, 1948 | Sixth Committee: Organization | 14/02/1948 | official documents | E/CONF.2/C.6/W.99 and E/CONF. 2/C. 6/W. 81-118/ADD. 1 | https://exhibits.stanford.edu/gatt/catalog/qb419vp8945 | qb419vp8945_90200225.xml | GATT_147 | 1,266 | 8,207 | United Nations Nations Unies RESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.6/W.99
ON DU 14 February 1948
TRADE AND EMPLOYENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
SIXTH COMMITTEE: ORGANIZATION
REPORT OF WORKING PARTY 4 OF SUB-COMMITTEE G
ARTICLES 91 AND 92
1. Working Party 4 has agreed, after several extensive meeting, on the
following text of Articles 91 and 92, and of a proposed resolution. Several
of the changes suggested, as for example changes suggested in Article 91,
paragraph 1 and Article 92, paragraph 2, have been made in view of agreement
already reached in Sub-Committee G.
2. The Working Party has agreed upon the use of the word "prejudiced"
rather than the words "substantially interested" in paragraph 2, Article 91,
as reflecting the view of the Sub-Committee. This change is intended to
make clear that a real interest of a Member must be adversely affected
before that Member can compel recourse of the Organization to the
International Court. A remote, theoretical or unsubstantial interest of
a Member in the decision in question would not be sufficient to give a
Member rights under Article 91.
3. The Working Party agreed to call the attention of Sub-Committee G to
the desirability of placing paragraph 3 of Article 92, as redrafted, at the
beginning of Chapter VIII as a separate Article, with the suggestion that
this question should be referred to the Central Drafting Committee, if
deemed necessary. It was suggested that if this were to be drafted as a
separate Article it would be desirable to make the two sentences of this
paragraph into separate sections.
4. It was agreed in the Working Party that the question of recourse by a
state which is a Member of the ITO to the International Court after the
conclusion of the procedures under Chapter VIII might be raised in the
Sub-Committee. It was also agreed that the draft resolution was presented
on a tentative basis and that delegations represented in the Working Party
might raise questions vith respect to its appropriateness.
5. Other changes in the draft have been made in accordance with discussion
either in Sub-Committee G or in the Working Party.
/Proposed text E/CONF.2/C .6 /W.99
Page 2
Proposed Text
ARTICLE 91
REFERENCE TO THE INTERNATIONAL COURT OF JUSTICE
1. The Conference or the Executive Board Organization may, in accordance
with arrangements made pursuant to paragraph 2 of Article 95 of the Charter
of the United Nations, request from the International Court of Justice
advisory opinions on legal questions arising within the scope of the
activities of the Organization.
2. Any resolution or decision of the Conference under [paragraph 3,
Article 90 or decision of the Conference under any other Article of] this
Charter shall, [be subject to review by the International Court of Justice
through the means of a request by the Organization for an advisory opinion
pursuant to the Statute of the International Court of Justice. The request
for review of such resolution or decision shall be made by the Organization,
in appropriate form, on the instance of any substantially interested Member]
upon the instance of any Member whose interests are thereby prejudided be
subject to review by the International Court of Justice through the means of
a request, in appropriate form, for an advisory opinion pursuane to the
Statute of the Court.
3. The request for an advisory opinion shall be accompanied by a statement
to be furnished by the Organization in consultation with the Members
substantially interested, in accordance with the Statute of the
International Court of Justice, of the facts underlying the question upon
which the opinion of the Court is requested. [The Organization shall supply
to the Court such further information as the Court may require]
4. Pending the delivery of the opinion of the International Court of Justice,
the resolution or decision of the Conference shall have full force and affect;
Provided that the Conference shall sunpend the operations of any such.
resolution or decision pending the delivery of the opinion where in the view
of the Conierence damage difficult to repair would otherwise be caused to
a Member concerned.*
5. The Organization shall consider itself as bound by the opinion of the
International Coourt of Jastice on any [the] questions referred by it to
the Court [to it .shall be binding upon the Organization]. The resolution
or decision in question shall be modified insofar as it does not accord with
the opinion of the International Court of Justice.
* Text not altered; inserted for convenience.
/ARTICLE 92 E/CONF.2/C.6/W.99
Page 3
ARTICLE 92
MISCELLANEOUS PROVISIONS
1. (Not within the term of reference of Sub-Committee G).
2. Nothing in this Chapter shall be construed to exclude other procedures
provided for in this Charter for consultation and settlement of differences
arising out of its operation. The Organization may regard consultation or
investigation undertaken under other provisions of the Charter as fulfilling
either in whole or in part, any similar procedural requirement in this Chapter.
3. The Members undertake in relation to other Members or the Organization,
that they will not have recourse to any procedure other than the procedure
envisaged in this Charter for complaints and the settlement of difficulties
arising out of its operation A. [nor,] The Members also undertake without
prejudice to any other international agreement, that they will not have
recourse to unilateral [sanctions] economic measures of any kind [on the ground
that there has been a violation of this Charter, in advance of a complaint to
the Organization and a final decision of the Organization establishing such a
violation] contrary to the provisions of this Charter.
4. The Conference and the Executive Board shall establish such rules of
procedure as may be necessary to carry out the provisions of this Chapter.
The rules of the Conference shall include provisions concerning the
maintenance force or suspension of any rulings of the Executive Board
pending review by the Conference under paragraph 3 of Article 90.*
* Text not altered; inserted for convenience.
/PROPOSED E/CONF.2/C .6/W.99
Page 4
PROPOSED RESOLUTION
The United Nations Conference on Trade and Employment, having Given
serious consideration to the relation of the International Trade Organization
and the International Court of Justice; and
having provided, in Chapter VIII of the Charter, procedures for review
of legal questions arising out of decisions of the Organization by the
International Court; and
having considered the problem arising out of the possibility of conflict
between the obligations of Members under the Statute of the International
Court of Justice and those provisions of the Charter to the effect that
Members will have recourse to the International Court only through the
procedures established for the obtaining of an advisory opinion pursuant to
the Charter and to Article 65 of the Statute of the International Court;
THEREFORE RESOLVES and AGREES:
1. that the Interim Commission of the International Trade: Organization,
through such means as may be appropriate, including if neceasary a
request for an advisory opinion by the appropriate organ of the
United Nations, shall consult with appropriate officials of the
International Court or with the Court itself, upon the questions of
(a) whether any conflict exists between the reciprocal obligations
of Members under these Charter and their obligations under the Statute
of the International Court of Justice; and
(b) whether there may be improvement of the procedures established
by the Charter for obtaining an opinion of the International Court,
in accordance with the provisions of Chapter VIII of the Charter
and the Statute of the Court; and
2. that the Interim Commission shall present a report on these question
to the first conference of the International Trade Organization. |
GATT Library | fw631fb1890 | Report of Working Party 4 on Interpretative Note to Article 40 | United Nations Conference on Trade and Employment, February 7, 1948 | Third Committee: Commercial Policy | 07/02/1948 | official documents | E/CONF.2/C.3/49 and E/CONF.2/C.3/38-57 | https://exhibits.stanford.edu/gatt/catalog/fw631fb1890 | fw631fb1890_90190147.xml | GATT_147 | 210 | 1,491 | United Nations Nations Unies UNRESTRICTED
E/CONF.2/C.3/49
CONFERENCE CONFERENCE 7 February 1948
ON DU ORIGINAL: ENGLISH
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI
THIRD COMMITTEE: COMMERCIAL POLICY
REPORT OF WORKING PARTY 4 ON INTERPRETATIVE NOTE TO ARTICLE 40
At its thirty-first meeting on 5 February 1948, Committee III
established Working Party No. 4 consisting of the representatives of
Brazil, Czechoslovakia, the United Kingdom and the United States to examine
the Interpretative Note to Article 40 as recommended by Sub-Committee D.
The Working Party held a meeting on 7 February 1948 and elected
Mr. R. J. Shackle (United Kingdom) as its Chairman.
The Working Party examined the purpose of the measures authorized under
paragraphs 1 (a), 1 (b) and 3 (b) of Article 40 as well as the effects which
they might have upon the trade of Members. The obligations incurred under
Article 22 were also taken into consideration.
It was unanimously agreed to recommend to the Committee to approve
on interpretative note in the following terms:
"Article 40,
It is understood that any suspension, withdrawal or modification
under pargaraphs 1 (a), 1 (b) and 3 (b) must not discriminate against
imports from any Member, and that such action should avoid, to the
fullest extentpo ssible, injur to other supplying Member countries." |
GATT Library | xk436gs4153 | Report of Working Party 5 on Article XVIII | General Agreement on Tariffs and Trade, September 9, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 09/09/1948 | official documents | GATT/CP.2/38 and GATT/CP.2/37,38+CP.2/38/Add.1 | https://exhibits.stanford.edu/gatt/catalog/xk436gs4153 | xk436gs4153_90320056.xml | GATT_147 | 5,818 | 37,248 | RESTRICTED
LIMITED B
GATT/CP.2/38
9 September 1948.
ORIGINAL: ENGLISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
Contracting Parties
Second Session
REPORT OF WORKING PARTY 5 ON ARTICLE XVIII
(1) Working Party No. 5, which held eight meetings, was
under the Chairmanship of Mr, R.J. SHACKLE (United Kingdom).
With the exception of the first meeting the Vice-Chairman,
Mr. C.L. HEWITT (Australia) presided.
(2) The Working Party consisted of representatives of
Australia, Brazil, Cuba, France, Netherlands, Norway,
United Kingdom and United States. The representatives of
Syria and Chile attended meetings of the Working Party at
which matters of interest to their countries were discussed.
Terms of reference
(3) The terms of reference were "to consider the lists of
products affected by non-discriminatory measures notified
under paragraph 6[II]* of Article XVIII in document
GATT/CP.2/4/Add.2, and to submit recommendations to the
Contracting Parties." The Working Party had before it the
aforementioned document GATT/CP.2/4/Add.2* which
reproduced the lists of non-discriminatory measures contained
in the original documents as follows;
Chile E/PC/T/250/Add.1
E/PC/T/256/Add.1
Cuba E/PC/T/249
India E/PC/T/242
Lebanon-Syria E/PC/T/251
E/PC/T/256/Add.3
.. Norway E/PC/T/246
E/PC/T/256/Add.1
Further, it was agreed after consultation between the
Chairman of the Working Party and the Chairman of the
CONTRACTING PARTIES that the Working Party should make
recommendations concerning the Note presented by the
United Kingdom delegation circulated as document
GATT/CP. 2/WP.5/3 of August 23 1948 and the letter of
August 23 from the Chairman of the Netherlands delegation.
to the Chairman of the CONTRACTING PARTIES (GATT/CP.2/WP.5/4).
* The paragraph numbers placed in square brackets in this
report refer to the revised paragraph numbers of Article
XVIII contained in GATT/CP.2/34.
** Also GATT/CP.2/4/Add.2/Corr.1. GATT/CP.2/38
page 2
(4) The Working Party had before it a schedule of dates
(Annex a) showing for the contracting parties concerned the
dates of signature and application of the Protocol of
Provisional Application and the dates on which the statements
of considerations in support of the non-discriminatory
measures were required to be made. It was agreed tnat the
date on which, according to the terms of paragraph 6[12] of
Article XVIII, detailed statements were required, was sixty
days after the date of provisional application, as distinct
from sixty days after the date of signature of the Protocol.
Special situations of the United Kingdom and Netherlands
(5) With respect to the Note by the United Kingdom delegation,
the Working Party considered the circumstances involved in the
notification by the United Kingdom of measures in force on
September 1 1947 in the large number of territories, for which
the United Kingdom has international responsibility. The
Working Party agreed to recommend that the CONTRACTING PARTIES
should recognise the measures in force on September 1 1947,
notified in the note submitted and listed in Annex B, as
falling within the provisions of paragraph 6[II] of
Article XVIII, although they were not notified until
August 23, 1948. accordingly the Working Party recommends
that the CONTRACTING PARTIES grant a waiver under article XXV
±n respect of the date of notification of the measures and
adopt Decision I set out in Annex C.
(6) With respect to the letter of august 23 1948 from the
Chairman of the Netherlands delegation, the Working Party
noted that the laws and regulations in the Netherlands Indies
were valid on September 1, 1947, but that their operation had
been suspended on that date. (However, regulations controlling
imports of these goods were being administered on that date for
financial reasons.) The Delegate for the Netherlands stated
however that the administration of these laws had re-commenced
from January 1, 1948 and that the measures were directly
applied from that date for protective purposes of recon-
struction and development. It was therefore agreed to
recommend that the CONTRACTING PARTIES should recognise the
measures listed in Annex B as falling within the provisions
of paragraph 6 [Il] of Article XVIII and that the CONTRACTING
PARTIES grant a waiver under Article XXV in respect of the
dates of operation and notification of the measures and adopt
Decision II set out in annex C.
Other Questions
(7) Because statements of the considerations in support
of non-discriminatory measures proposed to be maintained had
only recently been received from several contracting parties
it was decided to recommend that the CONTRACTING PARTIES
should examine all the measures at the third session. The
CONTRACTING PARTIES are required by the provisions of
paragraph 6 [12] of Article XVIII to give decisions within
twelve months of a government's becoming a contracting party,
that is in respect of measures notified by the Governments of
Cuba and the Netherlands (in respect of the Netherlands
Indies) by January 16, 1949 and April 10, 1949 respectively. GATT/CP.2/38
page 3
As this would be before the completion of the third session
of the CONTRACTING PARTIES, the Working Party decided to
recommend the adoption by the CONTRACTING PARTIES of
Resolution III set out in Annex C which would enable these
decisions to be given at the third session.
(8) The Working Party then considered the following
questions:
(a) eligibility of measures notified for consideration
under paragupl 6 [Il] of Article XVIII;
(b) nature of the information, which it would be
helpful for thegovernments concerned to include in
the statements in support of the maintenance of the
measures;
(c) procedure for examining and deciding on measures
notified.
Eligibility of measures
(9) With regard to the eligibility of measures notified
under paragraph 6 [ll] of Article XVIII the Working Party
agreed to draw the attention of the CONTRACTING PARTIES to
the terms of that paragraph, which permitted the notification
of only those measures which had been imposed for the
establishment, development or reconstruction of a particular
industry or branch of agriculture and which were not other-
wise permitted by the Agreement. In particular the Working
Party agreed to draw the attention of the CONTRACTING PARTIES
to the difference between the provisions of Article XII -
Restrictions to Safeguard the Balance of Payments - and
Article XVIII - Adjustments in Connection with Econoric
Development. Although measures imposed under the provisions
of Article XII might in fact provide protection to local
industries, this did not ipso facto bring such measures
within the scope of Article XVIII.
Measures notified by the Government of Cuba
(10) With regard to the measures notified by the Government
of Cuba the Working Party had before it the statement by that
Government of the considerations in support of the maintenance
of the measures (GATT/CP.2/WP.5/2 reproducing GATT/l/20).
The Working Party took note of the withdrawal of the measure
concerning quebracho and of the considerations advanced in
respect of the measures concerning sisal (henequen) and
trimmings, galloons and ribbons.,
(11) With respect to the measures concerning trimmings,
galleons and ribbons, the Working Party considered the
difference in nomenclature between the letter of notification
of the measures under paragraph 6 [ll] of Article XVIII dated
10 October, 1947 (E/PC/T/249 and GATT/CP.2/WP.5/2) and the
scheduler of tariff concessions (GATT, Volume 3, page 64).
The latter referred to item. 142A and 142B of the Cuban
tariff, which correspond with tariff items 142A, 142B, 142E
and 142F shown in the schedules. The Cuban tariff has not
as yet been amended to accord with the new sub-divisions,
which were used in the schedules. GATT/CP.2/38
page 4
(12) The Cuban representative stated that his Government
would seek to re-negotiate some of the items included in the
schedules of tariff concessions. It had not yet been able
to reach agreement upcn the withdrawal of these items, which
included items 127A and 142E and F (as listed in the
schedules). The Working Party noted that the provisions of
paragraph 6 [ll] of Article XVIII did not apply to quantitative
restrictions on the imports of these items, as tariff
concessions had been negotiated with respect to them. The
delegate of Cuba then stated that in relation to items 127A
and B and 12A and B (as they appear in Decree 2155 of 1944
of the Cuban Government, which covers rayon as well as other
synthetic ribbons), his delegation considered them all to be
off the schedules and consequently reserved the rights of his
Government to proceed with these items as not negotiated in
1947 at Geneva. The delegate of the United States stated
that his Government considered that certain of these items
were negotiated at Geneva and therefore properly remain in
Schedule IX.
(13) The Working Party also noted that the measures notified
concerning trimmings, galloons and ribbons were discriminatory
in their operation and consequently for this reason the
provisions of paragraph 6 [ll] of Article XVIII, which relate
solely to non-discriminatory measures, were not applicable.
Measures in operation in Norway
(14) The representative of Norway described the operation of
measures to restrict imports in force in Norway at the
present time . The Working Party noted that:
(a) The measures notified under paragraph 6 [ll] of
Article XVIII were provided for in decrees
instituted for the protection of domestic
industries and branches of agriculture and were
non-discriminatory in their application.
(b) Since the end of the war financial regulations
had been in force for the control of imports and
exports in order to protect the balance of
payments and these superseded the operation of the
measures referred to in the preceding paragraph.
Generally the financial regulations were not
administered in a non-discriminatory manner..
(c) The decrees under which the notified measures had
been in force, whilst still legally in existence,
were not in fact being administered.
(15) It was the opinion of the Working Party that the
regulations maintained in Norway at the present time for the
purpose of protecting the balance of payments applied to the
products in respect of which measures had been notified at
the second session of the Preparatory Committee of the United
Nations Conference on Trade and Employment!and appeared to
conform to the provisions of Article XII of the Agreement.
Therefore, it was not necessary for the CONTRACTING PARTIES
to determine the question of their maintenance under the
provisions of paragraph 6 [12] of Article XVIII. The GATT/CP.2/33
page 5
Working Party noted also that if and when, as a consequence
of changes in the Norwegian balance of payments situation,
these regulations ceased to be permissible under Article XII,
it would be open to the Norwegian Government to apply to the
CONTRACTING PARTIES under paragraph [7 or 8] of Article XVIII
for permission to use similar measures for the purpose of
promoting economic development or reconstruction. The
Norwegian Government would be free to submit such an
application in advance of the change in the balance of
payments situation which made Article XII inapplicable.
Measures notified by the Governments of Syria and Lebanon
(16) The Working Party considered the measures notified by
the Governments of Syria and Lebanon as contained in the
revised list presented by the two Governments (GATT/CP.2/
WP.5/5/Add.1) and also the explanatory note thereto
(GATT/CP.2/WP.5/5). The Working Party took note of the
withdrawal of items 839 and 845, on which tariff concessions
had been negotiated.
(17) With regard to the "products under monopoly control"
and the "products of existing industries" described in
sections (1) and (2) of the explanatory note, there was
discussion in the Working Party as to whether these
measures properly fell within the terms of paragraph 6[11]
of Article XVIII relating to the establishment, development
or reconstruction of a particular industry or branch of
agriculture. In view of the complexity of the questions it
was agreed that these decisions should be taken at the
third session of the CONTRACTING PARTIES, when the detailed
statement of considerations in support of the maintenance of
the measures described in the explanatory note will be
available.
Measure notified by the Government of India
(18) In view of the statement of considerations in support
of its non-discriminatory measure submitted by the
Government of India (GATT/CP.2/WP.5/6), the Working Party
considered that the measure should be examined under the
provisions of paragraph 6 [12] of Article XVIII.
Measures notified by the Government of Chile
(19) The Delegate of Chile advised the Working Party that
the measures, which had been notified by his Government,
should be considered under the provisions of paragraph
6 [11] of Article XVIII. The Working Party recommended
that further consideration should be given to this at the
Third Session of the CONTRACTING PARTIES.
Guidance as to information in support of maintenance of
measures
(20) With regard to the nature of the information, which it
would be helpful for applicant contracting parties to
provide as considerations in support of the maintenance of
measures, the Working Party decided to make recommendations
as set out in Annex D. In view of these recommendations GATT/CP.2/38
page 6
the Working Party agreed that the Governments of Cuba,
Netherlands, United Kingdom, India, Lebanon and Syria should
be invited to submit by October 31, 1948 such material
supplementary to their statements of considerations in
support of their measures at might seem appropriate to them.
Procedure for examining and deciding on measures notified
(21) The Working Party considered that, in order that the
CONTRACTING PARTIES at their third session should be able
(in accordance with the recommendation in paragraph 7 above)
to examine and give a decision concerning the measures
listed in Annex B. it was necessary
(a) to establish a procedure for the action necessary
between the second and third sessions in respect
of these measures,
(b) to consider in detail the procedure for examination
at the third session.
(22) In this connection the Working Party noted that
although. the CONTRACTING PARTIES are required under
paragraph 6 [12] of Article XVIII to give decisions on
existing measures as though the applications had been
submitted under paragraphs [7 or 8] the precise procedures
of the latter paragraphs need modification in relation to
existing measures.
(23) The Working Party noted that the procedure for dealing
with the existing measures of new adherents would be the
subject of special agreement between them and the CONTRACTING
PARTIES in each case. However, it was probable that in
basic essentials the procedure now established would form a
model for the future in dealing with any measures other than
those referred to in Annex B to which the provisions of
paragraph 6 [11] of Article XVIII would apply.
(24) The Working Party accordingly recommended the
procedures described in Annex E.
(25) The Working Party considered it desirable that
decisions taken at the third session on all the measures
listed in Annex E should include those notified by the
Government of Chile if, by the date of the next session,
Chile had become a contracting party. For this purpose it
would be necessary for the-CONTRACTING PARTIES, and also in
the interests of Chile, if statements in support of these
measures were submitted, in accordance with the timetable
suggested in Annex.E, by October 31, 1948, Although it was
recognized that the Government of Chile could not be bound
by the provisions of paragraph 6 [12] of Article XVIII unless
and until it became a contracting party, it was thought that
the Chilean Delegation might be able to agree to an informal
arrangement with the CONTRACTING PARTIES to supply the
required information by October 31 on the understanding that
it would be considered at the next session only if Chile had
become a contracting party by that date. GATT/CP.2/38
page 7
(26) The Chilean Delegate, who-was invited to give his views,
was unable to agree to this suggestion but undertook to
communicate it to his Government.
(27) After further consideration the Working Party recommends
that the Chilean Delegation be asked by the CONTRACTING PARTIES
to agree that on the date on which the Chilean Government
signs the Protocol of Provisional Application) it will
simultaneously forward detailed statements in support of the
maintenance of the measiires. Requests by the other
contracting parties for additional information should be made
through the Chairman within one month of receipt by them of
the Chilean statement.. Objections to any of the Chilean
measures may bp, lodged by the contracting parties which
consider themselves materially affected at any time up to
the date on which the CONTRACTING PARTIES examine and give a
decision concerning these measures. Since paragraph 6 [12]
of Article XVIII provides that such decisions shall be given
as soon as possible it is further recommended that the
CONTRACTING PARTIES at their third session give decisions on
the measures notified by Onile.
(28) The timetable described in the preceding paragraph is
recommended in the case of Chile instead of that set forth
in Annex E. The other procedures in Annex E would be applied
so that, for example, the Government of Chile would receive
copies of statements in support of the measures of other
contracting parties and the opportunity to lodge objections
by February 28, 1949.
Statement of Delegate of Cuba
(29) At the special request of the Cuban Representative the
following note has been included in the Report:
"After examining the procedures recommended by the
Working Party, contained in Annexes D and E, to be
followed by the CONTRACTING PARTIES in dealing with
existing measures under paragraph 6 [12] of Article XVIII,
the Cuban Delegation considers that a like detailed
procedure should be adopted by the CONTRACTING PARTIES
in relation to existing measures under Articles XII and
XVI of the General Agreement."
The Working Party considered that, since the substance of the
statement lay outside its terms of reference, it was not
possible to comment on it. GATT/CP.2/38
page 8
ANNEX A
DATES RELEVANT TO THE MAINTENANCE OF NON-
DISCRIMINATORY MEASURES UNDER PARAGRAPH 6
[11 and 12] OF ARTICLE XVIII AS PRESENTED
TO THE WORKING PARTY
Date of
Signature
of the
Protocol of
Provisional
Application
Date of
Application
of the
Protocol of
Provisional
Application.
Date on which Statement
of Considerations in
Support of maintenance
and of period of
maintenance required
to be made.
Dec.17 1947
Jan.16 1948
March 16 1948
Netherlands
in respect
of all. over-
seas
territories
March 11 1948
April 10 1948* June 9 1948
June 8 1948 July 8 1948 Sept.6 1948
Norway
United
Kingdom in
respect of
all over-
seas
territories
other than
Newfoundland
and Jamaica
June 10 1948
June 28 1948
July 10 1948 Sept.8 1948
July 28 1948* Sept.26 1948
June 29 1948
July 29 1948 Sept.27 1948
Syria June 30 1948 July 30 1948 Sept.28 1948
3 Although formally the GATT was provisionally applied on behalf
of these overseas territories on April 10 in the case of the
Netherlands and July 28 in the case of the United Kingdom, in fact
action was taken to apply the agreement provisionally on March 11
and June 28 respectively, i.e. the dates of signature.
Cuba
India
Lebanon GATT/CP.2/38
page 9
LIST OF PRODUCTS COVERED BY MEASURES NOTIFIED UNDER PARAGRAPH
6 [11] OF ARTICLE XVIII AND REQUIRING
DECSIONS AT THE THIRD SESSION
Cuba
Sisal (henequen) fibres, Decree No. 1693 of 23 June 1939.
Netherlands
In respect of Netherlands Indies
1935 No.
86 - cement latest bylaw 1940 No. 469
1935 No, 341 - iron frying pans - latest bylaw 1940 No. 259
1936 No. 542 - beer - latest bylaw 1940 No. 475
1934 No. 678 -
1936 No. 65 -
coloured woven textiles 'sarongs) - latest
bylaw ,1940 No. 229
some categories of cotton textiles which can
be woven on sarong looms - latest bylaw 1940
No. 431
India
Grinding wheels and segments.
United Kingdom
In respect of Northern Rhodesia and Mauritius
Tea (Mauritius)
"Filled" soaps i.e. soap containing not less than 45%
and not more than 62% of fatty acid (Northern Rhodesia)
Lebanon-Syria
55 to 62 )
(except 62b)
68 to 74
75 to 82
122
132
133 to 136
Description of Products
Edible fruit
Cereals
Milling products: malt,
starch and fecual
Sugar
Chocolate and articles made
of chocolate.
Preparations with basis of
flour or fecula. GATT/CP. 2/38
page 10
Tariff Item No.
137 to 144
152 to 161 )
(except 154b, 155, )
157a-2 and 3, 157b-2)
Description of Products
Preparations of vegetables or
fruits
171 and 172
178
192
(except 192b and c)
319
(except 319d, e-l
and 3-2)
320
(except 320d)
325
(except 325b)
Beverages, alcoholic liquids
and vinegars
Tobacco
Salt
Cement
Perfumery articles
Soap
Candles and tapers
Glues of animal origin
Matches
351 to 357
(except 353)
358 to 365
(except 362 and 363)
Ex. 379
393
Ex 398a
401 to 405
Tanned Leather
Manufactures of leather
Rubber soles
Plywood
Doors and windows
Articles made of wood
417 and 418
Cardboard
428
Envelopes
430
Boxes, cases for Jewellery,
spectacles etc. of cardboard
or paper.
443 to 446
Natural silk thread
Fabrics of natural silks pure
or mixed
470 to 492 )
(except 477 and 486a) )
Fabrics of artificial silk, of
artificial silk wastes and of
textile fibres, pure or mixed
329
449 to 461 GATT/CP.2/38
page 11
Tariff Item No.
Descrption of Products
507
518
522 to 525 )
(except 522b-4)
527 to 540
566
580 to 583 )
(except 58OA-a and )
b and 581A-a) )
Woollen fabrics
Cotton
Cotton thread
Cotton fabrics, pure or mixed
Cabling, cordage and twine
of hemp
600 to 606
(except 604b)
639
663 to 681
Hosiery
Footwear
Manufactures of cement and
concrete
Glass and glassware
Metal bedsteads
768 and 769
Ex 841a
Ex 855b
Ex 855c
Copper articles
Machinery for manufacturing
footwear
Machines for the manufacture
of beer
Machinery and apparatus for
the manufacture of matches.
860
Electric batteries
975 and 976
Games and toys for children
N.B. The exceptions in brackets are items forming the
subject of tariff negotiations concluded in 1947.
Chile
(A) Production in respect of which quotas have been applied
to assist the development of, the domestic Production
of similar merchandise:
Calcium carbide;
Cans of aluminium, saucepans and water bottles;
Tailor's chalk;
Butter;
Stockings of cotton, natural silk, rayon or nylon,
and socks of cotton, silk and wool;
Bovine cattle for slaghtering;
Sacks for agricultural uses,
Ex 755 GATT/CP.2/38
page 12
(B) Products in respect of which import licences are
withheld, to assist the development of the domestic
production of similar merchandise:
Silver alloyed with other metals;
Milling-cutters, boring tools, screw-taps, and
screw dies of all types and specifications;
Calcium carbide;
Toilet articles;
Paper clips;
Cork in sheets of a thickness not exceeding 4 mm.,
and ordinary stoppers of cork;
Endless belts, of linen, for cigar machines;
Window glass flat, common, of a thickness not
exceeding 6 mm. and a breadth not exceeding
1.55 metres;
Retort carbon;
Galalith, in sheets and bars;
Wicks for candles;
Wools up to 54 s.;
Potassium Carbonate;
Potassium metabisulphite;
Dry batteries, except those for telephone and bolls
and small tubular batteries;
Glass bricks or blocks for building;
Umbrellas except automatic or spring umbrellas and
on-tout-cas;
Fancy paper, glossy and for binding;
Threads, fibres and yarns of flax in all sizes up
to No, 30;
Tissues of horse hair;
Silica bricks, and foundry vessels of clay;
Footballs and basket balls;
Smoothing irons, coal-heated.
(E) Wines, tobacco, cigarn and cigarettes of foreign
origin subject to a higher excise duty than like
articles of domestic origin, with aim, inter
alia of rotecting the development of the corres-
ponding domestic industries. GATT/CP.2/38
page 13
ANNEX C
DECISIONS
The Contracting Parties to the General Agreement on
Tariffs and Trade.
PURSUANT to paragraph 5(a). of Article XXV of the
Agreement,
HAVING considered the circumstances relating to the
notification by October 10.1947 of measures under paragraph
6 of Article XVIII in force on September 1, 1947, in overseas
territories for which the United Kingdom has international
responsibility
DECIDE that with the exception of the date by which
notification of existing measures is required, the provisions
of paragraph 6 of Article XVIII shall apply to measures to
restrict the import of tea into Mauritius and of "filled soap"
into Northern Rhodesia in force on September 1, 1947,
notified by the Government of the United Kingdom on August 23,
1948.
II
The CONTRACTING PARTIES to the General Agreement on
Tariffs and Trade
PURSUANT to paragraph 5(a) of Article XXV of the
Agreement
HALVING noted the circumstances prevailing in the
Netherlands Indies on September 1, 1947
DECIDE that the provisions of paragraph 6 of Article
XVIII with the exception of the dates of September.1, 1947
and October 10, 1947 shall apply to the following measures of
the type referred to in that paragraph notified in respect
of the Netherlands Indies, on August 23, 1948:
1935 No. 86 - cement - latest bylaw 1940 No, 469
1935 No, 341 - iron frying pans - latest bylaw 1940
No, 259
1936 No, 542 beer latest bylaw 1940 No. 475
1934 No. 678 - coloured woven textiles (sarongs)
latest bylaw 1940 No. 229
1936 No. 65 - some categories ofcotton textiles which
can be woven on sarong looms - latest
bylaw 1940 No. 431 GATT/CP. 2/38
page 14
III
The CONTRACTING PARTIES to the General Agreement on
Tariffs and Trade (hereafter referred to as the Agreement)
acting pursuant to paragraph 5(a) of Article XXV of the
Agreement
HAVING noted that decisions under the provisions of
paragraph 6 of Article XVIII of the Agreement concerning
measures notified by the Governments of Cuba and the
Netherlands (the latter in respect of the Netherlands
Indies) must be given by January 16, 1949, and April 10,
1949 respectively and
HAVING noted that the next session of the CONTRACTING
PARTIES will not be held until April 1949 and that it is not
possible to make the required decisions at the current
session
DECIDE that the decisions in respect of the above
mentioned measures shall be given at the Third Session of
the CONTRACTING PARTIES. GATT/CP.2/38
page 15
ANNEX D
NATURE OF INFORMATION WHICH IT WILL BE HELPFUL
FOR APPLICANT CONTRACTING PARTIES TO SUPPLY AS
CONSIDERATIONS IN SUPPORT OF THE MAINTENANCE OF
MEASURES IN ACCORDANCE WITH PARAGRAPH 6 [12] OF
ARTICLE XVIII
(1) In setting out items on which it was thought that
information would be helpful it was recognized that many
countries have not the administrative techniques necessary
to provide information under every heading. It was con-
sidered however that it would be useful to applicant con-
tracting parties to have some guidance as to the material
the submission of which to the CONTRACTING PARTIES would
expedite decisions on applications. The types of infor-
mation listed in paragraph 2 and 4 below are therefore
given as illustrations without suggesting either that the
lists are exhaustive or that all the information listed
would be appropriate in all cases. It would be for the
applicant contracting parties themselves to dotermine what
information they will submit.
(2) If the applicant contracting party applies under
paragraph [8 (b)] it is suggested that the information sat
out below would be of assistance. In this list the
information suggested relates, except where otherwise
stated to the goods described under item (b) or to the
industry or branch of agriculture producing those goods.
Furthermore references to "industry" should be read, unless
otherwise stated, as referring also to "branch of agricul-
ture" and references to "economic development" as referring
also to "reconstruction"
(a) Precise description of the measure including the
range and type of goods to which it relates and
the method of operation.
(b) Precise description of the range and type of
goods produced by the industry in respect of
whose development the measure has been maintained
(c) Statistics of quantities and values over a period
of years showing -
(1) production (in the case of a branch of
agriculture also area planted)
(2) imports
(3) exports
(d) Number and location of enterprises or firms
(e) Numbers employed
(f) Total working population of the country by
principal occupations
(g) Average level of wages paid to employees GATT/CP.2/38
page 16
(h) Capital investment
(i) Net profits or losses
(j) Cost of imported product ex duty at place of
entry into country, costs of transport and
distribution of imported product from place of
entry to principal market or markets and selling
price of domestic product at principal market
or markets
(k) History of tariff and other protection enjoyed
including existing duty, if any, period for which
protective measures have been in force and the
effect which they have had on the establishment
or development of the industry.
(1) Reasons for the selection of the measure proposed
t.o be maintained in preference to other measures
permitted by the GATT such as tariff protection
or subsidy payments
(m) Data concerning the future development of the
industry - including for example expected levels
of production and costs - and the possibility of
its becoming independent of the measure proposed
to be maintained (This information would have a
particular bearing on the period for which the
applicant contracting party has requested the
maintenance of the measure).
(3) if an applicant contracting party elects to apply under
paragraph [7] of Article XVIII, the statements submitted by
it will require to give facts appropriate to whichever
criteria are relevant. In the cases of criteria (i) and
(ii) the following data would be helpful:
(i) (a) the date of establishment of the industry
(b) the type of protection during the period
January lst, 1939, to March 24th, 1948
resulting from abnormal conditions arising
out of the war
(ii) (a) the indigenous primary commodity which is
being processed
(b) statistics of exports of the primary
commodity
(c). details of the new or increased restrictions
imposed abroad. GATT/CP. 2/38
page 17
ANNEX E
PROCEDUREFOR DEALING WITH EXISTING MEASURE LISTED IN
ANNEX B
(a) Procedure between the second and third Sesions,
(1) The Contracting Partics, whose measures are referred
to in Annex B, should submit supplementary statements of
consideration in support of their measures to the Chairman
of the CONTROCTING PARTIES not later than October 31, 1948.
Those statements should contain as much as practicable of
the types of information suggested in paragraph 2 of Annex D.
In addition, when the contracting party concerned wishes the
measure to be considered in accordance with paragraphs
[7(i) and (ii)] of Article XVIII, the information suggested
n paragraph 3 of Annex D should be also provided. In the
case of applications under paragraphs [7(i) or (ii)]
information on the lines suggested in both paragraphs 2 and
3 of Annex E is required so that if the application is not
suggessful under paragraphs [7(i) or (ii)], the CONTRACTING
PARTIES may at the third session make a decision under
paragraph [8 (b)]. In each case the contracting party
concerned should indicate whether it wishes its case to be
considered under paragraph [7] of Article XVIII and the
period for which it wishes to maintain the measure,
(2) The Chairman of the CONTRACTING PArTIES should forward
the statements referred to in (1) above to all the contracting
parties and, as soon as possible, thereafter should send
them such relevant statistical and other information of the
type referred to in paragraph 7 below as can be collected.
Any Contracting party which wishes to have further infor-
mation should request this not later than December 15 1948,
through the Chairman of the CONTRACTING PARTIES who would
then assemble the requests and forward a consolidated request
to the applicant thereby avoiding a duplication of onquiries
from the contracting parties.
(3) If any of the contracting parties has any objection
to any of the measures, the Chairman should be so informed
not later than February 28, 1949. At the same time, the
contracting party making the objection should give evidence
to show that it is materially affected by the measures
(4) The Chairman should transmit the statements received
under (3) above to the other contracting parties so that
consideration may be given to then before the beginning of
the third session.
(b) Procedure for examination at the third Session
(5) The first task of the CONTRACTING PARTIES will there-
fore, be to examine any measure submitted for consideration
under the provisions of paragraph [7] and decide whether or
not it is permitted under those provisions, If the
CONTRACTING PARTIES decide that the case under paragraph [7]
is Justified, they will agree to the maintenance of the
measure for a specified period. GATT/CP. 2/38
page 18
(6) If the CONTRACTING PARTIES decide that the case under
paragraph [7] is not justified, they will consider the
measure under paragraph [8(b)], together with those measures
for which no case had been submitted under paragraph [7].
(7) In the case of all measures under (6) above, the
CONTR.CTING PARMITES will first decide whether any objection
has boon received front a contracting party whose interests
are materially affected. In this connection it may be
noted that Committee II of the United Nations Conference on
Trade and Employment decided that in interpreting the words
"materially affected" in par-graph 8 of Article 13 of the
Havana Chartor, which corresponds with paragraph [8] of
Article XVIII: "it would be proper for the Organization to
have regard for instance, to the interests of Members which
supplied a large proportion of the imports of the applicant
Member in the product concerned, those Members which were
substantially interested in exporting the product to world
markets, and those Members whose economics were materially
dependent on exports of the product." (ICITO/W.l. page 29).
For the purpose of determining which contracting parties are
materially affected, therefore the CONTRACTING PARTIES
would need to consider statistics relating to the world trade
in the goods in questions for example:
(a) imports into the territory of the applicant from
oach of the other contracting parties
(b) world exports
(c) exports from oach contracting party to all
countries
(d) the percentage of the total exports of all goods
of e.ach contracting party represented by exports
of the goods in question.
(8) If no objection has been received by Febeuary 28 1949
from a contracting party whose interests arc materially
affected, the CONTRACTING PARTIES will approve the maintenance
of the measure for a specified period.
(9) If there is objection from any materially affected
contracting party the CONTRACTING PARTIES will examine the
measure in accordance with paragraph [8 (b) (ii)] of Article
XVIII in the light of the reasons advanced both for and
against the measure before and during the third session and
in particular of the following considerations:-
(a) the applicant's need for economic development
(b) the effect which the measure is likely to have
on international trade
(c) the effect that the measure is likely to have
in the long run on the standard of living within
the territory of the applicant. GATT/CP. 2/38
page 19
(10) If as the result of the examination described in
the preceding paragraph above, the CONTRACTING PARTIES decide
that the measure is justified, they will permit its
maintenance for a specified period.
(11) If the CONTRACTING PARTIES decide that the reasure is
not justified, they will ask the applicant contracting party
to modify or withdraw the mneasure. In doing so however
they will, in accordance with paragraph 6 [14] of Article
XVIII, "have regard to the possible need of a contracting
party for a period of tine in which to make such modification
or withdrawal". |
GATT Library | tt097yr0864 | Report of Working Party 5 on Article XVIII as amended by the Contracting Parties | General Agreement on Tariffs and Trade, September 15, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 15/09/1948 | official documents | GATT/CP.2/38/Rev.1 and GATT/CP.2/38/Rev.1 CP.2/39+Add.1 CP.2/40-45 CP.2/44/Add.1 | https://exhibits.stanford.edu/gatt/catalog/tt097yr0864 | tt097yr0864_90320058.xml | GATT_147 | 7,492 | 47,808 | RESTRICTED
LIMITED B
GATT/CP. 2/38/Rev. 1
15 September 1948
Original: ENGLISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
Contractinig Parties
Second Session
REPORT OF WORKING PARTY 5 ON ARTICLE XVIII
As amended by the
CONTRACTING PARTIES
1. Working Party No. 5, which held eight meetings, was
under the Chairmanship of Mr. R.J. SHACKLE (United Kingdom),
With the exception of the first meeting the Vice-Chairman,
Mr. C.L. HEWITT (Australia) presided.
2. The Working Party consisted of representatives of
Australia, Brazil, Cuba, France, Netherlands, Norway,
United Kingdom and United States. The representatives
of Syria and Chile attended meetings of the Working Party
at which matters of interest to their countries were discussed.
Terms of reference
3. The terms of reference were "to consider the lists of
products affected by non-discriminatory measures notified
under paragraph 6 /II7x of Article XVIII in document
GATT/CP.2/4/Add 2, and to submit recommendations to the
Contracting Parties." The Working Party had before it the
aforementioned document GATT/CP.2/4/Add. 2xx which reproduced
the lists of non-discriminatory measures contained in the
original documents as follows:
Chile E/PC/T/250/Add. 1
E/PC/T/256/Add. 1
Cuba E/PC/T/249
India E/PC/T/242
Lebanon- Syria E//PC/T/251
E/PC /T/256/Add.3
Norway E/PC/T/246
E/PC/T/256/Add.1
Further, it was agreed after consultation between the Chair-
Man of the Working Party and the Chairman of the CONTRACTING
PARTIES that the Working Party should make recommendations
concerning the Note presented by the United Kingdom delegation
circulated as document GATT/OP. 2/WP.5/3 of August 23 1948 and
the letter of August 23 from the Chairman of the Netherlands
delegation to the Chairman of the CONTRACTING PARTIES
(GATT/CP. 2/WP. 5/4)
x The paragraph numbers placed in square brackets in this
report refer to the revised paragraph numbers of Article
XVIII contained in GATT/CP.,2/34
xx Also GATT/CP,2/4/Add. 2/Corr.1 GATT/CP. 2/38/Rev. 1
page 2
4. The Working Party had before it a schedule of dates
(Annex A) showing for the contracting parties concerned the
dates of signature and application of the Protocol of
Provisional Application and the dates on which the statements
of considerations in support of the nondiscriminatory
meresures were required to be made, It was agreed that the
date on which, according to the terms of paragraph 6[I2]
of Article XVIII, detailed statements were requires, was
sixty days after the date of provisional application, as
distinct from sixty days after the date of signature of the
Protocol.
Special situations of the United Kingdom and Netherlands
With respect to the Note by the United Kingdom delegation,
the Working Party considered the circumstances involved in the
notification by the United Kingdom of measures in force on
September 1 1947 in the large number of territories, for which
the United Kingdom has international responsibility. The
Working, Party agreed to recommend that the CONTRACTING PARTIES
should recognise the measures in force on September 1, 1947,
notified in the note submitted and listed in Annex B, as
falling within the provisions of paragraph 6[17] of Article
XVIII, although they were not notified until August 23, 1948.
Accordingly the Working Party recommends that the CONTRACTING
PARTIES grant a waiver under Article XXV in respect of the
date of notification of the measures and adopt Decision I
set out in Annex C.
6, With respect to the letter of August 23, 1948 from the
Chairman of the Netherlands delegation, the Working Party
noted that the laws and regulations in the Netherlands Indics
wore valid on September 1, 1947, but that their operation
had been suspended on that date. (However, regulations
controlling imports of these goods were being administered
on that date for financial reasons.) The Delegate for the
Netherlands stated however that the administration of these
laws had re-cornmenced from January 1, 1948 and that the
measures were directly applied frorm that date for purposes of
reconstruction and development. It was therefore agreed to
recommend that the CONTRACTING PARTIES should recognise the
measures listed in Annex B as notified pursuant to paragraph
6[I1]of Article XVIII and that the CONTRACTING PARTIES grant
a waiver under Article XXV in respect of the dates of oper-
ation and notification of the measures and adopt Decision II
set out in Annoex C.
Other Questions
7. Because statements of' the considerations in support of
non-discriminatory measures proposed to be maintained had
only recently been received from several contracting parties
it was decided to recommend that the CONTRACTING PARTIES
should examine all the measures at the third session. The
CONTRACTING PARTIES are required by the provisions of
paragraph 6 [12] of Article XVIII to give decisions within
twelve months of a governments becoming a contractirng party,
that is in respect of measures notified by the uovornments
of Cula and the Netherlands (in respect of the Netherlands
Indies) by January 16, 1949 and April 10 1949 respectively. GATT/CP .2/38/Rev. 1
page 3
As this would be before the compfoetion of the third session
of the CONTRACTING PARTIES, the Working Party decided to
recommend the adoption by the CONTRACTING PARTIES of Decision
III set out in Annex C which would enable those decisions to
be given at the third session, Thu adoption of that Decision
would imply that the Governments of Cuba and the Netherlands
are permitted to maintain measures notified by them until the
CONTRACTING PARTIES have taken a decision regarding such
measures.
8. The Working Party then considerd the following questions:
(a) eligibility of measures notified for consideration
under paragraph 6 [I1] of Article XVIII;
(b) nature of the information, which it would be
helpful for the governments concerned to include
in the statements in support of the maintenance
of the measures;
(c) procedure for examining and deciding on
measures notified.
Eligibility of measures
9. With regard to the eligibility of measures notified
under paragraph 6[I1] of Article XVIII the Working Party
agreed to draw the attention of the CONTRACTING PARTIES to
the terms of that paragraph, which pemitted the notification
of only those measures which had been imposed for the estab-
lishment, development or reconstruction of a particular
industry or branch of agriculture and wnich were not others.
wise permitted by the Agreement. In particular the Working
Party agreed to draw the attention of the CONTRACTING PARTIES
to the difference between the provisions of Article XII -
Restrictions to Safeguard the Balance of Fayments - and
Article XVIII - Adjustments in Conneetion with Economic
Development (Government assistance to Economic Doevelopment
and Reconstruction), Although measures imposed under the
provisions of Article XVI might in fact provide protection
to local industries, this did not ipso factor bring such
measures within the scope of Article XVIII.
Measures notified by the Goverinment of Cuba
10. With regard to the measures notified by the Government
of Cuba the Working Party had before it the statement by that
Government of the considerations in support of the main-
tenance of the measures (GATT/CP.2/WP .5/2 reproducing att/
1/20). The Working party look note of the withdrawal of
the measure concerning quebracho and of the considerations
advanced in respect of the measures coneerning sisal
(henequen) and trimmings, gallons and ribbons
11. With respect to the measures concerning trimmings,
galloons and ribbons, the Working Farty considered the
differcace in nomenclature between the letter of notification
of the measures under paragraph 6 [I1] or Article XVIII dated
10 October, 1947 (E/PC/T/249 and GATT/CP 2/WP. 5/2) and the
schedules of tariff concessions (AATT/Volume 3, page 64)
The letter referr d to items 142A and 1425B of the Cuban
tariff, which correspond with tariff items 142A, 142B a142E
and 142F shown in the schedules. The Cuban tariff has not
as yet been amended to accord with the new sub-divisions,
which were used in the schedules. GATT/CP.2/38/Rev. 1
page 4
12. The Cuban representative stated that his Government
would. seek to re-negotiate some of the items included in the
schedules of tariff concessions. It had not yet been able
to reach agreement upon the withdrawal of these items, which
included items 127A and 142E and F (as listed in the schedules)
The Working Party noted that the provisions of paragraph 6
[I1] of Article XVIII did not apply to quantitative restrict-
ions on the imports of these items, as tariff concessions
had been negotiated with respect to them. The delegate of
Cuba then stated that in relation to items 127A and B and
142A and B (as they appear in Decree 2155 of 1944 of the
Cuban Goverment, which covers rayon as well as other synthetic
ribbons), his delegation considered them all to be off the
schedules and consequently reserv d the rights of his
Government to proceed with these items as not negotiated
in 1947 at Geneva. The delegate of the United States stated
that his Government considered that certain of these items
were negotiated at Geneva and therefore properly remain in
Schedulee IX.
13. The working Party also noted that the measures notificd
concerning trimmings, galloons and ribbons were discriminatory
in their operation and consequently for this reason the
provisions of paragraph 6 [I1] of Article XVIII, which relate
solely to non-discriminatory measures, wore not applicable.
Measures in operation in Norway.
14. The representative of Norway described the operation of
measures to restrict imports in force in Norway at the
present time. The Working Party rioted that:
(a) The measures notified under paragraph 6 [I1] of
Article XVIII were provided for in decrees
instituted for the protection of domestic
industries and branches of agriculture and
were non-discriminatory in their application.
(b) Since the end of the war financial regulations
had been in force for the control of imports
and exports in order to protect the balance
of payments and these superseded the operation
of the mcasures referred to in the preceding
paragraph. Generally the financial regulations
were not administered in a non-discriminatory
manner.
(c) The decrees under which the notified measures
had been in force, whilst still legally in
existence were not in fact being administered.
15. It was the opinion of the Working Party that the regu-
lations maiatained in Norway at the present tine for the
purpose of protecting the balance of payments applied to the
products in respect of which measures had been notifid at
the second session of the Preparatory Committee of the United
Nations Conference on Trade and Employment and appeared to
conform to the provisions of Article XII of the Agreement.
Therefore, it was not necessary for the CONTRACTI G PARTIES
to determine the question of their maintenance under the
provisions of paragraph 6 [12] of Article XVIII. The GA TT/CP. 2/3 8/Rev. 1
page 5
Working Party noted also that if and when, as a consequence
of changes in the Norwegian balance of payments situation,
these regulations ceased to be permissible under Article XII,
it would be open to the Norwegian Government to apply to the
CONTRACTING PARTIES under paragraph [7 or 8] of Article XVIII
for permission to use similar measures for the purpose of
promoting economic development or reconstruction. The
Norwegian Governmet would be free to submit such an
application in advance of the change in the balance of pay-
ments situation which made Article XII inapplicable.
Measures notified by the Governments of Syria and
Lebanon.
16. The Working Party considered. the measures notified by
the Governments of Syria and Lebanon as contained in the
revised list presented by the two Governments (GA TT/CP.2/
WP,5/5/Add.l) and also the explanatery note thereto (GATT/
CP.2/WP.5/5). The Working Party took note of the withdrawal
of items 839 and 845 on which tariff concessions had been
negotiated.
17. With regard to the "products under monopoly control"
and the "products of existing Industries" described in
sections (1) and (2) of the explanatory note, there was
discussion in the Working Party as to whether these measures
properly fell within the-terms of paragraph 6/[I1] of
Article XVIII relating to the establishment, development or
reconstruction of a particular industry or branch of agricult-
ure. In. view of the complexity of the questions it was
agreed that the eligibility of these measures should be
considered at the third session of the CONTRACTING PARTIES,
when the detailed statement of considerations in support of
the maintenance of the measures described in the explanatory
note will be available.
Measure notified by the Government of India
18. In view of the statement of considerations in support
of its non-discriminatory measure submitted by the Government
of India (GATP/CP.2/WP.5./6), the Wo'rking Party considered
that the measure should be examined under the provisions of
paragraph 6 [12] of Article XVIII,
Measures notified by the Government of chile
19. The Delegate of Chile advised the Working Party that,
in his opinion, the measures which had been notified by his
Government should be considered under the provisions of para-
graph 6[I1] of Article XVIII. The Working Party recommended
that further consideration should be given to this question
at the Third Session of the CONTRACTIONG PARTIES.
Guidance as information in support of maintenance
of meaures
20. With regared to the nature of the information which it
would be helpful for applicant contracting parties to provide
as considerations in support of the maintenance of measures
the Working Party decided to make recommendations as set out
in Annex D. In view of these recommendations the Working GATT/CP.2/38/Rev. 1
page 6
Party agreed that the Governments of Cuba, Netherlands,
United Kingdom, India, Labanon and Syria should be invited
to submit by November 15, 1948 such material supplementary
to their statements of considerations in support of their
measures as might seem appropriate to them.
Procedure for examining and deciding on measures
notified.
21. The Working Party considered that, in order that the
CONTRACTING PARTIES at their third session should be able
(in accordance with the recommendations in paragraph 7
above) to examine and give a decision concerning the measures
listed in Annex B, it was necessary
(a) to establish a procedure for the action
necessary between the second and third
sessions in respect of these measures,
(b) to consider in detail the procedure for
examination at the third session.
22. In this connection the Working Party noted that,
although the CONTRACTING PARTIES are required under paragraph
6 [12] of Article XVIII to give decisions on existing measures
as though the applications had been submitted under para-
graphs [7 or 8] the precise procedures of the latter para-
graphs need modification in relation to existing measures.
23. The Working Party noted that the procedure for dealing
with the existing measures of new adherents would be the
subject of special agreement between them and the CONTRACTING
PARTIES in each case. However, it was probable that in
basic essentials the procedure now established would form a
model for the future in dealing with any measures other than
those referred to in Annex B to which the provisions of
paragraph 6[I1] of Article XVIII would apply.
24. The Working Party accordingly recommended the procedures
described in Annex E.
25. The Working Party considered it desirab that
decisions taken at the third session on all the measures
listed in Annex B should include those notified by the
Government of Chile if, by the date of the next session,
Chile had become a contracting party. For this purpose it
would to necessary for the CONTRACTING PARTIES, and also in
the interests of Chile, if statements in support of these
measures were submitted, in accordance with the timetable
suggested in Annex E, by November 15, 1948. Although it
was recognized that the Government of Chile could not be
bound by the provisions of paragraph 6 [I2] of Article XVIII
unless and until it became a contracting party, it was thought
that the Chilean Delegation might be able to agree to an in-
formal arrangement with the CONTRACTING PARTIES to supply the
required information by November 15 on the understanding
that it would be considered at the next session only if
Chile had become a contracting party by that dates GATT/CP. 2/38/Rev.1
page 7
26. The Chilean Delegate, who was invited to give his
views, was unable to agree to this suggestion but undertook
to communicate it to his Government.
27, After further consideration the Working Party recommends
that the Chilean Delegation be asked by the CONTRACTING
PARTIES to agree informally that on. the date on which the
Chilean Government signs the Protocol of Provisional
Application, it will simultaneously forward detailed state-
ments in support of the maintenance of the measures.
Requests by the other contracting parties for additional
information should be made through the chairman within one
month of receipt by them of the Chilean statement.
Objections to any of the Chilean measures may be lodged by
the contracting parties which consider themselves materially
affected at any time up to the date on which the CONTRACTING
PARTIES examine and give a decision concerning these measures.
Since paragraph 6 [12] of Article XVIII provides that such
decisions shall be given as soon as possible it is further
recommended that the CONTRACTING PARTIES at their third
session give decisions on the measures notified by Chile.
28. The timetable described in the preceding paragraph is
recormmonded in the case of Chile instead of that set forth
in Annex E. The other procedures in Annex E would be
applied so that, for cxample, the Government of Chile would
receive copies of statements in support of the measures of
other contracting parties and would have the opportunity to
lodge objections by February 28, 1949.
Statemeat of Delegate of Cuba
29. At the special request of the Cuban Representative
the following note has been included in the Reports
"After examining the procodures recommended by the
Working Party contained in Annexes D and F, to
be followed by the CONTRACTING PARTIES in dealing
with existing measures under paragraph 6[12] of
Article XVIII, the Cuban Delegation considers
that a like detailed procedure should be adopted
by the CONTRACTING PARTIES in relation to existing
measures under Articles XII and XVI of the General
Agreement."
The Working Party considered that, since the substance of
the statement lay outside its terms of referende, it was
not possible to comment on it.
Procedure for examining and deciding on new
measures submitted under Article XVII
30. It was agreed after consultation between the Chairman
of the Working Party and the Chairman of the CONTRACTING
PARTIES that the Working Party should make recomme nations
concerning the procedure to be applied to new measured
submitted under Article XVIII (as contained in GATT/CP.2/34)
between the Second and Third Sessions of the CONTRACTING
PARTIES. GATT/CP. 2/38/Rev. 1
page 8
31. The Working Party agreed that it was necessary to
provide for the practical application of the provisions of
Article XVIII relating to new protective measures, since
the terms of the Article prescribed obligations which could
not be carried out, especially between regular sessions,
without suitable machinery.
32. It was recognized that it was premature at this stage
to attempt to lay down a permanent procedure, since this
would have to be evolved in the light of experience. It
was however agreed to reco mend, experimentally and without
prejudice to future practice, certain procedures to be used
between the Second and Third Sessions of the CONTRACTING
PART IES.
33. It was considered unnecessary to provide other
machinery in the interim before the version of article XVIII
contained in the draft protocol (GATT/CP.2/34) came into
effect, beyond recmnmending that any contracting party which
wished to apply a new protective measure during that period
should inform the Chairman, who would notify particulars
to the other contracting parties and, at his discretion,
call a meeting of the CONTRACTING PARTIES if it was urgently
needed.
34. The main practical difficulties arise from the fact
that Article XVIII as contained in the draft protocol
(GATT/CP.2/34) is derived from Articles 13 and 14 of the
Havana Charter and that these Articles designed for the
use of the ITO they presuppose a body, in more or less
permanent session, capable of taking substantive decisions.
35. The Working Party considered the possibility of
establishing a. standing committee to administer provisions
of Article XVIII but rejected this proposal principally on
the grounds that the number of applications between the
second and third sessions was unpredictable. The Working
Party considers that substantive decisions under this
Article must be taken by the CONTRACTING PARTIES in session
and, where it is not possible to defer a decision until the
Third Session, it will be necessary for the Chairman to
call a special session. The Working Party wished to draw
attention to the fact that under the provisions of paragraph
10 a decision must be given within ninety days of the
receipt of an application under paragraphs 7 or 8.
36. Finally, the Working Party recognized that in practice
these procedures, which are necessarily complicated, may
not be invoked between the Second and Third Sessions, but
nevertheless considered it desirable to provide for the
various contingencies envisaged in Article XVIII. GATT/CP .2/38/Rev. 1
page 9
ANNEX A
DATES RELEVANT TO THE MAINTENANCE OF NON-
DISCRININATORY MEASURES UNBER PARAGRAPH 6
/11 and 12/ OF ARTICLE xviii AS PRENTED
TO TIHE WORKING PARTY
Date of
Signature
of the
Protocol of
Provisional
Application
Date of
Application
of the
Protocol of
Provisional
Application
Date on which Statement
of Considerations in
Support of maintenance
and of period of
mainteanance required
to be made.
Cuba
Doc.17 1947
Netherlands
in respect
of all
overseas
territories
March 11 1948
Jan.16 1948
April 10 1948x
March 16 1948
June 9 1948
India June 8 1948
Norway June 10 1948
United June 28 1948
Kingdom in
respect of
all over-
seas territories
other than New-
Foundland and
Jamaica
Lebanon
Syria
June 29 1948
June 30 1948
Juno 8 1948
July 10 1948
July 28 1948x
July 29 1948
July 30 1948
Sept. 6 1948
Sept. 8 1948
Sept.26 1948
Sept.27 1948
Sept.28 1948
Although formally the GATT was provisionally applied on behalf
of those overseas territories on April 10 in the case of the
Netherlands and July 28 in the case of the United Kingdom, in
fact action was taken to apply the reemont provisionally on
March 1 and June 28 respectively. GATT/CP. 2/38. Rev. 1
page 10
ANNEX B
LIST OF PRODUCTS COVERED BY MEASURES NOTIFIED UNDER PARAGRAPH
6[i1] OF ARTICLE XVIII AND REQUIRING
DECISIONS AT THE THIRD SESSION
Cuba
Sisal (henequen) fibres. Decree No.1693 of 23 June 1949
Netherlands
In respect of Netherlands Indies,
1935 No. 86 - cement - latest bylaw 1940 No. 469
1935 No. 341 - iron frying pans - latest bylaw 1940 No.259
1936 No.542 - beer - latest bylaw 1940 No. 475
1931 No.678 -
1936 No. 65 -
coloured woven textiles (sarongs) - latest
bylaw 1940 No. 229
some categories of cotton textiles which can
be woven on sarong looms - latest bylaw 1940
No .431
India
Grinding wheels and segments
United Kingdom
In respect of Northern Rhodesia and Mauritius
Tea (Mauritius)
"Filled" soap i.e.
and not more than
soap containing not less than 45%
62% of fatty acid (Northern Rhodesia)
Lebanon-Syria
Tariff Item No.
Description of Products
55 to 62
(except 62b)
68 to 74
75 to 82
122
132
133 to 136
)
Edible fruit
Cereals
Milling products: malt, starch
and fecula
Sugar
Chocolate and articles made of
chocolate.
Preparations with basis of
flour or fecula GATT/CP.2/38/Rev.1
page 11
Tariff Item No,
Description of Products
137 to 144
152 to 161 )
(except 154b, 155, )
157a-2 and 3, 157b-2)
171 and 172
178
192
(except 192b and c)
319
(except 319d,c-1 & 3-2)
320
(except 320d)
325
(except 325b)
329
340
351 to 357
(except 353)
)
358 to 365 )
(except 362 and 363))
Ex. 379
393
Ex 398a
Preparations of vegetables or
fruits
Beverages, alcoholic liquids
and vinegars
Tobacco
Salt
Cement
Perfumery articles
Soap
Candles and tapers
Glues of animal origin
Matches
Tanned Leather
Manufactures of leather
Rubber soles
Plywood
Doors and windows
401 to 405
Articles made of wood
417 to 418
Cardboard
428
Envelopes
Boxes, cases for jewellory,
spectacles etc. of
cardboafd or paper
443 to 446
Natural silk thread
449 to 461
Fabrics of natural silk, pure
or mixed
470 to 192 )
(except 477 and 486a))
Fabrics of artificial silk, of
artificial. silk waste, and of
textile fibres, pure or mixed GATT/CP .2/38/Rev .1
page 12
Tariff Item No.
507
518
522 to 525 )
(except 522b-4) )
527 to 540
Description of Products
Woollen fabrics
Cotton
Cotton thread
Cotton fabrics, pure or mixed
Cabling, cordage and twine of
hemp
580 to 583
(except 580-a and
b and 581-a).
)
Hosiery
600 to 606
(except 604b)
639
663 to 681
Ex 755
Footwear
Manufactures of cement and
concrete
Glass and glassware
Metal bedsteads
768 and 769
Ex 84 la
Copper articles
Machinery for manufacturing foot-
wear
Ex 855b
Machines for the manufacture of
beer
Ex 855c
Machinery and apparatus for the
manufacture of matches
860
Electric batteries
975 and 976
N.B. The exceptions in
subject of tariff
Games and toys for children
brackets are items forming the
negotiations concluded in 1947,
Chile
(A) Products in respect of which quotas have been applied
to assist the development of the domestic production
of similar merchandise:
Calcium carbide;
Cans of aluminium, saucepans and water bottles;
Tailor's chalk;
Butter;
Stockings of cotton, natural silk, rayon or nylon,
and socks of cotton, silk and wool;
Bovine cattle for slaughtering;
Sacks for agricultural uses.
566 GATT/CP.2/38/Rev.1
page 13
(B) Products in respect of which import licences are
withheld, to assist the development of the domestic
production of similar merchandise:
Silver alloyed with other metals;
Milling-cutters, boring tools, screw-taps, and
screw dies of all types and specifications;
Calcium carbide;
Toilet articles;
Paper clips;
Cork in sheets of a thickness not exceeding 4 mm.,
and ordinary stoppers of cork;
Endless belts, of linen, for. cigar machines;
Window glass, flat, common, of a thickness, not
exceeding 6 mm. and a breadth not exceeding
1.55 metres;
petort carbon;
Galalith, in sheets and bars;
Wicks for candles;
Wools up to 54 s. ;
Potassium Carbonate;
Potassium metabisulphite;
Dry batteries, except those for telephone and bells
and small tubular batteries;
Glass bricks or blocks for building;
Umbrellas except automatic or spring umbrellas and
en- tout-cas;
Fancy paper, glossy and for binding;
Threads, fibres' and yarns of flax in all sizes up
to No. 30;
Tissues of horse hair;
Silica bricks, and foundry vessels of clay;
Footballs and basket balls;
Smoothing irons., coal-heated..
(E) Wines. tobacco, cigars and cigarettes of. foreign
origin subiect to a higher excise duty than like
articles of domestic origin, with the aim, inter
alia, of protecting the development of the corres-
ponding domestic industries. GATT/CP.2/38/Rev.1
page 14
ANNEX C
DECISIONS
I
The CONTRACTING PARTIES,
exercising their power of waiver under paragraph 5 (a)
of Article XXV of the General Agreement on Tariffs and Trade,
HAVING considered the circumstances relating to the
notification by October 10 1947 of measures under paragraph
6 of Article XVIII in force on September 1, 1947, in overseas
territories for which the United Kingdom has international
responsibility
DECIDE that, with the exception of the date by which
notification of existing measures is required, the provisions
of paragraph 6 of Article XVIII shall apply to measures to
restrict the import of tea into Mauritius and of "filled soap"
into Northern Rhodesia in force on September 1, 1947,
notified by the Government of the United Kingdom on August
23, 1948.
II
The CONTRACTING PARTIES
exercising the power of waiver under paragraph 5 (a)
of Article XXV of the General Agreement on Tariffs and Trade,
HAVING noted the circumstances prevailing in the
Netherlands Indies on September 1, 1947
DECIDE that the provisions of paragraph 6 of Article
XVIII with the exception of the dates of September 1, 1947
and October 10, 1947 shall apply to the following measures
of the type referred to in that paragraph notified in respect
of the Netherlands Indies, on August 23, 1948:
1935 No. 86 cement - latest bylaw 1940 No. 469
1935 No. 341 - iron frying pans - latest bylaw 1940
No. 259
1936 No. 542 - beer - latest bylaw 1940 No. 475
1934 No. 678 - coloured woven textiles (sarongs) -
latest bylaw 1940 No. 229
1936 No. 65 - some categories of cotton textiles which
can be woven on sarong looms - latest
bylaw 1940 No. 431 GATT/CP.2/38/Rev. 1
page 15
III
The CONTRACTING PARTIES
exercising their power of waiver under paragraph 5(a)
of Article XXV of the General Agreement on Tariffs and Trade,
HAVING noted that decisions under the provisions of
paragraph 6 of Article XVIII of the Agreement concerning
measures notified by the Governments of Cuba and the
Netherlands (the latter in respect of the Netherlands
Indies) shall be given by January 16, 1949, and April 10,
1949 respectively and
HAVING noted that the next session of the CONTRACTING
PARTIES is not scheduled to be held until April 1949 and
that it is not possible to make the required decisions at
the current session
DECIDE that the decisions in respect of the above
mentioned measures shall be given at the Third Session
of the CONTRACTING PARTIES. GATT/CP .2/38/Rev. 1
page 16
ANNTEX D
NATURE OF INFORMATION WHIICH IT WILL BE HELPFUL
FOR APPLICANT CONTRACTING PARTIES TO SUPPLY AS
CONSIDERATIONS IN SUPPORT OF THE MAINTENANCE OF
MEASURES IN ACCORDANCE WITH PARAGRAPH 6 [12] OF
ARTICLE XVIII
(1) In setting out items on which it was thought that infor-
mation would be helpful, it was recognized that many countries
have not the administrative techniques necessary to provide
informaion under every heading. It was considered however
that it would be useful to applicant contracting parties to
have some guidance as to the material the submission of which
to the CONTRACTING PARTIES would expedite decisions on appli-
cations. The types of information listed in paragraphs 2 and 3
below are therefore given as illustrations without suggesting
either that the lists are exhaustive or that all the information
listed would be appropriate in all cases. It would be for the
applicant contracting parties themselves to determine what
informatin they will submit.
(2) It is suggested that the information set out below would
be of assistance, In this list the information suggested relates,
except where otherwise stated, to the goods described under
item (b) or to the industry or branch of agriculture producing
those goods, Furthermore references to "industry" should be
read, unless otherwise stated, as referring also to "branch of
agriculture" and references to "economic development" as
referring also to "reconstruction"
(a) Precise description of the measure including the
range and type of goods to which it relates and
the method of operation,
(b) Precise description of the range and type of
goods produced by the industry in respect of
whose development the measure has been maintained.
(c) Statistics of quantities and values over a period
of years showing -
(1) production (in the case of a branch of
agriculture also area planted)
(2) imports
(3) exports
(d) Number and location of enterprises or firms .
(e) Numbers employed
(2) Total working population of the country by
principal occupations.
(g) Average level of wages paid to employees. GATT/CP. 2/38/Rev.1
page 17
(h) Capital investment1.
(i) Net profits or losses.
(j) Cost of imported product ex duty at place of
entry into country, costs of transport and
distribution of imported product from place of
entry to principal market or markets and selling
price of domestic product at principal market
or markets.
(k) History of tariff and other protection enjoyed
including existing duty, if any, period for which
protective measures have been in force and the
effect which they have had on the establishment
or development of the industry.
(1) Reasons for the selection of the measure proposed
to be maintained in preference to other measures
permitted by the GATT such as tariff protection
or subsidy payments
(m) Data concerning the future development of the
industry - including for example expected levels
of production and costs - and the possibility of
its becoming independent of the measure proposed
to be maintained.(This information would have a
particular bearing on the period for which the
applicant contracting party has requested the
maintenance of the measure).
(3) If an applicant contracting party elects to apply
under paragraph /[7 (i) or (ii)] of Article XVIII, the
following additional data would be helpful:
(i) (a) the date of establishment of the industry,
(b) the type of protection during the period
January lst, 1939, to March 24th, 19489
resulting from abnormal conditions arising
out of the war,
(ii) (a) the indigenous primary commodity which is
being processed,
(b) statistics of exports of the primary
c ommodity,
(c) details of the new or increased restrictions
imposed abroad. GATT/CP.2/38/Rev.1
page 18
ANNEX E
PROCEDURE FOR DEALING WITH EXISTING MEASURES LISTED IN
ANNEX B
(a) Procedure between the second and third Sessions
(1) The Contracting Parties, whose measures are referred
to in Annex B, should submit supplementary statements of
consideration in support of their measures to the Chairman of
the CONTRACTING PARTIES not later than November 15, 1948. These
statements should contain as much as practicable of the types
of information suggested in paragraph 2 of Annex D. In addition on,
when the contracting party concerned wishes the measure to be
considered in accordance with paragraphs [7 (i) and (ii)] of
Article XVIII, the information suggested in paragraph 3 of
Annex D should be also provided. In the case of applications
under paragraphs [ 7(i) or (ii)] information on the lines
suggested in both paragraphs 2 and 3 of Annex E is required
so that, if the application is not successful under paragraphs
[7 (i) or (ii)], the CONTRACTING PARTIES may at the third
session make a decision under other relevant provisions of
Article XVIII. In eachease the contracting party concerned
should indicate whether it wishes its case to be considered
under paragraph [7] of Article XVIII and the period for which
it wishes to maintain the measure.
(2) The Chairman of the CONTRACTING PARTIES should forward
the statements referred to in (1) above to all the contracting
parties and, as soon as possible, thereafter, should send there
such relevant statistical and other information of the type
referred to in paragraph 7 below as can be collected, Any
contracting party which wishes to have further information
should request this not later than December 31, 1948, through
the Chairman of the CONTRACTING PARTIES, who would then assemble
the requests and forward a consolidated request to the applicant,
thereby avoiding a duplication of enquiries from the contracting
parties.
(3) If any of the contracting parties has any objection to
any of the measures. the Chairman should be so informed not
later than February 28, 1949. At the same time, the contracting
party making the objection should give evidence to show that it
is materially affected by the measure.
(4) The Chairman should transmit the statements received under
(3) above to the other contracting parties so that consideration
may be given to them before the beginning of the third session.
(b) Procedure for examination at the third Session.
(5) The first task of the CONTRACTING PARTIES will, ther-fore,
be to examine any measure submitted for consideration under the
provisions of paragraph [7] and decide whether or not it is
perritted under those provisions. If the CONTRACTING PARTIES
decide that the case under paragraph [7] is justified, they
will agree to the maintenance of the measure for a specified
period. GATT/CP.2/38/Rev/1
page 19
(6) If the CONTRACTING PARTIES decide that the ecse under
paragraph [7] is not justified, they will consider the
measure under paragraph [8 (b)], together with those measures
for which no case had been submitted under paragraph [7]
(7) In the case of all measures under (6) above, the
CONTRACTING PARTIES will first decide whether any objection
has been received fron a contracting party whose interests
are materially affected. In this connection it may be noted
that committee II of the United Nations Conference on Trade
and Employment decided that in interpreting the words
"materially affected" in paragraph 8 of Article 13 of the
Havana charter, which corresponds with paragraph [8] of Article
XVIII: "it would be proper for the Organization to have
regard, for instance, to the interests of Members which supplied
a large proportion of the imports of the applicant Member in
the product concerned, those Members which ware substantially
interested in exporting the producit to world markets, and
those Members whoe economies were materialy dependent on
exports of the product " (ICITO/W.I. page, 29) For the pur-
pose of determining which contracting parties are materially
affected, therefore before the CONTRACTING PARTIES would need to
consider ststistics relating to the world trade in the goods
in question, for example:
(a) imports into the territory of the applucant
from each of the other contracting parties
(b) world exports
(c) exports from each contracting party to all
counries
(d) the percentage of the total exports of all goods
of each contracting party represented by exports
of the goods in question.
(8) If no objection has been received by Fabruary 28, 1949
from a contracting party whose interests are materially
affected, the CONTRACTING PARTIES WILL APPROVE THE maintenance
of the measure for the period specified in the application.
(9) If there is objection from any materially arrected
contracting party the CONTRACTING PARTIES will examine the
measure in accordance with paragraph [8 (b) (ii)] of Article
XVIII in the light of the roasens advanced both for and against
the neasure before and during the third sossion and in parti-
cular of the folowing considaration:
(a) the applicant's need for economic development
and recenstraction
(b) the effect which the measure is likely to have,
immediately and in the long run on international
trade.
(c) the effect that the measure is likely to have
in the long run on the standard of living within
the territory of the applicant. GATT/CP. 2/38/Rev.1
page 20
(10) If as the result of the examination described in the
preceding paragraph above, the CONTRACTING PARTIES decide
that the measure is justified, they will permit its maintenance
subject to such limitations as they may impose.
(11) If the CONTRACTING PARTIES decide that the measure is
not justified, they will ask the applicant contracting party
to modify or withdraw the measure. In doing so, however,
they will, in. accordance with paragraph 6 [14] of Article XVIII,
"have regard to the possible need of a contracting party for a
period of tine in which to make such modification or withdrawal." GATT/CP. 2/38/Rev.1
page 21
ANNEX F
PROCEDURE FOR EXAMINING AND DECIDING ON NEW MEASURES
SUBMITTED UMDER ARTICLE XVIII
Note - The following procedure is suggested in relation to
each of the appropriate paragraphs of Article XVIII (as set
out in GATT/CP.2/34) and should be read on conjunction with
them.
A.
Para 3 (a)
Para 3 ( b)
Direct negotiations with all the contracting
parties nay take place at any time convenient
for all parties. In practice, however, it
will probably be convenient in most cases to
hold the negotiations at the Third Session when
general tariff negotiations are due to take
place. In cases where the contracting party
concerned wishes such negotiations to take
place at the Third Session it should give
notice of its intention, through the Chairman,
by 31 January 1949 In the case of items
materially affecting the trade of the United
States it is pointed out that because of
legislative requirements, unless such notice
were given by 31 October 1948, there could be
no assurance that the United States could
negotiate on such items at the Third Session.
The Contracting Party concerned will notify
the Chairman. In turn the Chairman will
notify the other contracting parties, and
at the same time
(1) indicate which, in his view, are the
materially affected contracting parties
with whom negotiations should take
place;
(ii) suggest a time schedule. (NB. In
cases where negotiations are contem-
plated in the course of the Third
Session, a precise tim.e schedule will
be unnecessary),
If no objection is raised by any of the
contracting parties to the Chairman's suggestion
under (i) or (ii) above, the negotiations will
proceed between the applicant contracting party
and the contracting parties which the Chairman
has nominated in accordance with the tine
schedule proposed by the Chairman.
If any objections is raised, the matter
will be referred for decision by the CONTRACTING
PARTIES at their Third Session. In cases of special
urgency, however, and at the discretion of the
Chairman a special session of the CONTRACTING
PARTIES may be called. GATT/CP .2/38/Rev .1
page 22
In either case a decision to release an
applicant contracting party from its obligations
must be taken by the CONTRACTING PARTY in session
Para 4 (a)
Para 4 (b)
Para 4 (c)
B.
Para
C,
Para
5
6
Para 7
Para 8 (a)
The .appllicant contracting party will notify the
Chairman, who will in turn notify the other
contracting parties.
Decision will be by the CONTRACTING PARTIES in
session. The Caliman will call a special session
at the earliest possible date.
Consultation under this paragraph will take place
when CONTRACTING PARTIES are in session.
as under paragraphs 3 (b) and 4..
Notifiecation and written statement in support
of the adoption of the measure for specified
period wil be sent to the Charan and through
him to the other centracting parties.
Application 1/ will be made to the chairman
simultaneeusly with the notification under
paragraph 6. The deision will be given by
the CONTRACTING PARTIES in session.
The centacting party concerned will enter
into. direct negotilation with the other contracting
parties it considors to be naterially affected,
and at the same time inform the chairman. The
chariman will infrom all the other centracting
oartues, and take note of any comments they may
have about the cheice of the materially affected
parties.
When substaantial agreement has been
reached, as the result of negotiation, the
centraction party directly concernd will
apply to the Chair an who will inform. the
other contracting partion of the application
and the conditions on which it is proposed
that relese from a obligations shall be given.
If no objection has been received to the choice
of the materially affected contracting parties
or to the propesed conditions, the Charman will
invite the concurrence of the centracting parties
to release the applicant qantracting party from
its obligations.
If any objeaction has been received, however,
the matter will be decided by the CONTRACTING
PARTIES in session.
1/ For the timetable see under paragraph 10. GATT/CP . 2/38/Rev .1
page 23
Para 8 (b) It is assumed for practical purposes that
any application between the Second and Third
Sessions will be an initial application and
not one made after the procedure of 8 (a)
has proved unsuccessful. Therefore appli-
cational/ to the CONTRACTING PARTIES under
8 (b) will be simultaneous with the notifi-
cation referred to in para 6. Where an
application under 8 (b) is intended, however,
the applicant should make this known at the
time the statement is submitted.
In communicating the statement to the
contracting parties, the Chairman will
suggest which of them, in his view, are
materially affected and invite comment.
At the same time he will invite those
contracting parties which he considers
materially affected to inform him by a
specified date whether or not there is
any objection to the proposed measure.
If no objection is'received by the
Chairman, in respect of his choice of
materially affected contracting parties,
the procedures of (i) .and (ii) below will
be followed. If there is objection to
the choice however, the matter must be
discussed by the CONTRACTING PARTIES in
session.
i) If none of the materially affected
contracting parties has notified any
objection to the measure by the date
prescribed by the Charman, the CONTRACTING
PARTIES, in session, will release the appli-
cant contracting party from its obligations.
11) If any objection to the measure is
received by the Chairman, the CONTRACTING
PARTIES will take a decision under. para
8 (b) (ii) in session
Para 9 The applicant contracting party, may, in
the circumstances described in the Paragraph,
take emergency action after informing the
Chairman who will in turn notify all the
other contracting parties. In informing
the Chairman the applicant contracting
party should furnish detailed information
showing that the provisions of paragraph 9
apply to the measures adopted including
1/ For the timetable see under paragraph 10 GATT/CP. 2/38/Rev .1
page 24
in particular the representative period,
which is being used as a basis for
determining the level of imports,
Para 10 The Chairman, within 15 days of receipt
of an application under paras 7 or 8
will inform the applicant contracting
party of the date by which a decision
may be expected. In the circumstances
it will usually be impractical, for the
Chairman to specify a period shorter
than the full 90 days referred to in
the paragraph.
Having regard to the provision
that, except in particular circumstances,
decisions shall be given within 90 days
of receipt of the application, the
Chairman will determine whether decisions
by the CONTRACTING PARTIES in session
require a special session |
GATT Library | tr810dw9498 | Report of Working Party 7 (Article 18) | United Nations Conference on Trade and Employment, February 23, 1948 | Third Committee: Commercial Policy | 23/02/1948 | official documents | E/CONF.2/C.3/71 and E/CONF.2/C.3/58-77/REV.1 | https://exhibits.stanford.edu/gatt/catalog/tr810dw9498 | tr810dw9498_90190173.xml | GATT_147 | 727 | 4,989 | United Nations Nations Unies UNRESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.3/71
ON DU 23 February 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH.
THIRD COMMITTEE: COMMERCIAL POLICY
REPORT OF WORKING PARTY 7 (ARTICLE 18)
1. Terms of Reference
Committee III, at its forty-first meeting held on Friday, 20 February,
established working Party 7 to give consideration to the provisions of
Article 18, requiring the elmiination of existing internal taxes which afford
protection to domestic production, in the light of the remarks of the delegates
of Argentina and Brazil particularly with respect to the difficulties of
transferring the protective element of such existing taxes to the customs
tariff, and to report by Monday, 23 February.
2. Membership
The Working Party consisted of the representatives of Argentina, Brazil,
Ecuador, France, Norway, Philippines, United Kingdom, United States, with
Mr. Lamavelt, Chairman of Sub-Committee A, as Chairman.
3. Explanation of Difficulties
(a) The delegate of Argentina explained that his Government was concerned
with existing differential internal taxes on certain luxury items, e.g.,
alcohol, alcoholic beverages, beer and silk.. Experience had shown that,
due to the length of Argentina's frontiers, tariffs on such items were
evaded and a contraband traffic developed. Internal taxes were therefore
imposed in order to facilitate collection. In addition, these items were
till subject to import duties, but so low as not to encourage evasion.
(b) The delegate of Brazil explained that his Government had imposed
differential internal taxes on certain items for as long as forty years.
Experience had shown that, in view of Brazil's long see and land frontiers
and few centers of consumption, it was in certain cases preferable to
collect internal taxes in these centers rather than .attempting to collect
customs tariffs onthe frontiers. Mainly, however, there were
administrative, constitutional and even political difficulties involved.
(c) The delegate of the Philippines explained that his Government wished
to maintain an existing protective internal tax imposed to encourage the
development of a low-priced rubber shoe industry. In his opinion, this
item was not bound in the Philippines-United States Trade Treaty and
therefore paragraph 3 of Article 18 would not apply. He preferred that
/the Philippines- E/CONF.2/C.3 /71
Page 2
The-Philippines-United States Trade Treaty be revised; otherwiise that a
transitional period be provided to permit the Philippines Government to
readjust it internal tax structure. The Philippines delegation
provisionally reserved its position.
Proposals
(a) The delegate of Ecuador suggested that Article 18 be amended to
provide for a transitional period of six months to one year after
ratification of the Charter by the Member concerned.If after such
period had elapsed the Member was still unable to comply with the
provisions of Article 18, the Organization should be so notified and
the internal taxes in question continued only the Organization's
consent;
(b) The delegate of Norway was of the opinion that the period of time
which was likely to elapse before the Charter comes into effect, say
two years, would be sufficient to permit the necessery adjustment of
existing internal tax systems. Nevertheless, he would be willing to
accent as a compromise mending Article 18 to provide for a transitional
period of six months after ratificafion of the Charter by the Member
concerned, during which period all existing protective internal taxes
would have to be eliminated.
5. Summary of Views
The Working Party was not able to reach any agreed conclusions and
therefore notes the members views as follows:
(a) All members of the Working Party accepted the principles of
Article 18, and most members recognized that a considerable period
of time, sey one to two years,would elapse before the Charter came
into force during which the readjustment of internal taxes required
by Article 18 might be effected;
(b) Four members, however, favoured the retention or existing
differentiatial internal taxes, subject to negotiations pursuant to
Article 17 for their elimination;
(d) Of these four:
(1)One accepted the principles of the Ecuadorian or
Norwegian proposals;
(2) One accepted the Norwegian proposal;
(3) One accepted the Ecuadorian proposal;
(4)One his original position in view of the division
of opinion in the Working Party;
(d) Four membars did not feel that sufficient evidence of technical
difficulties had been adduced;
/(e) Of these E/CONF.2/C.3/71
Page 3
(e) Of these four:
(1) Two were willing to accept as a compromise the Norwegian
proposal;
(2) Two were not in favour of any change in Article 18. |
GATT Library | kh945vm3391 | Report of Working Party 7 on the Cuban schedule | General Agreement on Tariffs and Trade, September 13, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 13/09/1948 | official documents | GATT/CP.2/43 and GATT/CP.2/38/Rev.1 CP.2/39+Add.1 CP.2/40-45 CP.2/44/Add.1 | https://exhibits.stanford.edu/gatt/catalog/kh945vm3391 | kh945vm3391_90320064.xml | GATT_147 | 384 | 2,405 | RESTRICTED
LIMITED B
GATT/CP.2/43
13 September 1948
ORIGINAL: ENGLISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
Contracting Parties
Second Session
REPORT OF WORKING PARTY 7 ON THE CUBAN SCHEDULE
The Working Party met on 11th September under the
Chairmanship of Mr. L.D. WILGRESS and discussed ways and
means of meeting the requests of the Governments of Cuba
and the United States as set forth in documents GATT/CP.2/W.12
and 13.
The representatives of Cuba and the United States
offered to recommend the following arrangement to their
Governments:
"1. The Government of Cuba will promptly take steps to
relieve the immediate difficulties affecting imports of
textiles, and will consult with representatives of the
Government of the United States at Havana with a view to
finding a mutually satisfactory solution for the problems
that have arisen in connection with Resolution 53O, such
solutions to be in accordance with the following principles:
- (a) The recognition of the right of the Government of
Cuba to take adequate customs enforcement measures
with respect to assessment at proper rates of duty
and under proper tariff classifications; and
(b) The Measures thus taken by the Government of Cuba
shall not have the effect of restricting trade.
The results of the consultations will be conveyed to the
Chairman of the Contracting Parties for the information of
the other contracting parties.
"2. The Government of Cuba will continue to apply to
coloured woven textiles the treatment provided for in the
third of the Notes under tariff items 114 through 117 and 132
through 135 of Schedule IX of the General Agreement.
"3. The United States will undertake to renegotiate
trimmings, ribbons and galloons (Items 127 A and 142E and F),
hollow tyres and inner tubes (Items 314 B and C) and nylon
stockings (Item ex 137 F) - and also coloured woven textiles,
referred to in paragraph 2, if the Government of Cuba so
desires - in return for adequate compensation. Initial
discussions to this end will begin immediately."
In recommending this solution to the Contracting Parties,
the members of the Working Party wish to express their under-
standing that acceptance of this arrangement will not in any
way impair the rights or obligations of the Government of
Cuba or of.the Government of the United States under the
General Agreement on Tariffs and Trade. |
GATT Library | dp987yh6514 | Report of Working Party 9 (Articles 42B) | United Nations Conference on Trade and Employment, March 15, 1948 | Third Committee: Commercial Policy | 15/03/1948 | official documents | E/CONF.2/C.3/90 and E/CONF.2/C.3/89/ADD.3-95 | https://exhibits.stanford.edu/gatt/catalog/dp987yh6514 | dp987yh6514_90190207.xml | GATT_147 | 156 | 1,164 | United Nations Nations Unies
CONFERENCE CONFERENCE UNRESTICTRICTED
ON DU E/CONF. 2/C.3/90
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI 15 March 1948
ORIGINAL: ENGLISH
THIRD COMMITTEE: COMMERCIAL POLICY
REPORT OF WORKING PARTY 9 (ARTICLES 42B)
Committee III at its forty fourth Meeting on 11 March appointed a
Working Party composed of the representatives of Australia, Brazil,
Denmark, France, New Zealand, Unites Kingdom and United States to consider
the following proposals of the delegation of Australia to amend paragraph 5
of Article 42B
(a) by the insertion of the words "mutually advantageous" before
the word "negotiations" in the first and second sentence, and
(b) to delete all the words after the word "preferences" in the
second sentence and to substitute "on products originating in
constituent territories of the proposed customs union or free-trade area.
The Working Party held one meeting on 15 March and decided to report
to Committee III that it did not favour the proposed amendments, |
GATT Library | nv480tg0020 | Report of Working Party No. 1 on Finance | General Agreement on Tariffs and Trade, September 7, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 07/09/1948 | official documents | GATT/CP.2/35 and GATT/CP.2/28 - 36 CP.2/32/Rev.1 | https://exhibits.stanford.edu/gatt/catalog/nv480tg0020 | nv480tg0020_90320052.xml | GATT_147 | 2,295 | 14,753 | RESTRICTED
RESTRICTED LIMITED C
GATT/CP. 2/35
7 September 1948
ORIGINAL: ENGLISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
Contracting Parties
Second Session
Report of Working Party No. 1 on Finance
I. Financing of Secretariat Services.
The Working Party agreed to consider the question of
financing the Secretariat services for the Contracting
Parties for a period beginning with the opening of the Second
Session and ending 31 December 19149.
The Secretariat accordingly provided budget estimates
to cover this period (Annex A).
The Working Party considered two alternative plans, A
and B, which are set out in Annex B to this Report. It was
generally agreed in the Working Party that there were many
practical advantages in Alternative B since it would avoid
some of the accounting and budgetary difficulties inherent
in Alternative A. On the other hand, it was impossible to
arrive at a general agreement on Alternative B because of
the divergent views of the United States Delegation.
It was accordingly agreed to explore further the prac-
ticability of Alternative A. Here, however, the Working
Party was confronted with the difficult question of the
basis for assessing costs as between Members. Some members
of the Working Party favoured a per capita division since
the Contracting Parties are not an organization but a meeting
of equal Governnents who are parties to a com-on agreement.
Members who were opposed to a per capita division felt that
any such arrangement would result in inequities as between
the Contracting Parties and also establish a harmful prece-
dent.
The Working Party submit the following recommendations
for a compromise solution. If these recommendations are
accepted the Working Party recommend the adoption of the
Resolution attached to this Report as Annex C.
(a) That in respect of the Second Session, the Contract-
ing Parties should adopt the procedure suggested in para-
graphs 1 and 2 of Alternative B, that is to say, that ICITO
should absorb the expenses of the Contracting Parties up to
the end of the Second Session. These expenses should be
accounted for separately in the accounts of the Interim
Commission in case any question should later be raised
regarding the manner in which expenses attributable to the
Contracting Parties should ultimately be divided.
(b) As regards the future expenses of the Contracting
Parties a "pay as you go" arrangement on the lines of
Alternative A should be adopted. For the purpose of the
division of expenses, the Contracting Parties should be
classified according to four categories: GATT/CP. 2/35
page 2
Category A - Countries whose share of total external
trade as shown in Annex H of GATT is 10% or more, i.e.
United Kingdom and United States.
Cartegory B - Countries whose share is 5% or more but
less than 10%, i.e. Belgium, Canada, France.
Category C - Countries whose share is 1% or more,but.
less than 5%, i.e. Australia, Brazil, China, Czechoslovakia,
India. Netherlands, Pakistan, New Zealand, Norway, South
Africa.
Category D - Countries whose share is less than 1%,
i.e. Burma, Ceylon, Cuba, Lebanon, Luxembourg, Southern
Rhodesia, Syria.
As between these categories the expenses should be
divided in accordance with the following proportions:
Category A - 10 units per country
Category B - 6 units per country
Category C - 4 units per country.
Sategory D - 1 unit per country.
In order to cover the budget estimates for the Contract-
ing Parties from the end of the Second Session until 31
December, 1949, a unit contribution of $900 would be
required, giving the following contributions:
Category A - 2 countries at $9,000 = $18,000 $18,000
Category B - 3 countries at $5, 400 = $16,200 $16,200
Category C - 10 countries at $3,600 = $ 36,000 $36,000
Category D - 7 countries at $ 900 =$ 6,300 $ 6,000
(c) The contribution of each Contracting Party deter-
mined in accordance with the above formula should be paid.
not later than 31 July 1049 to the Financial Officer at the
European Office of the United Nations for the account of
the Contracting Parties. Payment may be made in U.S.
dollars or Swiss francs at the option of each Contracting
Party. The approval of these financial arrangements shall
also constitute authority to the Executive Secretary of the
ICITO to apply at such time as he may deem appropriate, the
sums so paid into this account to reimburse the Interim
Commission for advances to the Contracting Parties.
(d) These collective arrangements by the Contracting
Parties in their individual capacities shall not be con-
strued as in any way conferring upon them the character of
an international organization. Accordingly, the basis for
division of expenses between the Contracting Parties in no
way constitutes a precedent for the basis of contributions
by governments to international organizations.
(e) Countries which are not at present Contracting
Parties but which accede to the General Agreement as a
result of the new tariff negotiations shall participate in
this financial arrangement on the same basis as the present
Contracting Parties. Such participation shall relate to
all expenses incurred from the date of the commencement of
the new tariff negotiations, i.e. 11 April 1949. The GATT/CP.2/35
page 3
contributions of the present Contracting Parties shall be
adjusted to take account of the contributions of new
Contracting Parties.
(f) In the event that Havana Charter does not enter
into force, the Contracting Parties agree that the expenses
of the Second Session shall also be reimbursed.
II. Revision of text of Rule 14 of the Rules of Procedure.
If the Contracting Parties accept the recommendation
of the Working Party on the financing of Secretariat ser-
vices, it is suggested that the text of Rule 14, as provi-
sionally adopted, be amended to read as follows:-
"The usual duties of a Secretariat shall,
by agreement with the Interim Commission
for the International Trade Organization,
be performed by the Executive Secretary
of the Interim Commission on a reimburs-
able basis."
III. Reprint of the-General Agreement on Tariffs and Trade.
The Working Party agreed as to the value of a reprint
of the GATT but considered that, in the interests of economy,
it was undesirable to undertake such reprinting as a charge
to the expenses of the Contracting Parties. They understand
however that some governments may reprint VOL. I of the
GATT and Protocols for their own purposes and they suggest
that the Contracting Parties might invite such Governments
to consider making a number of printed copies available to
the other Contracting Parties. In these circumstances,
the Working Party suggest that the Secretariat be instructed
to prepare a consolidated text in mimeographed form only.
IV. Procedure for carriving out cosulation between , and
for action bY the Contracting Parties during periods
between session.
The Working Party suggest that the procedure agreed
upon at the First Session should be continued. Under this
procedure, any communication which a contracting party or
other signatory of the Final Act at Geneva wishes to bring
before other contracting parties shall be sent to the
Chairman of the Contracting Parties, care of the Executive
Secretary.
It should be understood, however, that this procedure
would not preclude direct consultation between a contracting
party and one or more contracting parties on matters of
specific interest between such members or in case of
emergency (e.g. action under Article XIX). In such cases,
however, the contracting party initiating the consultation
directly should concurrently inform all the contracting
parties by an appropriate communication to the Chairman.
The Contracting Parties should be prepared to meet at
short notice by the Chairman to consider any urgent matter
subject to the jurisdiction of the Contracting Parties which GATT/CP. 2/35
page 4
a contracting party wished to bring before them between
regular sessions of the Contracting Parties.
V. Date of the Third Session of the Contracting Parties
The Working Party recommend that the Third Session of
the Cont-acting Parties should convene on 8 April 1949.
An earlier date would present problems to some of the Con-
tracting PartIes in view of their preparations for the
tariff negotiations. It seemed to the Working Party, in
the light of the experience in 1947 in Goneva, when the
Preparatory Committee and the Tariff Agreement Committee
net concurrently with the conduct of tariff negotiations.
that the holding of the Session concurrently with the tariff
negotiations would not present any serious problem. The
fixing of a date a few days earlier than the opening of the
tariff negotiations would afford an opportunity to doual
with any urgent matter which night require to be dealt with
prior to the negotiations. GATT/CP. 2/35
page 5
BUDGET ESTMATES FOR CONTRACTING -PARTIE
16 August ,1948, through 31 December, 1948
Second. Session, 16 August, 1948 --:
Conference Services
Secretariat
Preparatory Documentation
August, 1948 (date of closure
Second Session) to 31 May, 1949
(closure date of Third Session
including Tariff Negotiations):
Inter-session Secretariat Services 9,000
Preparatory Documentation
Third Session Conference Services
Third Session Secretariat Services
Tariff Negotiations
1 June, 1949, to 31 December, 1949:
Inter-session Secretariat Services
Preparatory Docunentation
Fourth Session, Conference Services
Fourth Session Secretariat Services
Unforeseen Expenses:
U.S. dollars
10,000
2,500
2,500
4 65 12, 965
9,000
500
10,000
2,500
28, 000
5,000
500
10,000
2,500
8,0000
Total:
50,000
18,000
88,965
The figures for the Secretariat Services are arrived
at by taking an amount of 10% of the Personnel Budget
of the Interim Commission for the International Trade
Organization Secretariat for periods between sessions,
and 50% of this budget during sessions. GATT/CP. 2/35
page 6
Possible arrangements for discharging these financial
commitments
Aternmative A.
(1) As regards the period between the First and Second
Sessions no charge to be made to the Contracting
Parties except for the expenses arising from the
physical preparation of documents. These latter
expenses could be added to the costs of the Second
Session.
(2) As regards the Second Session, the Executive Secretary
of the ICITO to furnish the Contracting Parties with
as accurate an estimate as possible of the actual
expenses involved (plus, if so decided, a sum for the
services of personnel of the Secretariat of ICITO
based on a percentage figure to be agreed.) Each
Contracting Party would either at the end of the
Session or within 60 days thereof pay to the Executive
Secretary of the ICITO its allotted share of the sun
so arrived at.
(3) A similar procedure to be followed in respect of
each subsequent session. The Executive Secretary of
ICITO to keep an account of services rendered to the
Contracting Parties between any two Sessions, the
charges for such services to be added to the costs of
the later session.
(4) In submitting budget estimates for the ICITO for the
last quarter of 1948 and for 1949 the Executive
Secretary to make provision for amounts necessary to
assure the servicing of the Contracting Parties,
assuming for this purpose that two sessions will be
required during 1949 and that a meeting for further
tariff negotiations will probably take place during
the early part of that year.
[Tentative estimates: -
Two Sessions of Contracting Parties
lasting 14 days each ........... $15,000
Tariff negotiations, assuming that
only the multilateral stage would
be chargeable to the Contracting
Parties ..... ................... 7,600
Documentation ......................... 2,250
Total ................................ 24,850]
(5) Sums paid to the Executive Secretary of the ICITO by
Contracting Parties for services rendered to be paid
in turn by him to the United Nations in order to
reduce proportionately the debt due from the ICITO
to the United Nations. GATT/CP.2/35
page 7
(6) Allocation of costs between the Contracting Parties
(a) provided total estimated costs do not exceed
$100,000 for period March 24, 1948, to December
31, 1949, contributions to be on a per capita
basis it being understood that this arrangement
is without prejudice to any general principles
regarding the allocation of expenses of
international bodies;
(b) if total estimated costs exceed $100,000 contribu-
tions to-be based upon percentage shares of
total external trade contained in Annex H to the
GATT;
(c) contributions to be payable in U.S. dollars or
Swiss francs at the option of the Contracting
Party concerned.
(1) Contracting Parties to make formal request to the
ICITO to provide Secretariat services on a non-reimburs-
able basis.
(2) Pending consideration of the request by the ICITO no
decision to be taken regarding Second Session expenses
and question to be reconsidered at Third Session in the
light of the reply from the ICITO.
(3) Assuming acquiescence of ICITO in suggestion (1) above,
expenses of the Contracting Parties to be included with
the other expenses of the ICITO in the total sum which
the future ITO would be obligated to reimburse to the
United Nations. At the first conference of the ITO
it could be decided whether the total expenses of the
ICITO (including the costs of services provided to
the Contracting Parties) should be met out of the
general budget of the Organization or whether an
additional contribution should be levied on Contracting
Parties members of the ITO in respect of that part of
the expenses of the Interim Commission attributable
to the servicing of the Contracting Parties. GATT/CP. 2/35
page 8
ANNEX C
WHEREAS Article XXV of the General Agreement on
Tariffs and Trade provides that: "Representatives
of the contracting parties shall meet from time to time
for the purpose of giving effect to those provisions of this
Agreement which involve joint action and, generally, with
a view to facilitating the operation and furthering the
objectives of this Agreement"; and
WHEREAS it is necessary to make provision for
Secretariat services for such meetings and for consultation
between the Contracting Parties in the intervals between
such meetings;
The Contracting Parties RESOLVE to recommend their
respective governments to take the necessary steps to give
effect to the financial arrangements set out in the
Annex to this Resolution. |
GATT Library | gt120th0882 | Report of Working Party no. 2 concerning the Chilean Amendment to paragraph 3 (b) of Article 34 | United Nations Conference on Trade and Employment, February 6, 1948 | Third Committee: Commercial Policy | 06/02/1948 | official documents | E/CONF.2/C.3/48 and E/CONF.2/C.3/38-57 | https://exhibits.stanford.edu/gatt/catalog/gt120th0882 | gt120th0882_90190146.xml | GATT_147 | 436 | 2,877 | United Nations Nations Unies UNRESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.3/48
6 February 1948
ON DU
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
REPORT OF WORKING PARTY NO. 2 CONCERNING THE CHILEAN AMENDMENT
TO PARAGRAPH 3 (b) OF ARTICLE 34
Chairman: Mr. C. E. MORTON (Australia)
In its thirtieth meeting on 31 January 1948. Committee III established
i4, o
Working Party No. 2 consisting of the represevetaties gof Afhanistan,
BelgCium,, India, hileUnited Kingddom anU the nSsitesdtate to consider
the amendment of the delegation of Chile to the Interpretative (Note ii)
of paragraph 3 (b) of Article 34.
In its first meeting on 3 February, the Working Party elected
Mr. C. E. Morton (Australia) as its Chairman. Australia not beingmember
of the Working Party the Chairman stated that he would act as co-ordinator
of views without taking part in any voting. The Working Party held three
meetings.
The Working Party examined the Chilean proposal, Item 29, (E/C/ONF.2
.3/10) in its amended form as well as the Indian system of valuation for
customs purposes of special categories of imported goods.
The Working Party agreed to recommend to Committee III for its
consideration an Interpretative Note (ii) to paragraph 3 (b) of Article 34
in the following terms:
)"( If on the date of signature of this Charter a Member has
in force a system of applying ad valorem rates of duty to [established]
fixed values which [remain fixed for a period of time] are not subject
to regular revision, the provisions of this Article requiring the
determination of "actual value" in regard to a particular product
shall not apply so long as the value established for [a particular]
that product remains unchanged.
As regards systems of fixed values existing on the date of
signature of this Charter which are revised periodically in accordance
with average values the maintenance of such a system would not be
onsidered a material departure from the provision s-f paragraph 3
of this Article if such fixed values are revised on the basis of the
/average of E/CONF.2/C.3/48 Page 2
not more than one year, provided a revision is made at any time on
the request of interested parties or Members. The revised value
should apply to the particular importation or importations which
formed subject of the request for revision of the fixed value,
and such revised fixed value shall then continue in force until
review is found necessary."
The representatives of Belgium, Chile and India, whilst agreement
with the suggested text, advised that they would consult their respective
governments on the matter.
The representative of the United States reserved the position of his
government. |
GATT Library | sn476qg5524 | Report of Working party No. 3 concerning the Mexican amendment to the second sentence of paragraph 1 of Article 11 | United Nations Conference on Trade and Employment, January 10, 1948 | Joint Sub-Committee of Committees II and VI | 10/01/1948 | official documents | E/CONF.2/C.26/A/W.12, E/CONF.2/C.2/D/W.1-3, C.23/A/W.1-3, and C.26/A/W.1-29 | https://exhibits.stanford.edu/gatt/catalog/sn476qg5524 | sn476qg5524_90180367.xml | GATT_147 | 218 | 1,512 | United Nations Nations Unies RESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C . 2&6/A/
ON DU W.12
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI 0RIGINAL: ENGLISH
JOINT SUB-COMMITTEE OF COMMITTEES II AND VI
REPORT OF WORKlNG PARTY NO. 3 CONCERNlNG THE MEXICAN AMENDMENT
TO THE SECOND SENTENCE OF PARAGRAPH 1 OF ARTICLE 11
The Mexican amendment to the second sentence of paragraph 1 of Article 11
(pages 5 and 6 of E/CONF.2/C.2/9) was referred to working Party No. 3 at the
eleventh meeting of the Joint Sub-Cormittees II and VI (E/CONF.2/C.2&6/A/W.8).
It was agreed at the meeting of the Working party on 9 January that the
text of the second sentence of paragraph 1 should read as follows:
"Accordingly, in order to stimulate and assist in the provision and
exchange of these facilities Members shall co-operate in accordance
with Article 10 in providing or arranging for the provision of such
facilities within the limits of their power, and Members shall not impose
unreasonable or unjustifiable impediments that would prevent other
Members from obtaining on equitable terms any such facilities for their
economic development."
It was also agreed that the words "and assure" be deleted from the
first line of paragraph 2 of the Geneva draft and be replaced by the words
"assist in" in conformity with the changes made in paragraph 1. |
GATT Library | ys796cg9354 | Report of Working Party No. 3 on Modifications in the General Agreement | General Agreement on Tariffs and Trade, August 28, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 28/08/1948 | official documents | GATT/CP.2/22.Corr.1 and GATT/CP.2/13/Add.2,3 CP.2/14-22, CP.2/22/Add.1,Corr.1 | https://exhibits.stanford.edu/gatt/catalog/ys796cg9354 | ys796cg9354_90320036.xml | GATT_147 | 101 | 661 | RESTRICTED
Limited B
GATT/CP.2/22.Corr .1
August 28, 1948
ORIGINAL: ENGLISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
CONTRACTING PARTIES
SECOND SESSION
Report of Working Party No. 3 on Modifications
in the General Agreement
On page 6, paragraph 32, delete in third line: XXII.
Delete the text of Annex II on page 20. This text will
be reproduced with the text of the Second Protocol, in
Document CP.2/22.Add.1.
Rapport du Groupe Travail No.3 sur les
Modifications . l'Accord General
Au paragraphe 32 enlever la reference XXII.
Supprimer l'annexe II, qui sera inseree, ainsi que le
texte du deuxieme Protocole, dans le document CP.2/22.Add.l. |
GATT Library | nc351pp4224 | Report of Working Party No. 3 on Modifications to the General agreement | General Agreement on Tariffs and Trade, August 30, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 30/08/1948 | official documents | GATT/CP.2/22/Rev.1 and GATT/CP.2/22/Rev.1+Rev.1/Corr.1 CP.2/22/Rev.1/Annex II/Rev.1 CP.2/23-27 | https://exhibits.stanford.edu/gatt/catalog/nc351pp4224 | nc351pp4224_90320037.xml | GATT_147 | 8,279 | 53,031 | RESTRICTED
Limited B
GATT/CP.2/22/Rev.1
August 30, 1948.
GENERAL AGREEMNT ON TARIFFIS AND TRADE ORIGINAL: ENGLISH
CONTRACTING PARTIES
SECOND SESSION
Report of Working Party No. 3 on Modifications
to the General agreement
1. In accordance with its terms of reference, the Working
Party considered the specific proposals which had been
submitted during the discussion in plenary session. It also
exchanged views on various suggestions submitted by several
Of its members.
2. After a full discussion during which representatives
of the Contracting Par ties explained the administrative
constitutional and other difficulties which would result
for some if the present text of Part II of the General
Agreement wore to stand and for others if the corresponding
Articles of the Havana charter were substituted immediately,
the Working Party reached the conclusion that a solution
should be sought which facilitated early ratification of
the Charter and final acceptance of the Agreement and which
encouraged Governments represented to the Havana conference
to accede to the Agreement within the shortest possible time.
3. With regard to the immediate replacement of Articles in
Part II, the Working Party. noted that since Part II of the
General Agreement would be suspended when the Havana Charter
enters into forces any amendments to those articles at this
stage would be operative only during the relatively short
period between now and the Charter's entry into force.
That being the case, the Working Party considered that the
same procedure should be followed as at the first session,
i.e. to limit amendments to cases where the retention of the
present provisions of Part II would create serious diffic-
ulties for Contracting Parties.
4. The Working Party accordingly recommends the replacement
of the following Articles by the corresponding provisions of
the Havana Charter mutatis mutandis.
(a) Article III (to be replaced by the provisions of
Article 18 of the Charter)
(b) Article VI (to be replaced by the provisions of
Article 34 of the Charter)
(c) Article XVIII (to be replaced by the provisions
of Articles 13 and.14 of the Charter)
5. The Working Party agreed to recommend the insertion
as paragraph 3 of Article I of provisions corresponding to
those of paragraph 3 of article 16 of the Charter, and the
deletion of the opening phrase in paragraph 9 of Article XV.
6.. In addition, the Working Party proposes a re-wording
of Article XXIX in order to eliminate certain purely temp-
orary provisions and to clarify certain points the GATT/CP.2/22/Rev.1
page 2
interpretation of which may give rise to difficulties. As
Article XXIX is contained in Part III of the General Agree-
ment, this text as amended will remain-operativo after the
entry into force of the Havana Charter.
7. Finally, the Working Party proposes a purely formal
amendment to the text of the interpretative note ad Article
II, paragraph is and various other drafting amendments con-
sequent on modifications which it recommends for adoption.
8. The text of the various amendments suggested is repro-
duced in Annex I.
9. For practical reasons, the Working Party has not
recommended further amendments to the text of the Agreement.
As explained in the following paragraphs of this report,
various proposals for amendments have been withdrawn on the
understanding that statements designed to clarify the intent
of the relevant provisions would be inserted in the report
of the Working Party. Moreover, if difficulties in applica-
tion were to arise before the entry into force of the.
Charter, the Contracting Parties would still have the possi-
bility under the terms of Article XXV to settle such cases in.
the light of the provisions of paragraph 1 of Article XXIX.
10. The Contracting Parties will find below a brief state-
ment of the considerations behind the attitude adopted by the
Working Party with regard to the various proposals sbmitted.
a) Reulacements
11. Article III: The Working Party recognised that if the
present text were maintained, there was a risk of difficulties
for certain Governments, such as the Chinese and the
Norwegian which expressed reservations when the text of
Article 1 of the Geneva Draft (reproduced in substance in
Article III of the Agreement) was adopted by the Preparatory
Committee. It also noted that administrative difficulties
pight arise in the case of countries which would have to
change their fiscal regulations twice - on acceptance of the
Agreement, and again on ratification of the Charter. Finally
it recognized that the wording adopted at Havana was clearer
and more precise than the text as it now stood.
12. Article VI: While agreeing that there is no substantive
difference between Article VI of the General Agreement and
Article 34 of the Charter of the Working Party recommend
the replacement of that Article as the text adopted at
Havana contains a useful indication of the principle govern-
ing the operation of that Article and constitute a clearer
formulation of the rules laid down in that Article. The
Working Party, endorsing the views expressed by Sub-committee
C of the Third Committee of the Havana Conferenceg agreed
that measures other than compensatory anti-dumping and
countervailing duties may not be applied to counteract
dumping or subsidization except in so far as such other
measures are permitted under other provisions of the General
Ag reement . GATT/CP. 2/22/Rev. 1
page 3
13. Article VIII: In view of the decision taken by the
Working Party to limit so far as practicable the number of
amendments, the. Norwegian representative did not press his
proposal to replace this article.
14. Article XVIII: The provisions relating to governmental
assistance to economic development or reconstruction were
discussed at length at Havana; if paragraphs 1 - 5 of
Article XVIII were replaced by the provisions of Article 13
of the Havana Charter there would be a greater incentive to
under-developed countries which participated in the work of
the Havana Conference to accede to the General Agreement.
The substitution in question would-also make it easier
for some Contracting Parties to obtain the approval
of their Parliaments when they come to submit the
General Agreement to their legislatures. Paragraphs
6 and 7 of Art. XVIII have also been redrafted in
order to incorporate.the substance of Article 14 GATT/CP. 2/22/Rev. 1
page 4
of the Havana Charter. The representative of Brazil did not
feel that; the text recommended for: Paragraph 11 of Article
XVIII was a faithful, rendering of Paragraph 1(a) of Article
14 of the Charter; he proposed either to insert the words
"or such other date as the CONTRACTING PARTIES may in
special. circumstances decide" after "September 1, 1947" and
after "October 10, 1947" or, alternatively, to add at the
end of Paragraph 11 the following provision contained in
sub-paragraph 1(a) of Art. 14 of the Charter : "except that
if in special circumstances the CONTRACTING PARTIES agree to
dates other than those specified in this paragraph; such
other dates shall: apply".
15. Article XXIX: The Working party proceeded. on the
basis of the text given in document GATT/CP. 2/12 of which
there had been a preliminary examination at the first
session. The text recommended by the Working Party incor-
porates various suggestions put forward in the course of
the discussion.''
16. Paragraph 1 : The new text reproduces the substance of
Paragraph 1 of Article XXIX, with certain drafting changes.
.The Working Party thought it preferable not to limit the
scope of this provision to Chapters I - VI of the Havana
Charter, as.suggested by the representative of the Union of
South Africa, on the understanding that that representative
would be free to raise the matter again in the plenary
meeting.
17. Paragraph 2 : The changes introduced in the new draft
are the following : the proviso has 'been deleted as ho
longer necessary; the words "and superseded by the corres-
ponding provisions of the Charter" have been deleted in
order to make it clear that when the Charter comes into force
and so long as it remains in force, the.General Agreement
would be limited to the provisions of- Part Iand Part III
including* the annexes in so far as they relate to those two
parts. Lastly, the Working Party decided that it was pre-
ferable to keep Art. I as amended in the agreement, in view
of pertain technical difficulties.
The Working Party considered whether it was necessary
to provide in the text of paragraph 2 for such minor adjust-
ments.(e.g. in cross references) as may be necessary when
Paragraph 2 is. suspended; . it came to the conclusion that
there was no need to insert any specific provision to that
effect as such adjustments could be introduced by the Con-
tracting Parties at the time of the entry into force. of the
Charter.
18. The Working Party felt that it was not necessary to
retain sub-paragraph 2 (b) in view of the fact that Part II
would be suspended so that the functions of the CONTRACTING
PARTIES in conncction with that part of the agreement would
automatically be transferred to the I.T.O.
19. Paragraph 3 : The Working Party felt that it would be
clearer to deal with the two oases contemplated in Paragraph
4 of Article XXIX in separate paragraphs.. The date of
January 1, 1949 has been changed and the. meeting of the
Contracting Parties would have to take place before December
31, 1949 if the Havana Charter.has not entered into force by GATT/CP. 2/22/Rev.1
page 5
September 30 1949, which is the date mentioned in sub -
paragraph 2 (b) of Article 103 of the Charter.
20. Paragraph. 4: The Working Party thought it desirable
to provide for the automatic re-entry into force of the
provisions of Part II, if the Havana Charter should cease
to be in force; except for Article XXIII, the provisions
of these articles would adopt the same form as the articles
of the Charter at the time when it ceases to be in force.
21. Paragraph 5: reproduces in substance the provisions
of paragraph 3 of the present article XXIX; however it has
been found necessary to specify that until a special agree.-.
ment is arrived at with a contracting party not yet party
to the Havana Charter, that party would continue to be bound
by th6 provisions of Part II.
22.Paragraph 6:This new provision has been inserted in
order to state clearly that the provisions of the Havana
Charter would prevail over the provisions of the General
Agreement. As it would not have been appropriate to.
birid the Contracting Parties who would not be members of the
I.T.O. by the provisions of the Havana Charter, the Working
Party was of opinion that the provision should be worded
accordingly.
b) . Additions
23. Article 15 of the Charter. For the reasons set forth
order to state clearly that the provisions of the Havana
in paragraphs 2 and 3 of (this report, the Working Party felt
that it could not usefully recommend at this stage the
insertion of the provisions of Article 15 of the Charter in
the General Agreement, proposed by the Syrian and French
representatives. It was subsequently agreed to insert a new
paragraph in Article I in order to meet the views of the
Syrian represerntative (see paragraph 25 below).
24. Artcles 26, 27 and 28 of the Charter. While agreeing
desirable, the majority of the Working Party felt that it
view of practical difficulties, they could not usefully
recommend such inclusion at the present stage, It was of
course understood that, in the light of Paragraphs I qf
Article XXIX, the Contracting Parties undertake to apply the
principles of the Havana Charter relating to export subsidies
to the full extent of their executive authority. The
Brazilian representative agreed nqt to press at this stage
the inclusion of Articles 26, 27 ad 28 of the Charter, While
preserving its right to revert to this matter, should it
become clear that the Havana Charter will not come into force
at "the timee envisaged.
25. Article I: The Working Party agreed to recommend the
insertion of the new paragraph in article I in order to provide
for the special position of certain countries of the near East. GATT/CP.2/22/Rev.1
page 6
It was the view of the Working Party that under the proposed
new paragraph of Article I the Contracting Parties, in taking
action pursuant to Article XXV with respect to preferences
among countries formerly apart of the Ottoman Empire, would
be required to make a decision in accordance with the
principles and requirements off Article 15 of the Havana
Charter.
26. Article V: The working Party considered the suggestion
by the Pakistan representative with regard to the insertion
of the interpretative note ad Article 33, Paragraph 1, of the
Havana Charter and came to the conclusion that such insertion
was not necessary, since the text of Article 33, Paragraph 1
of the Charter tallied with that of Article V, paragraph 1,
of the General Agreement, and the Contracting Parties who all
signed the Final Act of the Conference of Havana could not
interpret these provisions in anyway other than that laid
down in the note ad Article 33 of the Charter. . The represen-
tative of Pakistan appreciated the justice of this conclusion
and agreed to withdraw his proposal on the understanding
that the Working Party would record this statement in its
27. Article XII: In view of the decision taken by the
Working Party to limit as far as practicable the number of
changes in the General Agreement, the representative of
Syria did not press his proposal to replace that article.
.28. Article XV: Taking -account of the recommendation .of
Sub-Committee F of the Third Committee of the Havana Con-
ference, the Working Party agreed to recommend the deletion
of the phrase : "Subject to paragraph 4 of this article" in
paragraph 9 of Article XV, which had been proposed by the
representative of France, in order to ensure consistency
with Article 24 of the Charter.
29. Article : The representative of Brazil had proposed
that in Article XVI the drafting changes adopted when Article
25 of the Havana Charter was drawn up should be inserted.
The Working Party agreed that the differences between Article
XVI of the General Agreement and Article 25 of the Havana
Charter are not of a substantive nature, and that accordingly:
a) the phrase "increased exports" in line .3 of Article
XVI of the General Agreement was intended to include the GATT/CP 2/22/Rev. 1
page 7
concept of maintaining exports at a level higher than would
otherwise exist in the absence of the subsidy, as made clear
in line 3 of Article 25 of the Havana Charter; and
b) the intent of the last sentence of Article XVI of
the General Agreement is that consultation shall proceed
upon the request of a contracting party when it considers
that prejudice is caused or threatened and would not require
a prior inter-national determination.
30. Article XIX: It was also the understanding of the
Working Party that the phrase "being imported... in such
increased quantities" in paragraph 1 (a) of Article XIX was
intended to corer cases where imports may have increased
relatively, as made clear in paragraph 1(a) of Article 40
of the Havana Charter.
31. Annex I: The Working Party recommends the replacement
of the words "provisions of Article 31 of the draft Charter
referred to in Article XXIX of this Agreement", in the
interpretive note any Article 2, Paragraph 4, contained in
Annex I by the words " provisions of Article 31 of the Havana
Charter." This drafting change suggested by the representa-
tive of the Netherlands does not involve any change in the
scope of the provision. It has been found necessary because.
the draft Charter would no longer be mentioned in Article
XXIX of the General Agreement if the Contracting Parties
accept the wording of that Article as proposed by the
Working Party.
32. The adoption of the amendments recommended by the Working
Party would involve certain drafting changes in the text of
Articles I, II, XIII and XXVI. These changes are self- explana-
tory. The Working Party also recommends that the intorpreta-
tive notes adopted at Havana in connection with the articles,
the text of which would be introduced in the General Agreement,
should be inserted in Annex I to the Agreement.
Protocols
33. The Working Party recommends to the CONTRACTING PARTIES
the adoption of the attached draft protocols to give effect
to the amendments described in the Report (Annex II)
34. Two protocols have been prepared, one covering amendments
to Part II and Art. XXVI of the Agreement, the other covering
amendments to Part I and Art. XXIX. The former protocol will
come into force upon acceptance by two-thirds of the con-
tracting parties the latter upon acceptance by all the
contracting parties.
35. The Working Party regarded the modifications contained in
each draft protocol as being indivisible and thus each protocol
is drafted as effecting one amendment only to the General
Agreement. It will not be possible, therefore, for a govern-
ment to accept one of the modifications made by either of the
protocols and not the others made in that same protocol.
3 6. The Working Party recommends that the CONTRACTING PARTIES
should adopt a recommendation that those of the contracting
parties which are not able to sign the protocols without
qualification at the conclusion of the Second Session should
deposit their instruments of acceptance not later than
Otctober 15, 1948. GATT/CP .2/22/Rev. 1
page 8 ANNEX I
1. Amend the phrase "paragraphs 1 and 2 of article III"
in Article I to read: "paragraphs 2 and 4 of Article III."
Insert the following paragraph as a new paragraph 3 in
Article I, the present paragraph 3 becoming paragraph 4:
"3. The provisions of paragraph 1 shall not apply
to preferences between the countries formerly a part
of the Ottoman Empire and detached from it on
July 24 ,1923 , provided such preferences are approved
under sub-paragraph 5(a) of Article XXV, which shall
be applied in this respect in the light of paragraph 1
of Article XXIX".
2. Amend the phrase "paragraphs 1 and 2 of Article III"
in the interpretive note to paragraph 1 of Article I to
read "paragraphs 2 and 4 of Article III",
1. Amend the phrase "paragraph 1 of Article III" in
paragraph 2(a) of Article II to read 'paragraph 2 of
Article III."
2. Replace the text of the interpretive note to
paragraph 4 of Article II by the following text:
"Except where otherwise specifically agreed between
the contracting parties which initially negotiated
the concession, the provisions of this paragraph
will be applied in the light of the provisions of
Article 3 of the Havana Charter."
Replace the text of Article III by the following text
(Article 18 of the Charter):-
National TreatmenJt on Internal Taxation and Regulations
1. "The contracting parties recognise that internal
taxes and other internal charges, and laws, regulations
and requirements affecting the internal sale, offering for
sale, purchase, transportation, distribution or use of
products, and internal quantitative regulations requiring
the mixture, processing or use of products in specified
amounts or proportions, should not be applied to imported
or domestic produces so as to afford protection to domestic
production.
20 "The products of the territory of any contracting
party imported into the territory of any other contracting
party shall not be subject, directly or indirectly, to
internal taxes or other internal charges of any kind in
excess of those applied, directly or indirectly, to like GATT/CP. 2/22/Rev. 1
page .9
domestic products. Moreover no contracting party shall
otherwise apply internal taxes or other internal charges
to imported or domestic products in a manner contrary to the
principles set forth in paragraph 1.
3. "With respect to any existing internal tax which is
inconsistent with the provisions of paragraph 2 but which
is specifically authorized under a trade agreement, in
force on April 10, 1947, in which the import duty on the
taxed product is bound against increase, the contracting
party imposing the tax shall be free to postpone the
application of the provisions of paragraph 2 to such tax
until such time as it can obtain release from the
obligations of such trade agreements in order to permit the
increase of such duty to the extent necessary to compensate
for the elimination of the protective element of the tax.
4. "The products of the territory of any contracting party
imported into the territory of any other contracting party
shall be accorded treatment no less favourable than that
accorded to like products of national origin in respect of
all laws, regulations and requirements affecting their
internal sale, offering for sale, purchase, transportation,
distribution or use. The provisions of this paragraph shall
not prevent the application of differential internal
transportation charges which are based exclusively on the
economic operation of the means of transport and not on the
nationality of the product.
5. "No contracting party shall establish or maintain any
internal quantitative regulation relating to the mixture,
processing or use of products in specified amounts or
proportion which requires directly or indirectly, that any
specified amount or proportion of any product which is the
subject of the regulation must be supplied from domestic
sources. Moreover, no contracting party shall otherwise
apply internal quantitative regulations in a manner contrary
to the principles set forth in paragraph 1.
6. "The provisions of paragraph 5 shall not apply to any
internal quantitative regulation in force in the territory of
any contracting party on July 1, 1939. April 10, 1997 or
March 24, 1948 at the option of that contracting party;
PROVIDED that any such regulation which is contrary to the
provisions of paragraph 5 shall, not be modified to the
detriment of imports and shall be subject to negotiation.
7. "No internal quantitative regulation relating to the
mixture processing or use of products in specified amounts
or proportions shall be applied in such a manner as to
allocate any such amount or proportion among external
sources of supply.
8. "(a) The provisions of this Article shall not apply to
laws, regulations or requirements governing the procurement
by governmental agencies of products purchased for
governmental purposes and not with a view to commercial
resale or with a view to use in the production of goods for
commercial sale. GATT/CP, 2/22/Rev.1
page 10
" (b) The provisions of this Article shall not prevent
the payment of subsidies exclusively to domestic producers,
including payments to domestic producers derived from the
proceeds of internal taxes or charges applied consistently
with the provisions of this Article and subsidies affected
through governmental purchases of domestic products.
9. "The contracting parties recognise that internal
maximum price control measures, even though conforming to
the other provisions of this article, can have effects
prejudicial to the interests of the contracting parties
supplying imported products. accordingly , contracting
parties applying such measures shall take account of the
interests of exporting contracting parties with a view to
avoiding to the fullest practicable extent such prejudicial
effects.
10. "The provisions of this Article shall not prevent any
contracting party from establishing or maintaining internal
quantitative regulations relating to exposed cinematograph
ffilms."
Any internal tax or other internal charge or any
law, regulation or requirement of the kind referred to in
paragraph 1 which applies to an imported product and to the
like domestic product and is collected or enforced in the
case of the imported product at the time or point of
importation, is nevertheless to be regarded as an internal
tax or other internal charge, or a law, regulation or
requirement of the kind referred to in paragraph 1 and is
accordingly subject to the provisions ofArticle III,
The application of paragraph 1 to internal taxes
imposed by local governments and authorities within the
territory of a contracting party is subject to the
provisions of paragraph 6 of Article XXIV. The torn
"reasonable measures" in the last-montioned paragraph would
not require, for example; the repeal of existing national
legislation authorizing local governments to impose
internal taxes which, although technically inconsistent with
the, letter of article III are not in fact inconsistent with
its spirit, if such repeal would result in a serious
financial hardship for the local governments or authorities
concerned. With regard to taxation by local government
or authorities which is inconsistent with both the letter
and spirit of Article III, the term "reasonable measures"
would permit a contracting party to eliminate the
inconsistent taxation gradually over a transition period,
if abrupt action would create serious administrative and
financial difficulties.
Paragraph 2
A tax conforming to the requirements of the first
sentence of paragraph 2 would be considered to be
inconsistent with the provisions of the second sentence only GATT/CP. 2/22/Rev. 1
page 11
in cases where competition was involved between. on. the one
.hands the taxed product and on the other hand, a directly
competitive or substitutable product which was not similarly
taxed.
Paragraph 5
Regulations consistent with the provisions of the first
sentence of paragraph 5 shall not be considered to be
contrary to the provisions of the second sentence in any
case in which all of the products subject to. the regulations
are produced domestically in substantial quantities.
A regulation cannot be justified as being consistent with
the provisions of the second sentence on the ground that the
proportion or amount allocated to each of the products which
are the subject of the regulation constitutes an equitable
relationship between imported and domestic products.
D.
Replace the text of Article VI by the following text
(Article 34 of the Charter):-
1. The contracting parties recognize that dumping, by
which products of one country are introduced into the
commerce of another country at less than the normal value of
the products, is to be condemned if it causes or threatens
material injury to an established industry in the territory
of a contracting party or materially retards the establishment
of a domestic industry. For the purposes of this Article; a
product is to be considered as being introduced into the
commerce of an importing country at less than its normal
values if the price of the product exported from one country
to another -
(a) is less than the comparable price, in the
ordinary course of trade, for the like product
when destined for consumption in the exporting
country .or,
(b) in the absence of such domestic price, is less than
either
(i) the highest comparable price for the like
product for export to any third country in the
ordinary course of trade, or
(ii) the cost of production of the product in the
country of origin plus a reasonable addition
for selling cost and profit.
Due allowance shall be made in each case for differences
in conditions and terms of sale, for differences in
taxation and for other differences affecting price
comparability.
2. In order to off set or prevent dumping. a contracting
party may levy on any dumped product an.anti-dumping duty
not greater in amount than the margin of dumping in respect GATT/CP. 2/22/Rev. 1
page 12
of such product. For the purposes of this Article, the
margin of dumping is the price difference determined in
accordance with the provisions of paragraph 1.
3. No countervailing duty shall be levied on any
product of the territory of any contracting party imported
into the territory of any other contracting party in excess
of an amount equal to the estimated bounty or subsidy
determined to have been granted directly or indirectly,
on the manufacturer production or export of such product
in the country of origin or exportation including any
special subsidy to the transportation of a particular
product. The tern "countervailing duty" shall be understood
to mean a special duty levied for the purpose of offsetting
any bounty or subsidy bestowed, directly or indirectly.
upon the manufacture, production or export of any
merchandise.
4. Noproduct of the territory of any contracting party'
imported into the territory of any other contracting.party
shall be subject to anti-dumping or countervailing duty by
reason of the exemption of such product from duties or
.taxes borne by the like product when destined. for
consumption in the country of origin or exportation, or by
reason of the refund of such duties or taxes.
5. No product of the territory of any contracting party
.imported into the territory of any other contracting party
shall be subject to both anti-dumping.and countervailing
duties to compensate for the same situation of dumping or
export subsidization.
6. No contracting party shall levy any anti-dumping or
countervailing duty on the importation of any product of the
territcry of another contracting party unless it determines
that the effect of the dumping or subsidization as the case
may be, is such as to cause or threaten material injury to
an established domestic industry, or is such as to retard
materially the establishment of a domestic industry. The
CONTRACTING PARTIES may waive the requirements of this
paragraph so as to permit a contracting party to levy an
anti-dumping or countervailing duty on the importation of
any product for the purpose of offsetting dumping or
subsidization which causes or threatens material injury to
an industry in the territory of. another contracting party
exporting the product. concerned to the territory of the
importing contracting party.
7. A system for the stabilization of the domestic price
or of the return to domestic producers of a primary commodity,
.independently of the movements of export prices, which
results at times in the sale of the commodity for export at
.a price lower than the comparable price charged for the like
commodity to buyers in the. domestic market, shall be presumed
not to result in material injury within the meaning. of
paragraph 6 if it is determined by consultation among the
contracting parties substantially interested in the commodity
concerned that: GATT/CP. 2/22/Rev. 1
page 13
(a) the system has also resulted in the sale of the
commodity for export at a price higher than thes
comparable price charged for the like commodity to
buyers in the domestic market; and
(b) the system is so operated, either because of the
effective regulation of productions or otherwise,
as not to stimulate exports unduly or otherwise
.seriously prejudice the interests of other
contracting parties.
Interpregtative Note ad Article VI
Paragraph 1
Hidden dumping by associated houses (that is, the sale
by an importer at a price below that corresponding to the
price invoiced by an exporter with whom the importer is
associated and also below the price .n. the exporting country)
constitutes a form of price lumping with respect to which the
margin of sumping may be calculated on the basis of the price
at-which the goods are resold by the importers
Paragraphs 2 and 3
Note 1
As in many other cases in customs administration, a
contracting party may require reasonable security (bond or
cash deposit) for the payment of anti-dumping or counter-
vailing duty pending final determination of the facts in any
case of suspected clumping or subsidization.
Note 2
Multiple currency practices can in certain circumstances
constitute a subsidy to exports which may be met by
countervailling duties under paragraph 3 or can constitute a
form of dumping by means of a partial depreciation of a
country's currency which may be met by action under
paragraph 2. By "multiple currency practices" is meant
practices by governments or sanctioned by governments.
E.
Delete the phrase "and to any internal regulation or
requirement under paragraphs 3 and 4 of Article III" in
paragraph 5 of Article XIII.
Delete the introductory phrase to paragraph 9 of
Article XV which reads as follows:-
"Subject to the provisions of paragraph 4 of this
Article". GATT/CP . 2/22/Rev. 1
page 14
Replace the text of Article XVIII by the following text
(Article 13 and the relevant part of Article 14 of the Char.ter):
Article XVIII
.GOVERNMENTAL ASSISTANCE. TO ECONOMC DEVELOPMENT
AND RECONSTRUCTION
1. "The contracting parties recognise that special
governmental assistance may be required to promote the
establishment, development or reconstruction of particular
industries or branches of agriculture, and that in
appropriate circumstances the grant of such assistance in
the form of protective measures is justified. At the
sate time they recognise that an unwise use of such
measures would impose undue burdens on their own economies
and unwarranted restrictions on international trade, and
might increase unnecessarily the difficulties of adjustment
for the economies of other countries.
2. "The CONTRACTING PARTIES and the contracting parties
concerned shall preserve the utmost secrecy in respect of
matters arising under this Article.
A.
3. If a contracting party, in the interest of its
economic development or reconstruction, or for the purpose
of increasing a most-favoured-nation rate of duty in
connection with the establishment of a new preferential
agreement in accordance with the provisions of paragraph 3
of Article I, considers it desirable to adopt any non-
discriminatory measure which would conflict with an
obligation which the contracting party has assumed under
Part II of this Agreement, but which would not conflict
with other provisions of this Agreement, such contracting
Party
"(a) shall enter into direct negotiations with all the
other contracting parties. The appropriate schedules
to this agreement shall be amended in accordance with
any agreement resulting from such negotiations; or;
(b) shall initially or may, in the event of failure
to reach agreement under sub-paragraph (a), apply to
the CONTRACTING PARTIES. The CONTRACTING PARTIES
shall determine the contracting party or parties
materially affected by the proposed measure and shall
sponsor negotiations between such contracting party
or.parties and the applicant contracting party with.a
view-to obtaining expeditious and substantial
agreement. The CONTRACTING PARTIES :shall establish
and communicate to the contracting parties concerned
a time schedule for such negotiations following as
far as practicable any time schedule which may have
been proposed by the applicant contracting party. The GATT/CP. 2/22/Rev. 1
page 15
contracting parties shall commence and proceed
continuously with such negotiations in accordance
with the time schedule established by the CONTRACTING
PARTIES. At the request of. a contracting party, the
CONTRACTING PARTIES may; whers they concur in principle
with the proposed measure, assist in the negotiations.
Upon substantial agreement being reached, the applicant
contracting party maybe released by the CONTRACTING
PARTIES from the obligation referred to in this
paragraph, subject to such limitations as may have
been agreed upon in the negotiations between the
contracting. parties concerned.-
4. "(a) If as a result of action initiated under
paragraph 3 there should be an increase in imports of any
product concerned, including products which can be directly
substituted therefor, which if continued would be so great as.
to jeopardise the establishment, development or reconstruction
of the industry, or branch of agriculture. concerned, and if
no preventive measures consistent with the provisions of this
Agreement can be found which seem likely to prove effective,
the applicant contracting party may, after informing, and
when practicable consulting with, the CONTRACTING PARTIES,
adopt such other measure's as the situation may require,
provided that such measures do not restrict imports more
than necessary to offset the increase in imports referred
to in this sub-paragraph; except in unusual circumstances,
such measures shall not reduce imports below the level
obtaining in the most recent representative period preceding
the date on which the contracting party initiated action
under paragraph 3.
"(b) The CONTRACTING PARTIES shall determine, as soon
as possible whether any such measures should be continued,
discontinued or modified. It shall in any case be
terminated as soon as the CONTRACTING PARTIES detrmine that
the negotiations are completed or discontinued.
"(c) It is recognised that the relationship between
contracting parties preferred to in paragraph 3.involves
reciprocal. advantages, and therefore any contracting party
whose trade is materially affected.by the action may suspend
the application to the trade of the applicant contracting
party of substantially equivalent obligations or concessions
under this Aagreement provided that the contracting party
concerned has consulted the CONTRACTING PARTIES before taking
such action and the CONTRACTING PARTIES do not disapproved.
B.
5. "In the case of any non-discriminatory measure affecting
imports which would apply to any product in respect of which
the contacting party has assumed an obligation under
Article IIof this Agreement and which conflicts with any
other provision of this Agreement, the provisions of sub.
paragraph (b) of paragraph 3 shall apply; PROVIDED that
before granting a release the CONTRACTING PARTIES shall
afford adequate opportunity for all contracting parties
which they determine to be materially affected to express GATT/CP.2/2/Rev. 1
page 16
their views. The provisions of paragraph 4 shall also be
applicable in this. case.
C.
6. "If a contracting party in the interest of its economic
development or reconstruction considers. it desirable to adopt.
any non-discriminatory measure affecting imports which would.
conflict with the provisions of this Agreement other than
Article II, but which would not apply to any product in
respect of which the contracting party has assumed an
obligation under Article II, such contracting party shall
notify the CONTRACTING PARTIES and shall tranismit to the
CONTRACTING PARTIES a written statement of the considerations
in support of the adoption, for a specified period, of the
proposed measure.
7. "(a) On application by such contracting party to
CONTRACTING PARTIES shall concur in the proposed measure and.
grant the .necessary release for a specifiedd period if,
having particular regard to the applicant contracting party's
need for economic, development or reconstruction, it is
established that the measure
(i) is designed to protect a particular industry
established between January 1 .1939.and March 24,
1948 which. was protected during, that period of
its development by abnormal conditions arising. nut
of the war;. or
(ii) is designed to promote the establishment or.
development of a parties industry for the
processing of an indigenous primary commodity
when the external sales of such comodity have
been materially reduced as a result of new or
increased restrictions imposed abroad; or.
(iii) is necessary, in view of the possibilities. and
resources of the applicant contracting party to
promote the establishment or development of a
particular industry for the processing of
indigenous primary commodity, or for the
processing of a by-product of. such industry.
which would otherwise be wasted, in . order to
achieve a .fuller and more economic use of the
applicant contracting party's natural resources
and manpower and in the long run, to raise. the
standard of living within the territory of the
applicant contracting party, and is unlikely to
have a harmful effect, in the long run on
international, trade; or.
(iv) is unlikely to be more restrictive of .inter-
national trade than any other. practicable and
reasonable . measure permitted under this Agreement,
which could be imposed without undue difficulty,
and is the one most. suitable for the purpose
having regard to the economies of the. industry or
branch of agriculture concerned and to the
applicant contracting party's need for economic
development or reconstruction . GATT/CP.2/22/Rev.1
page 17
"The foregoing provisions of this sub-paragraph are subject
to the following conditions:
(1) any proposal by the applicant contracting party
to apply any such-measure, with or without
modification, after the end of the initial
period, shall not be subject to the provisions
of this paragraph; and
(2) the CONTRACTING PARTIES shall not concur in any
measure under the provisions of (i), (ii) or
(iii) above which is likely to cause serious
prejudice to exports of a primary commodity on
vb±h the economy of the territory of another
contracting party is largely dependent.
"(b) The applicant contracting party shall apply any
measure permitted under sub-paragraph (a) in such a way as
to avoid unnecessary damage to the commercial or economic
interests of any other contracting party"
8: "If the proposed measure does not fall within the
provisions of paragraph 7, the contracting party
.(a) may enter into direct consultations with the
contracting party or contracting parties which,
in its judgment would be materially affected by
the measure. At the same time, the contracting
party shall inform the CONTRACTING PARTIES of
such consultations in order to afford them an
opportunity to determine whether all materially
affected contracting parties are included within
the consultations. Upon complete or substantial
agreement being reached, the contracting party
interested in taking the measures shall apply: to
the CONTRACTING PARTIES : The CONTRACTING PARTIES
shall promptly examine the application to ascertain
whether the interests of all the materially
affected contracting parties have been duly
taken into account. If the CONTRACTING PARTIES
reach this conclusion, with or without further
consultations between the contracting parties
concerned they shall release the applicant
contracting party from its obligations under the
relevent provisions of th s Agreement subject to
such limitations as the CONTRACTING PARTIES may
impose, or
(b) may initially, or in the event of failure to reach
complete or substantial agreement under sub.
paragraph (a) apply to the CONTRACTING. PARTIES.
The CONTRACTING PARTIES shall promptly transmit the
statement submitted under paragraph 6 to the
contracting party or contracting parties which are
determined by the CONTRACTING PARTIES to be
materially affected by the proposed measure;
Such contracting party or contracting parties
shall within..the time. limits prescribed by the
CONTRACTING PARTIES, inform them whether, in the
light of the anticipated effects on the economy
of the territory of such contracting party or
parties, there is any objection to the proposed
measure. The CONTRACTING PARTIES shall, GATT/CP.2/22/Rev. 1
page 18
(I) if there is no objection to the proposed
measure on the part of the affected
contracting party or contracting parties,
immediately release the applicant
contracting party from its obligations
under the relevant provision of thi
Agreement; or.
(ii) if there is objection, promptly. examine.
the proposed measure having regard to the
provisions of this Agreement,to the
considerations presented by the applicant
contracting party and its need or economic
development or reconstruction, to the.
views of the contracting party or contracting
parties determined to be materially affected,
and to the effect which the proposed measure,
with or without modifications is. likely to
have, immediately and in the long run, on
international trade and, in the long run,
on the standard of living within the
territory of the applicant contracting
party. If, as a result of such examination,
the CONTRACTING PARTIES concur in the.
proposed measure, with or without
modification, they shall release the
applicant contracting party from its
obligations under the relevant provisions
of this Agreement, subject to such
limitations as they may impose.
9. "If. in anticipation of the concurrence of the
CONTRACTING PARTIES in the adoption of a measure referred .to
in.paragraph 6, there should be an increase or threatened
increase in the imports of any product concerned, including
products which can be directly substituted therefor, so
substantial as to Jeopardize the establishment, development
or reconstruction of the industry or branch of agriculture.
concerned, and if no preventive measures consistent with
this Agreement can be fund which seem likely to prove
effective, the applicant contracting party may, after
informing. and when practicable consulting with, the
CONTRACTING PARTIES, adopt such other measures as the
situation may require, pending a decision by the CONTRACTING
PARTIES on the contracting party's application; . PROVIDED
that such measures do not reduce imports below the level
obtaining in the most recent representative period preceding
the date .on which notification. was given under paragraph 6.
10. "The CONTRACTING PARTIES shall at the earliest
opportunity but ordinary within fifteen days after receipt
of an application under' the provisions of paragraph 7 or
sub-paragraphs (a) or (b) of paragraph 8, advise the
applicant contracting party of the date by which it will be
notified whethe or not it is released from the relevant
obligation. This shall be the earliest practicable date
and not later than ninety days after receipt of such
application:PROVIDED that if unforeseen difficulties
arise before the date set, the period maybe extended after
consultation with the applicant contracting party. If the GATT./CP.2/22/Rev, 1
page 19
applicant contracting party is not so notified by the date
set, it may, after informing the CONTRACTING PARTIES,
institute the proposed measyre.
11: "Any contracting party may maintain any non-
discrimentatory protective measure affecting imports in force
on September 1, 1947 which has been imposed for the
eestablishment, development or reconstruction of a particular
industry or branch of agriculture and which is not otherwise
permitted by this Agreement: PROVIDED that notification has
been given to the other contracting parties no later than
October 10, 1947 of such measure and of each product on which
it is to be maintained and of its nature and purpose.
12. Any contracting party maintaining any such measure
shall within sixty days of becoming a contracting party
submit to the CONTRACTING PARTIES a statement of the
considerations in support of the maintenance of the measure
and the periods for which it wishes to maintain it The
CONTRACTING PARTIES shall as soon as possible, but in any
case within twelve months from the day of such contracting
party becoming a contracting party, examine and given a
decision concerning the measure as if it had been submitted.
to.the CONTRACTING PARTIES for their concurrence under the
provisions of the preceding paragraphs of this Article.
13 The provisions of paragraphs 11 and 12 of this Article
shall not apply to any measure in conflict with obligations
under Article II of this Agreement:
14. In cases where the CONTRACTING PARTIES decide that a
measure should be modified or withdrawn by a specified date,
they shall have regard to the possible need of a contracting
party for a period of tine in which to make such modification
or withdrawal."
Interpretative note ad Article XVIII
Paragraphs 7 (a) (ii) and (iii)
The word "processing", as used in these sub- paragraphs,
means the transformation of a primary commodity or of a by-
product of such transformation into semi-finished or finished
goods but does not refer to highly developed industrial
processes .
Delete sub-paragraph5(b) of markets XXI
I.
Replace the text of Article XXIX by the following, text:
The Relation f this Agreement to the Havana Charter
1. "The contracting parties undertake to observe to the
fullest extent of their executive autherity the general
principles oof the Havana Charter pending their acceptance of
it in accordance within-their constintional procedures GATT/CP 2/22/Rev. 1
page 20
2. Part II of this Agreement shall be suspended on the
day on which the Havana Charter enters into force'
3. If by September 30, 1949, the Havana Charter has not'.
entered into force, the contracting parties shall meet
before December 31, 1949 to agree whether this Agreement shall
be amended, supplemented or maintained.
4. If at any time the Havana Charter should cease to be
in force, the contracting parties shall mee as soon as
practicable thereafter to agree whether this Agreement shall
be supplemented, amended or ,maintained: Pending such
Agreement, Part II of this Agreement shall again enter into
force provided that the provisions of Part II other than
Article XXIII shall be replaced, mutatis mutandis, in the
form in which they then appeared in the Havana Charter:
5. If any contracting party has not accepted the Havana
Charter by the date upon which it enters into forces the
contracting parties shall confer to agree whether, and if so
in what way, this Agreement insofar as it affects relations
between such contracting party and other contracting parties,
shall be supplemented or amended. Pending such agreement
the provisions of Part II of this Agreement shall ,notwith-
standing the provisions of paragraph 2 of this Article
continue to apply as between such contracting party and
other contracting parties.
6. . Contracting parties which are Members of the Inter-
national Trade Organtization shall riot invoke the provisions
of this Agreement so as to prevent the operation of any
provision of the Havana Charter. The application of the
principle underlying this paragraph to any contracting party
which is not a Member of the International Trade Organization
shall be the subject of an agreement pursuant to paragraph 5
of this Article." GATT/CP .2/22/Rev. 1
page 21
1) PROTOCOL MODIFYING PART II AND ARTICLE XXVI OF THE
GENERAL AGREEMENT ON TARIFFS AND TRADE.
The Governments of acting
in their capacity of contracting parties to the General
Agreement on Tariffs and Trade (hereinafter referred to
as the Agreement),
desiring to effect an amendment to the Agreement,
pursuant to the provisions of Article XXX thereof,
HEREBY AGREE AS. FOLLOWS:-
1. The texts of Articles III, VI, XIII, XV, XVIII and XXVI
of the Agreement and certain related provisions in Annex I.
shall be modified as follows:
2. This Protocol, done in a single English and a single
French originalboth texts .authentic shall, following its
signature at the close of the Second Session of the
Contracting Parties, be deposited with the Secretary-General
of the United Nations, The deposit of the Protocol will,
as. from the date of deposits constitute .the deposit of the
instruments of acceptance of the amendment set out in
paragraph 1 of this Protocol by any government whose
representative has signed without qualification. The
instruments of acceptance of other governments will be
deposited with the Secretary-General of the Uniited Nations.
3. The amendment set out in paragraph 1 of this Protocol
shall enter into force upon acceptance of it by two thirds
of the governments which are at that time contracting parties,
4. The Secretary-General of the United Nations will inform
all interested governments of each acceptance of the amend,
meftt set out in this Protocol and of the date upon which
such amendment enters into force. The Secretary-General is
authorized to effect registration of this Protocol at the
appropriate time.
IN WITNESS 'WHEREOF the respective representatives duly
authorized to that effect, have signed the present Protocol.
DONE at Geneva this day of September thousand nine
hundred and forty eight. |
GATT Library | vt042bm4634 | Report of Working Party No. 3 on Modifications to the General Agreement | General Agreement on Tariffs and Trade, August 27, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 27/08/1948 | official documents | GATT/CP.2/22 and GATT/CP.2/13/Add.2,3 CP.2/14-22, CP.2/22/Add.1,Corr.1 | https://exhibits.stanford.edu/gatt/catalog/vt042bm4634 | vt042bm4634_90320034.xml | GATT_147 | 8,154 | 51,959 | RESTRICTED
Limited B
GATT/CP. 2/22.
August 27, 1948.
ORIGINAL: ENGLISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
CONTRACTING PARTIES
SECOND SESSION.
Report of Working Party No. 3 on Modifications
to the General Agreement
1.: In accordance with its terms of reference, the Working
Party considered the specific proposals which had been
submitted during the discussion in plenary session. It also
exchanged views on various suggestions submitted by several
of its members.
2. After a full discussion during which representatives
of the Contracting Parties explained the administrative,
constitutional and other difficulties which would result
for some if the present text of Part II of the General
Agreement were to stand, and for others it the corresponding
Articles of the Havana Charter were substituted immediately,
the Working Party reached the conclusion that a solution
should be sought which facilitated early ratification of
the Charter and final acceptance of the Agreement, and which
encouraged Governments represented at the Havana Conference
to accede to the Agreement within the shortest possible time.
3. With regard to the immediate replacement of Articles in
Part II, the Working Party noted that since Part II of the
General Agreement would be suspended in the Havana Charter
when the latter enters into force, any amendments to those
articles at this stage would be operative only during the
relatively short period between now and the Charter's entry
into force. That being the case, the Working Party con-
sidered that the same procedure should be followed as at the
first session, ike., to limit amendments to cases where the
retention of the present provisions of Part II would create
serious difficulties for Contracting Parties.
The Working Party accordingly recommends the replacement
of the following Articles by the corresponding provisions of
the Havana Charter :
(a) Article III.(to be replaced by the provisions of
Article 18 of the Charter)
(b) Article VI (to be replaced by the provisions of
Article 34 of the Charter)
(c) Article XVIII (to be replaced by the provisions
of Articles 13 and 14 of the Charter)
5, The Working Party agreed to recommend the insertion
as paragraph 3 of Article I of provisions corresponding to
those of Paragraph 3 of Article 16 of the Charter, and the
deletion of the opening phrase in paragraph 9 of Article XV.
6. In addition, the Working Party proposes a re-wording
of Article XXIX in order to eliminate certain purely tem-
porary provisions and to clarify certain points the GATT/CP. 2/22
page 2
interpretation of which may give rise to difficulties. As
Article XXIX is contained in Part III of the General Agree-
ment, this text as. amended will remain operative after the
entry into force of the Havana Charter.
7. Finally, the Working Party proposes a purely formal
amendment to the text of the interpretative note ad Article
II, paragraph 4, and various other drafting amendments con-
sequent on modifications which it recommends for adoption.
8. The text of the various amendments suggested is repro-
duced in Annex I.
9. For practical reasons, the Working Party has not
recommended further amendments to the text of the Agreement.
As explained in the following paragraphs of this report,
various proposals for amendments have been withdrawn on the
understanding that statements designed to clarify the intent
of the relevant provisions would be inserted in the report
of the Working Party. Moreover, if difficulties in applica-
tion were to arise before the entry into force of the Charter,
the Contracting Parties would still have the possibility
under the terms of Article XXV to settle such cases in the
light of the provisions of paragraph 1 of Article XXIX.
10. The Contracting Parties will find below a brief state-
ment of the considerations behind the attitude adopted by the
Working Party with regard to the various proposals submitted.
a) Replacements
11. Article III : The Working Party recognised that if the
present text were maintained, there was a risk of difficulties
for certain Governments, such as the Chinese and the
Norwegian which expressed reservations when the text of
Article 1 of the Geneva Draft (reproduced in substance in
Article III of the Agreement) was adopted by the Preparatory
Committee. It also noted that administrative difficulties
might arise in the case of countries which would have to
change their fiscal regulations twice - on acceptance of the
Agreement, and again on ratification of the Charter. Finally,
it recognised that the wording adopted at-Havana was clearer
and more precise than the text as it now stood.
12. Article VIII : In view of the decision taken by the
Working Party to limit so far as practicable the number of
amendments, the Norwegian representative did not press his
proposal to replace this article.
13. Article XVIII : The provisions relating to governmental
assistance to economic development or reconstruction were
discussed at length at Havana; if paragraphs 1 - 5 of
Article XVIII were replaced by the provisions of Article 13
of the Havana Charter there would be a greater incentive to
under-developed countries which participated in the work of
the Havana Conference to accede to the General Agreement. The
substitution in question would also make it easier for some
Contracting Parties to obtain the approval of their Parlia-
ments when they come to submit the General Agreemerit to their
legislatures. Paragraphs 6 and 7 of Art. XVIII have also been
redrafted in order to incorporate the substance of Article 14 GATT/CP.2/22
page 3
of the Havana Charter. The representative of Brazil did not
feel that the text recommended for Paragraph 11 of Article
XVIII was a faithful rendering of Paragraph 1(a) of Article
14 of the Charter; he proposed either to insert the words
"or such other date as the CONTRACTING PARTIES may in
special. circumstances decide" after "September 1, 1947" and
after "October 10, 1947" or, alternatively, to add at the
end of Paragraph 11 the following provision contained in
sub-paragraph 1(a) of Art. 14 of the Charter : "except that
if in special circumstances the CONTRACTING PARTIES agree to
dates other than those specified in this paragraph, such
other dates shall apply".
14. Article XXIX . The Workingonarty proceeded on the
basis of the text given in document GATT/CP.2/12 of which
there had been a preliminary examination at the first
session. The text recommended by the Working Party incor-
porates various suggestions put forward in the course of
the discussion.
15. Paragraph 1 : The new text reproduces the substance of
Paragraph 1 of Article XXIX, with certain drafting changes.
The Working Party thought it preferable not to limit the
scope of this provision to Chapters I - VI of the Havana
Charter, as suggested by the representative of the Union of
South Africa, on the understanding that that representative
would be free to raise the matter again in the plenary
meeting.
16. Paragrph 2 : The changes introduced in the new draft
are the following : the proviso has been deleted as no
longer necessary; the words "and superseded by the corres-
ponding provisions of the Charter" have been deleted in
order to make it clear that when the Charter comes into force
and so long as it remains in force, the General Agreement
would be limited to the provisions of Part I and Part III,
including the annexes in so far as they relate to those two
parts. Lastly, the Working Party decided that it was pro-
ferable to keep Art. I as amended in the agreement, in view
of certain technical difficulties.
The Working Party considered whether it was necessary
to provide in the text of paragraph 2 for such minor adjust-
ments (e.g. in cross references) as may be necessary when
Paragraph 2 is suspended; it came to the conclusion that
there was no need to insert any, specific provision to that
effect as such adjustments could be introduced by the Con-
tracting Parties at the time of the entry into force of the
Charter.
17, The Working Party felt that it was not necessary to
retain sub-paragraph 2 (b) in view of the fact that Part II
would be suspended so that the functions of the CONTRACTING
PARTIES in connection with that part of the agreement would
automatically be transferred to the I.T.O.
18. Paragraph 3 : The Working Party felt that it would be
clearer to deal with the two cases contemplated in Paragraph
4 of Article XXIX in separate paragraphs. The date of
January 1, 1949 has been changed and the meeting of the
Contracting Parties would have to take place before December
31, 1949 if the Havana Charter has not entered into force by GATT/CP. 2/22
page 4
September 30, 1949, which is the date mentioned in sub-
paragraph 2 (b) of Article 103 of the Charter.
19. Paragraph 4 : The Working Party thought it desirable
to provide for the automatic re-entry into force of the
provisions of Part II, if the Havana Charter should cease
to be in force; except for Article XXIII, the provisions
of these articles would adopt the same form as the articles
of the Charter at the time when it ceases to be in force;
it is contemplated that the final text of the General Agree-
ment would be agreed upon at a meeting of the Contracting
Parties.
20. Paragraph 5 : reproduces in substance the provisions
of Paragraph 3 of the present article XXIX; however it has
been found necessary to specify that until a special agree-
ment is arrived at with a contracting party not yet party
to the Havana Charter, that party would continue to be bound
by the provisions of Part II.
21. Paragraph 6 : This new provision has been inserted in
order to state clearly that the provisions of the Havana
Charter would -revail over the provisions of the General
Agreement. As it would not have been legally possible to
bind the Contracting Part'es who would not be members of the
I.T.0. by the provisions of the Havana Charter, the Working
Party was of opinion that the provision should be worded
accordingly.
b) Additions
22. Article 15 of the Charter. For the reasons set forth
in paragraphs 2 and 3 of this report, the Working Party felt
that it could not usefully recommend at this stage the
insertion of the provisions of Article 15 of the Charter in
the General Agreement, proposed by the Syrian and French
representatives. It was subsequently agreed to insert a new
paragraph in Article I in order to meet the views of the
Syrian representative (see paragraph 17 below).
23. Articles 26, 27 and 28 of the Charter. While agreeing
in principle that insertion of this Article would be
desirable, the majority of the Working Party felt that in
view of practical difficulties, they could not usefully
recommend such inclusion at the present stage. It was of
course understood that, in the light of Paragraph I of
Article XXIX, the Contracting Parties undertake to apply the
principles of the Havana Charter relating to export subsidies
to the full extent of their executive authority. The
Brazilian representative agreed not to press at this stage
the inclusion of Articles 26, 27 and 28 of the Charter, while
reserving its right to revert to this matter, should it
become clear that the Havana Charter will not come into force
at the time envisaged.
c) Other Changes
2. Article I: The Working Party agreed to recommend the
insertion of a new paragraph in article I in order to provide
for the special position of certain countries of the near East, GATT/CP. 2/22.
page 5
It was the view of the Working Party that under the proposed
new paragraph of Article I the Contracting Parties, in taking
action pursuant to Article XXV with respect to preferences
among countries formerly a part of the Ottoman Empire, would
be required to make a decision in accordance with the
principles and requirements of Article 15 of the Havana
Charter.
25, Article V: The Working Party considered the suggestion
by the Pakistan representative with regard to the insertion
of the interpretative note ad Article 33, Paragraph 12 of the
Havana Charter and came to the conclusion that such insertion
was not necessary, since the text of Article 33,'Paragraph 1
of the Charter tallied with that of Article V, paragraph 1,
of the General Agreement, and the Contracting Parties who all
signed the Final Act of the Conference of Havana could not
interpret these provisions in any way. other than that laid
down in the note ad Article 33 of the Charter. The represen-
tative of Pakistan appreciated the justice of this conclusion
and agreed to withdraw his proposal on the understanding
that the Working Party would record this statement in its
report.
26. Article VI: While agreeing that there is no substan-
tive difference between Article VI of the General Agreement
and Article 34 of the Charter, the Working Party recommend
the replacement of that Article as the text adopted at
Havana contains a useful indication of the principle govern-
ing the operation of that Article. and constitute a clearer
formulation of the rules laid down in that Article. The
Working Party, endorsing the views expressed by Sub-committee
C of the Third Committee of the Havana Conference, agreed
that measures other than compensatory anti-dumping and
countervailing duties may not be applied to counteract
dumping or subsidization except in so far as such other
measures are permitted under other provisions of the General
Agreement.
27. Article XII In view of the decision taken by the
Working Party to limit as far as practicable the number of
changes in the General Agreement, the representative of
Syria did not press his proposal to replace that article.
28, Article XV : Taking account of the recommendation of
Sub-Committee F of the Third Committee of the Havana Con-
ference, the Working Party agreed to recommend the deletion
of the phrase : "Subject to paragraph 4 of this article" in
paragraph 9 of Article XV, which had been proposed by the
representative of France, in order to ensure uniformity with
the text of Article 24 of the Charter.
29. Article XVI : The representative of Brazil had proposed
that in Article XVI the drafting changes adopted when Article
25 of the Havana Charter was drawn up should be inserted.
The Working Party agreed that the differences between Article
XVI of the General Agreement and Article 25 of the Havana
Charter are not of a substantive nature, and that accordingly:
a) the phrase "increased exports" in line 3 of Article
XVI of the General Agreement was intended to include the GATT/CP. 2/22.
page 6
concept of maintaining exports at a level higher than would
otherwise exist in the absence of the subsidy, as made clear
in line 3 of Article 25 of the Havana Charter; and
b) the intent of the last sentence of-Article XVI of
the General Agreement is that consultation shall proceed
upon the request of a contracting party when it considers
that prejudice is caused or threatened and. would not require
a prior inter-national determination.
30. Article XIX: It was also the understanding of the
Working Party that the phrase "being imported ..... in such
increased quantities" in paragraph l (a) of Article XIX was
intended to cover cases where imports may have increased
relatively, as made clear in paragraph 1 (a) of Article 40
of the Havana Charter.
31. Annex I : The Working Party recommends the replacement
of the words "provisions of Article 31 of the draft Charter
referred to in Article XXIX of this Agreement", in the
interpretative note ad Article 2, Paragraph 4, contained in
Annex I, by the wo-ds "provisions of Article 31 of the Havana
Charter", This drafting change suggested by the represen-
tative of the Netherlands does not involve any change in the
scope of the provision, has been found necessary as the
draft Charter would no longer be mentioned in Article XXIX
of the General Agreement if the Contracting Parties accept
the wording of that Article as proposed by the Working Party.
32. The adoption of the amendments recommended by the
Working Party would involve certain drafting changes in the
text of Articles I, II, XII, XIII and XXVI. These changes
are self-explanatory. The Working Party also recommends that
the interpretative notes adopted at Havana in connection with
the articles, the text of which would be introduced in the
General Agreement, should be inserted in Annex I to the
Agreement.
33. The Working Party set up a Legal Working Group to
consider the means of giving effect to the amendments
recommended; the report of the Legal Working Group is under
consideration and the Working Party will submit its recom-
mendations in a further report to the Contracting Parties. ANNEX I GATT/CP,2/22
page 7
A.
1. Amend the phrase "paragraphs 1 and 2 of Article III"
in Article I to read: "paragraphs 2 and 4 of Article III."
Insert the following paragraph as a new paragraph 3 in
Article I, the present paragraph 3 becoming paragraph 4:
"3. The provisions of paragraph 1 shell not apply
to preferences between the countries formerly a part
of the Ottoman Empire and detached from it on
July 24, 1923, provided such preferences are approved
under paragraph 5 of Article XXV which shall be
applied in this respect in the light of paragraph 1
of Article XXIX".
2. Amond the phrase "paragraphs 1 and 2 of Article III"
in the interpretative note to paragraph 1 of Article I to
read "paragraphs 2 and 4 of Article III".
1. Amend the phrase "paragraph 1 of Article III" in
paragraph 2 (a) of Article II to read "paragraph 2 of
Article III.",
2. Replace the text of the interpretativee note to
paragraph 4 of Article II by the following text.
"Except where otherwise specifically agreed between
the contracting parties which intially negotiated
the concession, the provisions of this paragraph
will be applied in the light of the provisions of
Article 3 of the Havana Charter."
C.
Replace the text of Article III by the following text
(Article 18 of the Charter):-
Artricle Ill.
National Treatment on Internal Taxation and Regulations
1. "The contracting parties recognise that internal
taxes and other internal charges, and laws, regulations
and requirements affecting the internal sal.; offering for
sale) purchase, transportation distribution or use of
products; and internal quantitative regulations requiring
the mixture, processing or use of products in specified
amounts or proportions, should not be applied to imported
or domestic products so as to afford protection to domestic
production.
2. "The products of the territory of any contracting
party imported into the territory of any other contracting
party shall not be subject; directly or indirectly, to
internal taxes or other internal charges of any kind in
excess of those applied, directly or indirectly, to like GATT/CP.2/22
page 8
domestic products. Moreover, no contracting party shall
otherwise apply internal taxes or other internal charges
to imported or domestic products in a manner contrary to the
principles set forth in paragraph 1.
3. "With respect to any existing internal tax which is
inconsistent with the provisions of paragraph 2 but which
is specifically authorized under a trade agreements in
force on April 10, 1947, in which the import duty on the
taxed product is bound against increase, the contracting
party imposing the tax shall be free to postpone the
application of the provisions of paragraph 2 to such tax
until such time as it can obtain release from the
obligations of such trade agreements in order to permit the
increase of such duty to the extent necessary to compensate
for the elimination of the protective element of the tax.
4. "The products of the territory of any contracting party
imported into the territory of any other contracting party
shall be accorded treatment no less favourable than that
accorded to like products of national origin in respect of
all laws, regulations and requirements affecting their
internal sale, offering for sale, purchase transportation
distribution or use. The provisions of this paragraph shall
not prevent the application of differential internal
transportation charges which are based exclusively on the
economic operation of the means of transport and not on the
nationality of the product.
5. "No contracting party shall establish or maintain any
internal quantitative regulation relating to the mixture,
processing or use of products in specified amounts or
proportion which requires, directly or indirectly, that any
specified amount or proportion of any product which is the
subject of the regulation must be supplied from domestic
sources. Moreover, no contracting party shall otherwise
apply internal quantitative regulations in a manner contrary
to the principles set forth in paragraph l.
6. "The provisions of paragraph 5 shall not apply to any
internal quantitative regulation in force in the territory of
any contracting party on July 1, 1939, April 10, 1947 or
March 24, 1948 at the option of that contracting party;
PROVIDED that any such regulation which is contrary to the
provisions of paragraph 5 shall not be modified to the
detriment of imports and shall be subject to negotiations
7. "No internal quantitative regulation relating to the
mixture, processing or use of products in specified amounts
or proportions shall be applied in such a manner as to
allocate any such amount or proportion among external
sources of supply.
8. "(a) The provisions of this Article shall not apply to
laws, regulations or requirements governing the procurement
by governmental agencies of products purchased for
governmental purposes and not with a view to commercial
resale or with a view to use in the production of goods for
commercial sale. GATT/CP.2/22
page 9
"(b) The provisions of this Article shall not prevent
the payment of subsidies exclusively to domestic producers,
including payments to domestic producers derived from the
proceeds of internal taxes or charges applied consistently
with the provisions of this Article and subsidies effected
through governmental purchases of domestic products.
9. "The contracting parties recognize that internal
maximum price control measures, even though conforming to
the other provisions of this Article, can have effects
prejudicial to the interests of the contracting parties
supplying imported products. Accordingly, contracting.
parties applying such measures shall take account of the
interests of exporting contracting parties with a view to
avoiding to the fullest practicable extent such prejudicial
effects
10. "The provisions of this Article shall not prevent any
contracting party from establishing or maintaining internal
quantitative regulations relating to exposed cinematograph
films."
Interpretative Note ad Article III
Any internal tax or other internal charge, or any
law, regulation or requirement of the kind referred to in
paragraph 1 which applies to an imported product and to the
like domestic product and is collected or enforced in the
case of the imported product at the time or point of
importation, is nevertheless to be regarded as an internal
tax or other internal charge, or a laws regulation-or
requirement of the kind referred to in paragraph 1 and is
accordingly subject to the provisions of Article III.
Paragraph 1
The application of paragraph 1 to internal taxes
imposed by local governments and authorities within the
territory of a contracting party is subject to the
provisions of paragraph 6 of Article XXIV. The term
"reasonable measures" in the last-mentioned paragraph would
not require, for example the repeal of existing national
legislation authorizing local governments to impose
internal taxes which, although technically inconsistent with
the letter of Article III are not in fact inconsistent with
its spirit, if such repeal would result in a serious
financial hardship for the local governments or authorities
concerned. With regard to taxation by local governments
'or authorities which is inconsistent with both the letter
and spirit of Article III, the term "reasonable measures"
would permit a contracting party to eliminate the
inconsistent taxation gradually over a transition period,
if abrupt action would' create serious administrative and'
financial difficulties.
Paragraph
A tax conforming to the requirements of the first
sentence of paragraph 2 would be considered to be
inconsistent with the provisions of the second sentence only GATT/CP.2/22
page 10
in cases where competition was involved between, on the one.
hand the taxed product and on the other hand, a directly
competitive or substitutable product which was not similarly
taxed.
Paragraph 5
Regulations consistent with the provisions of the first
sentence of paragraph 5 shall not be considered to be
contrary to the provisions of the second sentence in any
case in which all of the products subject to the regulations
are produced domestically in substantial quantities.
A regulation cannot be justified as being consistent with
the provisions of the second sentence on the ground that the
proportion or amount allocated to each of the products which
are the subject of the regulation constitutes an equitable
relationship between imported and domestic products.
D.
Replace the text of Article VI by the following text
(Article 34 of the Charter):-
1. The contracting parties recognize that dumping, by
which products of one country are introduced into the
commerce of another country at less than the normal value of
the products, is to be condemned if it causes or threatens
material injury to an established industry in the territory
of a contracting party or materially retards the establishment
of a domestic industry. For the purposes of this Article, a
product is to be considered as being introduced into the
commerce of an importing country at less than its normal
value, if the price of the product exported from one country
to another
(a) is less than the comparable price, in the
ordinary course of trade, for the like product
when destined for consumption in the exporting
country, or,
(b) in the absence of such domestic prices is less than
either
(i) the highest comparable price for the like.
product for export to any third country in the
ordinary course of trade or
(ii) the cost of production of the product in the
country of origin plus a reasonable addition
for selling cost and profit.
Due allowance shall be made in each case for differences
in conditions and terms of sales for differences in
taxation and for other differences affecting price
comparability.
2. In order to offset or prevent dumping, a contracting
party may levy on any dumped product an anti-dumping duty
not greater in amount than the margin of dumping in respect GATT/CP/2/22
page ll
of such product. For the purposes of this Article, the
margin of dumping is the price difference determined in
accordance with the provisions of paragraph 1.
3. No countervailing duty shall be levied on any
product of the territory of any contracting party imported
into the territory of any other contracting party in excess
of an amount equal to the estimated bounty or subsidy
determined to have been granted, directly or indirectly,
on the manufacture, production or export of such product
in the country of origin or exportaiton, including any
special subsidy to the transportation of a particular
product. The term, "countervailing duty" shall be understood
to mean a special duty levied for the purpose of offsetting
any bounty or subsidy bestowed, directly or indirectly,
upon the manufacture, production or export of any
merchandise.
4. No product of the territory of any contracting party
imported into the territory of any other contracting party
shall be subject to anti-dumping or countervailing duty by
reason of the exemption of such product from duties or
taxes borne by the like product when destined of for
consumption in the country of origin or exportation, or by
reason of the refund of such duties or taxes.
5. No product of the territory of any contracting party
imported into the territory of any other contracting party
shall be subject to both anti-dumping and countervailing
'duties to compensate for the same situation of dumping or
export subsidization.
6. No contracting party shall lovy any anti-dumping or
countervailing duty on the importation of any product of the
territory of another contracting party unless it determines
that the effect of the dumping or subsidization, as the case
may be, is such as to cause or threaten material injury to
an established domestic industry, or is such as to retard
materially the establishment of a domestic industry. The
CONTRACTING PARTIES may waive the requirements of this
paragraph so as to permit a contracting party to levy an
anti-dumping or countervailing duty or, the importation of
any product for the purpose of offsetting dumping or
subsidization which causes or threatens material injury to
an industry in the territory of another contracting party
exporting the product concerned to the territory of the
importing contracting party.
7. A system for the stabilization of the domestic price
or of the return to domestic producers of a primary commodity,
independently of the movements of export prices, which
results at times in the sale of the commodity for export at
a price lower than the comparable price charged for the like
commodity to buyers in the domestic market, shall be presumed
not to result in material injury within the meaning of
paragraph 6 if it is determined by consultation among the
contracting par ties substantially interested in the commodity
concerned that: GATT/CP .2/22
page 12
(a) the system has also resulted in the sale of the
commodity for export at a price higher than the
comparable price charged for the like commodity to
buyers in the domestic market, and
(b) the system is so operated, either because of the
effective regulation of production, or otherwise,
as not to stimulate exports unduly or otherwise
seriously prejudice the interests of other
contracting parties.
Interpretative Note ad Article VI
Paragraph 1
Hidden dumping by associated houses (that is, the sale
by an importer at a price below that corresponding to the
price invoiced by an exporter with whom the importer is
associated and also below the price in the exporting country)
constitutes a form of price dumping with respect to which the
margin of dumping may be calculated on the basis of the price
at which the goods are resold by the importer.
Paragraphs 2 and 3
Note 1
As in many other cases in customs administration, a
contracting party may require reasonable security (bond or
cash deposit) for the payment of anti-dumping or counter-
vailing duty pending final determination of the facts in any
case of suspected dumping or subsidization.
Note 2
Multiple currency practices can in certain circumstances
constitute a subsidy to exports which may be met by
countervailing duties under paragraph 3 or can constitute a
form of dumping by means of a partial depreciation of a
country's currency which nay be met by action under
paragraph 2. By "multiple currency practices" is meant
practices by governments or sanctioned by governments,
E.
Delete the phrase "and to any internal regulation or
requirement under paragraphs 3 and i of Article III" in
paragraph 5 of Article XIII,
F.
Delete the introductory phrase to paragraph 9 of
Article XV which reads as follows:-
"Subject to the provisions of paragraph + of this
Article". GATT/CP. 2/22
page 13,
G.
Replace the text of.Article XVIII by the following text
(Article 13 of the Charter) : -
Article XVIII
GOVERNMENTAL ASSISTANCE TO ECONOMIC DEVELOPMENT
AND RECONSTRUCTION
1. "The contracting parties recognise that special
governmental assistance may be .required to promote. the
establishment, development or reconstruction of particular
industries .or branches of agriculture, and that in
appropriate circumstances the grant of such assistance in
the form of protective measures is justified. At the
same time they recognise that an unwise use of such
measures would impose undue burdens on their own economies
and unwarranted restrictions on International trade, and
might increase unnecessarily the difficulties of adjustment
for the-economies of other countries
2 "The CONTRACTING PARTIES and the contracting parties
concerned shall preserve the utmost secrecy in respect of
matters arising under this Article.
A.
3.. If a contracting party, in the interest of its
economic development reconstruction, or for the purpose
of-increasing a most-favoured-nation rate of duty in
connection with the establishment of a new preferential
agreement in accordance with the provisions of paragraph 3
of Article I, considers it desirable to adopt any non-
discriminatory measure which would conflict with an
obligation which the contracting party has assumed under
Part II of this Agreement, but which-would not conflict
with other provisions of this Agreement, such contracting
party
"(a) shall enter into direct negotiations with all the
other contracting parties. The appropriate shedules
to this Agreement shall be amended in accordance with
any agreement resulting from such negotiations; or;
(b) shall initially or may, in the event of failure
.,to reach agreement under.sub-paragraph (a), apply to
the CONTRACTING PARTIES. The CONTRACTING PARTIES
shall determine the contracting party or parties
materially affected by. the. proposed measure and shall
sponsor negotiations between such contracting party
or parties and the applicant contracting party with a
view to obtaining expeditious and substantial
agreement. The CONTRACTING PARTIES.shall establish
and communicate to the contracting parties concerned
a time schedule for such negotiations following as.
far as practicable any time schedule which may have
been proposed b the, applicant contracting party. The GATT/CP. 2/22
page 14
contracting parties shall commence and proceed
continuously with such negotiations in accordance
with the time schedule established by the CONTRACTING
PARTIES. At the request of a contracting party, the
CONTRACTING PARTIES may, where they concur in principle
with the proposed measure, assist in the negotiations.
Upon substantial agreement being reached, the applicant
contracting party may be released by the CONTRACTING
PARTIES from the obligation referred to in this
paragraph, subject to such limitations as may have
been agreed upon in the negotiations between the
contracting parties concerned.
i. "(a) If as a result of action initiated under
paragraph 3 there should be an increase in imports of any
product concerned, including products which can be directly
substituted therefor, which if continued would be so great as.
to jeopardize the establishment, development or reconstruction
of the industry, or branch of agriculture concerned,' and if
no preventive measures consistent with the provisions of this
Agreement can be found which seem likely to prove effective,
the applicant contracting party may, after informing, and
when practicable consulting with, the CONTRACTING PARTIES,
adopt such other measures as the situation may require,
provided that such measures do not restrict imports more
than necessary to offset the increase in imports referred
to in this sub-paragraph; except in unusual circumstances,
such measures shall not reduce imports below the level
obtaining in the most recent representative period preceding
the date on which the contracting party initiated action
under paragraph 3.
"(b) The CONTRACTING PARTIES shall determines as soon
as possible, whether any such measures should be continued,
discontinued or modified. It shall in any: case be
terminated as soon as the.CONTRACTING PARTIES determine that
the negotiations are completed or discontinued.
"(c) It is recognised that the relationship between
contracting parties referred to in paragraph 3 involves
reciprocal advantages, and therefore any contracting party
whose trade is materially affected by the action may suspend
the application to the trade of the applicant contracting
party of. substantially equivalent obligations or concessions
under this Agreement provided that the contracting party
concerned has consulted the.CONTRACTING PARTIES before taking
such action and the CONTRACTING PARTIES do not disapprove.
5. "In the case of any non-discriminatory measure affecting
imports which would apply to any product in respect of which
the contracting party has assumed an obligation under
Article II of this Agreement and which conflicts with any
other provision of this Agreement, the provisions of sub-
paragraph:(b) of paragraph 3 shall apply ; PROVIDED that
before granting a release the CONTRACTING PARTIES shall
afford adequate opportunity for all contracting parties
which they determine to be materially affected to express GATT/CP.2/22
page 15
their views. The provisions of paragraph 4 shall also be
applicable in this case.
C.
6. "If a contracting party in the interest of its economic
development or reconstruction considers it desirable to adopt
any nondiscriminatory measure affecting imports which would
conflict with the provisions of this Agreement other than
Article II, but which would not apply to any product in
respect of which the contracting party has assumed an.
obligation under Article II, such contracting party shall
notify the CONTRACTING PARTIES and shall transmit to the
CONTRACTING PARTIES a written statement of the considerations
in support of the adoption, for a specified period, of the
proposed measure.
7. "(a) On application by such contracting party to
CONTRACTING PARTIES shall concur in the proposed measure and
grant the necessary release for a specified period if,
having particular regard to the applicant contracting party's
need for economic development or reconstruction; it is
established that the measure
(±) is designed to protect a particular industry
established between January 1 1939 and March 24,
1948 which was protected during that period of
its development by abnormal conditions arising out
of the war; or
(ii) is designed to promote the establishment or
development of a particular industry for the
processing of an indigenous primary commodity,
when the external sales of such commodity have
been materially reduced is a result of new or
increased restrictions imposed abroad; or
(iii) is necessary in view of the. possibilities and
resources of the applicant contracting party to
promote the establishment or development of a
particular industry for the processing of
indigenous primary commodity, or for the
processing of a by-product of such industry,
which would otherwise be wasted, in order to
achieve a fuller and more economic use of the
applicant contracting party's natural resources
and manpower and, in the long run, to raise the
standard of living within the territory of the
applicant contracting party, and is unlikely to
have a harmful effect, in the long run, on
international trade; or
(iv) is unlikely to be more restrictive of inter-
national trade than any other practicable and
reasonable measure permitted under this Agreement,
which could be imposed without undue difficulty,
and is the one most suitable for the purpose
having regard to the economies of the industry or
branch of agriculture concerned and to the
applicant contracting party's need for economic
development or reconstruction. GATT/CP.2/22
page 16
"The foregoing provisions of this subparagraph are subject
to the following conditions:
(1) any proposal by the applicant contracting party
to apply any such measure, with or without
modification, after the end of the initial
period, shall not be subject to the provisions
of this paragraph; and
(2) the CONTRACTING PARTIES shall not concur in any
measure under the provisions of (i), (ii) or
(iii) above which is likely to cause serious
prejudice to exports of a primary commodity on
which the economy of the territory of another
contracting party is largely dependents
"(b) The applicant contracting party shall apply any
measure permitted under sub-paragraph (a) in such a way as
to avoid unnecessary damage to the commercial or economic
interests of any other contracting party.
8. "If the proposed measure does not fall within the
provisions of paragraph 71 the contracting party
(a) may enter into direct consultations with the
contracting party or contracting parties which,
in its judgment, would be materially affected by
the measure. At the same tines the contracting
party shall inform the CONTRACTING PARTIES of
such consultations in order to afford them an
opportunity to determine whether all materially
affected contracting parties are included within
the consultations. Upon complete or substantial
agreement being reached, the contracting party
interested in taking the measures shall apply to
the CONTRACTING PARTIES; The CONTRACTING PARTIES
shall promptly examine the application to ascertain
whether the interests of all the materially
affected contracting parties have been duly
taken into accounts If the CONTRACTING PARTIES
reach this conclusion, with or without further
consultations between the contracting parties
concerned, they shall release the applicant
contracting party from its obligations under the
relevent provisions of this Agreement subject to
such limitations as the CONTRACTING PARTIES may
impose, or
(b) nay initially, or in the event of failure to reach
complete or substantial agreement under subs
paragraph (a), apply to the CONTRACTING PARTIES.
The CONTRACTING PARTIES shall promptly transmit the
statement submitted under paragraph 6 to the
contracting party or contracting parties which are
determined by the CONTRACTING PARTIES to be
materially affected by the proposed measure.
Such contracting party or contracting parties
shall, within the time, limits prescribed by the
CONTRACTING PARTIES, inform them whether, in the
light of the anticipated effects on the economy
of the territory of such contracting party or
parties, there is any objection to the proposed
measure. The CONTRACTING PARTIES shall GATT/CP. 2/22
page 17.
(i) if there is no objetion to the proposed
measure on the part of the affected
contracting party or contracting parties,
immediately release the applicant
contracting party from its obligations
under the relevant provision of this
Agreement; or
(ii) if there is objection, promptly examine
the proposed measure, having regard to the
provisions of this Agreement, to the
considerations presented by the applicant
contracting party and its need for economic
development or reconstruction, to the
views of the contracting party or contracting
parties determined to be materially affected,
and to the effect which the proposed measures
with or without modification, is likely to
have, immediately and in the long run, on
international trades and, in the long run,
on the standard of living within the
territory of the applicant contracting
party' If, as a result of such examination,
the CONTRACTING PARTIES concur in the
proposed measure, with or without
modification, they shall release the
applicant contracting party from its
obligations under the relevant provisions
of this Agreenent., subject to such
limitations as they may impose.
9. "If, in anticipation of the concurrence of the
CONTRACTING PARTIES in the adoption of a measure referred to
in paragraph 6, there should be an increase or threatened
increase in the imports of any product concerned, including
products which can be directly substituted therefor, so
substantial as to jeopardize the establishment, development
or reconstruction of the industry or branch of agriculture
concerned, and if no preventive measures consistent with
this Agreement can be found which seem likely to prove
effective, the applicant contracting party nay, after
informing, and when practicable consulting with, the
CONTRACTING PARTIES, adopt such other measures as the
situation may require, pending a decision by the CONTRACTING
PARTIES on the contracting party's application; PROVIDED
that such measures do not reduce imports below the level
obtaining in the most recent representative period preceding
the date-on which notification was given under paragraph 6,
10. "The CONTRACTING PARTIES shall, at the earliest
opportunity but ordinarily within fifteen days after receipt
of an application under the provisions of paragraph 7 or
sub-paragraphs (a) or (b) of paragraph 8, advise the
applicant contracting party of the date by which it will be
notified whether or not it is released from the relevant
obligation. This shall be the earliest practicable date
and not later than ninety days after receipt of such
application: PROVIDED that if unforeseen difficulties
arise before the date set, the period may be extended after
consultation with the applicant contracting party. If the GATT/CP.2/22
page 18
applicant contracting party is not so notified by the date
set it may, after informing the CONTRACTING PARTIES,
institute the proposed measure.
11. "Any contracting party may maintain any non-
discriminatory protective measure affecting imports in force
on September 1, 1947 which has been imposed for the
establishment, development or reconstruction of a particular
industry or branch of agriculture and which is not otherwise
permitted by this Agreement; PROVIDED that notification has
been given to the other contracting parties no later than
October 10, 1947 of such measure and of each production which
it is to be maintained and of its nature and purpose.
12. Any contracting party maintaining any such measure
shall within sixty days of becoming a contracting party
submit to the CONTRACTING PARTIES a statement of the.
considerations in support of the maintenance of the measure
and the period for which it wishes to maintain it. The
CONTRACTING PARTIES shall as soon as possible, but in any
case within twelve months from the day of such contracting
party becoming a contracting party, examine and give a
decision concerning the measure as if it had been submitted
to the CONTRACTING PARTIES for their concurrence under the
provisions of the preceding paragraphs of this Article.
13. The provisions of paragraphs 11 and 12 of this Article
shall not apply to any measure in conflict with obligations
under Article II of this Agreement.
14. In cases where the CONTRACTING PARTIES decide that a
measure should be modified or withdrawn by a specified dates
they shall have regard to the possible need of a contracting
party for a period of time in which to make such modification
or withdrawal:"
Interpretative Note ad Article XVIII
Paragraphs 7 (a) (ii) and (iii)
The word "processing", as used in these sub-paragraphs,
means the transformation of a primary commodity or of a by-
product of such transformation into semi-finished or finished
goods but does not refer to highly developed industrial
processes.
H.
Delete sub-paragraph (as of paragraph 5 of Article XXVI)
I.
Replace the text of Article XXIX by the following text,
Article XXIX
The Relation of this Agreement to the Havana Charter
The Relation of this Agreement to the Charter
1. "The contracting parties undertake to observe to the
fullest extent of their executive authority the general
principles of-the Havana Charter pending their acceptance of
it in accordance with their constitutional procedures GATT/CP.2/22
pace 19
2. Part II of this Agreement shall be suspended on the
day on which the Havana Charter enters into force,
3. If by September 30, 1949, the Havana Charter has not
entered into force, the contracting parties shall meet
before December 31, 1949 to agree whether this Agreement shall
be amended, supplemented or maintained.
If at any tine the Havana Charter should cease to be
in force, the contracting parties shall meet as soon as
practicable thereafter to agree whether this Agreement shall
be supplemented, amended or maintained- Pending such
Agreement, Part II of this Agreement shall, again enter into
force provided that the provisions of Part II other than
Article XXIII shall be replaced nutatis mutandis, in the
form in which they then appeared in the Havana Charter;
5. If any contracting party has not accepted the Havana
Charter by the date upon which it enters into force, the
contracting parties shall confer to agree whether, and if so
in what ways this Agreement insofar as it affects relations
between such contracting party and other contracting parties,
shall be supplemented or amended., Pending such agreement
the provisions of Part II of this Agreement shall notwith-
standing the provisions of paragraph 2 of this Article
continue to apply as between such contracting party and
other contracting parties,
Contracting parties which. are Members of the Inter-
national Trade Organization' shall not invoke the provisions
of this Agreement so as to prevent the operation of any
provision of the Havana Charter, The application of the
principle underlying this paragraph to any contracting party
which is not a Member of the International Trade Organization
shall be the subject of an agreement pursuant to paragraph 5
of this Article." GATT/CP.2/22
page 20
ANNEX II
DRAFT OF PROTOCOL CONTAINING AMENDMENTS TO
PART II
The Governments of acting
in their capacity of contracting parties to the General
Agreement on Tariffs and Trade (hereinafter referred to
as the Agreement),
desiring to effect an amendment to the Agreement,
pursuant to the provisions of Article XXX thereof,
HEREBY AGREE AS FOLLOWS:-
1. The texts of Articles III, VI, XIII, XV, XVIII and XXVI
of the Agreement shall read as follows:-
2. This Protocol done in a single English and a single
French original both texts authentic shall, following its
signature at the close of the Second Session of the
Contracting Parties, be deposited with the Secretary-General
of the United Nations. The deposit of the Protocol wills
as from the date of deposit, constitute the deposit of the
instruments of acceptance of the amendment set out in
paragraph 1 of this Protocol by any.government whose
representative has signed without qualification. The
instruments of acceptance of other governments will be
deposited with the Secretary-General of the United Nations.
3. The amendment set out in paragraph 1 of this Protocol
shall enter into force upon acceptance of it by two thirds
of the governments which are at that time contracting parties.
4. The Secretary-General of the United Nations will inform
all interested governments of each acceptance of the amend-
ment set out in this Protocol and of the date upon which
such amendment enters into force. The Secretary-General is
authorized to effect registration of this Protocol at the
appropriate time.
IN WITNESS WHEREOF the respective ropresentatives duty
authorized to that effect, have signed the present Protocol.
DONE at Geneva this day of August one thousand nine
hundred and forty eight. |
GATT Library | wd976jv6008 | Report of working party No. 3 on Modifications to the General Agreement. Corrigendum | General Agreement on Tariffs and Trade, August 31, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 31/08/1948 | official documents | GATT/CP.2/22/Rev.1/Corr.1 and GATT/CP.2/22/Rev.1+Rev.1/Corr.1 CP.2/22/Rev.1/Annex II/Rev.1 CP.2/23-27 | https://exhibits.stanford.edu/gatt/catalog/wd976jv6008 | wd976jv6008_90320038.xml | GATT_147 | 377 | 2,407 | RESTRICTED
Limited B
GATT/CP .2/22/Rev .1/Corr .1
31 August 1948
ENGLISH ONLY
GENERAL AGREEMENT ON TARIFFS AND TRADE
Contracting Parties
Second Session
Report of working party No. 3 on Modifications
to the General Agreement
Page 5, Paragraph 24
In the third line from the end of this paragraph,
delete the word "its" and read "reserving the right..."
Page 19
Under section H delete XXV and read "Article XXVI".
Page 21 At the end of this page, insert the following:
2) PROTOCOL MODIFYING PART I AND ARTICLE XXIX OF
THE GENERAL AGREEMENT ON TARIFFS AND TRADE.
The Governments of acting in their
capacity of contracting parties to the General Agreement on
Tariffs and Trade (hereinafter referred to as the Agreement)
Desiring to effect an amendment to the Agreement,
pursuant to the provisions of Article XXX thereof,
HEREBY AGREE AS FOLLOWS:
1. The texts of Articles I, II and XXIX of the Agreement
and certain related provisions in Annex I shall be modified
as follows :-
2. This Protocol, done in a single English and a single
French original, both texts authentic, shall, following its
signature at the close of the Second Session of the Contract-
ing Parties, be deposited with the Secretary-General of the
United Nations. The deposit of the Protocol will, as from
the date of deposit, constitute the deposit of the instru-
ments of acceptance of the amendment set out in paragraph 1
of this Protocol by any government whose representative has
signed without qualification. The instruments of acceptance
of other governments will be deposited with the Secretary-
General of the United Nations.
3. The amendment set out in paragraph 1 of this Protocol
shall enter into force upon acceptance of it by all of the
governments which are at that time contracting parties. GATT/CP. 2/22/Rev.1/Corr.1
page 2
The Secretary-General of the United Nations will
inform all interested governments of each acceptance of
the amendment set out in this Protocol and of the date
upon which such amendment enters into force. The Secretary-
General is authorized to effect registration of this
Protocol at the appropriate time.
IN WITNESS WHEREOF the respective representatives duly
authorized to that effect, have signed the present Protocol.
DONE at Geneva this day of September one
thousand nine hundred and forty eight. |
GATT Library | vx868md4534 | Report of Working party No. 3 on new Article 11 A. proposed by Chile (E/CONF.2/C.2/9, pages 12 and 13) | United Nations Conference on Trade and Employment, January 22, 1948 | Joint Sub-Committee of Committees II and VI | 22/01/1948 | official documents | E/CONF.2/C.26/A/W.25, E/CONF.2/C.2/D/W.1-3, C.23/A/W.1-3, and C.26/A/W.1-29 | https://exhibits.stanford.edu/gatt/catalog/vx868md4534 | vx868md4534_90180380.xml | GATT_147 | 594 | 4,184 | United Nations Nations Unies RESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.2&6/A/ W.25
ON DU 22 January 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
JOINT SUB-COMMITTEE OF COMMITTEES II AND VI
REPORT OF WORKING PARTY NO. 3 ON NEW ARTICLE 11 A PROPOSED BY CHILE
(E/CONF.2/C.2/9, pages 12 and 13)
1. New Article 11 A was referred by the Joint Sub-Committee of Committees II
and VI to Working Party No. 3 at the twentieth meeting held .19 January, "to
examine and make recommendations concerning the incorporation of any ideas
which might be appropriate either in the existing Articles or in the
resolution". (E/CONF.2/C.2&6IA/W.23).
2. After discussing the question with the delegate of Chile the Working Party
recommends that the following changes* should be made.
The Chilean delegate agreed to the changes.
Article 10, paragraph 1
In order to amplify the obligations of Members to assist
development in underdeveloped countries:
"Members shall co-operate with one another, with . the Economic and
Social Council of the United Nations, with the Organization and with
other appropriate inter-governmental organizations in fecilitating
and promoting industrial and general economic development."
Article 10, paragraph 2
To amplify the obligations of the Organization and to link
development with the objective of higher standards of living:
'With a view to promoting industrial and general economic development
and consequently higher standards of living, especially of those
countries which are still relatively undeveloped...the Organization
shall.....
(a) (i) study its natural resources and its potentialities for
industrial and general economic development and assist
in the formulation of plans for [its economic] such
development;
(ii) ......etc.
* These changes are indicated by underlining in the case of addition and
square brackets in the case of deletions. In paragraph 1 of Article 10
the changes are from the Geneva draft. In paragraph 2 the changes are
from the text as amended and set out in E/CONF.2/C.2&6/A/W.2/Add.1. In the
proposed resolution the changes are to the text contained in Annex C of
E/CONF.2/C.2&6/A/W.2.
/Proposed resolution E/CONF.2/C.2&6/A/W.25
Page 2
Proposed resolution
In order to place special emphasis on the development of industries
processing locally produced raw materials,
"The United Nations Conference on Trade and Employment, having
considered.............
Therefore resolves
that the Interim Commission of the International Trade Organization
is hereby directed to examine
(i) .....
(ii) the availability of facilities for technical surveys or studies
of: the natural resources of under-developed countries; or
the possibilities, in relation to the demand for the products
of the industries concerned, of their industrial development,
whether general or in relation to the processing of locally-
produced raw materials or other particular industries; or for
the improvement.
3. It was agreed that:
(a) paragraph 3 (b) of new Article 11 A which refers to industrial
patents was covered by the text of paragraph 3 (b) of Article 11 as
adopted at the sixteenth meeting of the Joint Sub-Committee
(E/CONF.2/C.2&6/A/W.18), as the term "industrial patents" is included in
the word "technology".
The text of paragraph 3 (b) reads as follows:
"3. 'The Organization may, in such collaboration with other
inter-governmental organizations as may be appropriate
(a) ......
(b) make recommendations and promote agreements designed to
facilitate an equitable distribution of skills, arts, technology,
materials and equipment with due regard to the needs of all Members;
(c) .......
(b) the reference that price disparities in paragraph 3 (a) of
Article 11 A was met by the recommendation for inclusion of a new
paragraph (f) within Article 69. This text has been approved by the
Joint Sub-Committee at its twenty-first meeting and is contained in
document E/CONF.2/C.2&6/A/W.24, page 3. |
GATT Library | mj253ty5554 | Report of Working Party no. 3 on paragraph 1 (a) of Article 40 | United Nations Conference on Trade and Employment, February 12, 1948 | Third Committee: Commercial Policy | 12/02/1948 | official documents | E/CONF.2/C.3/52 and E/CONF.2/C.3/38-57 | https://exhibits.stanford.edu/gatt/catalog/mj253ty5554 | mj253ty5554_90190151.xml | GATT_147 | 263 | 1,793 | United Nations Nations Unies UNRESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.3/52
ON DU 12 February 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
THIRD COMMITTEE: COMMERCIAL POLICY
REPORT OF WORKING PARTY NO. 3 ON PARAGRAPH 1 (a) OF ARTICLE 40
At its thirty-second meeting on 5 February 1948, Committee III
established Working Party No. 3 consisting of the representatives of Mexico,
Venezuela, the United Kingdom and the United States to consider a proposal
to substitute the word "Charter" for "Chapter" in paragraph 1 (3) of
Article 40.
The Working Party, electing Mr. R. J. Shackle (United Kingdom)
Chairman, held three meetings.
The Working Party considered a proposal by the delegations of
Venezuela and Mexico that the opening words of paragraph 1 (a) of Article 40
be amended to read:
"If, as a result of unforeseen developments and of the effect
of the obligations incurred by a Member under this Charter......."
The delegations of Venezuela and Mexico explained that, in their
view, action by a Member in pursuance of its obligations under Article 3
or under Article 9 might in certain circumstances result in an influx of
imports such as would cause serious injury to domestic producers, while at
the same time the situation might not be such as would justify resort to the
provisions of Article 21.
The Working Party agreed that:
Situations deriving from the fulfillment by a Member of its
obligations under Articles 3 or 9 might constitute an "unforeseen
development" for the purpose of this paragraph.
It is recommended that the foregoing should form part of the record
of Committee III. |
GATT Library | jn377hr1728 | Report of Working Party No. 3 on the Request of the United States for a Waiver in respect of Preferential Treatment for the Trust Territory of the Pacific | General Agreement on Tariffs and Trade, September 7, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 07/09/1948 | official documents | GATT/CP.2/36 and GATT/CP.2/28 - 36 CP.2/32/Rev.1 | https://exhibits.stanford.edu/gatt/catalog/jn377hr1728 | jn377hr1728_90320053.xml | GATT_147 | 1,994 | 12,497 | RESTRICTED
LIMITED B
GATTCP. 2/36
7 September 1948
ORIGINAL : ENGLISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
Contracting Parties
Second Session
Report of Working Party No. 3
On the Request of the United States for a Waiver
In respect of Preferential Treatment for theTrust
Territory of the Pacific
According to its terms of reference, the Working Party
has considered the request of the United Statcs for a
waiver in respect of preferential treatment for the Trust
Territory of the Pacific Islands on the basis of the
information submitted by the United States representative.*)
After a detailed discussion in which the members of the
Working Party and a certain number of observers expressed
their views as regards the legal and economic implications
of the request of the United States, the Working Party
reached the following conclusions:
1. It is appropriate for the CONTRACTING PARTIES to
consider the request under Article XXV of the General Agree-
ment on Tariffs and Trade. There is no other provision of
the General Agreement under which that request could be.
examined.
2. The Working Party examined whether the request of the
United States was based on the existence of "exceptional
circumstances". It cane to the conclusion that such
exceptional circumstances existed as indicated in the
following paragraphs.
3. The Islands of the Trust Territory were accorded
preferential treatment by Japan so long as they remained
under Japanese mandate end such preferential treatment
would be eliminated with the inauguration of the United
States administration. If the waiver requested were
granted to the United States, the Islands would remain in a
position similar to that existing before the inauguration
of the United States administration and would enjoy the
same privileges comparable to those enjoyed by other Trust
Territories which, in accordance with the exceptions
*) The documents GATT/CP.2/WP.3/5, GATT/CP.2/WP.3/6 and
GATT/CP.2/WP.3/6 corr.1 contain statistical and factual
information on the production and trade of the Trust
Territory of the Pacific. GATT/CP.2/36
page 2
provided for in Article I of the General agreement , receive
preferential treatment for their imports into the territories
of the respective administering authorities.
4. Also, unlike the situation prevailing under Japanese
mandate, the administering authority would not enjoy any
preference for their imports into the Trust Territory of the
Pacific Islands.
5. Moreover, the Working Party considered that the exodus
of the 70,000 Japanese who were mainly employed in the sugar,
alcohol and dried bonito industries of the Islands would
probably lead to the practical disappearance of those
industries and that the transformation undergone by the
economy of the Island would justify certain exceptional
measures in order to enable the administering authority to
fulfil its obligations in accordance with Paragraph 2 of
Art. 6 of the Trusteeship Agreement for the former Japanese
mandated Islands.
6. The Working Party was of opinion that the production
figures and export possibilities of the Islands were so un-
important that, under the conditions expected to exist, the
granting of the waiver would not be likely to cause substan-
tial injury to the trade of the other contracting parties.
The export values of the five main export commodities
of the islands amounted to about 11 million dollars in 1936,
but sugar exports which accounted for more than half of
those export values are not likely to be continued and the
phosphate exports are expected to terminate by 1951, on
account of the depletion of resources. The copra exports
ranged from 10 to 15 thousand tons during the 1930's but it
is unlikely that future production will exceed a yearly
average of 10,000 tons. This estimated production would
correspond to about 5% of the total United States' imports
of copra.
Most of the products are now admitted duty-free and the
system of sugar import quotas allocated by areas now in
force in the United States would not allow an increase in the
imports of sugar originating in the islands. While the
reduction by 2 ? per pound in the tax on the processing of
coconut oil from copra will improve the income derived by
the Islands from copra exports, it is not expected that it
will bring about a substantial increase in the total volume
of such exports, which have to compete with the more
efficient production of the Philippines.
It was, however, understood that if the underlying
economic factors on which the decision of the CONTRACTING
PARTIES would be based were modified so as to cause or
threaten substantial injury to the trade of contracting
parties, the decision to be taken at this session could be
reconsidered by the CONTRACTING PARTIES. Moreover, it was
pointed out that such a decision would only oind the
contracting parties and that, when the Charter comes into
force, the Conference of the ITO would, unless the provisions
of Article 15 of the Charter were found applicable, have to
examine an application for a waiver under Paragraph 3 of
Article 77 of the Havana Charter. GATT/CP.2/36
page 3
7. The Working Party considered whether the waiver should
take the form of a specific authorization to grant preferen-
tial treatment to certain products of the Trust Territory
of the Pacific Islands or of a general authorization to
apply a duty-free treatment to all products of that territory.
In view of the small amount of trade involved and of the
diversified but minor character of certain of the exports in
question, the Working Party came to the conclusion that it
would be more practicable to grant a general authorization
applicable to all products of the Trust Territory, of the
Pacific Islands and imported into the Customs territory of
the United States, which consists of the United States and
its possessions except the Virgin Islands, American Samoa,
the island of Guam, Wake Island, Midway Islands, and Kingman
Reef.
8. The scope of the waiver would be the following:
a) The entry into the customs territory of the United States
of all products of the Trust Territory of the Pacific
Islands could be made duty-free and the United States would
not thereby be obliged to extend the sane treatment to the
like products of the territories of the contracting parties.
b) The United States would be authorized to apply to coconut-
oil processed from copra produced in the Trust Territory of
the Pacific Islands and imported into the customs territory
of the United States the lower rate of internal tax of 3 ?
per pound presently applicable to coconut-oil processed from
copra produced in the Philippine Republic and the United
States would not be obliged to extend the sane rate to coconut-
oil processed from copra produced in the territories of the
contracting parties, which would remain taxable at 5 ? per
pound.
9. The provision contained in the note to Annex D of the
General Agreement to the effect that "the imposition of an
equivalent margin of preference to replace a margin of pre-
ference in an internal tax existing on April 10, 1947,
exclusively between two or more of the territories listed in
this Annex, shall not be deemed to constitute an increase in
a margin of tariff preference" would apply mutatis mutandis
to the margin of preference in the processing tax applicable
to coconut-oil processed from copra produced in the Trust
Territory of the Pacific Islands.
10. The Working Party recommends that the preferential
treatment to be accorded in favour of the imports from the
Trust Territory in the Pacific Islands should be governed by
the provisions of Article I of the General Agreement and
that the date of April 10, 1947, referred to in sub-paragraphs
(a) and (b) of the final paragraph of Article I should be
replaced, in the case of the preferences covered by the
decision, by the date on which such preferences come into
force.
Finally, it was understood that these preferences would
be subject to negotiations under Article 17 of the Havana
Charter as all preferences covered by Article 16 of the
Charter. GATT/CP.2/36
page 4
11. The Working Party submits to the CONTRACTING PARTIES
the following decision for their approval:
DECISION CONCERNING A WAIVER UNDER PARAGRAPH 5 (a)'
OF ARTICLE XXV OF THE GENERAL AGREEMENT ON TARIFFS
AND TRADE IN RESPECT OF THE TRUST TERRITORY OF THE
PACIFIC ISLANDS.
The CONTRACTING PARTIES, acting pursuant to paragraph
5 (a) of Article XXV of the General Agreement on Tariffs
and Trade,
Taking note of the request of the Government of the
United States with respect to the establishment of a referen-
tial treatment for imports into the United. States from the
Marshall, Caroline and Marianas Islands (other than Guam),
which islands wore formerly held by Japan under mandate and
which, by agreement with the Security Council of the United
Nations approved on April 2, 1947, have been placed under
the trusteeship system of the United Nations with the United
States as the administering authority,
Considering that while under Japanese mandate, the
exports of such islands were entitled to preferential treat-
ment in the market of the metropolitan territory of Japan,
upon which such exports were substantially dependent, and
that such preferential treatment has been terminated upon
the establishment of the trusteeship under the administra-
tion of the United States,
Considering further that while under Japanese mandate
such islands applied a system of preferential treatment for
imports from Japan, which system will, under United States
administration, be replaced by a system of non-discriminatory
treatment for the goods of all countries,
And considering further that the replacement of prefer-
ential entry for the exports of such islands into the market
of Japan by preferential entry into the market of the
United States is not, in view of the nature and small
volume of the production and trade involved and of the
underlying economic factors affecting such production and
trade, likely to result in substantial injury to the trade
of any of the contracting parties,
HEREBY DECIDE AS FOLLOWS:
1. Subject to paragraph 2 of this Decision, the
provisions of paragraph 1 of Article I of the General
Agreement on Tariffs and Trade shall be waived to the extent
necessary to permit the Government of the United States
(a) to accord duty-free treatment except as
otherwise provided for in paragraph (b), to all products
of the Trust Territory of the Pacific Islands imported
into the customs territory of the United States without
obligation thereby to extend the same treatment to the
like products of the other contracting parties, and GATT/CP.2/36
page 5
(b) to accord, in respect of products of the Trust
Territory of the Pacific. Islands imported into the
customs territory of the United States, the same rate
of internal tax on the processing of coconut-oil (or,
if such internal tax should be converted into the
equivalent import duty, the same rate of equivalent
duty):as may be applied consistently with the General.
Agreement on Tariffs and Trade, in respect of the like
products of the Philippine Republic, without obligation
to extend the same treatment to the like products of
the other contracting parties.
2. The margins of preference created upon the
institution of the treatment provided for in paragraph 1
shall thereafter be bound against increase in the same
manner as other preferences under the General Agreement on
Tariffs and Trade and for this purpose the date of April 10,
1947, referred to in sub-paragraphs (a) and (b) of the
final paragraph of Article I of the General Agreement shall
be replaced by the date on which such treatment is instituted;
such date shall be notified to the CONTRACTING PARTIES by
the Government of the United States.
3. In the event that the underlying economic factors
affecting the production and trade of the Trust Territory of
the Pacifi¢ Islands should change so that the preferences
authorized by this Decision should result or threaten to
result in substantial injury to the competitive trale of
any contracting party, the CONTRACTING PARTIES, upon the
request of any affected contracting party, shall review
this Decision in the light of all relevant circumstances. |
GATT Library | fr551tf1461 | Report of Working party No. 3 to Joint Sub-Committee of Committees II and VI regarding Turkish amendement to paragraph 2 of Article 10 | United Nations Conference on Trade and Employment, January 10, 1948 | Joint Sub-Committee of Committees II and VI | 10/01/1948 | official documents | E/CONF.2/C.26/A/W.14, E/CONF.2/C.2/D/W.1-3, C.23/A/W.1-3, and C.26/A/W.1-29 | https://exhibits.stanford.edu/gatt/catalog/fr551tf1461 | fr551tf1461_90180369.xml | GATT_147 | 391 | 2,816 | United Nations Nations Unies
CONFERENCE CONFERENCE E/CONF .2/C.2&6/A/
ON DU 10 January 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGlNAL: ENGLISH
JOINT SUB-COMMITTEE OF COMMITTEES II AND VI
REPORT OF WORKING PARTY NO. 3 TO JOINT SUB-COMMITTEE
OF COMMITTEES II AND VI REGARDING TURKISH
AMENDEMENT TO PARAGRAPH 2 OF ARTICLE 10.
1. The Turkish amendment to paragraph 2 of Article 10 (page 3 of
E/CONF.2/C.2/9) was referred to Working Party No. 3 by the Joint
Sub-Committee of Committees II and VI at its thirteenth meeting
(E/CONF . 2/C .2&6/A/W/11) .
2. At the meeting of the Working Party on 10 January, the representative
of Turkey presented a further text taking the form of an additional
paragraph 3 in Article 10 as follows:
"The Organization shall co-operate fully with the Economic
and Social Council of the United Nations and with all appropriate
inter-governmental organizations on all phases of economic
development within their special competence and in particular in
respect of financing, equipment, technical assistance and the
Provision of managerial skills essential to the development of
under-developed countries."
The representative of the International Bank for Reconstruction and
Development indicated that he was in agreement with this text.
3. There was a discussion in the Working Party with regard to the
last words of the aforementioned text, namely, "essential to the
development of under-developed countries". The working Party decided
to put forward to the Joint Sub-Committee the following two texts:
Text A:
"3. The Organization shall co-operate fully with the Economic
and Social Council of the United Nations and appropriate
Inter-Governmental Organizations on all phases of economic development
within their special competence and in particular in respect of
finance, equipment, technical assistance and managerial skills
essential to the development of under-developed countries."
Text B:
"3. The organization shall co-operate fully with the Economic and
Social Council of the United Nations and appropriate Inter-Governmental
/Organizations E/CONF .2/C .2&6/A/W .14
Page 2
Organizations on all phases of economic development within their
special competance and in particular in respect of finance, equipment,
technical assistance and managerial skills."
The Working Party was in substantial agreement that Text B was
Preferable in the light of the question of reconstruction. However, the
representative of Turkey preferred the first text in order to stress the
reeds of under-developed countries. The representative of the Bank
expressed his agreement with either text. |
GATT Library | sd246xp8422 | Report of Working Party No. 4 on the Reservation of Ceylon | General Agreement on Tariffs and Trade, August 27, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 27/08/1948 | official documents | GATT/CP.2/21 and GATT/CP.2/13/Add.2,3 CP.2/14-22, CP.2/22/Add.1,Corr.1 | https://exhibits.stanford.edu/gatt/catalog/sd246xp8422 | sd246xp8422_90320033.xml | GATT_147 | 384 | 2,483 | RESTRICTED
LIMITED B
GATT/CP . 2/21
27 August 1948
ORIGINAL: ENGLISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
Contracting Parties
Second Session
Report of Working Party No. 4 on
the Reservation of Ceylon
Working Party No. 4 on the Reservation of Ceylon met
at 3 p.m. on 24 August 1948 under the Chairmanship of Dr.
E. Angenthaler (Czechoslovakia).
The working party consisted of representatives of
Australia, Belgium, Canada, Ceylon, China, Czechoslovakia,
Norway, United Kingdom and United States.
The terms of reference were "to examine the reservation
of the Government of Ceylon to its signature of the Protocol
of Provisional Application, and to consider the possibilities
of a solution in accordance with the terms of the reservation
or in accordance with the provisions of Article XXIII or
Article XXV7 or of other relevant provisions of the General
Agreement on Tariffs and Trade.
After a thorough discussion the Working Party agreed
that the case should be considered under the provisions of
Article XXIII rather than those of Article XXV and that
special consideration should be given to the difficulties
with which Ceylon is faced at this time. In the light of
these difficulties the Working Party unanimously
decided to recommended the adoption by the CONTRACTING PARTIES
of the resolution as follows:
"THE COTRACTING PARTIES
Having considered the reservation made by the Government
of Ceylon at the time of the signing of the Protocol of Pro-
visional Application of the GATT, and
Taking note of the reference of the matter to the
CONTRACTING PARTIES by the Government of Ceylon and the
statement of its representative expressing the readiness of
his Government to re-open negotiations with any of the other
contracting parties in respect of the tariff items concerned
at any convenient time and place,
Recommend under Article XXIII that the Government of
Ceylon renegotiate with the contracting parties concerned not
later than during the turiff negotiations, which are expected
to commence in April 1949, and use its best endeavours to
achieve a satisfactory adjustment."
In recommending the adoption of this resolution the
Working Party wishes to express its opinion that the case of
Ceylon was considered in the light of the present special
difficulties of this country and should not serve as a prece-
dent for other cases which should be treated in accordance
with the particular circumstances. |
GATT Library | cm421wp3239 | Report of Working Party no. 5 on Article 31A | United Nations Conference on Trade and Employment, February 18, 1948 | Third Committee: Commercial Policy | 18/02/1948 | official documents | E/CONF.2/C.3/64 and E/CONF.2/C.3/58-77/REV.1 | https://exhibits.stanford.edu/gatt/catalog/cm421wp3239 | cm421wp3239_90190164.xml | GATT_147 | 393 | 2,722 | United Nations Nations Unies
CONFERENCE CONFERENCE E/CONF.2/C.3/64
ON DU 18 February 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI EN
THIRD COMMITTEE: COMMERCIAL POLICY
REPORT OF WORKING PARTY NO. 5 ON ARTICLE 31A
At its thirty-fifth meeting on 13 February 1948, Committee III established
Working Party No. 5 to examine and make recommendations concerning the texts
proposed for the new Article 31A by Sub-Committee J on State Trading
(E/CONF.2/C.3/43) and by the delegation of Cuba (E/CONF.2/C.3/9/Add.2) in the
light of the proposals put forward during the discussion in Committee.
The representatives of Belgium, , Bolivia, Chile, Cuba, New Zealand,
Philippines, United Kingdoam nd United States were appointed members and the
RighHt on. Walter Nash (New Zealand) was nominated Chairman of the Working
Party which held one meeting.
After fu1l examination of both proposals and of the points raised in
mComlttee, unianmous agreement was reached, subject only to provisional
reservations,end ping instructions, by the delegates of Chile and the United
States.
In Making its recoemmndation, the Working Party understood that the term
"liquidation" would not apply to disposal of a national security stockpile for
the purposes for which it was accumulated.
It is accordingly recommended that Article 31A should read as follows:
Article. 31A
Liquidation of Non-Commercial Stocks
1. If a Member holding stocks of any primary mcomodity accuumlated for
non-mmecoracil purposes should liquidate such stocks, it shall carry out such
liquidation, as far as practicable, in a manner that will avoid serious
disturbance to wor ld markets for themm cuodity concerned.
2.n Ay such Member sha:l l
(a) give not lessa thn four months public notice of its intention
to liquidate such stocks; or
(b) give not less than four months prior notice to the Organization
ouch in ch intention.
he 3. e Mencmber c-erned shall, at the request of any Member which considers
suitself bstantially interested, consult as to the best means oinf avoidg
substanjtial inury to the economic interests of producers and consumers of
/the primary Page 2
the primary ## in question. In cases where the interests of several
Members might be substantially affected, the Organization say participate in
such consultation, and th Member holding these stocks shall give due
Consideration to its recommendations.
4. The provisions of paragraphs 1, 2 and 3 shall not apply to routine
disposal of supplies necessary for the rotation of stocks to avoid deterioration. |
GATT Library | zn241yj0066 | Report of Working Party no. 5 on Item 17 (Sweden) | United Nations Conference on Trade and Employment, January 14, 1948 | Third Committee: Commercial Policy and Sub-Committee E (Articles 20 and 22) | 14/01/1948 | official documents | E/CONF.2/C.3/E/W.11 and E/CONF.2/C.3/D/W/1-13/E/CONF.2/C.3/E/W/1-23 | https://exhibits.stanford.edu/gatt/catalog/zn241yj0066 | zn241yj0066_90190545.xml | GATT_147 | 180 | 1,252 | United Nations Nations Unies E/CONF.2/C.3/E/
CONFERENCE CONFERENCE 14 January 1948
ON DU
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
THIRD COMMITTEE: COMMERCIAL POLICY
SUB-COMMITTEE E (ARTICLES 20 AND 22)
REPORT OF WORKING PARTY NO. 5
ON ITEM 17 (SWEDEN)
1. At the Fifth Meeting of the Sub-Committee the delegate of Sweden said
he would withdraw his amendment to paragraph 2 (c) of Article 20 if a
reference was made in the records of the Sub-Committee that his case was
covered by the existing working.
2. It was agreed at the same meeting that the delegates of Sweden and the
United Kingdom should draft a note to this end.
3. The delegates of Sweden and the United Kingdom have agreed on the
following Wording of this note:
"The Sub-Committee agreed that the provisions of Article 20: 2 (c)
(ii) would cover arrangements under which the Government concerned made
temporary surpluses of grain available as animal feeding stuffs to
smallholders and similar categories with a low standard of living, free
of charge or at prices below the current market level". |
GATT Library | xh654bs4059 | Report of Working Party no. 6 | United Nations Conference on Trade and Employment, February 19, 1948 | Third Committee: Commercial Policy | 19/02/1948 | official documents | E/CONF.2/C.3/66 and E/CONF.2/C.3/58-77/REV.1 | https://exhibits.stanford.edu/gatt/catalog/xh654bs4059 | xh654bs4059_90190166.xml | GATT_147 | 195 | 1,366 | United Nations Nations Unies UNRESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.3/66
19 February 1948
ON DU
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
THIRD COMMITTEE: COMMERCIAL POLICY
REPORT OF WORKING PARTY NO. 6
1. Working Party No. 6 was set up at the thirty-seventh meeting of
Committee III to consider the proposal of the delegation of India either
to amend the text or to insert a new Interpretative Note so as to make
clear that sub-paragraph 2 (c) of Article 20 covered horticultural,
sericultural and primary forest products. It was composed of the
representatives of Brazil, India, Norway, the Union of South Africa and
the United States. The representative of the Union of South Africa was
appointed Chairman.
2. The Working Party recommends that the following passage be approved
by Committee III and inserted in the records of that Committee:
"The term 'agricultural product' in sub-paragraph 2 (c) of
Article 20 may include inter alis sericultural products and certain
plant products (a) which are derived from the plant in the natural
process of growth, such as gums, resins and syrups and (b) a major
part of the total output of which is produced by smell producers." |
GATT Library | yx402sg5692 | Report of Working Party no. 6 on Item 23 (Chile) and Item 24 (Geneva Draft Note) (Reference E/CONF. 2/C.3/7) | United Nations Conference on Trade and Employment, January 22, 1948 | Third Committee: Commercial Policy and Sub-Committee E (Articles 20 and 22) | 22/01/1948 | official documents | E/CONF.2/C.3/E/W.16 and E/CONF.2/C.3/D/W/1-13/E/CONF.2/C.3/E/W/1-23 | https://exhibits.stanford.edu/gatt/catalog/yx402sg5692 | yx402sg5692_90190550.xml | GATT_147 | 297 | 2,040 | United Nations Nations Unies RESTRICTED
CONFERENCE CONFERENCE E/CONF. 2/C. 3/E/W.16
CONFERENCE CONFERENCE 22 January 1948
TRADE AND EMPLOYMENT COMMRCE ET DE L'EMPLOI ORIGINAL: ENGLISH
THIRD COMMITTEE: COMMERCIAL POLICY
SUB-COMMITTEE E (ARTICLES 20 AND 22)
REPORT OF WORKING PARTY NO. 6 ON ITEM 23 (CHILE) AND
ITEM 24 (GENEVA DRAFT NOTE)
(Reference E/CONF. 2/C.3/7)
Item 23
1. The delegation of Chile proposed the addition of the following sentence
to paragraph 2 of Article 20:
"Restrictions applied under (d) formerly (c)7 of the present
Article shall be strictly limited to periods during which the
circumstances referred to therein prevail and shall not be imposed
on seasonal articles of consumption when like domestic products
are not available."
2. The Working Group, composed of the delegates for Chile, Netherlands,
Peru, the United Kingdom and the United States agreed to submit for the
acceptance of the Sub-Committee the following wording to be added after
(c) (iii) of paragraph 2 of Article 20:
"Restrictions on imports under sub-paragraph 2 (c) of this
Article shall be applied only as long as the governmental measures
referred to in this sub-paragraph are in force. Restrictions
applied under sub-paragraph 2 (c) on the import of products, the
supply of which is subject to seasonal variation, shall not be
operated in such a way as to prevent their import in quantities
sufficient to satisfy demand for current consumption purposes
during those periods of the year when like domestic products, or
domestic products for which the imported product can be directly
substituted, are not available."
Item 24 (in relation with the Note on paragraph 2 (c) of Article 20
appended to the Geneva Draft).
The Working Group decided to wait with the final recommendation on
this note until Working Party No. 1 of this Sub-Committee has finished its
task. |
GATT Library | tq632qf9187 | Report of Working Party no. 8 (Article 42) | United Nations Conference on Trade and Employment, March 12, 1948 | Third Committee: Commercial Policy | 12/03/1948 | official documents | E/CONF.2/C.3/87 and E/CONF.2/C.3/78-89/ADD.3 | https://exhibits.stanford.edu/gatt/catalog/tq632qf9187 | tq632qf9187_90190195.xml | GATT_147 | 266 | 1,837 | United Nations Nations Unies UNRESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.3/87
ON DU 12 March 1948
TRADE AND EMPLOY0ENT COMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
THIRD COMMITTEE : COMMERCIAL POLICY
REPORT OF WORKING PARTY NO. 8 (ARTICLE 42)
The Third Committee, at its forty-fourth meeting on 11 March, appointed
representatives of the delegations of Chile, France, the United Kingdom,
the United States of America and Venezuela to constitute a Working Party
for the purpose of clarifying the text of Article 42 in the light of the
discussion at that meeting.
The representative of the delegation of France was unable to attend the
meeting of the Working Party. The other members of the Working Party agreed
on the following text which they recommend to the Third Committee:
"Article 42
Territorial Application of Chapter 1V
"1. The provisions of Ohapter IV shall apply to the customs territories,
of the Members. If there are under the jurisdiction of any Member two
or more customs territories in respect of which this charter has been
accepted, each such customs territory shall be treated as though it
were a Member exclusively for the purposes of the territorial
application of Chapter IV; Provided that the provisions of this
paragraph shall not be construed to create any rights or obligations
as between two or more customs territories under the Jurisdiction
of a single Member.
"2. For the purposes of this Chapter a customs territory shall be
understocd to maen any territory with respect to which separate
tariffs or other regulations of commerce are maintained for a substantial
part of the trade of such territory with other territories." |
GATT Library | hx782fj2680 | Report of Working Party no. 9 on Items 55 and 57 (India) and 56 (Czechoslovakia) (Reference: E/CONF.2/C.3/7) | United Nations Conference on Trade and Employment, January 31, 1948 | Third Committee: Commercial Policy and Sub-Committee E (Articles 20 and 22) | 31/01/1948 | official documents | E/CONF.2/C.3/E/W.19 and E/CONF.2/C.3/D/W/1-13/E/CONF.2/C.3/E/W/1-23 | https://exhibits.stanford.edu/gatt/catalog/hx782fj2680 | hx782fj2680_90190554.xml | GATT_147 | 690 | 4,496 | RESTRICTED.
United Nations Nations Unies E/CONF.2/C .3/E/W.19
CONFERENCE CONFERENCE 31 January 1948
ON DU ORIGINAL: ENGLISH
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI
THIRD COMMITTE: COMMERCIAL POLICY
SUB-COMMITTEE E (ARTICLES 20 AND 22)
REPORT OF WORKING PARTY NO. 9
ON ITEMS 55 AND 57 (INDIA) AND 56 (CZECHOSLOVAKIA)
(Reference: E/CONF.2/C.3/7)
1. Working Party No. 9 consisting of the representatives of Ireland,
Mexico, Netherlands, Peru and the United Kingdom was set up at the
Seventh Meeting of the Sub-Ccmmittee to consider Items 55 and 57 (India)
and Item 56 (Czechoslovakia). The representatives of India and
Czechoslovakia presented their views to the Working Party and the
representatives of Canada and the United States also took part in the
debate as observers.
Items 55 and 57 (India)
2. The Working.Party understands the first sentence of sub-paragraph
3 (b) of Article 22 as requiring the Member in all cases to give not
later than the beginning of the relevant period public notice of quotas
fixed for a specified future period, but as permitting a Member, which
for urgent balance of payments reasons is under the necessity of changing
the quota within the course, of a specified period, to select the timing
of its public notification of the change.
The above in no way affects the obligation of a Member under
sub-paragraph 3 (a) where applicable.
The Working Party recommends that the substance of the above note
be inserted in the Report of Sub-Committee E to Committee III and if the
Sub-Comittee agrees to this the delegation of India will withdraw its
amendments.
Item 56 (Czechoslovakia)
3. The Working Party discussed fully the reservation of Czechoslovakia
contained in the footnote to sub-paragraphs 3 (b) and. 3 (c) of the
Geneva text. The Working Party considered that some provision should
be made in the Charter for releasing a Member from its obligation to
give public notice under sub-paragraph 3 (b) and 3 (c) in the case of
a Member trading with a non-Member or non-Members; it was also felt,
/however, E/CONF.2/C.3/E/W.19
Page 2
however, that adequate safeguards for exporting countries were essential,
The Working Party considered that Article 74 paragraph 3 would not be
a suitable provision in the first instance for a Member desiring to secure
such a release both because a waiver of an obligation under that paragraph
could only be obtained by a two-thirds majority and also because it would
require a decision by the Conference as distinct from the Executive Board,
If, however, a Member failed to obtain satisfaction under the proposed new
sub-paragraph 3 (d) (see below) the Working Party agreed that a Member would
be free to have recourse to Articel 74.
The Working Party. accordingly recommends the adoption of the following
wording to be inserted as a new sub-paragraph 3 (d) of Article 22:
"If the Organization finds, an request from a Member, that the
interests of that Member would be seriously prejudiced by the
necessity of complying in relation to certain products with the
obligation of sub-paragraph (b) and the obligation under sub-paragraph (c)
of this paragraph to give public notice, by reason of the fact that a
large part of its imports of such products is supplied by non-Members,
the Organization shall release such Member from such obligations to
the extent and for such time as it finds necessary to prevent such
prejudice. Any request made by a Member pursuant to this sub-paragraph
shall be acted upon promptly by the Organization."
The Working Party expressed its view, and recommends that its view be
inserted in the Report of Sub-Committee E to Committee III that, to enable
prompt considerations of applications under sub-paragraph 3 (d) it would be
desirable for the Organization to delegate its functions in respect of this'
sub-paragraph to the Executive Board; and. that, provided an application
under this sub-paragraph was made sufficiently early and. accompanied by
sufficiently full information to enable adequate-.consideration by, the
Executive Board before the commencement of the quota period the Executive Board
should temporarily release the applicant Member from the requirement to give
public notice for the period necessary for the Executive Board to make a
decision on the application. |
GATT Library | dd225rq7963 | Report of Working Party no.1 on Article 20 (2) (c) | United Nations Conference on Trade and Employment, February 7, 1948 | Third Committee: Commercial Policy and Sub-Committee E (Articles 20 and 22) | 07/02/1948 | official documents | E/CONF.2/C.3/E/W.18 and E/CONF.2/C.3/D/W/1-13/E/CONF.2/C.3/E/W/1-23 | https://exhibits.stanford.edu/gatt/catalog/dd225rq7963 | dd225rq7963_90190553.xml | GATT_147 | 3,287 | 21,229 | United Nations Nations Unies RESTRICTED
E/COF. 2/C. 3/E/W. 18
CONFERENCE CONFERENCE 7 February 1948
ON DU
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
THIRD CMMITTEE: COMMERCIAL POLICY
SUB-COMMITTEE (ARTI2CLE 20 AND 22)
REPORT OF WORKING PARTY NO. 1 ON ARTICLE 20 (2) (c)
Working Party No. 1 consisting of the delegates of Colombia, Ireland,
Netherlands, Sweden, the United Kingdom end the United States was set up at
the third meeting of Sub-Committee to consider the amendments of Sweden
(Item 21 of the Annotated Agenda - E/CONF.2/C.3/7), Ireland (Item 22) and
gypt (Item 15). At the seventh meeting of the Sub-Committee, this Working
was enlarged to include the delegates of Mexico and Peru, and charged
with considering further the interpretation of the term "restrict" in
Article 20 (2) (c) and. the amendments of Peru (E/CONF.2/C.3/E/W.5) and of
Ireland (E/CONF.2/C.3/E/W.6). The amendment of Norway (Item 19), the United
Kingdom amendment (E/CONF.2'/C.3/2/W.10) and the Geneva draft note on "special
factors" were later referred to this Working Party by the Chairman of Sub-
Committee E, as were any amendments arising out of the discussions in the
Working Party. The delegates of Canada and Denmark have attended the meetings
throughout and other delegations whose amendments have been under discussion
have presented their views. The Working Party reports as follows:
I. General
The Working Party agreed that Article 20 (2) (c) was not intended to
provide a means of protecting domestic producers against foreign competition
out simply to permit, in appropriate cases, the enforcement of domestic
governmental measures necessitated by the special problems relating to the
production and marketing of agricultural and fisheries products.
II. Interpretation of the term "restrict".
The Working Party agreed that in interpreting the term "restrict' for
the purposes of Article 20 (2) (c) the essential point was that the measures
of domestic restriction must effectively keep domestic output below the level
which it would have attained in the absence of restrictions.
III. Amendments Designed to Narrow the Scope of Article 20 (2) (c)
The Working Party discussed fully the proposals of Egpt and Peru seeking
to provide that Article 20 (2) (c) should apply only:
(a) where the restrictions on domestic outpout were temporary (Egypt);
/(b) to permit E/CONF.2/C.3/E/W.18
Page 2
(b) to permit only temporary use of import restrictions (Peru);
(c) where there was a surplus of production (Egypt, supported by Peru);
or
(d) where there was no subsidy to domestic production (Peru).
As regards (a) and (b) it was noted that the term "temporary" was
difficult to define, that Working Party No. 3 on export restrictions had
recommended the substitution of the words' "for the period necessary" for the
word "temporary". in Article 20 .(2) (a), and that the terms. of Article 20 (2)
(c), particularly with the additional provisions recommended by Working Party
No. 6, would ensure that import restrictions could be applied only for as
long as they were necessary to the enforcement of restrictions on domestic-
output. It was agreed that Governments would certainly not wish to. restrict
domestic output of agricultural and fisheries products for any longer period
than was really necessary. The delegates of Egypt and Peru withdrew these .
proposals, on the understanding that they would be free to reintroduce them
if the additional provisions recommended by Working Party. No. 6 were not
adopted by the.Conference.
As regards (c), the Working Party agreed that no Government would wish
to restrict domestic output except when obliged to do so by the existence of
a surplus or by a persistent tendency towards the production of a surplus;
however, to write (c) (or, indeed, (a) or (b)) into the text of the Charter
would in practice have the effect of giving the Organization the power to
determine whether and when Members could or could not institute or enforce-
particular restrictions on domestic agricultural production, a condition which
Governwnets could not reasonably be expected to accept.
As regards (d), the Working Party agreed that it was not the case that
subsidies were necessarily inconsistent with restrictions of production and
that in some cases they might be necessary features of a governmental program
for restricting production. It was recognized, on the other hand, that there
might be cases in which restrictions on domestic production- not effectively
enforced and that this, particularly in conjunction with the application of'
subsidies, might lead to misuse of the provisions of Article 20 (2) (c). .The
Working Party agreed that Members whose interests were seriously prejudiced
by the operation of a domestic subsidy should normally have recourse to the
procedure of Article 25 and that this procedure would be open to any member
who considered that restrictions on domestic agricultural production applied
for the purposes of Article 20 (2) (c) were being rendered ineffective by the
operation of a domestic ??. The essential point was that the restrictions
on domestic production should be effectively enforced .and the Working Party
recognized that unless this condition were fulfilled, restrictions on imports
/would not be E/CONF.2/C. 3/E/W.18
Page 3
would not be warranted.
It was agreed (except by the delegate of Peru who reserved his position
as regards the question of subsides) that points (c) and (d) might adequately
be met by the insertion of "effectively" after "operate" in the fourth line
of Article 20 (2) (c) and by the provision of other suitable safeguards for
the interests of exporting countries (see under IV below).
IV. Safeguards for Exporting Countries
The Working Party gave full consideration to the question of safeguards
to prevent prejudice to the interests of exporting countries by import
restrictions imposed in consequence of restrictions on domestic output under
Article 20 (2) (c). It Was agreed that the possibility that the provisions of
the Article might be misused by the imposition of restrictions on domestic
output which were not effectively enforced should be dealt with by the
Amendments suggested in the last paragraph of section III.
The Working Party further noted that the provisions of Article 22, and
in particular the consultation provisions of Article 22 (4), applied to import
restrictions imposed under Article 20 (2) (c); further, that it would be open
to a Member at any time to make representations under Article 41 to a Member
applying import restrictions under Article 20 (2) (c), or to raise under
Articles 89 and 90 the question whether the Governmental measures restricting
domestic output were such as to warrant the application of import restrictions
under Article 20 (2) (c).
It was pointed out that the sudden imposition of import restrictions
under Article 20 (2) (c) might have serious effects on the interests of
exporting countries, and that to avoid this there should be provisions
requiring Members intending to introduce such import restrictions to give as
much advance notice as possible to exporting countries in order to afford
.adequate opportunity for consultation before the import restrictions are put
into effect. It was suggested that this point might be met by the inclusion
of the provisions as to prior notice and consultations set out in VII below.
It was agreed that provision should be made for the observance of secrecy
with regard to prior notice of, and consultation concerning, the proposed
introduction of restrictions if the Member proposing to introduce such
restrictions should so request.
It was pointed out that it was possible that import restrictions might
in certain circumstances operate so as :to give undue advantage to particular
exporting countries. For example, global quotas not allocated among supplying
countries might sometimes operate in a manner unduly favourable to those
countries best able for any reason to take prompt advantage of the global
quota at the opening of the quota period; and it was agreed that Members, in
/administering E/CONF. 2/C. 3 /E/W.18
Page 4
administering import restrictions, should pay due regard to the need for
avoiding such a result. It was also agreed that, in the case of perishable
commodities, due regard should be had for the special problems affecting the
trade in these commodities.
V. Amendments Designed to Widen the Scope of Article 20 (2) (c)
The Working Party, discussed the amendment of Ireland (Item 22) providing
for the use of import restrictions to implement governmental policy to..
maintain the incomes of producers, and also an amendment put forward in the
Working Party by the delegate of Colombia, providing for the use of import
restrictions to stabilize agricultural prices. A majority of the Working
Party felt that these amendments provided for the use of import restrictions
on a much broader basis than that provided in the case of restrictions under
(i) of Article 20 (2) (c), and if generally applied would widen the scope of
the Article in a way which would seriously endanger the interests of
agricultural exporting countries, and. that the particular difficulties of
Ireland should be met by other measures. The delegate of Colombia withdrew
his amendment in view of the lack of support for it, but the delegate of
Ireland felt unable to withdraw his amendment.
A further amendment was proposed to the Working Party by the delegate of
Ireland, providing for the use of import restrictions to facilitate the
disposal of seasonal and, unavoidable surpluses of domestic production. In
discussion, this amendment did not receive support, and the delegate of
Ireland withdrew it.
The Working Party discussed the amendment of Sweden providing for the
use of import restrictions to mitigate seasonal and short term fluctuations
in the supply of Agricultural products. After hearing a statement by the
delegate of Sweden as to his Government's policy in regard to livestock
production, the Working Party agreed that a number of measures that he had
described were certainly capable of being used for restricting domestic
production, and, to the extent that they were so used, would be covered by
the provisions of Article 20 (2) (c) (i). On this understanding the delegate
of Sweden withdrew his amendment.
VI. Other Points.
Norwegian Amendment
After hearing the explanation of the Norwegian delegate, the Working
Party decided .that the proposal to substitute the word "partly" for "mainly"
in Article 20 (2) (c) (iii) was unnecessary. It was agreed that, under the
existing text, in a case for example in which a Member wished to restrict the
quantities permitted to be.produced of any animal product the production of
which was dependent wholly or mainly on two or more imported kinds of feeding
/stuffs E/CONF.2/C. 3/E/W.18
Page 5
stuffs considered together but not necessarily on either kind considered
separately, it would be open to that Member to restrict the production of
animal products, provided that domestic production of the imported kinds of
feeding-stuffs were relatively negligible, by treating the imported kinds of
feeding-stuffs as a single commodity and applying import restrictions thereto
It was further agreed that if the various imported feeding-stuffs were
in fact treated as a single commodity, import restrictions thereon should be
applied globally on. the total combined imports without allocating shares to
the individual feeding-stuffs. It was felt that, in cases where this procedure
would not be practicable, the import restriction should take the form of an
equal proportionate reduction in the amount permitted to be imported of each
of the several feeding-stuffs.
The delegate for Norway accordingly withdrew his amendment.
United Kingdom Amendments
(a) After discussion the amendment in document E/CONF.2/C.3/E/W.10 was
withdrawn by the delegate of the United Kingdom.
(b) The Working Party accepted a further United Kingdom suggestion
that in order to avoid ambiguity the words "agricultural or fisheries"
should be inserted between "domestic" and "product" at the end of
sub-paragraph 2 (c) (i).
Geneva Note on "special factors"
The Working Party took note of the new note to Article 22 on "special
factors" recommended by Working Party No. 8, and agreed that this, from the
point of view of Article 20 (2) (c) of the Geneva text, was desirable in that
it made clear that, in cases where separate import quotas were allotted to
the various foreign suppliers, a country whose productive efficiency or
ability, to export had increased relatively to other foreign suppliers since
the representative period on which import quotas were based should receive a
relatively larger import quota. The Working Party recommends that the note
to Article 20 (2) (c) of the Geneva text on "special factors" should be
retained as an interpretative note to sub-paragraph 3 (d), subject to the
changes indicated below to bring it into line with the proposed new note to
Article 22. It was brought to the notice of the Working Party that the
delegation of Cuba may wish to raise the question of the footnotes relating
to "special factors" in Articles 20 and 22 when these Articles are again
discussed by Sub-Committee E.
VII. Proposed Revised Text of Article 20 (2) (c)
(NOTE: The following revised text of the existing Article 20 (2) (c)
to which has been added a new paragraph 3 contains the alterations suggested
in the earlier paragraphs of this report and takes into account the United
/Kingdom E/CONF.2/C.3-/E/W.l8
Page 6
Kingdom drafting amendment (Item 16), whioh-was accepted by Sub-Committee E;
it also. incorporates the changes proposed by Working Party No. 6 in documents
E/CONF.2/C.3/E/W.16 (peragraph 3 (a) below) and in E/CONF.2/C./E/W.16/Add.1
(interpretative note on "in any form"). The drafting of the former has in
consequence been slightly altered with the concurrency of Working Party No. 6).
ARTICLE 20
2. The provisions of paragraph 1 of this Article shall not extend to
the following:
(a) (Still under consideration by Sub-Committee E);
(b) As in Geneva text;
(c) Import restrictions on any agricultural or fisheries product,
imported in any form, necessary to the enforcement of governmental
measures which operate effectively:
(i) to restrict the quantities of the like domestic product
permitted. to be marketed or produced [of the like domestic
product], or, if there is no substantial domestic production
of the like product, of a domestic agricultural or fisheries
product for which the imported product can be directly
substituted; or
(ii) As in Geneva text;
(iii) As in Geneva text.
3.. With regard to import restrictions applied under the provisions of
sub-paragraph 2 (c):
(a) such restrictions shall be applied only so long as the
governmental measures referred to in sub-paragraph 2 (c) are in
force, and when applied to the import of products, the supply of
which is subject to seasonal variation, shall not be applied in
such a way as to prevent their import in quantities sufficient to
satisfy demand for current consumption purposes during those
periods of the year when like domestic products, or domestic products
for which the imported product can be directly substituted, are not
available.
(b) Any Member intending to introduce restrictions on the importation
of any product shall in-order to avoid unnecessary damage to the
interests of exporting countries give notice in writing, as far in
advance as practicable, to the Organization and to Members having a
substantial interest in supplying that product; in order to afford
such Members adequate opportunity for consultation in accordance
with paraaphs 2 (d) and 4 of Artcle - 22; before the restrictions
enter into force. At the request of the importing Member concerned.
/the notification E/CONF. 2/C .3/E/W.18
Page 7
the notification. and any informtion disclosed dulring these
consultations shall be kept strictly confidential.
(c) Any Member applying such restrictions [on the importation of
any product pursuant to this sub-paragraph] shall give public notice
of the total quantity, or value of the product permitted to be
imported during a specific future period and of any change in such
quantity or value.
(d) Any restrictions applied under sub-paragraph 2 (c) (i) shall
not be such as will reduce the total of imports relative to the
total of domestic production, as compared with the proportion
which might reasonably be expected to rule between the two in the
absence of restrictions. In determining this proportion, the Member
shall pay due regard to the proportion prevailing during a previous
representative period, and to any special factors which may have
affected or may be affecting the trade in the product concerned.
(Paragraph 3 of the Geneva Text of Article 20 would then become
paragraph 4).
Interpretative Note
[The ten "in any form"' in this paragraph covers the same products when
in an early stage of processing and still perishable, which compete directly
with the fresh product,. and if freely imported would tend to make the
restriction on the fresh product ineffective.]
The term "agricultural or fisheries product, imported in any form" means
such product in the form in which it is originally sold by its producer and
such processed forms of the product the importation of which, without
restrictions, would. make ineffective the restrictions on the importation of
the product in its original form.
Interpretative Note
The provisions of Article 20 (3) (b) with regard to prior consultation
would not prevent a Member which had given other Members a reasonable period
of' time for such consultation from introducing the restrictions at the date
intended. It is recognized that, in the case of consultation with regard to
import restrictions applied under sub-paragraph 2 (c) (ii), the period of
advance notice provided would in some cases necessarily be relatively short.
Interpretative Note
The term "special factors" in sub-paragraph 3 (d) includes changes in
relative productive efficiency as between domestic and foreign producers, [or
as between different foreign producers] but not changes artificially brought
about by means not permitted under the Charter, which may have occurred since
the representative period.
/VIII. The E/CONF .2/C .3-/E/W.18
Page 8
VIII. The Working Party recommends that the substancbe of section I, II, III
and IV be incorporated. in the Report of Sub-Committee E to Committee III,
together with the last paragraph of section V dealing with the amendment of
Sweden and that part of section VI which deals with the amendment of Norway.
IX. The representative of Mexico wished to record a pro forma reservation
regarding the exceptions in Article 20 (2) (o) to the general prohibition of
quantitative restrictions under Article 20 (1). Hee stated that he interpreted
that import restrictions under Article 20 (2) (c) were allowed only when they
did not affect products whose treatment was otherwise specified in prior
international commitments.
The representative of Mexico also stated that he wished to record a
reservation by his delegation regarding Article 20 (2) (c), in view of the
divergent position taken by certain delegations with respect to the procedure
for establishing quantitative restrictions under Article 13 and under
Article 29 (2) (c).
The delegates of. Peru and Colombia wished to state that the provisions of
Article 20 (2) (c) gave a definite advantage to certain countries because they
allowed them to apply import restrictions to defend their agriculture against
some contingencies. Their delegations considered that other countries,
particularly underdeveloped ones, should be allowed to defend their economies
and foster their development by similar or other measures, by provisions in
another or other Articles of the Charter. Consequently, they reserved the
position of their countries regarding: Article 20, pending the final text of
Article 13.
The delegateof Ireland areed with the delegate of Colombia that
Article 20 (2) (c) seemed to favour those countries which, because of the
manner in which their agricultural industries are, organized and officially
controlled, can readily institute schemes of regulation qualifying them for
the benefits of that sub-paragraph. Nonetheless, he did not-object to the
retention of this sub-paragraph. He maintained, however, that the provisions
of the Article should be extend so as to enable other countries to use import
restrictions at least to meet situations arising out of unavoidable seasonal
fluctuations in supply, and also to allow for the maintenance of stable income
in agriculture. He was compelled to reserve his position on these points. |
GATT Library | cv642tp6610 | Report of Working Party no.3 on Item 6 (Australia) and Item 7 (Greece) | United Nations Conference on Trade and Employment, January 16, 1948 | Third Committee: Commercial Policy and Sub-Committee E (Articles 20 and 22) | 16/01/1948 | official documents | E/CONF.2/C.3/E/W.14 and E/CONF.2/C.3/D/W/1-13/E/CONF.2/C.3/E/W/1-23 | https://exhibits.stanford.edu/gatt/catalog/cv642tp6610 | cv642tp6610_90190548.xml | GATT_147 | 257 | 1,807 | United Nations Nations Unies RESTRICTED
CONFERENCE CONFERENCE E/C0NF.2/C 3/E/W. 14
CONFERENCE CONFERENCE 16 January 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
THIRD COMMITTEE: COMMERCIAL POLICY
SUB-COMMITTEE E (ARTICLES 20 AND 22)
REPORT OF WORKING PARTY NO. 3
ON ITEM 6 (AUSTRALIA) AND ITEM 7 (GREECE)
1. Working Party No. 3, consisting of the delegates of Australia, France
and the United States, was setup at the Third Meeting of the Sub-Committe.
2. The Working Party considered the amendment of Australia to
paragraph 2 (a) of Article 20 (Item 6) and, in consultation with the
delegates of Greece, the amendment submitted by the Greek delegation to
paragraph 2 (a).
3. Its recommendations as to Sub-Committee E are as follows:
Item 6
The following text is recommended to meet the amendment put
forward by the delegation of Australia:
"(a) export prohibitions or restrictions [temporarily]
applied for the period necessary to prevent or relieve
critical shortages of foodstuffs or other products
essential to the exporting Member country".
Item 7
In connection with the amendment submitted by the delegation
of Greece, it was felt that the position could best be met by
an interpretative footnote. It is recommended that this note
should take the following form:
"In the case of products which are basic to diet
in the exporting country and which are subject to
alternate annual shortages and surpluses, the provisions
of this sub-paragraph do not preclude such export
prohibitions or restrictions as are necessary to maintain
from year to year domestic stocks sufficient to avoid
critical shortages". |
GATT Library | ff266dt5190 | Report of Working, Party No.3 on Modifications to the General Agreement : Annex II (Revised). Draft protocol modifying part II. Article XXVI of the General Agreement on Tariffs and Trade | General Agreement on Tariffs and Trade, August 30, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 30/08/1948 | official documents | GATT/CP.2/22/Rev.1/Annex II/Rev.1 and GATT/CP.2/22/Rev.1+Rev.1/Corr.1 CP.2/22/Rev.1/Annex II/Rev.1 CP.2/23-27 | https://exhibits.stanford.edu/gatt/catalog/ff266dt5190 | ff266dt5190_90320039.xml | GATT_147 | 775 | 5,072 | RESTRICTED
LIMITED B
GATT/CP .2/22/Rev.l/
Annex II/Rev.1
30 August 1948.
ORIGINAL: ENGLISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
CONTRACTING PARTIES
SECOND SESSION
Report of Working, Party No.3 on Modifications
to the General Agreement
ANNEX II (Revised)
DRAFT PROTOCOL MODIFYING PART II. ARTICLE XXVI
OF THE GENERAL AGREEMENT ON TARIFFS AND TRADE
The Goveriments of ........................ acting
in their capacity of Contracting Parties to the General
Agreement on Tariffs and Trade (hereinafter referred to
as the Agreement),
desiring to effect an amendment to the Agreement,
pursuant to the provisions of Article XXX thereof,
HEREBY AGREE AS FOLLOWS:-
1. The texts of Articles III, VI, XIII, XV, XVIII and
XXVI of the Agreement and certain related provisions of
Annex I shall be modified as follows:
2. (a) This Protocol shall be opened for signature
at Geneva and shall remain open for signature on behalf
of any of the Contracting Parties until the
Signature may be with or without reservation as to
acceptance.
(b) Any Contracting Party which has either signed
this Protocol subject to a reservation as to acceptance
or has not signed this Protocol may accept the Protocol
at any time after by deposit of an
instrument of acceptance with the Secretary-General of
the United Nations. GATT/CP .2/22/Rev .1/
Annex II/Rev.l
Page 2
(c) On this Protocol shall be
deposited with the Secretary-General of the United Nations
and such deposit; shall thereupon constitute the deposit
of the instruments of acceptance of the Contracting
Parties which have signed the Protocol without reservation.
3. The amendment set out in paragraph 1 of this
Protocol shall enter into force for all the Contracting
Parties upon the deposit of instruments of acceptance, in
accordance with paragraph 2 of this Protocol, by two-thirds
of the Governments which at that time are Contracting
Parties.
(a) The Secretary-Gen ral of the United Nations will
inform all the Contracting Governments of the deposit
of each instrument of acceptance and of the date on which
the amendment set out in paragraph 1 of this Protocol
enters into force.
(b) The Secretary-General is authorised to effect
registration of this Protocol under Article 102 of the
Charter of the United Nations at the appropriate time.
IN WITNESS WHEREOF the respective representatives duly
authorised to that effects have signed this Protocol.
DONE at Geneva this............... day of September
one thousand nine hundred and forty-eight in a single
copy in English and in French, each of which shall
be equally authoritative. GATT/CP .2/22/Rev. 1/
ANNEX II/Rev. 1
page 3
DRAFT OF PROTOCOL MODIFYING PARTS I AND III OF
THE GENERAL AGREEMENT ON TARIFFS AND TRADE.
The Governments of acting
in their capacity of Contracting Parties to the General
Agreement on Tariffs and Trade (hereinafter referred to
as the Agreement),
desiring to effect an amendment to the Agreement,
pursuant to the provisions of Article XXX thereof,
HEREBY AGREE AS FOLLOWS:-
1. The texts of Articles I, II and XXIX of the
Agreement shall be modified as follows:-
2. (a) This Protocol shall be opened for signature at
Geneva and shall remain open for signature on behalf of
any of the Contracting Parties until the
Signature may be with or without reservation as to
acceptance.
(b) Any Contracting Party which either has signed
this Protocol subject to a reservation as to acceptance
or has not signed this Protocol may accept the Protocol
at any time after by deposit of an
instrument of acceptance with the Secretary-General of
the United Nations.
(c) On this Protocol shall be
deposited with the Secretary-General of the United Nations
and such deposit shall thereupon constitute the deposit
of the instruments of acceptance of the Contracting
Parties which have signed the Protocol without reservation.
3. The amendment set out in paragraph 1 of this
Protocol shall enter into force for all the Contracting
Parties upon the deposit of instruments of acceptance in
accordance with paragraph 2 of this Protocol, by two-thirds
of the Governments which at that time are Contracting Parties. GATT/CP.2/22/Rev. 1/
ANNEX II/Rev.1
page +
(a) The Secretary-General of the United Nations
will inform all the Contracting Governments of the
deposit of each instrument of acceptance and of the
date on which the amendment set out in paragraph 1
of this Protocol enters into force.
(b) The Secretary-General is authorsed to
effect registration of this Protocol under Article 102
of the Charter of the United Nations at the appropriate
time.
IN WITNESS WHEREOF the respective representatives
duly authorized to that effect, have signed this
Protocol.
DONE at Geneva this ............. day of September
one thousand nine hundred and forty-eight in a single
copy in English and in French, each of which shall be
equally authoritative. |
GATT Library | gh669sc5645 | Report of Working Party no.3 the Chilean ammendment to paragaph 2 of Article 11, the Afghanistan amendment to paragraph 3 of Article 11 and the Pakistan amendment to paragraph 2 of Article 10 | United Nations Conference on Trade and Employment, January 12, 1948 | Joint Sub-Committee of Committees II and VI | 12/01/1948 | official documents | E/CONF.2/C.26/A/W.15, E/CONF.2/C.2/D/W.1-3, C.23/A/W.1-3, and C.26/A/W.1-29 | https://exhibits.stanford.edu/gatt/catalog/gh669sc5645 | gh669sc5645_90180370.xml | GATT_147 | 518 | 3,726 | United Nations Nations Unies RESTRICTED
E/CONF .2/C .2&6/A/
CONFERENCE CONFERENCE W.15
ON DU 12 January 1948 ORIGINAL: ENGLISH
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI :
JOINT SUB-COMMITTEE OF COMMITTEES II AND VI
REPORT OF WOKING PARTY NO. 3 ON THE CHILEAN AMENDMENT TRO PARAGRAPH 2
OF ARTICL.E 11, THE AFGEANISTAN AMENDMENT TO PARAGRAPH OF ARTICLE 11
AND THE PAKISTAN AMENDMENT TO PARAGRAPH 2 OF ARTICLE10
1. The Joint Sub-Committee of committees II and VI referred the following
amendments to Working Party No. 3 at its twelfth meeting.
(see E/CONF.2/C.2&6/A/W.9):
(1) Chilean amendment to paragraph 2 of Article 11
(page 9 of E/CONF.2/C.2/9)
(2) Amendment proposed by Afghanistan to paragraph 3 of Article 11
(page 10 of E/CONF.2/C.2/9)
(3) Pakistan amendment to paragraph 2 of Article 10
(page 3 of E/CONF.2/C.2/9)
2. It was agreed that the following additional sub-paragraph in paragraph 3
would enable the Organization to act in the way envisaged in the three
amendments. The additions and deletions indicanted in the text below by
underlining and square brackets respectively refer to changes from the text
contained in E/CONF.2/C.2&6/A/W.3 as amended by the Joint Sub-Committee at its
ninth (E/CONF.2/C.2&6/A/W.6) and fourteenth (E/CONF.2/C.2&6/A/W.13) meetings.
"3. The Organization may in such collaboration with other
inter-governmental organizations as may be appropriate.
(a) make recommendations for and promote bilateral or multilateral
agreements on measures designed.
(i) to assure just and equitable treatment for the enterprise,
skills, capital, arts and technology brought from one
Member country to another;
(ii) to avoid international double taxation in order to
stimulate the flow of foreign private investments;
(iii) to facilitate an equitable distribution of skills, arts,
technology, materials and equipment.
(b) formulate and promote....investment".
3. The Committee felt that this text would enable the Organization to make
/recommendations E/CONF .2/C .2&6/A/W.15
Page 2
recommendations and promote international agreements to assist countries
encountering difficulties as a result of shortages.
4. The Committee considered that:
(a) the words "facilitate an equitable distribution" made clear that
conditions of "shortage" as stated in the Chilean amendment and condition
of "short supply" as stated in the Afghanistan amendment were contemplate-
since if supplies were ample the problem of equitable distribution would
not arise;
(b) the promotion of an agreement to facilitate an equitable distribution
of skills, arts, technology, materials and equipment, was not restricted
by the use to which these facilities were put, i.e. if these facilities
were essential to established industries as well as to economic
development, the Organization could recommend an agreement in appropriate
circumstances;
(c) if the Organization believed that speculation was affecting the
equitable distribution of the facilities covered by this Article and it
thought that such action was useful and appropriate, it would be able
under the terms of the suggested amendment to make recommendations to
governments and promote agreements between governments, which provided
for the parties to take measures against speculation;
(d)"industrial patents" would be included in the. term "technology";
consequently, without prejudice to the discussion in the Sub-Committee of
the new Article 11 A proposed by Chile, the purpose of paragraph 3 (b) of
that proposal may be met by this amendment. |
GATT Library | gf719cw7508 | Report of Working Party no.4 on Item 8 (China) | United Nations Conference on Trade and Employment, January 16, 1948 | Third Committee: Commercial Policy and Sub-Committee E (Articles 20 and 22) | 16/01/1948 | official documents | E/CONF.2/C.3/E/W.15 and E/CONF.2/C.3/D/W/1-13/E/CONF.2/C.3/E/W/1-23 | https://exhibits.stanford.edu/gatt/catalog/gf719cw7508 | gf719cw7508_90190549.xml | GATT_147 | 126 | 788 | United Nations
CONFERENCE
ON
TRADE AND EMPLOYMENT
Nations Unies
CONFERENCE
DU
COMMERCE ET DE L'EMPLOI
RESTRICTED
E/CONF .2/C.3/E/W.15
16 January 1948
ORIGINAL: ENGLISH
THIRD COMMITTEE: COMMERCIAL POLICY
SUB-COMMITTEE E (ARTICLES 20 AND 22)
REPORT OF WORKING PARTY NO. 4 ON ITEM 8 (CHINA)
1. Working Party No. 4 consisting of the delegates of Chile, China and the
United States was set up at the Fifth Meeting of the Sub-Committee to consider
the amendment of China (Item 8).
2. The Chinese Delegation, after having discussed the question in the
Working Party, has decided to withdraw its amendment to paragraph 2 (a) of
Article 20 but reserves the right to bring the matter up again if certain
provisions in the Geneva Draft of certain other Articles are altered. |
GATT Library | cg091wc9161 | Report of Working Party no.8 | United Nations Conference on Trade and Employment, February 7, 1948 | Third Committee: Commercial Policy and Sub-Committee E (Articles 20 and 22) | 07/02/1948 | official documents | E/CONF.2/C.3/E/W.17 and E/CONF.2/C.3/D/W/1-13/E/CONF.2/C.3/E/W/1-23 | https://exhibits.stanford.edu/gatt/catalog/cg091wc9161 | cg091wc9161_90190552.xml | GATT_147 | 615 | 3,996 | United Nations Nations Unies RESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.3/E/W.17
ON DU 7 February 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
~~~~4im . . . .
OMMMR= COTOS: C0O4ECL' ICY`-'
SUB-C41=E ERTICLES 20 AND 22)
RPOT ORKINOF WCRPAROTY NO.8
1. Working P artyNo. 8 was set up at the Sixth Meeting of the Sub-Committee
and consisted of the delegates for Mexico, New Zealand, Peru, the United
Kingdom and the United States. The Working Party enjoyed the benefit of
co-operation with the delegates for Turkey and Uruguay at its meetings.
2. It was appointed to consider sub-paragraph 2 (d) of Article 22 in the
light of the amendments proposed thereto and was given authority to consult
on matters of common concern with a Working Party of Sub-Committee F.
The following items fell within its terms of reference:
Item 51 (Uruguay)
Items 52 and( 58 Mexico)
Item 54 (Turkey)
Item 59 (Geneva Draft Note)
Item 60 (Syria and Lebanon)
and the footnote to sub-paragraph 2 (d) in the Geneva Draft.
Item 51 (Uruguay)
The Working Party agreed that the objectives of this amendment were fully
covered by the present draft of paragraph 2 because price and delivery
conditions were obviously among the main factors which would determine the
distribution of trade in the absence of import restrictions. In the light of
this explanation, the delegate for Uruguay withdrew the amendment.
Items 52 (Mexico) and 54 (Turkey)
These amendments were withdrawn in view of the proposed revision of the
footnote (see Item 59 below).
Item 58 (Mexico)
Thre Woking Party considered that the fact that it was the member applying
the restriction who allocated the quota was already sufficiently clear, both
because paragraph 2 (d) specifically mentioned this and on the more general
ground that there was no hint elsewhere that anybody else was to allocate the
quota. The delegate for Mexico therefore withdrew this amendment.
Item 60 (Syria and Lebanon)
The delegates for Syria and Lebanon stated that they had no objection to
/their E/CONF.2/C.3/E/W .17
Page 2
their amendment being considered in connection with Article 23 and on the
request of the Working Party they presented their views to the appropriate
Working Party of Sub-Committee F of Committee III. The Working Party of
Sub-Committee F considered that the amendment had properly been referred to
it and Working Party No. 8 did not therefore examine this amendment further.
Item 59 (Geneva Draft Note)
The Working Party agreed that this note should be retained and that it
should be framed to cover the objectives of the amendments of Mexico (Item 52)
and Turkey (Item 54). It was also agreed that the note should refer to the
term "special factors" wherever used in Article 22.
Accordingly the Working Party recommends that the following wording be
added as an interpretative note to the text in place of the existing note to
paragraph 4:
"The term 'special factors' as used in this Article includes
inter alia the following changes as between the various foreign producers
which may have occurred since the representative period:
(i) changes in relative productive efficiency;
(ii) existence of new or additional ability to export; and
(iii) reduced ability to export;
but does not include changes artificially brought about since the
representative period by means not permitted under the Charter."
The Working Party agreed that the use of the words "inter alia" should
be called to the attention of the Central Drafting Committee in order that
the various footnotes to the text might be stardardized throughout the Charter.
Geneva Note to Sub-Paragraph 2 (d)
The Working Party recommends that this footnote be deleted, though this
recommendation is conditional upon the adoption of the new footnote proposed
above. |
GATT Library | mx138hg3053 | Report of Working Party of Sub-Committee G of Committee VI on chapter VIII | United Nations Conference on Trade and Employment, January 9, 1948 | Committee VI: Organization | 09/01/1948 | official documents | E/CONF.2/C.6/W.30 and E/CONF. 2/C. 6/W. 1-40 | https://exhibits.stanford.edu/gatt/catalog/mx138hg3053 | mx138hg3053_90200138.xml | GATT_147 | 686 | 4,216 | United Nations
CONFERENCE
ON
TRADE AND EMPLOYMENT
Nations Unies
CONFERENCE
DU
COMMERCE ET DE L'EMPLOI
RESTRICTED.
E/CONF.2/C.6/W.30
9 January 1948
ORIGINAL: ENGLISH
COMMITTEE VI: ORGANIZATION
REPORT OF WORKING PARTY OF SUB-COMMITTEE G OF
COMMITTEE VI ON CHAPTER VIII
1. The Working Party, composed of representatives of Australia, India,
Mexico and the United. States considered. several alternatives suggested and
agreed unanimously on the text of Articles 89 and 90, paragraph 4.
2. The following is a suggested text for Article 89 - Consultation between
Members:
"If' any Member should consider. that any benef it accruing to
it directly or indirectly, implicitly or explicitly under any the
provisions of this Charter other than Article 1 is being nullified
or impaired, [or that the attainment of any of the objectives set
forth in Article 1 is being impeded], as a result of
(a) the failure of another Member to carry out [its]
obligation g under this Charter, or
: (b) the application by another Member of any measure, whether
or not it conflicts with the provisions of the Charter, or
- (c) the existence of any other situation 7 the Member may
.6-.. discussions undertaken.
3. .The following is a suggested. text for Article 90 - Reference to the-
Organization; -
. Paragraph 4.
` If' the Conference Considars that [the circumstances are serious
enough] the nullification or impairment referred to in Article 89 in
fact exists and. is sufficiently serious to justify such action....etc.'
1, Comments
(a) After consideration of the points of view expressed in
the sub-committee meeting the working party considered that it''
Could best reconcile these views and the sense of the meeting by
narrowing the scope of the preamble to Article 89. It was felt
that Article 1 of the Charter is so broad. that it would be possible
to show that almost any action taken by a Member Impeded the
/attainment of E/CONF.2/C.6/W.30
Page 2
attainment of one of the objectives set forth in Article 1, and
therefore provided a basis for complaint. The working party,
therefore, felt that a considerable narrowing of the scope of
Article 89 and a consequent elimination of many of the difficulties
encountered by certain delegations would result from elimination
of the reference to Article 1. In order to make entirely clear
that Article 1 could not be read back into Article 89 by
construction of the words "any benefit", it was also decided to
qualify the words "any benefit" in the manner shown in the redraft.
It was agreed further that the addition of the phrase "implicitly
or explicitly" would make clear that a high level of employment
consequent to demand in another Member country was a benefit to
any Mamber reasonably implied under Chapter 2.
(b) The working party decided to make the indicated chance in
sub-paragraph (a) of Article 89 in order to make clear that it
was not necessary to allege a failure of a Member to carry out
all of its obligations under the Charter.
(c) After extensive discussion of sub-paragraph (b) of Article 89
it was decided to allow this sub-paragraph to remain as in the
Geneva text. The working party considered that this sub-paragraph
would apply to the situation of action taken by a Member such as
action pursuant to Article 94 of the Charter. Such action, for
example, in the interest of national security In time of war or
other international emergency would be entirely consistent with
the Charter, but might nevertheless result in the nullification
or impairment of benefits accruing to other Members. Such other
Members should, under those circumstances, have the right to bring
the matter before the Organization, not on the ground that the
measure taken was inconsistent with the Charter, but on the ground
that the measure so taken effectively nullified benefits accruing
to the complaining Member.
The representative of India vas doubtful about the necessity- of
inclusion of the sub-paragraphs a, b, and c, but other Members of the
Working Party felt that there were some advantages in keeping the
sub-paragraphs a, b and c in the text of Article 89 as it stands now, |
GATT Library | pg707kp6062 | Report of Working Party on Article 21 | United Nations Conference on Trade and Employment, January 21, 1948 | Third Committee: Commercial Policy and Sub-Committee F (Articles 21, 23 and 24) | 21/01/1948 | official documents | E/CONF.2/F/W.19 and E/CONF.2/C.3/F/W.1-31/REV.2 | https://exhibits.stanford.edu/gatt/catalog/pg707kp6062 | pg707kp6062_90190581.xml | GATT_147 | 505 | 3,468 | United Nations Nations Unies RESTRICTED
CONFERENCE CONFERENCE E/CONF.2/F/W.19
ON DU 21 January 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
THIRD COMMITTEE: COMMECIAL POLICY
SUB-COMMITTEE F (ARTICLES 21, 23 AND 24)
REPORT OF WORKING PARTY ON ARTICLE 21
1. At its Fifth Meeting the Sub-Committee appointed a Working Party
consisting of the delegates of Belgium, Brazil, Cuba, India, the United Kingdom
and the United States of America to consider the amendments to Article 21
submitted by the delegation of Belgium (C.3/F/W.6). Items 28 and 33
(Australia) were also referred to this Working Party at the Sixth Meeting of
the Sub-Committee. Mr. J. A. GUERRA (Cuba) was elected Chairman of the
Working Party.
2, The Working Party has agreed on the following amendments to Article 21:
(a) The following paragraph 1 should be inserted before the present
paragraph 1:
1. (a) Members recognize that
(i) It is primarily .the responsibility of each Member to
safeguard its external financial position and to
achieve and maintain stable equilibium in its balance
of payments;
(ii) an adverse, balance of payments of one Member may have
important offects on the trade and balance of payments
of other Members, particularly if it results in the
imposition by the Member, for the purpose of
safeguarding its external financial position, of
restrictions affecting international trade;
(iii) the balance of payments of each Member is of concern
to other Members, and therefore it is desirable that
the Organization should promote mutual consultations
and, whore possible, agreed action consistent with
this Charter for the purpose of correcting a
maladjustment ir. balances of payments;
(iv) action taken to restore stable equilibrium in the
balance of payments should so far as possible employ
methods which expand rather than contract
international trade.
/(b) The E/CONF.2/C .3/F/W.19
Page 2
(b) The principles set forth in sub-paragraph (a) of this
paragraph shall guide the Organization in action taken under
the relevant provisions of this Article and Articles 23 and
24.
(b) The present paragraphs 1, 2, 3, 4 and 5 of Article 21 should be
numbered respectively 2, 3, 4, 5 and 6.
(c) The present paragraph 2 (b) should read as follows:
A Member applying restrictions under sub-paragraph (a) shall
progressively relax and ultimately eliminate them as its external
financial position improves, in accordance with the provisions
of that sub-paragraph. This provision shall not be interpreted
to mean that a Member is required to relax or remove such
restrictions if that relaxation or removal would thereupon produce
conditions Justifying the intensification or institution
respectively of restrictions under sub-paragraph (a).
(d) The following phrase should be added at the end of paragraph 3 (c)
(iii) of the Geneva text: "including interests under Articles 3 and 9",
(e) The following sentence should be inserted as the first sentence
of paragraph 4 (e) of the Geneva text:
In consultations between a Member and the Organization under
this paragraph there shall be full and free discussion and
expression of opinions as to the causes and nature of the Member's
balance-of-payments difficulties. |
GATT Library | fj128vp0946 | Report of Working Party on Article 23 | United Nations Conference on Trade and Employment, February 25, 1948 | Third Committee: Commercial Policy and Sub-Committee F (Articles 21, 23 and 24) | 25/02/1948 | official documents | E/CONF.2/C.3/F/W.31/Rev.1 and E/CONF.2/C.3/F/W.1-31/REV.2 | https://exhibits.stanford.edu/gatt/catalog/fj128vp0946 | fj128vp0946_90190596.xml | GATT_147 | 2,292 | 14,754 | United Nations Nations Unies RESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.3/F/W. 31/
ON DU Rev.1
25 February 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
THIRD COMMITEE: CONMERCIAL POLICY
SUB-COMMITEE F (ARTICLES 21, 23, 24)
REPORT OF WORKING PARTY ON ARTICLE 23
1. At its Eighth Meeting, 17 January 1948, Sub-Committee F appointed a
working party to consider amendments submitted to Article 23. The Working
Party consisted of the delegates of Australia, Belgium, Canada, Czechoslovakia,
France, Norway, United Kingdom and the United States of America. The
delegate of Greece was also appointed a member of the Working Party for
the purpose of considering an amendment to Article 23 submitted by Greece.
2. Mr. Neil Perry (Canada) was elected Chairman of the Working Party.
3. The following amendments were referred to the Working Party by
Sub-Coimrittee F. They are listed according to the paragraph of Article 23
to which they refer and identified either as items in the Annotated Agenda
(E/CONF.2/C.3/7) or as separate working papers submitted to the Sub-Committee.
Paragraph 1 (a)
Amendment by Czechoslovakia (W.14)
Paragraph 1 (b)
Entire paragraph - Amendment by Czechoslovakia (W.14)
Sub-paragraph (i) - Amendment by Norway (W.5)
Amendment by Belgium (W.6)
Sub-paragraph (ii). Amendment by Belgium (W.6)
Amendment by France (W.3)
Paragraph 2
Amendment by Czechoslovakia (W.14)
Paragraph 3 (a)
Item 67 (Denmark)
Amendment by Czechoslovakia (W.14)
Paragraph 3 C)
Item 68 (Mexico)
Amendment by Czechoslovakia (W.14)
Paragraph 3 - Proposed New Sub-paragraph
Item 69 (Italy)
Paragraph 5
Amendment by Czechoslovakia (W.14)
Paragaph 5 - Proposed New Sub-paragraph
Amendment by Norway (W.4) /Paragraph ap E/CONF.2/C/.3/F/w. 31/Rev.1
Page 2
Paragraph 5 - Proposed New Sub-paragraph
Proposal by Greece (originally Item 78 and replaced by a new amendment
submitted to the Working party).
Proposed Now Paragraph 6
Amendment by France (Item 74 ).
The Working Party also considered an amendment to Article 22 proposed by
Syria and Lebanon (Item 60 of the Annotated Agenda) which was referred to it
by Sub-Committee E of Committee III as falling more properly under Article 23.
4. In the course of its deliberations the Working Party heard statements from
the delegates of Denmark, Italy, Lebanon, Mexico and Syria relating to their
proposed amendments.
Representatives of the International Monetary Fund also participated in the
meetings.
5. After a thorough consideration of the amendments mentioned above the
Working Party has concluded that a substantial redraft of Article 23 is
desirable and submits the text which appears at the end of this report, with
the interpretative note annexed thereto. The new text does not require the
interpretative note to paragraph 3 of Article 23 of the Geneva Draft and it
has accordingly been dropped.
6. The major changes from the Geneva text of Article 23 are to be found in
paragraphs 1, 2 and 4 of the revised Article.
7. In conjunction with the proposed revision of Article 23, it is considered
desirable that paragraph 9 of Article 24 of the Geneva text (renumbered
paragraph 8 in the text submitted by the Working Party on Article 24 and
subsequently described by that number) be amended by the deletion of the phrase
"Subject to paragraph 4 of this Article," at the beginning of the paragraph. As
a consequence of this change the Working Party recommends that the interpretation
note now attached to paragraph 4 of Article 24 of the Geneva text be attached to
paragraph 8 of that Article, that the first sentence of the note be deleted, and
that certain consequential drafting changes be made as shown in the attached text.
8. Paragraph 1 defines the exceptions to the rule of non-discrimination
permissible during the post-war transitional period, This transitional period
and its application in respect of individual members are defined by reference
to the provisions of Article XIV of the International Monetary Fund or by
reference to an analogous provision of a special exchange agreement pursuant
to paragraph 6 of Article 24. The discriminatory measures, including
adaptations thereof, permitted under paragraph 1 may be applied by a Member
during the transitional period without the prior approval of the Organization.
After the termination of the transitional period for the Member in question
any departure from the rule of non-discrimination is subject to the prior
/approval E/CONF.2/C.3/F/W.3l/Rev.1
Page 3
approval of the Organization, pursuant to the provisions of paragraph 2.
9. Paragraph 4 permits a Member applying import restrictions in accordance
with Article 21 to control its export in such a manner as to increase its
earning of currencies which it can use without deviation from the provisions
of Article 22.
10. The effect of the Amendent to paragraph 8 of Article 24 is that the
measures defined in that paragraph are not precluded by the provisions
of this Section of the Charter.
11 Paragraphs 3 and 5 of the revised draft are substantially the same as
paragraphs 4 (a) and 5 respectively of the Geneva text of Article 23. Faragraph 5
(b) of the revised article incorporates an amendment which is a consequential
change resulting from certain amendments to Annex A of Article 17 which have
been approved by Commttee III with reservation by the delegations of Brazil and
Iruguay. (See E/CONF. 2/C .3/59, page 17).
12. It is considered. by the Working Party that the above changes meet a large
number of the objectives to which the amendments submitted were directed. In
view of the extensive revision of Article 23 it is not practicable to indicate
how particular amendmnts have been accomodated. However, the amendments
submitted by the following countries are considered by the delegates of those
countries to be covered by the new text:
(a) Belgium
(b) Czechoslovakia
Amendimnts to paragaphs 1 (a), 1 (b), 2, 3 (a), and 3 (c) are covered
by Article 23 and the proposed amendment to paragraph 5 is covered by
the proposed revision of paragraph 8 of Article 24.
(c) Denmark
(d) France
(e) Norway. (amendment to paragraph 1 (b) (i))
(f) Lebanon
(g) Syria
13. The Norwegian delegate indicated that the new text of Article 93 on
Relations with Non-Members, suggested by the delegation of Czechoslovakia
and accepted by the Sub-Committee of the Sixth Committee (E/CONF.2/C.6/W.108)
as a basis for discussion, met the major part of the problem to which his
amendment on long-term. agreements (E/CONF.2/C. 3/F/W. 4) was directed, and,
accordingly, withdrew this amendment.
14. With respect to the amendment submitted by Italy (Item 69) the
Working Party considers that paragraph 2 of the revised text takes account
of the concept of relative injury.
15. The delegate of Mexico has informed the Working Party that his
/delegation E/CONF 2/C .3/F/W.31/Fev.l
Page 4
delegation is now reviewing the new text to see whether the purpose of its
amendment (Item 68) is met.
16. The amendment submitted by Greece proposing a new Article 23A (Item 78)
was replaced by an amendment to paragraph 5 of Article 23 submitted to the
Working Party by the delegate of Greece. After the new text of Article 23,
together with the change proposed in Article 24, were before this Working
Party, the delegate of Greece advised the Working Party that these new texts
went a long way to meet the problem of his country. However, he did not
feel that his point was met entirely, particularly in the post-transitional
period. The Working Party believes that further amendment in this respect
would provide too wide an exception, and therefore recommends no further
change in the text. The delegate of Greece advised the Working Party that
his delegation reserved its position.
Article 23
Exceptions to the Rule of Non-discrimination
I. (a) The Members recognize that the aftermath of the war has brought
difficult problems of economic adjustment which do not permit the
immediate full achievement of non-discriminatory administration of
quantitative restrictions and therefore require the exceptional
transitional period arrangement set forth in this paragraph.
(b) A Member applying restrictions under Article 21 may, in the use of
such restrictions, deviate from the provisions of Article 22 in a manner
having equivalent effect to restrictions on payments and transfers for
current international transactions which that Member may at that time
apply under Article XIV of the Articles of Agreement of the International
Monetary Fund, or under an analogous provision of a special exchange
agreement pursuant to Article 24, paragraph 6.
(c) A Member applying restrictions under Article 21 and which was
applying import restrictions to safeguard its balance of payments
on 15 February 1948 in a manr which deviated from the rules of
non-discrimination set forth in Article 22 may, to the extent that
such deviation would not have been covered on that date by sub-
paragraph (b) of this paragraph, continue so to deviate, and may adapt
such deviation to changing circumstances. A Member which was a contracting
party under the General Agreement ?? Tariffs and Trade on 15 February 1946
may, in the application of restrictions under Article 21, deviate from the
rules of non-discrimination set forth in Article 22 in accordance with the
provisions of paragraphs 1-3 of Article XIV of that Agreement, to the
extent that such deviation would not have been covered on that date by
sub-paragraph (b) of this paragraph. The Organization may, if it deems
/such action E/CONF . 2/C.3/F/W.31/Rev. 1
Page 5
such action necessary in exceptional circumstances, make representations
to any Member deviating from the provisions of Article 22 pursuant to this
sub-paragraph that conditions are favourable for the termination of any
particular deviation, or for the general termination of such deviations.
The Member shall be given a suitable time to reply to such
representations. If the Organization thereafter finds that the Member
persists in unjustifiable deviation from the provisions of Article 22,
the Member shall, within sixty days, limit or terminate such deviations
as the Organization may specify.
(d) The policies applied in the use of import restrictions under sub-
paragraphs (b) and (c) of this paragraph in the post-war transitional
period shall be designed to promote the maximum development of multi-
lateral trade possible during that period end to expedite the,
attainment of u ?? of payments position 'wdch will no longer
require resort to Article 21.
Member shall deviate from the provisions of Article 22 pursuant
to sub-paragraphs (b) or (c) of this paragraph except during the post-war
transitional period arrangement for that Member pursuant to Article XIV
of the Articles of Agreement of the International Monetary Fund, or
pursuant to an analogous provision of a special exchange agreement under
Article 24, paragraph 6.
2. Notwithstanding the termination of the Member's transitional period
arrangement pursuant to sub-paragraph 1 (e) of this Article, a Member which
is applying import restrictions under Article 21 may, with the consent of
the Organization, temporarily deviate from the principles of Article 22 in
respect of a small part of its trade where the benefits to the Member or
14 Members concerned substantially outweigh any injury which may result to the
trade of other Members.
3. The provisions of Article 22 shall not preclude restrictions in accordance
with Article 21 which are applied against imports from other countries, but not
as among themselves, by a group of territories having a common quota in the
International Monetary Fund an condition that such restrictions are in all
other respects consistent with Article 22.
4. A Member applying import restrictions under Article 21 shall not be
precluded by this Section from applying measures to direct its exports in such
a manner as to increase its earnings of currencies which it can use without
deviation from Article 22.
5. A Member shall not be precluded by this Section from applying quantitative
restrictions .
(a) having equivalent effect to exchange restrictions authorized under
Section 3 (b) of Article VII of the articles of Agreement of the
International Monetary Fund; or E/CONF .2/C s3 /F/'W. 31/ReV.1
Page 6
(b) undar the preferential arrangements provided for in Annex A of
this Charter, pending the outcome of the negotiations referred to
therein.
Interpretative Note to Paragraph 2 of Article 23
One of the situations contemplated in paragraph 2 is that of a Member
holding balances acquired as a result of current transactions which it finds
itself unable to use without a. measure of discrimination.
Changes Proposed in Article 24
"[9/] S. [subject to paragraph 4 of this Article,] Nothing in this Section
shall preclude
(a) the use by a Member of exchange controls or exchange restrictions
in accordance with the Articles of Agreement of the International
Monetary Fund or with that Member's special exchange agreement.
with the Organization, or
(b) the use by a Member of restrictions or controls on imports or
exports the sole effect of which, additional to the effects permitted
under Articles 20, 21, 22 and 23, is to make effective such exchange
controls or exchange restrictions."
Changes Proposed in Interpretative Footnote to ArtIcle 24
"[Paragraph 4.] Paragraph 8.
[The word. "frustrate" is intended to indicate, for examples that
infringements by exchange action of the letter of any Article of this
Charter shall not be regarded as offending against that Article if, in
practice, there is no appreciable departure from the intent of the
Article. Thus] For example a Member which, as part of its exchange
control, operated in accordance with the Articles of Agreement of the
International Monetary Fund, required payment to be received for its
exports in its own currency or in the currency of one or more members
of the International Monetary Fund would not thereby be deemed to be
offending against Article 20 or Article 22. Another example would be
that of a Member which specified on an import licence the country from
which the goods might be imported for the purpose not of introducing any
additional element of discrimination in its import licenses but of
enforcing permissible exchange controls." |
GATT Library | td533xs8396 | Report of Working Party on Article 23 | United Nations Conference on Trade and Employment, February 24, 1948 | Third Committee: Commercial Policy and Sub-Committee F (Articles 21, 23 and 24) | 24/02/1948 | official documents | E/CONF.2/C.3/F/W.31 and E/CONF.2/C.3/F/W.1-31/REV.2 | https://exhibits.stanford.edu/gatt/catalog/td533xs8396 | td533xs8396_90190594.xml | GATT_147 | 2,273 | 14,769 | United Nations Nations Unies RESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.3/F/W. 31
ON DV 24 February 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
THIRD COMMITTEE: COMMERCIAL POLICY
SUM-COMMITTEE F (ARTICLES 21, 23, 24)
REPORT OF WORKING PARTY ON ARTICLE 23
1.At its Eighth Meeting, 17 January 1948, Sub-Committea F appointed a
working party to consider amendments submitted to Article 23. The Working
Party consisted of the delegates of Australia, Belgium, Canada, Czechoslovakia,
France, Norway, United Kingdom and the United States of America. The
delegate of Greece was also appointed a member of the Working Party for
the purpose of considering an amendment to Article 23 submitted by Greece.
2.Mr. Neil Perry (Canada) was elected Chairman of the Working Party.
3. The following amendments were referred to the Working Party by
Sub-Committee F. They are listed according to the paragraph of Article 23
to which they refer and identified either as items in the Annotated Agenda
(E/CONF.2/C.3/7) or as separate working papers submitted to the Sub-Ccaittee.
Paragraaph 1 (a)
Amendment by Czechoslovakia (W.14)
Paragraph 1 (b)
Entire paragraph - Amendment by Czechoslovakia (W.14).
Sub-paragraph (i) - Amendment by Norway (W.5)
Amendment by Belgium (W.6)
Sub-paragraph (ii)- Amendment by Belgium (W.6)
Amendment by France (W.3)
Paragraph 2
Amendment by Czechoslovrakia (W.14)
Paragraph 3 (a)
Item 67 (Denmark)
Amendment by Czechoslovakia (W.14)
Paragraph 3 (c)
Item 68 (Mexico)
Amendment by Czechoslovakia (W.14)
Paragraph 3 - Proposed New Sub-paragraph
Item 69 (Italy)
Paragraph 5
Amendment by Czechoslovakia (W.14)
Paragrgaph 5-Proposed New Sub-paragraph
Amendment by Norway (W.4) /Paralaph 5 E/CONF..2/C. 3/F/W. 31
Page 2
Paragraph 5 - Proposed New Sub-paragraph
Proposal by Greece (originally Item 78 and replaced by a new amendment
submitted to the Working Party).
Proposed New Paragraph 6
Amendment by France (Item 74).
The Working Party also considered an amendment to Article 22 proposed by
Syria and Lebanon (Item, 60 of the Annotated Agenda) which was referred to it
by Sub-Committee E of Committee III as falling more properly under Article 23.
4. In the course of its deliberations the Working Party beard statements from
the delegates of. Denmark, Italy, Lebanon, Mexico and Syria relating to their
proposed amendments.
Representatives of the International Monetary Fund also participated in the
meetings.
5. After a thorough consideration of the amendments mentioned above the
Working Party has concluded that a substantial redraft of Article 23 is
desirable and submits the text which appears at the end of this report, with
the interpretative note annexed thereto. The new text does not require the
interpretative note to paragraph 3 of Article 23 of the Geneva Draft and it
has accordingly been dropped.
6. The major changes from the Geneva text of Article 23 are to be found in
paragraphs 1, 2 and 4 of the revised Article.
7. In conjunction with the proposed revision of Article 23, it is. considered
desirable that paragraph 9 of Article 24 of the Geneva text (renumbered
paragraph 8 in the text submitted by the Working Party on Article 24 and
subsequently described by that number) be amended by the deletion of the phrase
"Subject to paragraph 4 of this Article," at the beginning of the paragraph. As
a consequence of this change the Working Party recommends that the interpretativ
note now attached to paragraph 4 of Article 24 of the Geneva text be attached to
paragraph 8 of that Article, that the first sentence of the note be deleted, and
that certain consequential drafting changes be made as shown in the attached text.
8. Paragraph 1 defines the exceptions to the rule of non-discrimination
permissible during the post-war transitional erpiod. This transitional period
and its application in respect of additional members are defined by reference
to the provisions of Article XIV of the International MonetaryFu dn or by
reference to an analogous provision of a special exchange Agreement pursuant
o paragraph 6 of Article 24. The discrimi3atory m.asurea .ncmuduing : -
adaptations thereof, permitted under paragraph 1 may be applied by a Member
during the transitional period without the prior approval of the Organization.
After the termination of the triansiti onal perod forthe Member in question
any departure from the rulemi atoof is non-cd iscrininsubjetto the prior.
/approval E/CONF.2/C.3/F/W. 31
Page 3
approval of the Organization, pursuant to the provisions of paragraph 2.
9. Paragraph 4 permits a Member applying import restrictions in accordance
with Article 21 to control its exports in such a manner as to increase its
earning of currencies which it can use without deviation from the provisions
of Article 22.
10 The effect of the Amendment to paragraph 8 of Article 24 is that the
measures defined in that paragraph are not precluded by .the provisions
of this Section of the Charter.
11. Paragraphs 3 and 5 of the revised draft are substantially the same as.
paragraphs 4 (a) and 5 respectively of the Geneva text of Article 23. Paragraph 5
(b) of the revised article incorporates an amendment which is a consequential
chage result ng from certain amendments to Annex A of Article 17 which have
been approved by Committee III with reservation by the delegations of Brazil and
ruguay. (See E/CONF.2/C.3/59, page 17).
12. It is considered by the Working Party that the above changes meet a large
number of the objectives to which the amendments submitted were directed. In
view of the extensive revision of Article 23 it is not practicable to indicate
how particular amendments have been accommodated. However, the amendments
submitted by the following countries are considered by the delegates of those
countries to be covered by the new text:
(a) Belgium
(b). Czechoslovakia
Amendments to paragraphs 1 (a), 1 (b), 2, 3 (a), end 3 (c) are covered
by Article 23 and the proposed amendment to paragraph 5 is covered by
the proposed revision of paragraph 8 of Article 24.
(c) Denmark
(d) France
(e) Norway (amendment to paragraph 1 (b) (i))
(f) Lebanon
(g) Syria
13. The Norwegien delegate indicated that the new text of Article 93 on
Relations with Non-members, suggested by the delegation of Czechoslovakia
and accepted by the Sub-Committee of the Sixth Committee (E/CONF.2/C.6/W.108)
as a basis for discussion, met the major part of the problem to which his
amendment on long-term amedments (E/C0NF.2/C.3/F/W.4) was directed, and,
accordingly, withdrew this amendment.
14.. With respect to the amendment submitted by Italy (Item 69) the
Working Party considers that paragraph 2 of the revised text takes account
of the concept of relative injury.
15. The delegate of Mexico has informed the Working Party that his
/delegation E/CONF.2/C.3/F/W.31
delegation is now reviewing the new text to see whether the purpose of its
amendment (Item 68) is met.
16. The Working Party considered the amendment submitted by Greece
(originally Item, 78) in the form of an amendment to paragraph 5 of
Article 23 submitted by the delegate of Greece. After the new text
of Article 23, together with the change proposed in Article 24, were
before this Working Party the delegate of Greece advised the Working
Party that these new texts went a long way to meet the problem of his
country. However, he did not feel that his point was met entirely,
particularly in the post-transitional period. The Working Party believes
that further amendment in this respect would provide to wide an exception,
and therefore recommends no further change in the text. The delegate of
Greece advised the Working Party that his delegation reserved its position.
Article 23
Exceptions to the Rule of Non-Discrimination
(a) The Members recognize that the aftermath of the war has brought
difficult problems of economic adjustment which do not permit the
immediate full achievement of non-discriminatory administration of
quantitative restrictions and therefore require the exceptional
transitional period arrangement set forth in this paragraph.
(b) A Member applying restrictions under Article 21 may, in the use of
such restrictions, deviate from the provisions of Article 22 in a manner
having equivalent effect to restrictions on payments and transfers for
current international transactions which that Member may at that time
apply under Article XIV of the Articles of Agreement of the International
Monetary Fund, or under an analogous provision of a special exchange
agreement pursuant to Article 24, paragraph 6.
(c) A Member applying restrictions under Article 21 and which was
applying import restrictions to safeguard its balance of payments
on 15 February 1948 in a manner which deviated from the rules of
non-discrimination set forth in Article 22 may, to the extent that
such deviations would not have been covered on that date by sub-
paragraph (b) of this paragraph, continue so to deviate, and may adapt
such deviation to changing circumstances. A Member which was a contracting
party under the General Agreement on Tariffs an dTrade on15 February 1948
may, in the application of restrictions under Article 21, deviate from the
rules of non-discrimination set forth in Article 22 in accordande with the
provisions of paragraphs 1-3 of Article XIV of that Agreement, to the
extent that such deviation would not have been covered on that date by
sub-paragraph (b) of this paragraph. The organization may, if it deems
/such action E/CONF.2/C.3/F/W.31
Page 5
such action necessary in exceptional circumstances, make representations
to any Member devieting from the provisions of Article 22 pursuant to this
sub-paragraph that conditions are favourable for the termination of any
particular deviation, or for the general termination of such deviations.
The Member shall be given a suitable time to reply to such
representations. If the Organization thereafter finds that the Member
persists in unjustifiable deviation from the provisions of Article 22,
the Member shall, within sixty days, limit or terminate such deviations
as the Organitation may specify.
(d) The policies applied in the use of import restrictions under sub-
paragraphs (b) and (c) of this paragraph in the post-war transitional
period shall be designed to promote the maximum development of multi-
lateral trade during that period and to expedite the attainment of a
balance of payments position which will no longer require resort to
Article 21.
(e) No Member shall deviate from the provisions of Article 22 pursuant
to sub-paragraphs (b) or (c) of this paragraph except during the post-war
transitional period arrangement for that Member pursuant to Article XIV
of the Articles of Agreement of the International Monetery Fund, or
pursuant to an analogous provision of a special exchange agreement under
Article 24, paragraph 6.
2. Notwithstanding the termination of the Member's transitional period
arrangement pursuant to sub-paragraph 1 (e) of this Article, a Member which
is applying, import restrictions under Article 21 may, with the consent of
the Organization, temporarily deviate from the principles of Article 22 in
respect of a small part of its trade where the benefits. to the Member or
Members concerned substantially outweigh any injury which may result to the
trade of other Members,
3. The provisions of Article 22 shall not preclude restrictions in accordance
with Article 21 which are applied against importe from other countries, but not
as among themselves, by a group of territories having a common quota in the
International Monetary Fund on condition that such restrictions are in all
other respects consistent with Article 22.
4. A Member applying import restrictions under Article 21 shall not be
precluded by this Section from applying measures to direct its exports in such
a manner as to increase its earnings of currencies which it can use without
deviation from Article 22.
5. A Member shall not be precluded by this Section from applying quantitative
restrictions:
(a) having equivalent effect to exchange restrictions authorized under
Section 3 (b) of Article VII of the Articles of Agreement of the
International Monetary Fund; or
/(b) under the E/CONF.2/C.3/F/W.31
Page 6
(b) under the preferential arrangements provided for in Annex A of
this Charter pending the outcome of the negotiations referred to
therein.
Interpretative Note to Paragraph 2 of Article 23
One of the situations contemplated in paragraph 2 is that of a Memoer
holding balances acquired as a result of current transactions which it finds
itself unable to use without a measure of discrimination.
Changes Proposed in Article 24
[9.] 8. [Subject to paragraph 4 of this Article ] Nothing in this Section
shall preclude
(a) the use by a Member of exchange controls or exchange restrictions
in accordance with the Articles of Agreement of the International
Monetary Fund or with that Member's special exchange agreement
with the Organization, or
,(b) the use by a Member of restrictions or controls on imports or
exports the sole effect of which, additional to the effects permitted
under Articles 20, 21, 22 and 23, is to make effective such exchange
controls or exchange restrictions."
Changes Proposed in Interpretative Footnote to Article 24
"[Paragraph 4.] Paragraph 8.
[The word "frustrate" is intended to indicate, for example, that
infringements by exchange action of the letter of any Article of this
Charter shall not be regarded as offending against that Article if, in
practice, there is no appreciable departure from the intent of the
Article. Thus] For example a Member which, as part of its exchange
control, operated in accordance with the Articles of Agreement of the
International Monetary Fund, required payment to be received for its
exports in its own currency or in the currency of one or more members
of the International Monetary Fund would not thereby be deemed to be
offending against Article 20 or Article 22. Another example would be
that of a Member which specified on an import licence the country from
which the goods might be imported for the purpose not of introducing any
additional element of discrimination in its import licences but of
enforcing permissible exchange controls." |
GATT Library | tp309qb4012 | Report of Working Party on Article 23 | United Nations Conference on Trade and Employment, March 15, 1948 | Third Committee: Commercial Policy and Sub-Committee F (Articles 21, 23 and 24) | 15/03/1948 | official documents | E/CONF.2/C.3/F/W.31/Rev.2 and E/CONF.2/C.3/F/W.1-31/REV.2 | https://exhibits.stanford.edu/gatt/catalog/tp309qb4012 | tp309qb4012_90190597.xml | GATT_147 | 3,611 | 23,904 | United Nations
CONFERENCE
ON
TRADE AND EMPLOYMENT
Nations Unies
CONFERENCE RESTRICTED
DU E/CONF. 2/C.3/F/W. 31/
COMMERCE ET DE L'EPLOI 15 March 1948
ORIGINAL: ENGLISH
THIRD COMMITTEE: COMMERCIAL POLICY
SUB-COMMITTEE F (ARTICLES 21, 23, 24)
REPOT OF WORKING PARTY ON ARTICLE 23
1. At its Eghth Meeting, 17 January 1948, Sub-Committee F appointed a
working party to consider amendments submitted to Article 23. The Working Party
consisted of the delegates of Australia, Belgium, Canada, Czechoslovakia, France,
rway, United Kingdom and the United States of America. The delegate of Greece
was also appointed a member of the Workng Party for the purpose, of considering
an amendment to Article 23 submitted by Greece.
2. Mr. Neil Perry (Canada) wass elected Chairman of the Working Party.
3. The following amendments were referred to the Working Party by Sub-
Committee F. They are listed according to the paragraph of Article 23 to which
they refer and are identified either as items in the Annotated Agenda.
(E/CONF.2/C.3/7) or as separate working papers submitted to the Sub-Committee.
Paragraph 1 (a)
Amendment by Czechoslovakia (W.14 )
Paragraph 1 (b)
Entire paragraph - Amendment by Czechoslovakia (W.14)
Sub-paragraph (i) - Amendment by Norway (W.5)
Amendment by Belgium (W.6)
Sub-paragraph (ii) - Amendment by Belgium (W.6)
Amendment by France (W.3)
Paragraph 2
Amendment by Czechoslovakia (W.14)
Paragraph 3 (a)
Item 67 (Denmark)
Amendment by Czechoslovakia (W. 14)
Paragraph 3 (c)
Item 68 (Mexico)
Amendment by Czechoslovakia (W. 14)
Paragaph 3 - Proposed New Sub-paragraph
Item 69 (Italy)
Paragraph 5
Amendment by Czechoslovakia (W.14)
Paragraph 5 - Proposed New Sub-pragraph
Amendment by Norway (W. 4)
/Paragraph 5 E/CONF .2/C.3/F/W.31/Rev. 2
Page 2
Paragraph 5 - Proposed New Sub-paragraph
Proposal by Greece (originally Item 78 and replaced by a new amendment
submitted to the Working Party).
Proposed New Paragragph 6
Amendment by France (Item 74).
The Working Party also considered an amendment to Article 22 proposed by
Syria and Lebanon (Item 60 of the Annotated Agenda) which was referred to It by
Sub-Committee E of Committee II as falling more properly under Article 23.
4. In the course of its deliberations the Working Party heard statements from the
delegates of Denmark, Italy, Lebanon, Mexico and Syria relating to their proposed.
amendments.
Representatives of the International Monetary Fund also participated in the
meetings.
5. After a thorough consideration of the amendments mentioned above, the Working-
Party has concluded that a substantial redraft of Article 23 is desirable. Since,
however, certain Members have already accepted the principles of Article 23 of the
Geneva text and have begun to apply them, the Working Party considers that such
Members should be allowed, if they so desire, to continue to apply these principles
during the transitional period as defined below in paragraph 8. The Working Party
accordingly submits the text which appears at the end of this report together with
a proposed new Annex which embodies these principles. Three Interpretative Notes
have been attached to the text of the Article and one to the Annex.
The new text does not require the Interpretative Note to paragraph 3 of
Article 23 of the Geneva Draft and it has accordingly been dropped.
6. The major changes from the Geneva text of Article 23 are to be found in
paragraphs 1, 2 and 4. of the revised Article.
7. In conjunction with the proposed revision of Article 23, it is considered
desiable that paragraph 9 of Article 24 of the Geneva text (renumbered _-
paragraph 8 in the text submitted by the Working Party on Article 24 and
subsequently described by that number) be amended by the deletion of the phrase
"aSbjeact to piagrsh 4 of this Article," at the beginning of the paragraph.
As a consequence of this change thae Working Prty recommends that the
interpretative note now attached to paragraph 4 of Article 24 of the Geneva
text be atatachaed to pragrph 8 of that Article, that the first sentence of
the note be deleted, and that certain consequential drafting changes be made
as aoi i the attached text.
8. aragraphn s1 defleathe exceptions to the rule of non-discrimination
permissible durings twhe pot-ar transitional period. This transitional period
and its application in respect of individual members are defined by reference
to theiprovistns of Article XIV of the International MonFetar~ Ynd or by
referencese to E/CONF.2/C .3/F/M. 31/Rev.2
Page 3
reference to an analogous provision of a special exchange agreement pursuant to
paragraph 6 of Article 24. The discriminatory measures, including adaptations
thereof, permitted under paragraph 1 may be applied by a Member during the
transitional period without the prior approval of the Organization.
Sub-paragraph 1 (d) provides that a Member may under certain conditions
elect to operate during the transitional period under the Annex rather than under
sub-paragraphs (b) and (c) of the Article. The subject matter of the Annex is
dealt with in Pararaph 12 below. Sub-paragraphs (g) and (h) deal with the
administrative control which is to be exercised by the Organization over measures
taken by a Member under this Article. The attention of the Working Party was
particularly directed to ensuring that Members operating under sub-paragraphs (b)
and (c) and Members operating under the Annex enjoyed equality of treatment in
this respect. As a consequence, the Working Party felt it desirable in drafting
these sub-paragraphs to take note of the procedures laid down in Article XIV of
the Articles of Agreement of the International Monetary Fund.
After the torminaticn of the transitional period for the Member in question
any departure from the rule of non-discrimination is subject to the prior
approval of the Organization, pursuant to thr provisions of paragraph 2.
9. Paragraph 4 permits a Member applying ?? restrictions in accordance with
Article 21 to control its exports in such manner as to increase its earning of
currencies which it can use without deviation from the provisions of Article 22.
10. The effect of the Amendment to paragraph 8 of Article 24 is that the
measures defined in that paragraph are not precluded by the provisions of this
Section of the Charter.
11. Paragraphs 3 and 5 of the revised draft are substantially the same as
paragraphs 4 (a) and 5 respectively of the Geneva text of Article 23.
Paragraph 5 (b) of the revised article incorporates an amendment which is
a consequential change resulting from certain amendments to Annex A of
Article 17 which have been approved by Committee III with reservation
by the delegations of Brazil and Uruguay. (See E/CONF.2/C.3/59, page 1Y).
12. The Annex contains a substantial part of the provisions of the
Geneva text of Article 23. Certain sections of that text have,
however, been transferred to the Article proper and the declaration
in sub-paragraph 1 (a) has been omitted. The procedures for
administrative control by the Organization in sub-paragraph
3 (a) and 3 (c) in the Geneva text have been replaced by
sub-paragraphs 1 (g) and 1 (h) of the Article. The criteria
in sub-paragraph 1 (b) of the Geneva text remain the same.
13. It is considered by the Working Party that the above changes meet
a large number of the objectives to which the amendments submitted were
directed. In view of the extensive revision of Article 23 it is not
/practicable E/CONF.2/C .3/F/W. 31/Rev.2
Page 4
practicable to indicate how particular amendments have been accomodated.
However, the amendments submitted by the following countries are
considered by the delegates of those countries to be covered by the
new text:
(a) Belgium
(b) Czechoslovakia
Amendments to paragraphs 1 (a), 1 (b), 2, 3 (a), and 3 (c) are
covered by Article 23 and the proposed amendment to paragraph 5
is covered by the proposed revision of paragraph 8 of Article 24.
(c) Denmark
(d) France
(e) Norway (amendment to paragraph 1 (b) (i))
(f) Lebanon
(g) Syria
14. The Norwegian delegate indicated that the new text of Article 93
on Relations with Non-Members, suggested by the delegation of
Czechoslovakia and accepted by the Sub-Committee of the Sixth Committee
(E/CONF.2/C.6/W.108) as a basis for discussion, met the major part of the
problem to which his amendment on long-term agreements (E/CONF.2/C.3/F/W.4)
as directed, and accordingly, withdrew this amendment.
15. With respect to the amendment submitted by Italy (Item 69) the
Working Party considers that paragraph 2 of the revised text takes
account of the concept of relative injury.
16. The delegate of Mexico has informed the Working Party that
his delegation is now reviewing the new text to see whether the
purpose of its amendment (Item 68) is met.
17. The amendment submitted by Greece proposing a new Article 23A .
(Item78) was replaced by an amendment to paragraph 5 of Article 23
submitted to the Working Party by the delegate of Greece. After
the new text of Article 23, together with the change proposed in
Article 24, were before this Working Party, he delegate of Greece
advised the Working Party that these new texts went a long way to
meet the problem of his country. However, he did not feel that
his point as met entirely, particularly in the post-transitional
period. The Working Party believes that further amendment in this
respect would provide too wide an exception, and therefore
recommends no further change in the text. The delegate of Greece
advised the Working Party that his delegation reserved its
position.
/Article 23 E/CONF.2/C.3/F/W.31/Rev.2
Page 5
Article 23
Exceptions to the Rule of Non-Discrimination
1 (a) The Members recognize that the aftermath of the war haa brought
difficult problems of economic adjustment which do not permit the
immediate full achievement of non-discriminatory administration of
quantitative restrictions and therefore require the exceptional
transitional period arrangement set forth in this paragraph.
(b) A Member applying restrictions under Article 21 may, in the use
of such restrictions, deviate from the provisions of Article 22 in a
manner having equivalent effect to restrictions on payments and
transfers for current international transactions which that Member may
at that time apply under Article XIV of the Articles of Agreement of
the International Monetary Fund, or under an analogous provision of a
special exchange agreement pursuant to Article 24, paragraph 6.
(c) A member applying restrictions under Article 21 and which was
applying import restrictions to safeguard its balance of payments on
March 1948 in a manner which deviated from the rules of non-
discrimination set forth in Article 22 may, to the extent that such
deviation would not have been covered on that date by sub-paragraph (b)
of this paragraph, continue so to deviate, and may adapt such deviation
to changing circumstances.
(d) Any Member which before 1 July 1948 has signed the Protocol of
Provisional Application agreed upon at Geneva on 30 October 1947, and
which by such signature has provisionally accepted the principles of
paragraph 1 of Article 23 of the Draft Charter submitted to the Havana
Conference by the Preparatory Comittee, may elect by written notice to
the Interim Commission or to the Organization before 1 January 1949,
to be governed by the provisions of Annex [ ], which embodies
such principles, in lieu of the provisions of sub-paragraphs (b) and (c)
of this paragraph, Annex [ ] shall not be applicable to any Member
which does not so elect. Sub-paragraphs (b) and (c) of this paragraph
shall not be applicable to any Member which does so elect.
(e) The policies applied in the use of import restrictions under sub-
paragraphs (b) and (c) of this paragraph or Annex [ ] in the post-war
transitional period shall be designed to promote the maximum development
of multilateral trade possible during that period and to expedite the
attainment of a balance of Payments position which will no longer require
resort to Article 21, or to transitional exchange arrangements.
/(f) A Member E/CONF.2/C.3/F/W.31/Rev. 2.
Page 5
(f) A Member may deviate from the provisions of Article 22 pursuant
to sub-paragraphs (b) or (c) of this sub-paragraph or pursuant to
Annex [ ] only so long as it is availing itself of the poet-var
triasitional period arrangements under Article XIV of the Articles of
Agreement of the International Monetary Fund, or under an analogous
provision of a special excharge agreement under Article 24, paragraph 6.
(6) Not later than 1 March 1950 (three years after the date on which
the International Monetary Fund began operations) and in each year
thereafter, the Organization shall. report on any action still being
taken by Members under sub-paragraphs (b) and (c) of this paragraph
or under Annex [ ]. On or about 1 March 1952, and in each year
thereafter, any Member still entitled to take action under the -
;.ovisions of sub-paragraph ([) o] of Annex t 7 shall consult the
Organization as to any deviations from Article 22 still in force pursuant
to such provisions and as to its continued resort to such provisions.
Aftea 1 March 1952 eny action ]nder Annex [ 7 going beyond the
maintenance in force of deviations on which consultation has taken place
and which the Organization has not found unjustifiable, or their
adaptation to changing circumstances, shall be subject to any limitations
of a general character which the Organization may prescribe in the light
of the Member's circumstances.
(h) The Organization may, if it deems such action necessary in
exceptional circumstances, make representations to any Member permitted
to.take actron under the p.ovisions of sub-paragraph (c) or of
AnnexL 7 that conditions are favourable for the termination of any
particular deviation from the provisions of Article 22 or for the general
abandonment of deviations, under the provisionsa of sub-paragrph (c) or,
in the period after 1 March n195[2, ]under Anex . The Member shall
be given a Iitable time to reply to such representations. If the
Organizhation finds tat the Member persists in unjustifiable deviation
from the provisions of Article 22, the Member shall, waithin sixty dys,
limit or terminate such deviations as the Organization may specify..
2. Notwithstanding the termination' of the Members transitional period
arrangement pursuant to sub-paragraph 1 (f) of this Article, a Member which
is applying import restrictions under Article 21 may, with the consent of
the Organization, temporarily deviate from the principles of Article 22 in
respect of a small part of its trade where the benefits to the Member or
Members -concerned substantially outweigh any injury which may result to the
trade of other Members.
/3. The provisions E/CONF.2/C.3/F/W.31/Rev.2
Page 7
3. The provisions of Article 22 shall not preclude restrictions in accordance
with Article 21 which are applied against imports from other countries, but
not as among themselves, by a group of territories having a common quota in
the International Monetary Fund on condition that such restrictions are in all
other respects consistent with Article 22.
4. A Member applying import restrictions under Article 21 shall not be
precluded by this Section from applying measures to direct its exports in such
a manner as to increase its earnings of currencies which it can use without
deviation from Article 22.
5. A Member shall not be precluded by this Section from applying quantitative
restrictions:
(a) having equivalent effect to exchange restrictions authorized
under Section 3 (b) of Article VII of the Articles of Agreement of
the International Monetary Fund; or
(b) under the preferential arrangements provided for in Annex A of
this Charter, pending the outcome of the negotiations referred to
therein.
Interpretative Note to Paragraphs 1 - 4
It is recalled that since the provisions of paragraphs 1 - 4 of Article 23
apply only to Members operating restrictions under Article 21, the provisions
of paragraph 5 of Article 21 apply also to action under paragraphs 1 - 4 of
Article 23.
Interpretative Note to Paragraph 2 of Article 23
One of the situations contemplated in paragraph 2 is that of a Member
holding balances acquired as a result of current transactions which it finds
itself unable to use without a measure of discrimination.
/ANNEX [ ]
. ,~~~~~~~~~~~~~~~~~~~~ E/CONF.2/C.3/F/W.31/Rev.2
Page 8
ANNES [ ]
(Applicable to Members who so elect, in accordance with paragraph 1 (d) of
Article 23, in lieu of paragraphs 1 (b) and 1 (c) of Article 23.)
1. (a) A Member applying import restrictions under Article 21 may
relax such restrictions in a manner which departs from the provisions
of Article 22 to the extent necessary to obtain additional imports
above the maximum total of imports which it could afford in the light
of the requirements of paragraphs 3 (a) and 3 (b) of Article 21 if
its restrictions were fully consistent with Article 22; Provided that
(i) levels of delivered prices for products so imported are not
established substantially higher than those ruling for
comparable goods regularly available from other Members
and that any excess of such price levels for products so
imported is progressively reduced over a reasonable period;
(ii) the Member taking such action does not do so as part
of any arrangement by which the gold or convertible
currency which the Member currently receives directly or
indirectly from its exports to other Members not party to
the arrangement is appreciably reduced below the level it
could otherwise have been reasonably expected to attain;
(iii) such action does not cause unnecessary damage to the
commercial or economic interests of any other Member,
including interests under Articles 3 and 9.
(b) Any Member taking action under this paragraph shall observe
the principles of sub-paragraph (a) of this paragraph. A Member
shall desist from transactions which prove to be inconsistent with
that sub-paragraph but the Member shall not be required to satisfy
itself, when it is not practicable to do so, that the requirements of
that sub-paragraph are fulfilled in respect of individual transactions.
2. The provisions of Article 22 shall not preclude restrictions in
accordance with Article 21 which assist, in the period until 31 December 1951,
by measures not involving substantial departure from the provisions of
Article 22, another country whose economy has been disrupted by war,
3. Any Member taking action under paragraphs 1 or 2 of this Annex shall
keep the Organization regularly informed regarding such action and shall
provide such available relevant information as the Organization may request.
4. If at any time the Organization finds that import restrictions are
being applied by a Member in a discriminatory manner inconsistent with
the exceptions provided for under paragraphs 1 or 2 of this Annex, the
Member shall, within sixty days, remove the discrimination or modify it
as specified by the Organization; Provided that any action under paragraphs
/1 or 2
> ts,~~~~~~~~ E/CONF.2/C.3/F/W.31/Rev.2
Page 9
1 or 2 of this Annex, to the extent that it has been approved by the
Organization at the request of a Member under a procedure analogous to that
of paragraph 5 (c) of Article 21, shall not be open to challenge under this
paragraph or under paragraph 5 (d) of Article 21 on the ground that it is
inconsistent with Article 22.
Interpretative Note to Annex
It is understood that the fact that a.Member was operating under the
provisions of Article 43 paragraph 1 (b) (i) does not preclude that Member
from [obtaining additional imports] [operaton] under this annex, but that
the provisions of this Article (including its Annex) do not in any way limit
he rights of Members under Article 43 paragraph 1 (b) (i).
Changes Proposed in Article 24 -
Hf J 8 ubjc,]t to paxe saph 4 of this Articlej Nthing in this Section
shall preclude
(a) the use by a Member of exchange controls or exchange restrictions
in accordance with the ArtiCles of Agreement of the International Monetary
Fund or with that Member's special exchange agreement with the
Organization, or
(b) the use by a Member of restrictions or controls on imports or
exports the sole effect of which, additional to the effects permitted
under Articles 20, 21, 22 and 23, is to make effective such exchange
controls or exchange restrictions."
Chngos 2roposd in IterretatFootnote to Article 24
-8;agrrph4.7 Paagaph B.
[he word "frustrate" is intended to indicate, for example, that
infringements by exchange action of the letter of any Article of this Charter
shall not be regarded as offending against that Article, if, in practice, there
is no appreciable departure from the intenThus] the Article. 1usB7For example
a Member which, as part of its exchange control, operated in accordance with
the Articleg oInAgreement of the izternational Monetary Fund, required payment
to be received for its exports in its own currency or in the currency of one
or more members of ohe International Mcnetary Fund would not thereby be deemed
to be off ending against Article 20 or Article 22. Another example would be
that oecifiember whichpospc¢if ed on an imort license the country from which
theor goodos might be impted fr the purpose not of introducing any additional
element of discrimination in its import licenses but of enforcing
permissibl4exchanGe controls."
/Interpretativa Note
. ,.~~~~~~~~~~~ E/CONF.2/C.3/F/W.31/Rev.2
Page 10
Interpretative Note to Sub-Paragraph 1 (f) Suggested
by the United Kingdom Delegation -
general tttiois of- achner character whihc, under the last sentence
of aeagraph Ion), m a-be p1aced ca and'efter I March 1952 on future
deviations from Article 22, would not include limitations relating to
individual commodities.
NoteRepo Workinga Party Besort - Sugested
dom Delegatited 'c= Dele__etion
It was agreed that the provisions of the last sentence of paragraph 1 (f)
would noa authorize the Org'nizatson to prescribe, aa a "limitation of a
general character", that a Member shall consult with the Organization
prior to introducing deviations from the provisions of Article 22 which it
would otherwise be permissible for the Member to introduce without such
prior consultation
D . -, -
.. .. I
!.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~.
'*
. : |
GATT Library | qn299tx7786 | Report of Working Party on Article 24 | United Nations Conference on Trade and Employment, February 4, 1948 | Third Committee: Commercial Policy and Sub-Committee F (Articles 21, 23 and 24) | 04/02/1948 | official documents | E/CONF.2/C.3/F/W.22 and E/CONF.2/C.3/F/W.1-31/REV.2 | https://exhibits.stanford.edu/gatt/catalog/qn299tx7786 | qn299tx7786_90190585.xml | GATT_147 | 1,245 | 7,867 | United Nations Nations Unies
CONFERENCE CONFERENCE RESTRICTED
ON DU E/CONF.2/C.3/F/W.22
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI 4 February 1948
ORIGINAL: ENGLISH
THIRD COMMMITTEE: COMMERCIAL POLICY
SUB-COMMITTEE F (ARTICLE 21, 23 AND 24)
REPORT OF WORKING PARTY 0N ARTICLE 24 -
1. Ats it Eighth Meegtin Sub-Committee F requested the Working Party on
Article 21, maugented by the delegate for Australia, to consider. amendments
to Article 24 which were referred to a Working Pa rty by the Sub-Committee.
Accorgldiny, the Working Party on Article 24 consisted of the delegates for
Auastrlia, Belgium, Brazil, Cuba, Indiah, Ute nited Kingdom and the United
States of America, with Mr. J. A.EReA AG (Cuba) as Chairman.
2. The Working Party makes the following recommendations:
(a) After consideration of paragraph 2 of Article 24 in the light
of the amendments proposed by Australia and. New Zealand (Items 79
d 80 of the Annotated Agenda), the Working Party recommends the
following text for paragraph 2: . -
"2. In all cases in which the Organization is called upcn to
conssider or deal with problem concerning monetary reserves,
balance of payments or foreign exchange arrangements, the
Organization shall consult fully with the International Monetary
und. In such consultation, the Organization sha1l accept all
findings of statistical and other facts presented by the
International Monetary Fund relating to foreign exchange,
monetary reserves and balance of payments, and shall .accept
the determination of the Fund as to whether action by a
Meer, in exchange matters is in accordance with the Articles
of Ageement of the International Monetary Fund, or with the
terms of a special exchange agreement between that Member and
the Organization. [Wh]en the Organization, in for the purpose
of reaching its fin decision in cases involving the criteria
set forth in paragraph 2 (a) of Article 21, ls examining a
situation in the light of the relevant consideration under
all the pertinent provisions of Article 21, it shall accept
the determination of the International Monetary Fund as to
what constitutes a seriou's decline in the Members monetary
/reserves E/CONF. 2/C.3/F/W.22
Page 2
reserves, a very low level of its monetary reserves or a
reasonable rate of increase in its monetary reserves, and
as to the financial aspects of other matters covered in
consultation in such cases "
(b) The Working Party gave consideration to an amendment to paragraph 6
proposed by the delegate for Liberia, referring to the case of a country
which does not use its own national currency. The Working Party
recommends that paragraph 6 should be amended to meet this case in the
manner indicated below.
In this connection, two members of the Working Party, while having
no objection in substance to the text shown below, thought that the
Sub-Committee should consider whether such a provision should be
included in the text of Article 24, or whether the special situation
of Liberia could be suitably dealt with under Article 74, which provides
for the waiver of obligations under the Charter.
The Working Party also considers that paragraphs 6 and 7 of Article 24
can be combined with advantage, since they deal with the same subject. It
also recommends that a consequential amendment should be included in the
present paragraph 8 (new paragraph 7). With these modifications paragraphs 6
and 7 would read as follows:
"6. (a) Any Member of the Organization which is not a member of the
International Monetary Fund shall, within a time to be determined
by the Organization after consultation with the International
Monetary Fun&, become a member of the Fund or, failing that, enter
into a special exchange agreement with the Organization. A
Member of the Organization which ceases to be a member of the
International Monetary Fund shall forthwith enter into a special
exchange agreement with the Organization. Any special exchange
agreement entered into by a Member under this paragraph shall
there upon become part of its obligation under this Charter.
[7. (a)] (b) Such a special exchange agreement [between a Member and
the Organization under paragraph 6 of this Artlcle] shall provide
to the satisfaction of the Organization that the objectives of
this Charter will not be frustrated as a result of action in
exchangee matters by the Member in question.
[(b)] (c) The terms of any such agreement shall not impose
obligations on the Member in exchange matters generally more
restrictive than those imposed by the Articles of Agreement of
the International Monetary Fund on members of the Fund.
/(d) No E/CONF.2/C. 3/F/W. 22
Page 3
(d) No special exchange agreement shall be required of a Member
so long as it uses solely the currency of another country and so
long as neither the Member nor the country whose currency is
being used have exchange restrictions. Nevertheless, if the
Organization at any time considers that the absence of a special
exchange agreement may be permitting action which tends to impair
the purposes of any of the provisions of this Charter, it may
require the Member to enter into a special exchange agreement in
accordance with the provisions of this Article. A Member of the
Organization which is not a Member of the International Monetary
Fund and which has no special exchange agreement may be required
at any time to consult with the Organization on any exchange
problem.
[8] 7. A Member which is not a member of the International Monetary
Fung, whether or not it has a special exchange agreement, shall furnish
such information within the general scope of Section 5 of Article VIII
of the Articles of Agreement of the International Monetary Fund, as the
Organization may require in order to carry out its functions under this
Charter."
Note: Present paragcaph 9 would be renumbered 8
(c) The Working Party, while aware of the desirability of keeping
interpretative notes to a minimum, considers that the interpretative
footnote to paragraph 4 of Article 24 of the Geneva text relating to
"frustration" (Item 81 of the Annotated Agenda) is both essential and
too detailed for inclusion in the text of Article 24. It therefore
recommends that this interpretative note be appended to the text of
Article 24.
(d) The Working Party took note of the amendment of Mexico (Item 82)
which was referred to it by the Sub-Committee on the understanding that
it would be desirable that a more specific amendment be submitted by
Mexico for consideration by the Working Party.
Having heard a further explanation by the delegation of Mexico,
the Working Party does not consider that the text of Article 24 requires
any change in the light of the proposed Mexican amendment. It took
note that the problem to which the delegation of Mexico had directed its
amendment was similar to that being considered by Sub-Committee G of
Committee III.
In the light of the Working Party's recommendation the Mexican
delegate stated that his delegation reserved its position on Article 24.
/(a) The Working E/CONF. 2/C. 3/F/W. 22
Page 1
(e) The Working Party considers that the title of Article 24 would
more clearly indicate its content If it were changed to read as
follows: "Relationship with the International Monetary Fund and
Exchange Arrangements", It recommends also that the title of
Section 3 of Chapter IV would more clearly indicate the content of
the section if it were to read: "Quantitative Restrictions and
Related Exchange Matters" instead of "Quantitative Restrictions and
Exchnge Controls".
. . ~ . ..
, ' ;' " ' . *, . . .' -t . ',., |
GATT Library | bm107jv9020 | Report regarding criticisms and selection of indexes of International economical valorization of the delegation of Cuba | United Nations Conference on Trade and Employment, January 7, 1948 | Sixth Committee: Organization | 07/01/1948 | official documents | E/CONF.2/C.6/44 and E/CONF.2/C.6/12/ADD.4-44 | https://exhibits.stanford.edu/gatt/catalog/bm107jv9020 | bm107jv9020_90170096.xml | GATT_147 | 11,276 | 73,376 | United Nations Nations Unies UNRESTRICTED
CONFERENCE CONFERENCE E/CONF. 2/C.6/44
CONFERENCE CONFERENCE 7 January 1948
ON DU ORIGINAL: ENGLISH-
TRADE AND EMPLOYMENT COMMERCE ET DE l'EMPLOI SPANISH
SIXTH COMMITTEE: ORGANIZATION
REPORT REGARDING CRITICISMS AND SEECTION OF INDEXES OF INTERNATINAL
ECONOMICAL VALORIZATTION OF THTE DELEGATION OF CUBA
At tho season corresponding to Committee VI, in which the voting
procedure was discussed, for inseortion into the Charter of the International
Trade Organization, the delegate for Cuba, Dr. Gustavo Gutierrez, opposed
the woighted vote formula proposed and announced that the delegation of Cuba
would be glad to distribute, as a purely technical antecedent, the report
that the same should receive from its Technical Adviser,
Prof. Julian Alienes, The Cuban delegation haw now the pleasure of
distributing the above-mentioned paper amongst the other delegations.
In order to render more comprehensive the text o' the Report, we deem
it advisable to point out offhand the sequence in which the various matters
contained therein are to be dealt with, as also the distribution we intend
to Give thereto.
Pursuant to the aasignnment entrusted to us, we deem it proper to devote
the first part of this Report to the criticism of indexes for international
economic valuation appearing in document (E/CONF.2/4) and others. The
second part of the Report shall consist of a brief and slight analytical
survey that may facilitate the discussion and selection of the best indexes
of economic valuation on the part of the various members of the delegation.
2. CRITICISM ON THE INDEXES OF INTERNATIONAL
BCONOMIC VALUATION
21. General Remarks Concerning this Problem
Even though the assignment entrusted to us Is confined to the
criticism of the oft repeated document (E/CONF.2/4), we wish to clarify
that In making such criticism we have also taken Into account Annex "A"
of the "Report of the Drafting Committee of the Preparatory Commission of
the United Nations Conference on Trade and Employment" (New York,
January-February 1947) entitled "First Report of the Administrative Sub-
Committee (Report on the general structure of the Board of Directors and
regarding the voting procedure)". This means, that the criticism of the
economic pointers which we are going to perform, covers not only those
/indexes included F/CONF.2/C .6/44
indexes included. in the document (E/CONF.2/4) but also those contained in
the report of New York. Likewise, it covers the criticism on such Indexes
as appear in the Appendix to the Geneva Draft. In general, the points which
are to be the subject of said criticism are those concerning the total
population of the countries, the national revenue, the total foreign trade of
each country, the percentage of the said total trade over the amount of the
respective national revenue and, finally, the average "per-capita"
international trade. The criticism on each and every one of said data, we
understand afford sufficient elements of judgment for the interpretation
of each and every one of the proposals made in connection with the subject
of determining the right to vote.
It is of interest to set forth herein that the point of view upon
which is based the criticism to be made on this aspect of the Report refer
to the data themselves, id ost, to the statistical phase thereof and not
to the economic significance of each of such factors. This criticism - the
economic - shall follow the one to be made, in the first place, in connection
with the data themselves.
211. Statistical Criticism on the Figures Rearding Population
To this effect mention should be made of the fact that, In general,
the figures covering population contained in document (E/CONF.2/4) are
correct for almost all of the countries. As an example, we shall state that
out of the seventy-six countries comprised within the said document, we were
able to verify, on forty-six cases, their figures on population (see
Appendix "A") inasmuch as such figures were shown on the "Monthly Bulletin
of Statistics - Statistical Office of the United Nations", issue of
October 1947 (sheets 1 to 4, both inclusive).
Out of this verification, we extract, however, some discrepancies,
to wit:
(a) India, appearing in the document (E/CONF.2/4) with a population
(including the Pakistan) of 375,000,000 for the year 1938 and or
412,000,000 for the year 1946, only reaches, as per the Statistical
Bulletin already mentioned of the United Nations to populations of
279,000,000 and 311,000,000, respectively. However, this population
reform to an area which only comprise the old British provinces.
Nevertheles line with the said Bulletin, the total population
in 1941 was 388,998,000 inhabitants. As may be readily seen,
everyone of the quoted figures differ from those contained in the
Report (C/CONF.2/4).
/(b): In connection E/CONF.2/C,6/44
Page 3
(b) In connection with Peru, some discrepancies also exict, although
of a minor quantity. For example, pursuant to the Report now the
subject of our criticism, the population of Peru in 1938 was 6.5 million
inhabitants and in 1946, 7.4 million inhabitants, whilst, according
to the Statistical 1.- Cetin of the United Nations, the population
on the first mentioned year was of about 6 million and in the latter
year 7 millions.
(c) We find a similar discrepancy in the case of the Union of South
Africa whereat the Report under criticism shows a figure of
12.5 million for the population of 1946, without exceeding, pursuant
to the Statistical Bulletin of the United Nations, the figure of
11.4 million. The figure concerning 1938 appearing with an aggrregate
of I' million In the Report under review is not verifiable through
lack of data therefor on the part of the United Natatons Bulletin
horeinbefore mentioned.
(d) In the case of the United States of North America there are also
substantial differences, Lot us take, for instance the fact that,
in 1938 the Report shows, in round figures, the population of the
United States to be 132 million inhabitants; in 1946, the figure
is 144 million. However, according to the Statistical Bulletin of
the United Nations, the figures corresponding to the said two years
are: 129.8 million inhabitants and 141.2 respectively, and,
(e) Finally, in the case of Ethiopia, the data on the Report show
a population for 19, of 9.5 million inhabitants whilst the population
given for 1946 exceeds 15 million. However, it is not only in the
Statistical Bulletin of the United Nations where no data is
available, but in the "Statistical Year Book of the League of Nations"
corresponding to the period 1942-1944 (published in January 1945),
the latest figure for the population of Echiopia in the year 1939,
is shown which does not exceed 5 and a half milion inhabitants.
All these facts serve to show, with remandble a reaq,. to what an
extent. the figures of the nations under review are conflicting insofar as
their respective population is concerned. All others, agreegating.forty-six
which have already been ver 'iod, are in a satie atory p Jition by. reason
of the proximity existing, between the figures shown in the said Report and
the figures shown on the statistical data published by either the old
League of Natione or else by the very United Nations.
If it is considered that thirty countries or nations are still pending
verification and that amongst those already verified there are five showing
discrepancies of regular importance, we shall arrive at the conclusion that
it would be necesary to make a proper check up on these figures in order to
/be able to E/CONF. 2/C.6/44 Page 4
be able to reach correct statistics of population to, assiet in purposes of
international comparisons.. However, mention should not be omitted of the
fact that, most probably, tht is the best statis Ical dat. ,ivailable among
the nations.
212. Statistical Criticism on the Figures on Revenues or National Receipts
Even though it is very common to speak of revenues or national
dividends when referring to the net value attained by the production of a
country within a given period of time - in this case, the year - we always
refer, in dealing with this subject, to the term "National receipts", so as
not to cause confusion with the word "revenue" which has other different and
specific meaning in Economics.
In this instance, the statistical defect is still greater than the one
dealt with upon making a c-..ticism of the figures on population, inasmuch as
pursuant to the oft-repeated Statistical Bulletin published by the
United Nations, corresponding to the month of September, only twenty-two
countries out of the seventy-six reviewed in the Report, do regularly draw
up and publish the figures corresponding to their national income. Said
countries are Argentina, Austria, Bulgaria, Belgium, Canada, Chile,
Czechoslovakia, Denmark, Dominican Republic, France, Ireland,. Mexico,
Netherlands, New Zealand, Norway, Palestine, Porto Rico, South Africa, Sweden
Switzerland, United Kingdom and the United States of America.
This first antecedent -regarding the lack of Information is already
sufficiently impressing to do away with all hopes based upon the existence
of an index of the national income, but the fact remains, that besides, new
evidences of inconvenience thereto may be invoked, for instance, the
following: Every national calculates and publishes, as it is logically
implied, their respective figures of national receipts, with expression
thereof in the respective currency, thus creating the serious problem of
converting all such figures into a single currency which may allow proper
comparison, since this is the aim pursued upon trying to dispose of the
figures covering the nation 1 income. However, as hereinafter' set forth,
such conversion into a common denominator, of the national receipts, is
impossible today by reason of the inconsistency in the rate of exchange of
the various currencies, and even on the assumption of such not being the
case, we would find ourselves before the problem that the figures of the
national income converted into a common currency would not as yet be
economically comparable since they merely represent monetary income and not
the actual income, which, in the long run, - as can be later found herein -
is that should be definitely considered.
In corroboration of the discrepanciesa existing in the data concerning
national income conveyed in the document (E/CONF."/4) and '-ll other data
/shown o.. pages 107 E/CONF.2/C.6/44
Page 5
shown on pages 107 and 108 of the Statistical Bulletin of the United Nations,
issue of Soptember 1947, we shill comment as follows: pursuant to the said
Bulletin of the United Nations, Mexico, in the year 1938, had a national
income amounting to 1,140 million dollars. Taking the figures of national
income in Mexican pesos as given by the Bulletin of the United Nations, and
taking into account the prevailing rate of exchange between the Mexican peso
and the dollar of the United States in 1938 (which was 1.00 Mexican peso
equal to 0.2212 of a dollar of the United States Currency) we find that the
national income was at the time of 1,177 million dollars, that is, a figure
very much similar to the previous one. However, if we take into account
the figures corresponding to the year 1945 we find that Me.:, co enjoyed an
income in Mexican pesos of 11.978 million: applying thereto the rate of
exchange of 0.2058 dollars per peso corresponding to this latter date,
it would develop that the value of the national income would be 2,465 million
dollars and not 1,510 as appears from the figures shown in the document
(E/CONF.2/4). The difference in years (1945 and 1946) we don't think
suffices to explain the discrepancy between both figures.
The case of Belgium is still more illustrative. Belgium had a
national income in 1938 of 65,200 million Belgium francs. The rate of
exchange in U. -. Dollars s 0.03379 dollars per franc, which converted
the former figure to a Belgium national income avaluated in U. S. Dollars.
for 1938, on an equivalent to 2,200 million dollars, which figure more or
less reconciles with that shown in the document (E/CONF.2/4). However, in
1946, pursuant to the Bulletin of the United Nations, the Belgian national
income is given as 190,000 million francs, the rate of exchange being
0,02285 dollars per Belgian franc. Basing the calculations on this rate
of exchange the national income turns out to be 4,341 million U. S. Dollars.
If it is considered that the document (E/CONF.2/4) shows the Belgian income
for 1946 as only 2,790 million dollars, it will be noted that a very
substantial difference exist between one estimate and th. other.
The case of Canada wihich has also been verified by us, constitutes,
perhaps, one of the few presenting a great similarity on both dates, since,
after taking into consideration the income given by the Bulletin of the
United Nations for Canada in the two years under comparison and, besides,
considering the rates of exchange prevailing between the Canadian and the
North-American currency, we find that the figures reconcile by the two
already mentioned procedures during the year 1938 and only differ in a degree
as regards the year 1946.
And, finally, we wisi to set forth another case - that of the
Netherlands - amongst other s which could be submitted to consideration, but
/due to sheer lack E/CONF.2/C.6/44
Page 6
due to sheer lack of time, we are unable to enter Into min- .e details thereon.
In this latter case as also in the former one of Canada, whilst some
discrepancies exist they are not quite noticeable, since by following the
former procedure we find that the fiGures corresponding to the national
Income resulting thereby are, for the year 1938, of 2,800 million dollars
as per the document (E/CONF.2/4) and of 2,746 pursuant to our calculations,
and in 1946, of 2,970 million in conformity with the said documents and of
3,018 in line with our base of estimation.
After setting forth the foregoing, we deem it unwarranted to continue
digging any further into tI. : question. The contention herein made are
sufficient to create the conviction that the figures of the national income
are very meagre in quantity and too deficient when considered among
themselves, thus bearing out great difficulties for purposes of comparison
to such an extent as to render them useless, to a great measure, for the
purposes herein pursued by us. For further data on this point of the
national income reference may be made to Appendix B at the end of this Report.
213. Criticism on the Figures Regarding Overall Trade
With regard to the figures covering the overall trade of each country,
id est, the figure resulting from the import and export trade altogether,
we must state that are have n I followed any special means of statistical
verification. Such a decision on our pare is based upon two fundamental
reasons: First, to the fact that, es a rule, the statistics covering the
export trade of countries notwithstanding their well-known deficiencies,
afford a greater degree of perfection than any other international trade
appearing both in the Old Yearly Records of the League of Nations, as also
in the monthly Statistical Bulletins of said organization and in those
of the United Nations, are shown in the currency of each of the various
countries, which circumstance would impose upon us a task involving an
enormous number of caluclations for which there is no time available now,
especially taking into cons. deration the fact that, as a rule, such
statistical work, offer a high degree of efficiency.
Comparative figures are only available for purposes of international
trade in the "Annualre Statistique de la Societé des Nations" corresponding
to 1938-1939, whereat on pages 218 and 219 a general schedule of world
trade is shown covering the period since 1929 and up:to 1938, said record
showing the trade pertaining to each of the countries covered by said chart,
in old gold (dollars) of the United States.
These figures bear a real comparative value and may be used in works
concerning the pre-war period, but are of no use for the p t-war; in the
first place, because they do not cover a period as far as the War and,
secondly by reason of the fact that such figure represent old dollars.
/The data contained E/CONF. 2/C. 6/44
Page 7
The data contained in the Draft Charter of Goneva (pages 65 to 67) should
therefore be subject to revision, even though, in principle the acceptance
thereof appears to be in order.
A very important criticism is in order from a statistical point of
view-as regards the summing up of the export and import trade represented
by such figures, to wit: that they constitute the grand total of several
partial additions which, in some way are heretogeneous as already stated,
from a statistical viewpoint - since it is evident that for the collection
of some of the data (that concerning importations) the c.i.f. method is
.followed while, on the other hand, for the gathering of other data (that
concerning exportation) the method mostly followed is on the f.o.b. basis.
This is the case of Cuba and we understand, the general method followed.
214. Criticism on the Figures Covering Percentage of Total Trade over the
National Income
The figures contained in the Report (E/CONF.2/4) concerning the
percentage represented by the import and export trade as a whole, as compared
with a national income, bear the defect which is partly borne out of the
figures constituting the basis of the computation, that is, the deficiency to
which we have previously referred in connection with the fact that the
national income data is generally deficient and internationally insufficient;
however, a high value must be attached to these figures inasmuch as they
eliminated the problem of having to evaluated the national income under the-
basis of an arbitrary rate of exchange. The following of this method would
enable each country to evaluate its international trade on the basis of Its
own currency, thus making the computation of the aforesaid percentage in
comparison with its national income also evaluated in the proper currency
of the country, without the necessity, therefore, of having to make prior
conversions of the national figures to a common international currency,
for instance, the dollar. This procedure would avert the task of using
arbitrary rates of exchange, such latter aspect being quite important in
times of great monetary disruption as actually prevails.
21. Criticism on the Figures Covering Por-capita Trade
In connection with the criticism of the figures, themselves, covering
the per-capita trade, the foregoing opinions are applicable to the case.
These figures present the same defect as those covering population and, to
some extent, they show the deficiency borne out when converting into dollars,
the foreign trade of each country. Save for these two deficiencies, no
other, from a statistical point of view, is attributable, in our judgment,
to the figures under review.
/216. Special Statistical E/CONF. 2/C .6/44
Page 8
216. Special Statistical Criticiem on all Previous Figures with Repect
to Cuba
As regards Cuba, we deem it advisable to subject to a special
analytical criticism the figures contained in the document (E/CONF.2/4).
Insofar as the figures covering population is concerned, it may be
stated that they are similar to those appearing in the said document, even
though those figures pertaining to the year 1938 should be somewhat higher,
that is exceeding the 4.2 millions shown on the said document, reaching
perhaps 4.4 millions; while it is possible that in 1946, however, the actual
figures for Cuba may turn out to be a little lower, that is, in lieu of
5 millions, the figure of 4,900,000 inhabitants. Such differences are based
on personal estimates of population carried out after computing the
demographic equation for Cuba based on the five last national census and
which enable us to obtain the empirical law of the development of the Cuban
population. We cannot rely very much upon the official estimates since the
additions made to the Census of Cuba, by the proper Office dealing with the
population, have many defects, in our judgment. Let us take, for example,
that covering the population of Cuba for the year 1930-31, in which latter
year, as it is of common knowledge, a near census of the Cuban population
was made. In accordance therewith, the figure covering the population of
Cuba increased in 1931 by almost - 400,000 inhabitants whereas the normal
rate of the growth of the population of Cuba at that time, pursuant to our
demographic equation, was only 70,000 persons per annum. Our figures, which
were computed on the basis of the said equation are very much closer to the
actual facts than those borne out of comparing the figures of the Statistical
Office on population with those of the Census, since it is inconceivable that
in a year of financial crisis such as the one of 1930-31, the population of
Cuba should have increased in such a degree as fivefolds above the normal.
However inasmuch as the differences In this connection are quite
small, we understand that the above contention should only be regarded for
purposes of illustration and nothing else. The figures on population shown
in the document (R/CONF.2/4) may therefore be regarded as valid insofar as
Cuba is concerned.
Insofar as international trade is concerned, the figures corresponding
to Cuba are correct; pursuant to official statistics, as regards the year
1938; inasmuch as an aggregate amount of 248 million dollars for import and
export is given, while the official figure of the General Direction of
Statistics (Dirección General de Estadisticas) shows an amount of 248.7 million
dollars; that is to say, as far as the year 1938 is concerned, both figures
are practically the same.
/However, such is not E/CONF.2/C.6.44
Page 9
However, such is not the case as regards the figure for 1946. In
1946, pursuant to official statistics, the export trade amounted to
475.9 million dollars and the amount of imports was 307.2 million dollars.
As can be readily noted the total amount reconciles with the 783 million
dollars shown in the document (E/CONF.2/4) as the value of the Cuban exports
and imports. On the other hands taking into account the adjustments which
have been made in matters of exportations and importations, when making up
the international balance of payments of Cuba corresponding to 1946, as
was done by the General Direction of Statistics of the Ministry of Finance
(Direccidn General de Estadisticas del Ministeria de Hacienda), we find
that the figures covering exportation have been readjusted to such an extent
as to place it in the amount of almost 524 millions, after which the figures
covering importations were in excess of 300 million dollars. From all of the
foregoing, It is implied that the total amount of Cuban imports and exports
in 1946 reached the figure of 624 million dollars, instead of 783 as appears
from the said document.
As regards the Cuban national income, the document (E/CONF.2/4). gives
no figures for Cuba insofar as the year 1938 is concerned. However, we
venture to present herein the figure of 430 million dollars as representative
of the national income at that time, in line with the estimate made by the
undersigned during the year 1940, as published in the pamphler entitled
"La.Economís de Cuba" ("The Cuban Economy") pages 41 and following..
(Directorio-Oficial de Exportación e Importación, Producción y Turismo).
The aforesaid document (H/CONF.2/4) gives a figure for the national
income of Cuba during the year of 1946 equal to 590 million dollars;
however, this figure turns out to be exceedingly low, so much so that it
allows one to think that the actual figure coverings the Cuban national income
was three times as much as the one just mentioned. In this respect, we are
able to make an estimate based upon the following assumptions:
First: That the figure of 430 millions for the national income
for 1938 is correct.
Second: That the increase in the overall national production -
that is to say both the production for export as also
that for the domestic consumption - have been augmented
at least in .the proportion of 33 per cent from 1938 to
1946; and,
Third: That the prices covering not only exportation but also
Imports and domestic, have been increased in general in the
proportion of at least twofolds and a half over the
levels prevailing in 1938,.
/Taking these facts E/CONF.2/C.6/6/44 Page 10
Taking these facts as a basis, the estimate covering the national
income for 1946 would be increased to about 1,400 million dollars, which
figure we consider to be very close to the one which should actually
represent the Cuban national income in 1946.
We are more satisfied with this figure because of the fact that In
making calculations for other purposes, prior to this work, our estimates
of national income for 1946 have been pretty close to the figure of
1,400 million dollars. In support of the reliability of these estimates we
are pleased to state that the same were based in such important data as
were afforded by the national re; enuo taxes, the value of exportations and
that of clearing banks compensations. And finally as a further proof on
behalf of the estimate of 1,400 million dollars, as representative of the
Cuban national income in 1946, we shall state that the said figures perfectly
concur with the figures covering the public receipts. Otherwise, that is,
should a figure be considered as pertaining to the national income for.
1946 very much below the one already submitted, the result would be that
the pressure of taxation in Cuba would be measured by a coefficient very
much above 18 percent, which is something so disproportionate and absurd
as to merit no real credit.
After taking innto consideration these remarks in connection with the
national income as also the contentions made with regard to the value, of the
Cuban exports and imports, we find that the figure of 133 per cent shown
as representative of the percentage of exports and imports as compared with
the national income is entirely untrue. In our estimation, the value of
Cuban exportations plus that of the importations represent 55.6 per cent
of the national income in the year 1938 and 58.1 per cent in the year 1946.
And finally, we wish to state that the conversion of the figures
covering the Cuban trade renders it necessary for the figures shown in the
document (E/CONF.2/4), insofar as the trade "per capita" is concerned, to
be also readjusted in connection with Cuba. Thus we find ourselves with
the fact that in the year 1938 the figure of the "per capita" trade for
Cuba should have been 59 dollars, while in 1946 it should be 165 dollars.
The figure assigned to Cuba for this latter year, pursuant to the document
(E/CONF.2/4) does not exceed 157 dollars.
The foréoing covers all pertinent remarks which had to be set
forth by the undersigned in connection with the figures, themselves,
mentioned in the document (E/CONF.2/4).
This notwithstanding, we deem it advisable to make a special criticism
of each of the indices which have been the subject of a statistical analysis.
-/Thus far, this E/CONF.2/C.6/44
Page 11
Thus far, this criticism has covered, almost exclusively, the valoation
acpect from a strictly statistical point of view; now it is an order that a
criticism be made on such indices from an economic point of view, This is
that we contemplate doings hereinbelow.
22, Total and Specia Criticism on the "general economic criterion" Adoptedes
a means for Doteimining the Indexed of Iterinational Economic Valuation
In the first place we wish to state that we deem it improper, for
purposes of measuring the importance of each and every one of the countries
participating in this Conference, insofar as the international trade
organization is concerned, to take into account such data as may pertain
to the. general economic structure and magnitude of the countries involved
rather than to take special account of the structure and magnitude of its
international trade properly said. We understand that in a Conference of
this nature., it is only proper to estimate the relative importance of economic
bearing of each country by taking into account international trade
criterions instead of the concepts of the domestic economy of each nation.
By following the latter procedure would give rise to the nonsensical or
absurd position that, for instance, the millions and millions o.f persons
composing the population of China, would have considerable bearing on the
decisions to be adopted in matters of international commerce, whilst, as a
matter of fact, the importance attached to international trade by each
inhabitant of the immense nation of China is the very minimum or of
ngligible significance, since they hardly produce for export nor do they
consume imported commodities. The same would be the case were we to .take
into consideration the immense area of the Hindoostan (or India) to attach
thereto, by reason of its extensive territory, the weight or deciding factor
of its right to vote. Miles and miles of the Hindu territory are hardly
affected by international trade, save in a minimum degree, hence it is quite
absurd that such criterions as are entirely aloof of international trade
should be allowed to have a deciding bearing on the resolutions adopted in
the latter subject matters. As a further proof to such an absurdity,
mention may be made, as well, of the very case taking place in the
United States whenever the enormous amount of millions of dollars
constituting the national income of the great North-American nation is taken
as a deciding index of the bearing to be attached to the country over the
international trade organization. If due account is taken of the fact that
only a minimum portion of such an immense national income of the
United States is related to international commerce, such fact would readily
lead to the concussino that a deciding factor is then taken into account
/which has almost E/CONF. 2/C. 6/44
Page 12
which has almost no bearing on the decided matter. The absurdity thus
becomes quite evident.
It is only logical that domestic criterions on the national economic
valuation be accepted, for instance, for purposes of detemining the voting
procedure within the Economic and Social Council of the United Nations,
whereat the whole of the economic problems of the world are to be dealt with;
we deem it proper that for purposes of voting within the International
Monetary Fund there shall have been taken into account such factors as are
related to the balance of payments and the monetary reserves of the nations;
we also deem it adequate that, for instance, as regards the International
Bank for Reconstruction and Development the criterions as to the borrowing
and lending capacity of the countries as also the capacity for contribution
should be the deciding factors for voting; but it follows that it should not
be regarded as fair in any manner whatsoever that within an international
trade organization the matters taken up thereat, of such vital influence
to many countries, should be decided upon by simply taking into account the
General economic importance thereof rather than its specific importance as
regards the very international trade matters subject of discussion.
Having set forth the above in a general way, we deem it advisable to
submit herein an economic analysis of each of the indexes hereinbefore
reviewed, with the object of determining why, from the point of view of a.,
specific economic criticism, it is neither the total population of the
countries nor the national income thereof or its total foreign trade,-that
should constitute the proper indexes for determining what specific bearing
should correspond to each country within the sphere of the International
Trade Organization,
221. Criticism on the Index of Population from an Economic Point of View
Economically speaking, it cannot be said that the factor of
population constitutes an index for clearly determining the importance
of a country in the international trade and, therefore, an index for
measuring the influence thereof within the Organization coming to
regulate such trade into a global basis, The importance of each
country within the international trade should be measured either through
its absolute international trade or through its relative international
trade, The first procedure of measurement is somewhat related to the
population, but it goes without saying that such relationship is not
perfect; it often happens that the absolute international trade is
higher in those countries where the population is greater and economic
/conditions are E/CONF.2/C.6/44
Page 13
conditions are similar. The fact remaine, however, that nations
are also dependable on the international. trade to such a degree as
the life of each inhabitant depends on said international commerce. Thus,
the cuontention cannot be made that every North-American or every
Chiraman depends on the international trade to the same extent as a
Cuban, as an example. Hence, it is not the figure coverirg the total
population what should be taken into account as a factor for measuring
the importance of a country from the point of view of international
trade, but that, in fact, to some extent, it is the figures covering
the absolute and relative international trade thereof that should
constitute a factor in the decision.
222. Criticism on the Index of the National Income
From an economic point of view it is in order to contest the action
of having the data covering the absolute national income incorporated
as a factor for determining the importance which should be attached
to each country within an organization for the ruling of
international trade. The arguments which, in our opinion, should
enable us to show our opposition to this index of valuation, are the.
followring:
(a) that there are no data available as to the national income
which are either efficient or sufficient, as already stated;
(b) that the methods for the preparation of the national income,
both from the stananoint of statistics as also from an
economic point of view, differ very much from one country
.to another, which renders the results obtainable to
difficult for comparative purposes from one nation to another;
(c) that the national income, from the point of view
of international comparison, requires the reduction
thereof to a common currency,.for instance, the dollar,
all of which bears out the problem of the availability
of rates of exchange of the other currencies as against
the dollar, and that such rates be real and not
arbitrary, untrue or capricious, as is the case with
the rates of exchange which, in most cases, now
prevail.
/This evidence E/CONF.2/C.6/44
Page 14
This evidence the fact that even though no other deficiencies
should exist, the national income cannot be considered as an
outstanding comparative factor of the nations from an internationally
commercial point of view since it is impossible to show the
respective national income in a common denominator, for instance,
the dollar;
(d) because, even though this were possible, the final
outcome is that the very nature of the national income renders
the figures thereof as non-convertible to a common currency.
This is due to the fact that the national income is formed, in a minimum
degree, by international securities, but in its major part is constituted
by well-acknowledged domestic securities, without their having any
connection whatsoever with international markets. All of which means
that an income of 100 dollars "per-capita" in the United States does not
afford the same purchasing power and therefore do not represent the same
actual income as 100 dollars would afford in any other country of the world.
Should these arguments not suffice, the fact may also be added that
inasmuch as the preferential scales of consumers show some variation from
one country to another by reason of the different ways, climates, tastes,
etc., it is evident that it is not possible in any given case for an equal
monetary income "per-capita" to be considered as the same actual income'
"per-capita", And, of course, it follows that it is only the actual income
of a country that would be of value for comparative purposes of an
international nature, The incomparableness of the figures covering the
national income evidences the unsuitability of this index for the international
purposes thus pursued.
It is not proper to contend that this problem of the conversion of the
monetary income into actual income is liable to be solved through the
correction of the monetary income by means of adequate general price indexes.
The error would prevail, since the index of prices is nothing else but a
measure of the fluctuation of prices of an aggregate of commodities within a
time basis which has been arbitrarily reputed as equal by all countries. For
example, the most common price index at the present time is that whereby all
computations are based in the average of 1935-39, which actually means that
It is arbitrarily being surmized that, at the moment, all countries had an
equal purchasing power for equal portions of their national income, such income
being considered from a monetary standpoint. Inasmuch as this is absolutely
against the actual facts, such argument is of no avail.
/223. Economic E/CONF. s I *-1. - / 1 .11/ -s r,,
Page 15
223. Economic Criticism on the Index of Total ForeignTrade
We have thus noted that the figures taken into account in the various
procedures nor existing insofar as determining the right to vote is concerned,
have been based upon the aggregate of the exports and imports of each country.
Sufficient stress should be laid from a general point of view on. the fact
that this procedure works to the detriment of such countries as necessarily
maintain, by reason of their economic structure and bealance of payments, a
positively strong status of their commercial balance. Every country with a
well-balance commerce, id eat, those with exports and imports alike or very
similar in their aggregate value, upon taking the joint index of both types
of international commerce for measuring the importance of the country,
visualize almost a duplication of the position which such countries would
have had should there be considered a single one of these factors, that is,
either the foreign trade or the import trade. However, those countries
having a comercial balance regularly unlevelled, whether in a positive or
negative sense, when summing up their exports and imports do never get to
duplicate their simple position in any manner whatsoever. Let us assume, as
a typical example, two countries: (A) and (B) with equal exports, to wit:
exports for a value of 100, and let us also assume that country (A) imports
95 by reason of its economic structure, whilst country (B) imports 70. It is
fully evident that if the index taken as a means for measuring the importance
of each country were the exportations alone, then both countries would have
an equal position; however, if the standard used is that of the addition, we
would find ourselves before the fact that whilst country (A) reaches a
weight equal to 195 points, country (B) only reaches a weight equal to
170 points. Factors concerning the economic structure of the countries
would thus be exerting a notable influence in the weight that would be
brought to bear by each country in the adoption of resolutions on
international trade.
This seems unadvisable from a general point of view, since it would
imply as much as granting importance to factors of the general economic
structure of the countries to ponder on the number of votes which each of
them shall be entitled to have in adopting decisions concerning
International trade. Thus we would ignore the general principle that only
commercial criterions should prevail for determining the measure of
importance of each country in an organization dealing with international
commerce.
But it is that we also understand that there is another argumen
suggesting the advisability of not considering as an index the aggregate
figure of imports and exports. Such argument is as follows: inasmuch as
the statistical valuation of exports is usually f.o.b. and the imports are
/computed E/CONF. 2/C.6/44
Page 16
computed on a c.i.f. basis, there is an evident discrepancy between both
figures which, in some way, hampers the addition thereof, Thus it would be
necessary to either exclude freight and insurance from the import trade or,
else, it would be necessary to add up freight and insurance to the export
trade From a national aspect, the statistical valuation on the f.o.g. basis
for exports and c.i.f. for imports is correct, since it reflects the
"economic moment" of the arrival or departure of the merchandise to or from
the country, as the case may be. However, from an international point of
view, for purposes of both imports and exports, a uniform similar criterion
should be adopted, to wit: that concerning the arrival, of the goods at the
market of destination, or that regarding the departure of the goods from
their producing countries. However, the statistics on international
commerce now available are not prepared in the said manners
3. SELECTION OF INDEXES OF COMMERCIAL VALUATION
31. Analysis on the Simple Index (Not Double) of the Absolute Value of the
Foreign Trade
Due note having been taken of the statements herein before made both
insofar as regard the statistical criticism of said indexes, as also
regarding the economic criticism of said indexes we must deem it advisable
to set forth now which are the indexes which, in our Judgment, ought to
serve as standard for determining the position or specific weight of each
country within the combine formed by all nations composing the International
Trade Organization,
We have already stated that, in principle, we had decided to substitute
the general economic criterion which have been inspiring each and every one
of the various formulae which have bean outlined to serve as a basis for
determining the relative position of the countries belonging to the
International Trade Organization, by a criterion to be specifically of an
international trade nature.
In line with the foregoing, we consider that there are a number of
indexes which should serve as a basis for ascertaining the said specific
weight of the countries within the International Trade Organization. Amongst
others to be reviewed hereunder, the index which, in our opinion, is of the
greatest importance is, undoubtedly, that represented, either by the total
value of the exports of a country or else by the total value of the imports
of a country. In our judgment, every country, as it is logically implied,
should make use of such a figure as, pursuant to its commercial. balance,
shows a higher amount.
/This index E/CONF.2/C.6/44
Page 17
This index takes into account the absolute magnitude of the countries -
which is really fair - but always from an international trade viewpoint. It
is only logical that in a valuation of the kind under contemplation, the
amount of thousands of million dollars of the export trade of the United
States, for instance, should weigh very much more than the few million
dollars represented by the foreign trade of Paraguay or of any other small
country. As far as we are concerned, therefore, there is no doubt
whatsoever that this index is the first and most important which should be
considered in the solution of our problem. Thereby, the position of the large
countries is duly acknowledged since they are the ones who have the highest
absolute value of exports or imports, as the case may be.
This index, from an economic point of view, does not suffer from
fundamental defects insofar as the international comparison is concerned,
since the values of an international trade are always the values of a
world-wide or semi-world-wide market that, on the assumption of normal
exchange rates, they should and ought to be shown as a world currency such
as the dollar. The only streak of doubt prevailing, as regards this index,
is the present lack of normal rates of foreign exchange. This constitutes
at the present time a general problem involving all comparison of international
monetary values, since the fact should not be ignored that we are living in
a period of tremendous monetary abnormally. In our opinion, there is no
other way to obviate this problem but to retrovert from the present time.
in order to adopt the figures pertaining to those pre-War years when, it is
conceded, there prevailed a certain degree of exchange normalcy. This
solution should constitute the basis for the calculation of the present index
until such time as a world monetary normalcy is finally achieved, at which
time, through the said medium the exchange rates of some currency as against
others may answer the actual economic requirements involved.
32. Analysis of the Index of Relative Value of Foreign Trade
If in the case of the preceding index we have taken into account the
absolute importance of international commerce, thus admitting therein the
interests of the large countries who find their functions within the world
trade more fully represented, it is only logical that we should now pass
on to make description of an index which takes into consideration the
relative magnitude of the countries from the said standpoint of international
trade. That is, from the standpoint of what such international trade
represents for the very life of each nation. In our opinion, this index is,
as regards small countries, the homologous of what the previous one represents
to the large countries, and should be considered in a general way as a
second index in category within a general valuation of indexes demonstrative
of the importance which every nation has in the international trade.
/From a E /CONF. 2/C.6/44
Page 18
From a statistical' point of view, this index may be measured by means
of two different procedures: (a) the procedure ot percentage of exports
vis-a-vis the national income; and (b) the procedure of the "per capita,"'
of exports or of imports.
As regards the first index there still prevail many of the deficiencies
which were incorporated by us, in due course, to the data on the national
income, However, it is obvious that, in this index, two of the main defects
:are excluded, which we-attribute to the index of national income, si.os it is
not possible to make comparison of absolute figures which, by reason of their
nature, are incomparable, nor is it necessary to convert the national income
of each country' into a common currency. The percentage being a relative
figure, it may be obtained by establishing the relation between the total
value of the exports or the imports of each country with the total value of
the national income shown in the very currency of the nation.,
Therefore, this index eliminates the problems of comparison which
formerly existed in connection with the income, even though the insufficiency
and deficiency of statistics on income may continue establishing a deadline
to the former and to the practical use thereof.
We are Interested, however, insofar as countries of little development
is concerned, to stress the fact that this index is perhaps the one affording
greater importance, hence it would be only too logical that notwithstanding
the deficiencies of the national income, a special emphasis be herein laid
on the defense thereof.
Even on the assumption that the preceding index was not computable by
reason of the defects and limitations already pointed out, it may be possible
to measure the importance of the relative value of the international trade
of each country by means of the index of the value of the exports or imports
of each country shown per unit of production, that is, the "per capite" of
inhabitants. This index is evidently the simplest of all. International
commercial statistics as also the statistics of population, notwithstanding
their defects, are perhaps the best ones available in an international sense.
However, as regards this "per capita" trade index, there still remains the
problem of the selection of the rate of exchange of some currencies with
another, which inconvenience would be averted with the use of the
aforementioned index.
Furthermore, this index as compared with the foregoing one shows a
serious inconvenience which would diminish to a great extent the importance
to be conceded to countries with a low income, since it favours in a special
manner the countries of greater "per capita" income as against those of less
"per capita" income.
/Let us take E/CONF.2 /C. 6/44
Page 19
Let us take, for example, two countries entirely imaginary, even though
the case may suggest a close similarity with the United States of America and
Cuba. Let us assume, therefore, that the said countries show the following
economic picture:
(1) (2) (3)
"Per Capita"
National "Per capita" Income % of
COUNTRY Exportation Population Income Exportation (3:2) (1:3)
A $ 500 mil. 5 mil. $1,500 mil. $100 $300 33
B 15,000 mil. 150 mil. 150,000 mil. 100 1,000 10
From the above given figures, it may be reeJly noted how country (A)
on the assumption of having an export percentage, as compared with the
national income, three times as much as that of country (B), would
nevertheless have an equal "per capita" exportation value, Thereby, we
understand, full evidence is established of the advantage which the preceding
index affords to countries not having a very high standard of living, as
against the index now being reviewed.
33. Index of Geographic Concontration of the Import and Export Trades
The third index which we deem advisable to suggest for purposes of
determining the right to vote within the International Trade Organization to
be created, is that concerning the degree of concentration which, as regards
the various markets or principal sources of national supply, are experienced
both by the export as well as the import trade of a country. This index we
may just as well call "index of geographic concentration of foreign trade",
whether of exports or imports, as the case may be.
It stands out very clearly that this index, by reason of its own nature,
offers certain complexity of computation, but even so, we deem it our duty
to set forth before the members of the delegation that, in our judgment, it
is the third in general importance, which commitment, as above stated, is
our personal criterion.
The index under review, we understand should be taken into consideration
since it serves to demonstrate how vital is for a country its peculiar form
of international trade from a geographical point ofview or as regards the
various markets. Every measure on the international trade is, with no doubt
whatsoever, more significant and deciding to a country having a high
geographic concentration of its international trade than to another one who,
to the contrary, maintains a high geographic dispersion of its export and
import trade. The country in the former case, has almost no possibility,
alternative or countervailing means in the face of any contingency or of
a lasting change, whilst the latter, always finds, or at least finds it
more easily, their relieving moans of change and countervailling measures.
/Hence it E/CONF.2/C.6/44
Page 20
Hence it follows that due consideration should be given to this structural
reason of international commerce for determining the specific weight of a
country in so far as it refers to the voting policy within the International
Trade organization.
Considering the general characteristics of the economic facts under
review, we propose that the index of geographic concentration of
international cammerce be taken into account as one of those which are to
serve the purpose of making the valuation of the specific weight which every
country bears within the organization of said international commerce.
From a statistical point of view, the standard which should serve
to measure the amount of geographic concentration both as regards the export
and the import trade would be the index set forth on pages 98 and following
of the work entitled "National Power and the Structure of Foreign Trade",
by Albert O. Hirechman (University of California, 1945). "The concentration
of the trade of a nation - says Hirschman - depends upon the number of the
countries with whom it deals and the distribution more or less unbalanced
of its commercial traffic amongst the countries". Further on, Mr. Hirschman,
himself, give us the formula for the computation of the index under review:
"the imports (or exports) of a country from (or to) other countries, may be
indicated as a percentage of its total importations or exportation The
index is calculated on the basis of the addition of the squares of these
percentages and through the extraction of the square root of the sums
thereof."
Appendix "D" of the Report contains the corresponding chart with the
indexes of geographic concentration of the export and import trade of
45 countries.
34. Index of the Internal Structure of the International Commerce of Each
Country.
Another index of special interest, would be that of the structure or
integration of the export and import trade of every country. We understand
that the international trade, depending upon the internal structure showed
by imports and exports, serves the purpose of expressing - in a certain way -
the measure of the economic development of each nation, the nature of its
economy and, consequently, the degree of movability of the productive factors
.within the country.
The percentage which the "non-manufactured" commodities represent in
the exportation of each country over the total value of exports, is indicative
to us of the measure in which a country is still pending development and,
consequently, the scarce movability of productive factors existing therein.
The percentage of imports of "manufactured" articles over the total imports
by the country, is at the same time representing the measure in which the
/domestic demand E/CONF.2/0.6/44 Page 21
domestic demand is dependent upon the foreign production for meeting the
consumption of higher quality items required as a result of the culture
and standard of living of civilized countries.
I it is to be considered that the indexes already reviewed by us,
that is, if it should be taken into account that the percentages of the
exportation of "non-manufactured" commodities, as compared to the total
exportation, as also the percentages of imports of "maufactured" goods
as compared to total-imports, represent to a certain extent, within the
scope of the international trade the measure of movability of the productive
factors within the country, involved, it seems to us quite evident that all
such countries as may have a greater percentage of "non-manufactured"
articles in their exports, and a higher percentage of the importation of
"manufactured" items, are those having a lesser economic development end,
therefore, possess a lesser movability of the productive factors from the
point of view of the numerous probable uses or applications of the latter,
and, consequently, are dependent, to a greater extent, on international
trade. This means, that in the face of any change or contingency any
nature as regards international commerce, the capacity for adjustment to
the new situation, on the part of the countries having high percentages in
the exportation of "non-manufactured" goods and in the importation of
"manufactured" items is much below the capacity of adjustment of highly
developed countries, id est, those having a small percentage or at least
a lesser percentage of exports of "non-manufactured" commodities and also
a lower 'or minimum percentage of importation of manufactured articles.
From the above statements it stands out quite evident that .any measure
dealing with international trade has a great bearing on any of the countries
whose status is that of the former case; any measure of this nature
affecting the countries placed in the latter position-may be better endured.
This suggests the necessity of assigning a greater specific weight to.
countries of small development than to those fully developed, in so far as
it concerns the decisions which, from this point of view, may be adopted
by the International Trade Organization to be created.
The index which would statistically measure the said position is, as
already stated, either that of the percentage representing that part of
the total exports pertaining to the value of exports of "non-manufactured"
articles, or the percentage covering the importation of manufactured goods
over the total imports, or both. This double index bears the advantage of
its easy computation because of the fact that the statistics on international
'trade prove to be most efficient and numerous than any other to be found
within the scope of the world. Likewise, it affords the advantage of not
creating any problem in making comparison in absoluts terms, and, moreover,
it averte the inconvenience which at the present time is somewhat without
solution, of expressing all national monetary values through a aingle
currency for instance, the dollar. The probIem or instability of exchange
/now prevailing E/CONF. 2 /C.6 /44
Page 22
now prevailing and the ascrtaining of the rates of exchange of currencies
among themselves, would therefore be entirely averted in the index now under
consideration.
35. Inldex of Merchant Fleets.
And, finally, we consider that it is advisable for us to point out the
index relating to the national merchant fleets as amongst such indexes which
deserve due consideration from the point of view of international trade and
for purposes of pondering on matters of vote as will be required within the
International Trade Organization to be created. It is evident that
international trade is carried on mostly by moans of vessels, Hence there
is no doubt whatsoever in the fact that the commercial importance of every
country is not only measurable, from an international point of view, in
proportion to the import or export trade being made, but that it should also
be measured by considering the available means of transportation enjoyed
by each country for carrying on its own international trade or the
international commerce of the other countries. It is for these reasons that
it becomes advisable to take into account as one of the indexes - which,
as a matter of fact is one of least importance among these already given -
as representative of international trade, the index covering the tannenge
of national merchant fleet.
As regards this index, the position of. small countries with little
development is very unfavorable. Take for instance the position of Cuba.
But as we understand that the standard to be adopted should contain indexes
containing both fully developed countries as also those of little
development, it is necessary and advisable to include this index, even though
in the least degree, within the general standard to be proposed by Cuba.
The adversity for Cuba is evident as regards thereto, but the inclusion
thereof would serve as a token of the good faith of Cuba in proposing a
standard providing an index which is so detrimental to it.
4. FINAL PROVISIONS
In view of the foregoing and as a summary thereof, we hereby propose:
First
That the case of Cuba it should adopt the so-called criterion
of international trade, as against the general economic concept which
has thus far been tho basis for the selection of indexes to determine
on the right to vote. within the International Trade Organization.
Second
That the following indexes be considered as the ones which should
form part of the above mentioned international trade criterion: a) the
index of exports and imports expressed as an absolute value in a single
currency; b) the one dealing with the percentage of exports in relation
to the respective national incomes; c) that one showing the "per capita"
-of the export and import trade; d) the one of the percentage of exports
or imports of "non-manufactured" or "manufactured" goods, as the case
/may be; Page 23
may be; e) that concerning the percentage of geographic concentration
of the international trade of each nation; and f) the one regarding
the tonnage of the respect merchant marine fleets. We are of the
opinion that Cuba should struggle towards having the indexes seat forth
above duly considered in this same sequence of importance, and such
procedure to hold true even in cases when the measure for pondering on
the right to vote for each of such countries is held in abeyance
awaiting for the decision to be adopted by the Commission referred to
in the preceding paragraph; and,
Third
That a "petit-comite" of work be organized for purposes of
incorporating into such indexes as may be selected by the Delegation
as preferable, the results of the "experience" borne out therefrom
thus making the proper computations concerning the various discussions
whether they be direct or implied,
This is all what the undersigned Adviser wishes to submit in order.
to comply with the task entrusted him as regards the problem of reporting
to. the Cuban Delegation on the economic indexes which should serve as a
basis for establishing the criterion sustained by it in so far as the
matter of the vote is concerned.
Before closing, however, we wish to convey hereby our natural lack
of full satisfaction towards the contents of this Report which, even though
it could and should have been drawn up in a better fashion, such a goal
has not been fully met; due in part, and as major cause, to the personal
limitations of the writer and, also, though for sheer lack of time.
(sgd.) Julian Alienes y Urosa.
/APPENDIX "A" E/CONF.2/C.6/44
Page 24
APPENDIX "A"
POPULATION OF THE WORLD IN THE YEARS 1938 AN 1946 AA PER THE "MONTHLY
BULLETIN OF STATISTICS. .- STATISTICAL OFFICE OF THE UNITED NATIONS"
ISSUES NUMBER 10 OCTOBER 1947
(Shown in units of thousands of persons)
COUNTRIES YEAR 1938 YEAR 1946
Argentina
Australia
Austria:
Belgium
Bolivia
Brazil
Bulgaria
Canada.
Ceylon
Chile
China
Colombia
Costa Rica
Cuba
Cyprus
Czechoslovakia
Denmark
Dominican Republic
Ecuador
Egypt
Finland
France
Germany
Greece
Guatemala
Honduras
Hungary
Iceland
India
Ireland
Italy
Japan
Korea
Mexico
Holland
New Zealand
Nicaragua
Norway
Palestine
Panama
Paraguay
Peru
Philippines
Poland
Portugal
Roumania
12,957
6,893
6,760
8,387
3,294
39,410
6,244
5,810
4,635
8,702
623
4,228
377
14,603
3,777
1,637
2,865
16, 297
3,671
41,100
68, 425
7,109
3,044
9,060
118
282, 341
2,937
43,771
72, 223
22,634
19,071
8,680
1,607
2,914
1,435
5,990
15,814
34,849
19,750
15,832
7,449
7,009
8, 389
3,788
46,726
6,993
12,307
6,700
5,479
455,592
10,318f
772:
5,052.
462
13,091
4,101
2, 089
3,340O
18,833
3,877
40,000
65,911
7,450o
3,575
1,220
9,309
132
310,625
4.5,646
73,114
19, 369
22,776
.9,417
1,761
1,109
3,105
1,912
632
1,200
19,067
23,930
8,223
16,472
/Salvador E/CONF.2/C.6/44 Page 25
APPENDIX "A"
( Continued)
CONRIES YEAR 1938 YEAR 1946
Salvador 1,704 1,997
South Africa 2,081 2,363.
Spain 25,493 27,246
Sweden 6,297 6,719
Switzerland 4,192 4,466
United Kingdom 47,485 47,175
United States 129,825 141,229
Uruguay 2,108 2,281
Venuezuela 3,431 4,300
/APPENDIX "B" E/CONF.2/C. 6/44
Page 26
APPENDIX `"B"
ESTIMATES ON THE NATIONAL INCOME IN THE YEARS 1938 AND 1946 AS REGARDS
SOME COUNTRIES, PURSUANT TO THE SPETENBER 1947 ISSUE OF THE "MONTHLY
BULLETIN OF STATISTICS. - STATISTICAL OFFICE OF THE UNITED NATIONS"
COUTRIES NATIONAL CURRENCY YEAR YEAR
(in units of millions of) 1938 1946
Argentina
Australia
Belgium
Bulgaria
Canada
Czechoslovakia
Denmark
Dominican Republic
France
Ireland
Mexioo
Holland
New Zealand
Norway
South Africa
Sweden
Switzerland
United Kingdom
United States
Pesoe
Pounds Sterling (A)
Francs
Leva (1,000 millions)
Dollars
Crowns (1,000 millions)
Kroners
Dollars
Francs (1,000 millions)
Pounds
Pesos
Guldens
Pounds (N.Z.)
Kroners
Pounds (S.A.)
Kronors
Francs
Pounds
Dollars
/APPENDIX "C"
8, 857
803
65,200
3,940
56.6
5,861
348
154.4
5,223
4,989
185. 8
4,359
364,8
11,277
8,202
4,671
67,375
1,265
190,000
334.0
9,212
148.8
180.35
295
7,985
w _ _ _
7,622
19,264
7,974
178,204 E/CONF.2/C.6/44
Page 27
APPENDIX "C"
CHART COVERING THE "NON-INDUSRIAL" EXPORTS AND THE "INDUSTRIAL'' IMPORTS
(Shown in the % over the total and the respective trade)
(Facts taken from Document III/1 as compiled by the
"Preliminary International Trade Meeting" of London)
over the total national over the total national
COUNTRIES imports as represented by exports as represented by
the imports of the exports of "non-
"manufactured items". manufactured" goods.
1925 1929 1935 1925 1929 1935
Argelia
Belgian Congo
Egypt
Union of South Africa
Canada
United States
Argentina
Bolivia
Brazil
Chile
Colombia
Costa Rica
Cuba
Dominican Republic
Ecuador
Guatemala
Honduras
Mexico
Panama
Peru
El Salvador
Venezuela
China
Manchuria
India
Netherlands Indies
Iran
Japan (1)
Japan (2)
Korea
British Malaya.
Siam
Albania
Germany
Austria
Belgium
Bulgaria
Denmark
Spain
75.1
51.8
21.9
69.1
66.8
59.6
70.6
64.8
45.8
71.8
67.0
65.0
70.8
61.2
66.7
80.7
75.7
49.2
77.3
70 8
58.9
18.6
21.3
28.1
69.2
57.8
33.0
22.0
68.8
35.9
43.2
67.4
68.5
58.0
78.2
59.2
26.1
68.8
67.2
59.6
73.6
79.1
66.9
52.7
57.4
74.6
67.3
72.4
59.7
64.4
69.6
77.7
49,6
62.8
72.5
68.9
62.7
21.0
69.6
50.4
16.8
39.7
27.1
67.6
40.0
48.3
61.8.
74.1
58.1
84.1
21.7
71.1
64.3
59.7
69.8
86.6
71.4
57.3
71.0
74.0
67.3
69.8
76.9
86.7
51.2
74.0
72.6
66.9
14.1
63.4
29.9
70.4
55.4
13.5
32.0
27.0
62.0
42.3
48.4
98.9
97.0
97.2
73.3
64.7
96.6
99.6
99.8
95.7
99.3
95.5
93.6
99.4
97.9
99.4
100.0
99.7
99.7
98.3
82.7
78.6
98.4
85.8
49.6
93.2
96.2
99.5
24.7
24.4
44.2
97.5
88.9
71.2
91.8
94.4
96.3
91.9
71.9
54.4
97.3
99.8
99.6
95.8
99.0
99.2
95.7
98.3
87.5
99.3
99.4
99.9
99.8
99.9
99.2
85.0
96.8
74.9
97.7
89.3
47.2
87.8
92.6
95.7
99.8
25.5
25.7
40.6
92.1
87.9
77.5
96.0
88.7
96.2
93.0
71.4
56.4
95.2
98.5
99.5
98.6
99.6
97.4
97.3
87.1
99.1
99.7
99.3
98.6
99.5
79.2
9601
75.1
96.8
93.3
30.9
94.8
97.6
100.0
19.9
31.0
49.2
96.5
87.8
82.7
(1) Including trade with
(2) Excluding trade with
Korea and Formosa.
Korea and Formosa.
/Esthonia E/CONF.2 /C.6/44
Page 28
APPENDIX "C"
(Continued)
over the total national % over the total national
COUNTRIES imports as represented by exports as represented by
the imports of the exports of "non-
"manufactured items". manufactured" goods.
1925 1929 1935 1925 1929 1935
Esthonia
Finland
France
Greece
Ireland
Iceland.
Italy
Letonia
Lituania
Norway
Netherlends
Polend
Portugal
Rumania
United Kingdom
Sweden
Switzerland
Czechoslovakia
Turkey
U.R.S.S.
Yugoslavia
Australia
New Zealand
39.6
46.1
12.8
31.6
57.9
41.6
51.7
22.4
47.5
53.8
42.4
34.3
44.1
34.3
38.7
23.0
35.9
71.1
76.3
73.0
42.9
48.0
17.6
37,3
48.1
60.5
26.8
42.2
51.4
41.1
38.5
80.5
21.2
43.8
43.8
31.6
72.1
37.7
71.4
73.8
75.0
42.1
17.7
41.3
37.1.
53.6
59.9
23.9
52.7
59.2
2:30
46.6
38.6
79.5
16.0
48.1
44.8
28.0
83.3
43.5
69.0
73.8
77.0
29.9
96 6
83.5
91.4
99.9
51.7
85.9
93.1
75.9
65.4
77.7
87.2
22.3
60.2
19.2
37.7
94.9
90.8
98.2
98.8
68.8
33.6
98,0
79.6
91.1
99.7
45.9
67.0
93.1
77.6
63.2
80. 4
88.1
97.8
22,8
59.3
19.9.
28.3
88.9
89.6
91.3
97.2
98.8
77.1
38.7
97.2
70.1
99.8
52.0
79.5
93.5
79.3
67.4
77.0
83.0
98.8
5.8
55.6
19.1
27.4
97.0
81.0
94.4
96.0
99.3
/APPENDIX "D" E/CONF.2/C.6/44
Page 29
APPENDIX "D"
CHART ON THE GEOGRAPHIC CONCENTRATION OF FOREIGN TRADE
YEAR 1938
% OF GEOGRAPHIC CONCENTRATION
COUNTRIES
OF IMPORTS OF EXPORTS
Bulgaria 54.0 60.3
Hungary 44.5 48.2
Rumania 42.1 33.2
Yugoslavia 43.6 45.5
Greece 36.5 45.3
Turkey 50.6 47.6
Holland 30.3 32.2
Belgium 27.1 28.8
Czechoslovakia 26.0 26.6
Switzerland 32.8 26.9
Poland. 30.3 33.2
Norway 34.5 35.9
Sweden 35.7 33.9
Denmark 44.1 59.4
Esthonia 38.5 47.4
Lativia 44.8 55.0
Lituania 48.9 41.5
Finland 34.9 48.9
Portugal 30.6 31.3
Albania 41.2 70.2
United Kingdom 21.8 19.6
Ireland 52.5 92.7
Canada 65.3 53.5
Ceylon 35.5
India 38.5 37.8
British Malaya 38.3 37.0
Australia 46.2 56.3
New Zealand 52.8 84.0
Egypt 29.9 38.1
Nigeria 67.13 68.3
Union of South Africa 47.8 75.9
Argentina 30.6 37.6
Bolivia 37.3 66.5
Brazil 39.0 41.8
Chile 40.6 --
Colombia 55.8 61.5
Ecuador 44.3 44.0
Peru 42.2 37.7
Uruguay 29.1 38.3
Cuba 713 77.3
Mexico 61.1 68.7
Netherlands Indies 34.1 32.4
Philippines 69,4 78.0
(Dats taken from the book entitled nationall Power and the Structure of
Foreign Trade", by Albert 0. Hirschman. University of California Press.
1945. ) |
GATT Library | js549nw7185 | Report Sub-Committee of Committees II and VI on Articles 9, 10 and 11 | United Nations Conference on Trade and Employment, February 12, 1948 | Second Committee: Economic Development and Sixth Committee: Organization | 12/02/1948 | official documents | E/CONF.2/C.2/36, E/CONF.2/C.6/72, and E/CONF.2/C.6/44-75 | https://exhibits.stanford.edu/gatt/catalog/js549nw7185 | js549nw7185_90170136.xml | GATT_147 | 3,113 | 21,138 | United Nations Nations Unies UNRESTRICTED
CONFERENCE CONFERENCE E/CONF. 2/C. 2/36
ON DU E/CONF. 2/C.6/72
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPOI 12 February :1948ebry194g 8
SONOOND CKVELOPMENT DE=l 0Pd
MITTEE: ORGANIZATIONIANIZATIO
REPINT SUB-COMMITTEE OF COMMITTEES II AND VcCTTZ OFVI
ON ARTICLES 9, 10 AND 11
1. The Joint Sub-Committee was appointesixththe ai'xt meeting of Committee II
and the fifth and seventh meetings of Committee VI with terms of reference:
"1. To examine Articles 9, 10 and 11 of Chapter III, proposed amendments
thereto and any proposed new articles relating to the positive functions
of the Organization in promoting economic development in the light of the
d sc ssion.in-Committee II with a view to maming recogmendations as to the
texts of ticles artioleseand any organizations provisions which may be
required as a consequence thereof.
2. To examine the proposal of the Mexican delegation for the
establishment of an Economic Development Committee of the Organization
taking into account any conclusions reached under paragraph 1 and any
other relevant considerations.
3. In making recommendations under paragraphs 1 and 2 to take into
account the functions of other organs of the Organization and of the
United Nations and Specialized Agencies inigeneral In the field of'
economic development and any financial implications.
To report to both Committee II and Committee VI."
2. The ooint Sub-Cmmittee was composed of representatives of;
Australia France u Tirkey
Belgium Iraq United Kingdom
brazil Mexico United States
China Pakistan Venezuela
Colombia South Africa
Dr.-H. . Coombs.(Australia) was elected Chairman of the Sub-Committee.
3. A number of representatives of delegations who were not members of the
Sub-Committee attended as observers and in many cases took part in the
d iscussionon particular amenrments for which they were primarily responsible
or in which they had special interest. Representatives of the International
/Bank for E/CONF. 2/C.2/36
E/CONF. 2/C.6/72
Page 2
Bank for Reconstruction and Development and of the Food and Agricultural
Organization, as well as the Director of the Fiscal Division of the Economic
Affairs Department of the United Nations gave their views to the Sub-Committee.
4. The Sub-Committee had held twenty-seven meetings at the date of approval
of this report. It examined Articles 9, 10 and 11 and all the amendments and
proposals submitted to it in connection with these articles as listed in
Annex A in Accordance with paragraphs 1 and 3 of its terms of reference.
As a result of its examination the Sub-Committee decided to recommend:
(i) revised texts of Articles 9, 10 and 11 as set out in Annex B;
(ii) a resolution to be adopted by the Conference as set out in
Annex C;
(iii) chance in Article 69 as set out in Annex D; and
(iv) inclusion as a new article in Chapter IX of the text set out in
Annex E.
It was agreed that the asforementioned recommendations diaposed of all the
amendment and proposals listed in Annex A.
5. In accordance with the decision of Committee II at its sixteenth meeting
to establish Sub-Committee D to examine and submit recommendations concerning
the footnote to Chapter III on "Reconstrution" the Joint Sub-Committee did
not consider, the question of the inclusion of any reference to reconstruction
with respect to any of the changes recommended in Articles 9, 10 or 11.
6. The constitutional provisions of certain Members were brought. tothe
attention of the Sub-Committee, These provide that all controversies which
may arise out of contracts in which the State or one of its sub-divisions
are parties are to be resolved by national tribunals. It was agreed that
these constitutional requirements are not in conflict with any provision
of the articles with which the Sub-Committee was concerned that the
Organization would not in any manner have jurisdiction over facts resulting
from such a situation nor oyer the decisions of the national tribunals. The
action which the Organization would be able to take in relation to such cases
would be limited toa release or a diminution of the obligations assumed or
concessions granted by the Member which asserts a nullification or impairment
of a benefit under the Charter, if the Organization finds that the situation
which has been created justifies such action,
7. The representatives of Belgium and the United States expressed the view
that Article 11 did inot prevent any government from taking such action as
might be reasonable or justifiable to protect the saving of its nationals,
such action being subject to review by the Organization. However, the
Sub-Committee considered the text of the article to be clear and, therefore,
agreed unanimously that it was not necessary to include any explanation in
the report.
/8, With E/CONF.2/C.2/36
E/0OVF.2/C.6/72
Page 3
8. With respect of paragraph 2 of Article 11 the Sub-Committee took the
view that agreements promoted or recommended for adoption under paragraph 2
of Article 11 would not fall within paragrph 4 of Article 74.
9. With respect to paragraph 2 (b) of Article 11 the Sub-Committee took
the view that, while it was difficult to we precise at this stage as to the
nature of appropriate measures, more equitable and widely spread use of the
means to economic development could be achieved by joint action by Members.
It seemed desirable, therefore, that it should be made clear that the
Organization had the necessary authority, with due respect to the functions
and actitivities of other inter-governmental organizations, to make
recommendations for and promote agreements whether bilateral or multilateral
to provide for such joint action, if study of the circumstances suggested
that such a course were desirable. The Sub-Committee drew attention to the
fact that whether any agreements would in fact be concluded was dependent
upon the willingness of governments to enter into then and that the scope
of such agreements would be dependent upon the discretion of the governments
concerned. The Sub-Committee felt that the proposed paragraph 2 (b) would
enable the Organization to make recommendations and promote agreements to
assist countries ancountering difficulties as a result of actual or
prospective shortages. The Sub-Committee considered that:
(a) the promotion of an agreement to facilitate an equitable
distribution of skills, arts, technology, materials and equipment,
was not restricted by the use to which these facilities were put,
i.e. if these facilities were essential to established industries
as well as to economic development, the Organization could recommend
an agreement in appropriate circumstances;
(b) without presuming to judge whether such action would in fact be
desirable, the text approved would permit the Organization, if it
believed that speculation was affecting the equitable distribution of
the facilities referred to in paragra,1:. . and it judged that such
action was relevant and appropriate, could recommend and promote
agreements between governments providing for measures against
speculation;
(c) the authority granted to the Organization to make recommendations
and promote agreements designed to facilitate an eqnitable distribution
of skills, arts, technology, materials and eqaipment could enlarge
the scope of the co-operation and the assistance which the Organization
could give to Members in accordance with Article 10 and would be of
assistance to countries which were having difficulties in obtaining
the capital Goods, equipment and materials which they required,
(d) "industrial patents" were included in the term "technology",
/10. with E/CONF.2/C.2/36 E/CONF.2/C.6/72
Page 4
10. With reference to the text recommended to be included in Chapter IX
as a new article and set out in Annex E, the Sub-COmmittee noted that this
text would be acceptable to the Italian delegation in disposing of the new
article proposed by them to be inserted between Articles 69 and 70.
(E/CONF.2/C.6/12, page 4) and the amendment submitted by them to Article 81
(E/CONF.2/C.6/12, page 13). The Sub-Committee agreed that this text would
require the Organization in cases where the economic circumstances of Members
were relevant, to give consideratin, to all of the factors affecting those
economic circumstances. Among such .actors might be the degree of assistance
extended to a Member by other Members or by existing inter-governmental
organizations.
11. It was agreed that the words "within the limits of their power" in
paragraph 1 (a) of Article 11 were clearly expressed by the words in the
French text "dans la mesure ou ils le pouront" and that the Central Drafting
Committee should be asked to consider what were the most appropriate English
words. It was agreed that the English word "enterprise" in paragraph 1 (b)
of Article 11 had the technical meaning used by economists, i.e. the
activities of en entrepreneur, It was agreed that the Central Drafting
Committee should be asked to consider the most appropriate word or words
to express this idea in French. E/CONF.2/C.2/36
Page 5
ANNEX A
AAM S AND PROPOSALS SUBMITTED TO JOINT SUB-COMMTTEE
IN CONNECTION WITH ARICLES 9, 10 AND 11
Pages of Revised
Item Article Paragraph Name or Annotated Agenda
No. Country (E/CONF.2/C.2/9)
Ceylon
Mexico
Burma
Turkey
Mexico
Mexico
Italy
Chile
Uruguay
Mexico
China
Mexico
Burma
Norway
Chile
Afghanistan
Peru
Mexico
Chile
Chile
Costa Rica
Colombia
2
2
3
3
3
4
5
5
5 and 6
5 and 7*
6 and 7*
10 and 11*
11
12 and 13*
20 and 21
21
25, 26, 27 and 28
* Also E/CONF.2/C.2/9/Add.4/Corr.3r r .;
/CONF.2/C.2/9/Add./§9>ddr.4/Cor 3
BM= B
1,
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16,
17,
18.
19.
20,
21.
22.
23.
10
10
10
10
10
N1
11
11
11
11
11
11
11
11
12
11
New 12A-
2
2
2
Additional
Additional
1
1
1
1
1
2
2
3
Additional
Additional
Additional
. _
^ w E/CONF.2/C.2/36 E/CONF.2/C.2/72
Page 6 ANNEX B
TEXT OF ARTICLES 9, 10 AND 11 RECOMMENDED
(Additions to and deletions from the text of the Genera Draft are
shown by underlining and square brackets respectively)
Article 9
Development of Domestic Resources and Productivity
- Membere shall within their respective territories take action designed
progressively to develop, and where necessary to reconstruct, industrial and
other economic resources and to raise standards of productivity through
measures [consistent] not inconsistent with the other provisions of this
Charter.
Article 10
Co-operation for Economic development
1. Members shall cooperate with one another, with the Economic and Social
council of the United Nations, with the Organization and with other appropriate
inter-governmental organizations in facilitating and promoting industrial and
general economic development.
2. With à view to facilitating and promoting industrial and general economic
development and consequently higher standards of living, eepecially of those
countries which are still relatively undeveloped and subject to any arrangements
entered into between the Orgarniation and the Economic and Social Counoil
and appropriate inter-governmental organization, the Organization shall,
within its powers and resources, at the request of any Member:
(a) (i) study its natural resources and its potentialities for
industrial and general economic development and assist
in the formulation of plans for such development;
(ii) funish [any member which so requests] it with appropriate
advice concerning its plans [and] for economic development
and the financing and carrying out of its programes for
economic development [.];
or (b) [shall] assist it to procure such advice [.] or study.
[Such advice or assistance, shall be furnished upon] These services are to be
provided on terms to be agreed and in such collaboration with appropriate
regional or other inter-governmental organizations as will use fully the
competence of saoh of them. The Organization shall, upon the same conditions,
likewise aid members in procuring appropriate technical assistance.
/3. With a. view E/CONF.2/C.2/36
E/CONF.2/C.6/72
Page 7
3. With a view to facilitating and promoting industrial and general economic
development especially of those countries which are still relative undeveloped
the Organization shall co-operat fully with the Economic and Social Council
of the United Nations and appropriate inter-governmental Organizations on
all phapes of economic development within their special competance and
in particular in resoct of finance, equipment, technical assistance and
managerial skills.
Article 11
Means of Promoting Economic Develoment
1. Progressive industrial and general economic development requires among
other things adequate supplies of capital funds, materials, modern equipment
and technology, and techical and manage al skills. Accordingly, in order
to stimulate and assist in the provision and exchange of these facilities,
(a) Members shall co-operate in accordance with Article 10 in
providing or arranging for the provision of such facilities within
the limits of their power, and [no Member shall] Members shall not
impose unreasonable or unjustifiable impediments that would prevent
other Members from obtaining on equitable term any such facilities
fcr their economic development [.];*
(b) no Member shall take unreasonable or unjustifiable action within
its territories injurious to the rights or interests of natio. zUs of
other Members in the enterprise, skills, capital, arts or technology
which they have supplied.
[3] 2. The Orgenization may in such collaboration with other
inter-overnmental organization as may be appropriate
(a) make recommendations for and promote [international7 bilateral
or multilateral agreements on measures designed
(i) to assure just and equitable treatment for the enterprise,
skiIls, capital, arts and technology brought from one Member
country to another;
(ii) to avoid international drtuble taxation in order to stimulate
the flow of foreign priva 3 investments;
(Iii) to enlaxge to the greatest possible extent the benefits to
Members from the fulfilment of the obligations under this
Article.
(b) make reoos ondatic-s and promote agreement desiged to facilitate
an equitable distribution of skills arts technology materials and
* In addition to the changes indicated what was the first part of the second
sentence in the Geneva Draft has become the second part of sub-paragraph (a)
and what was the second part of the second sentence in the Gene% Draft
has become the first part of sub-paragraph (a). E/CONF.2/C. 2/36
E/CONF. 2/C.6/72
Page 8
equipment with due regardq to the needs of all Members;
(c) [including the elaboration and7 formulate and promote the
adopting of general agreement or statement of principles as to the
conduct, practices and treatment of foreign investment.
/ANNEX C E/CONF.2/C.2/36
E/CONF.2/C.6/72
Page 9
ANNEX C
PROPOSED RESOLUTION TO BE ADOPTED BY THE CONFERENCE
The United Nations Conference on Trade and Employment, having considered
the problem of the industrial and general economic development and
reconstruction of the Members of the International Trade Organization; and
Having noted the related activities of other inter-governmental
organizations and specialized agencies; and
Having determined that positive measures for the promotion of the
economic development and reconstruction of Members are an essential condition
for the realization of the purpose stated in Article 1 of the Charter of the
International Trade Organization and to the accomplishment of the objectives
therein set forth; and
Having regard to the provisions of Articles 10, 69 and 84 of the Charter,
Therefore resolves:
1. That the Interim Commission of the International Trade
Organization* is hereby directed to examine
(i) the powers, responsibilities and activities in the field
of industrial and general economic development and
reconstruction of the United Nations, of the specialized
agencies and of other inter-governmental organizationsy
including regional organizations;
(ii) the availability of facilities for technical surveys
or studies of; the natural resources of underdeveloped
countries; or the possibilities of their industrial
development, whether general or in relation to the
processing of locally produced raw materials or other
particular industries; or for the improvement of their
systems of transportation and communications; or with
respect to the manner in which investment of foreign
capital may contribute to their economic development;
and in the light of this examination to report to the organization
upon
(a) the structure and administrative methods,
(b) the working relations with the United Nations, the
specialized agencies and other inter-governmental
* If no such Commission is formed, a *special committee shall be named,
/organizations including F/CONF.2/C. 2/36
E/CONF.2/C.6/72
Pege 10
organizations including regional organizations
which will enable. the International bade Organization most
effectively to carry out its positive functions for the promotion
of the economic development and reconstruction of Membera.
2. That the report and recommendations of the Interim Camission*
shall be submitted in such a manner and at such a time as will
enable the Conference of the International Trade organization to
takre appropriate action at its first session.
* If no such Commission is formed, a special comittee shall be named.
/ANNEX D E/CONF.2/C.2/36
E/CONF.2/C.6/72
Page 11
ANNEX D
RECOMMENDED CHANGES IN ARTICLE 69
(Text of Geneva Draft with recommended additions and deletions
indicated by underlining and square brackets respectively)
Article 69
Funct I .n
The Organization shall perform the functions provided for elsewhere in
this Charter. In addition the Organization shall have the following functions:
(a) to collect, analyse and publish information relating to international
trade, including information relating to commercial policy, business
dractices, commodity problems and industrial and general economic
development;
(b) to encourage and facilitate consultation among Members on all
questions relating to the provisions of this Charter;
(a) to undertake studies on, make recommendations for, end promote
internationlobilateral or multilateral agreements on, measures designed
(i) to assure just and equitable treatment for foreign nationals
and enterprises;
(ii) to expand the volume and to improve the bases of international
trade, including measures designed to facilitate co rcial
arbitration and the avoidance of double texation; [and]
(iii) to carry out on a regional or other basis, having due regard to
the activities of existing regional or other organizations, the
functions specified in paragraph 2 of Article 10;
(iv) to Promote and enaourem" establishments for the technical
training that is necessa for progressive Industrial and
general economic development; and.
(v) generally to achieve any of the objectives set forth in
Article 1,
(d) generally to consult with and make recommendations and, as necessary,
furnish advice and assistance to Members regarding any matter relating to
the operation of this Charter, and to take anx other action necessary and
proper to carry out the provisions of this Charter;
(a) to co-operate with the United Nations and intergovernmental
organizations in furthering the achievement of the economic and social
objectives of the Unijed Nations and the restoration A mainteane
of international peace and security;
/(f) in such E/CONF.2/C.2/36
F/CONF.2/C.6/72
Page 12
(f) in such conllaboration with the Economic and Social Council of the
United Nations and with other inter-governmental organizations as may be
appropriate to undertake studies on the relationship between world prices
of primary commodities and manufactured produats to consider and where
appropriate, to recommends international agreement on measures designed
to reduce, progessively any unwarranted disparity in those prices. E/CONF.2/C.2/36
E/CONF.2/C.6/72
Page 13
ANNNEX E
ADDITIONAL TEXT RECOMMENDED TO BS INCLUDED IN CHAPTER IX
AS A MEW ARTICLE
In the .exercise of its functions the Organization shall have due regard
to the economic circumstances of Members, to the factors affecting those
circumstances and to the consequences of its determinations upon the interests
of the Member or Members concormed. |
GATT Library | wq050xw2750 | Report to Committee III on Article 21 | United Nations Conference on Trade and Employment, February 16, 1948 | Third Committee: Commercial Policy and Sub-Committee F (Articles 21, 23 and 24) | 16/02/1948 | official documents | E/CONF.2/C.3/57 and E/CONF.2/C.3/38-57 | https://exhibits.stanford.edu/gatt/catalog/wq050xw2750 | wq050xw2750_90190156.xml | GATT_147 | 2,739 | 18,045 | United Nations Nations Unies UNRESTRICTED
E/CONF. 2/C.3/57
CONFERENCE CONFERENCE 16 February 1948
ON DU ORIGINAL: ENGLISH
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
THIRD COMMTTTEE: COMMERCIAL POLICY
SUB-COMMITTEE F ON ARTICLES 21, 23 AND 24
REPORT TO COMMITTEE III ON ARTICLE 21 N ARTIE 2
Mr. J. MELANDER (Norway). MMEAM ()
1. wub-Cwammittee F Ws appointed on 5 January 1948 to examine and submit
ions on recallo prsp amosementsdenations omndents to Articles 21, 23 and 24.
2. The Sub-Committee was composed of representatives of Argentina,
Australia, Belgium, Brazil, Canada, Cuba, Czechoslovakia, France, Greece,
India, italy, Lebanon, Liberia, Norway, Philippines, United Kingdom and the
United States.
3. Mr. J. Melander (Norway) was duCnaniman.mously electe hair
4. The Sub-Committee has held twelve meetings as of 16 February 1948.
A list of the amendments considered is attached as Annex A.
5. A number of representatives of delegations who were not members of the
Sub-Coaie attended. asobservers and also too k parts insn te'discusaio f
amendments which they had submitted. Tee alks oihe Sub-Comentsnebtsmitheard
by the representatives of the International Monetary Fund.
tee Tm b-Committee has completed consideration of Articles 21 and 24.
It has not yet received a report from a Working Party on Article 23.
40ve in order to facilitate the work of Committee III, the Sub-Committee
l submitting the present report dealing only with Article 21.
7. Lving examined the amendments to Aticle 21 and proposals arising out
of those amen the dmentsSub-Com recomittee mmendsto Committee III the approval
of the revised text of this Article with the Interpretative Note appended
thereto as set forth in Annex B of this Report.
8. The main change in Article 21m recomended by the Sub-Committee the
inclusion of a new paragraph 1. This change was made in responase to n
amendment sedubmitt by B elgiONFum(E/C. 2/C. 3/F/W. 6) and relates to action
which may be takecorrect n to justme malaents inal nce the baof payments.
In response to an amendment of Australia (Item 33 of the Annotated Agenda)
certain changes have been made in present paragraph 3 (b).
Present paragraph 3 (c) (i) h as beeamended in response to a proposal
submitted by Argentina (Item 38 of the Annotated Agenda).
Present paragraph 4 (b) has beens amendesd iswn repoe to dman amenentby
/nmakDe E/CONF.2/C .3/57
Page 2
Denmark (Item 35 of the Annotated Agenda).
The introductory phrase of present paragraph 4 (b) (i) has been deleted
and, paralleling this, the Sub-Committee recommends the deletion of the
interpretative note relating to this phrase.
In response to a proposal by Brazil (E/CONF.2/C.3/F/W.24)
sub-paragraphs (ii) and (iii) of paragraph 3 (c) of the Geneva text
have been transferred to paragraph 3 (c) of the present text (paragraph 2
of the Geneva text) on the ground that they constitute limitations on any
kind of quantitative restrictions irrespective of whether the restriction
is a consequence of the domestic policies referred to in paragraph 3 (c) of
the Geneva text or of other causes. .
In response to a proposal by New Zealand (E/CONF.2/C.3/F/W.23) an
interpretative note appended to Article 31 of the Geneva text has been
transferred to Article 21. . ;
9. Reservations.
The delegation of Chile reserves its position on sub-Pragraph 3 (a)
(sub-paragraph 2 (a) of the Geneva text).
The delegation of Argentina reserves its position on Article 21.
/ANNEX A E/CONF. 2/C .3/57
Page 3
ANNEX A
AMENDMENTS SUBMITTED TO ARTICLE 21, 23, AND 24
Paragraph
(Geneva text)
21 Proposed new
Paragraph 1
Country
Belgium
Reference*
E/CONF. 2/C . 3 /F/W .6
21
21 1
21 2 (a)
21 2 (a)
21 2 (a)
21 2 (b)
21 3 (a)
21 3 (b)
21 3 (b)
21 3 (b)
21 3 (c)
21 3 (c)
21 4 (a)
21 4 (a)
21 4 (a)
21 4 (b)
21 4 (c)
21 4 (c)
21 4 (c)
21 4(d)
21 4 (e)
21
21
23
Reservation
on Article
Footnote
1 (a)
Ceylon
Australia
Argentina
Venezuela
Chile
Ceylon
Australia
Argentina
Denmark
Geneva Draft Note
Belgium
Ceylon
Argentina
Brazil
Ceylon and Venezuela
Argentina
Italy
Uruguay
Uruuay
Venezuela
Uruguay
Venezuela
Italy
Italy
Italy
Belgium
New Zealand
Uruguay
27
28
29
30
31
32
33
34
35
36
E/CONF. 2/C.3/F/W.6
37
38
E/CONF. 2/C.3/F/W. 24
39
40
41
42
43
44
45
46
49
50 (Replaced by
E/CONF .2/C . 3/F/W.23
62
* The numbers refer to items in the Annotated Agenda (E/CONF. 2/C. 3/7.)
unless otherwise stated.
/Mexico
Article E/CONF.2/C 3/57
Page 4
Article
23
23
23
23
23
23
23
23
23
23
23
23
Paragraph
(Geneva text)
1 (a)
1 (b)
Country.
Mexico
Norway
United Kingdom
1 (b)
3 (a)
3 (a)
3 (c)
3
(new subparagraph)
3
3
4
5 (b)
23 5
(new subparagraph)
23 New Paragraph 6
23 Entire Article
23 Entire Article
23 Entire Article
Entire Article
Proposed New Article
2
2
6
Proposed New Article
Entire Article
Entire Article
Belgium
Italy
Denmark
Mexico
Italy.
Uruguay
Geneva Draft
Uruguay
Brazil
Norway
France
Argentina
Czechoslavakia
Belgium
Chile
Greece
New Zealand
Australia
Geneva Draft
Liberia
Mexico
Argentina
Belgium
Reference
63
64 (Replaced by
E/CONF.2/C.3/F/W.5)
65 (Withdrawn in
Committee III)
E/CONF. 2/C.3F//W.6
66
67
68
69
70
Note 71
72
73
E/CONF.2/C .3/F/W.4
74
75
76 (Replaced by
E/CONF.2/C.3/F/W.14)
77 (Replaced by
E/CONF.2/C..3/F/W.6)
77
78
79
Note 81
E/CONF/C .F/ 315//W.15
82
83
84
B
23
23A
24
24
24
24
24
24
24
/ANNEX B E/CONF.2/C.3/57.
Page 5
Article 21
Restrictions to Safeguard the Balance of Paymeats
1. The Members recognize that
(a) it is primarily the responsibility of each Member to safeguard
its external financial position and to achieve and maintain stable
equilibrium in its balance of payments;
(b) an adverse balance of payments of one Member may have important
effects on the trade and balance payments of other Members, if
it results in or may lead to, the impostion by the Member of
restrictions affecting international trade;
(c) the balance of payments of each Member is of concern to other
Members, and therefore it is desirable that the Organization should
promote mutual consultations and, where possible agreed action
consistent with this Charter for the purpose of correcting a
maladjustment in the balance of payments; and that
(d) action taken to restore stable equilibrium in the balance of
payments should, so far has as the Member or Members concerned find
possible, employ methods which expand rather than contract
international trade.
[1.] 2. Notwithstanding the provisions of pargraph 1 of Article 20, any
Member, in order to safeguard its external financial position and balance of
payments, may restrict the quantity or value of merchandise permitted to be
imported, subject to the provision of the following paragraphs of this Article.
[2.] 3. (a) No Member shall institute, maintain or intensify import
restrictions under this Article except to the extent necessary
(i) to forestall the imminent threat of, or to stop, a
serious decline in its monetary reserves, or
(ii) in the case of a Member with very low monetary reserves,
to achieve a reasonable rate of increase in its reserves;
/due regard E/CONF. 2/C. 3/57
Page 6
due regard being paid in either case to any special factors which
may be affecting the Member's reserves or need for reserves,
including, where special external credits or other resources are
available to it, the need to provide for the appropriate use of
such credits or resources.
(b) A Member[s] applying restrictions under sub-paragraph (a)-
shall progressively relax and ultimately eliminate them as
[such conditions] its external financial position improves,
in accordance with the provisions of that sub-paragraph.
[maintaining them only to the extant that the conditions
specified in that sub-paragraph still justify their application.]
This provision shall not be interpreted to mean that a Member
is required to relax or remove such restrictions if that
relaxation or removal would thereupon produce conditions
justifying the intensification or institution repectively of
restrictions under sub-paragraph (a). [they shall eliminate the
restrictions when conditions would no longer justify their
institution or maintenance under that sub-paragraph.]
(c) Members undertake:
[(ii)] (i) not to apply restrictions so as to prevent
unreasonably the importation of any on description
[(iii)] (ii)
of goods in minimum commercial quan,titeies th
exclusion of which would imepair regular channels
of trade, or restrictions which would prevent the
importation of commercial samples, cr-prevent
[compliance with patent, trademark, copyright,
or similar procedures] the importation of such
minimum quantities of a product as may be
necessary to obtain and maintain patent; trademark
copyright or similar rights under industrial or
intellectual property laws; and
(iii) to apply restrictions under this Article in such
a way as to avoid unnecessary damage to the
commercial or-economic interests of any other
Member including interests under Articles 3 and 9.
(Secretariat note: paragraphs 3 (c) (i) and (ii) were
paragraphs 3 (c) (ii) and (iii) of the Geneva text.)
[3] 4. (a) The E/CONF. 2/C. 3/ 57
Page 7
[3.] 4. (a) The Members recognize that in the early years of the Organization
all of them will be confronted in varying degrees with problems of
economic adjustment resulting from the war. During this period the
Organization shall, when required to take decisions under this Article
or under Article 23, take full account of the difficulties of post-war
adjustment and of the need which a member may have to use import
restrictions as a step towards tho restoration of equilibrium in its
balance of payments on a sound and lasting basis.
(b) The Members recognize that, as a result of domestic policies
directed toward the fulfilment of a Member's obligations under
Article 3 relating to the achievement and maintenance of full and
productive employment and large and steadily growing demand or its
obligations under Article 9 relating to the reconstruction or
development of industrial and other economic resources and to the
raising of standards of productivity, such a Member may experience
[a high level of demand for imports] such pressure on its monetary
reserves as to justify restrictions under sub-paragraph 3 (a) of
this Article.
Accordingly:
(i) [notwithstanding the provisions of paragraph 2 of
this Article] No Member shall be required to withdraw
or modify restrictionso n the ground that a change in
such policies would render unnecessary the restrictions
which it is applying under this Article.
(ii) Any Member applying import restrictions under this Article
may determine the incidence of the restrictions on imports
of different products or classes or products in such a way
as to give priority to the importation of those products
which are more essential in the light of such policies.
(c) Members undertake, in carrying out their domestic policies [:],
[(i)] to pay due regard to the need for restoring equilibrium in
their balance oef Payments on a sound and lasting basis and to the
desirability of assuring an economic employment of productive
resources[;].
[(ii)] (transferred to 2 (c) (i))
[(iii)] (transferred to 2 (c) (ii))
[4.] 5. (a) Any Member which is not applying restrictions under this Article,
but is considering the need to do so, shall, before instituting such
restrictions (or, in circumstances in which prior consultation is
impracticable, immediately after doing so), consult with the
/Organization as to E/CONF.2/C.3/57
Page 8
Organization as to the nature of its balance-of-payments difficulties,
alternative corrective measures which may be available, and the
possible effect of such measures on the economies of other Members.
No Member shall be required in the course of consultations under
this sub-paragraph to indicate in advance the choice or timing of
any particular measure which it may ultimately determine to adopt.
(b) The Organization may at any time invite any Member which is
applying import restrictions under this Article to enter into such
consultation with it, and shall invite any Member substantially
intensifying such restrictions to consult within thirty days. A
Member thus invited shall participate in such discussion. The
Organization may invite any other Member to take part in these
discussions. Not later than two years from the day on which this
Charter enters into force, the Organization shall review, all
restrictions existing on that day and still applied. under this
Article at the time of the review.
(c) Any Member may consult with the Organization with view to
obtaining the prior approval of the Organization for restrictions
which the Member proposes, under this Article, to maintain, intensify
or institute, or for the maintenance, intensification or institution
of restrictions under specified future conditions. As a result of
such consultations, the Organizatian may approve in advice the
maintenance, intensification or institution of restrictions by the
Member in question insofar as the general extent, degree of intensity
and duration of the restrictions are concerned, To the extent to
which such approval has been given, the requirements of
sub-paragraph (a) of this paragraph shall be deemed to have been
fulfilled and the action of the Member applying the restrictions
shall not be open to challenge under sub-paragraph (d) of this
paragraph on the ground that such action is inconsistent with the
provisions of sub-paragraphs [2] 3 (a) and 3 (b) of this Article.
(d) Any Member which considers that another Member is applying
restrictions under this Article inconsistently with paragraph [2] 3 or
[3] 4 of this Article or with Article 22 (subject to the provision
of Article 23) may bring the matter for discussion to the Organization;
and the Member applying the restrictions shall participate in the
discussion. The Organization, if it is satisfied that there is a
prima face case that the trade of the Member initiating the procedure
is adversely affected, shall submit its view to the parties with the
/aim of E/CONF.2/C.3/57
Page 9
aim of achieving a settlement of the matter in question which is
satisfactory to the parties and to the Organization. If no such
settlement is reached and if the Organization determines that the
restrictions are being applied inconsistently with paragraph [2] 3 or
[3] 4 of this Article or with Article 22 (subject to the provisions
of Article 23), the Organizational shall recommend the withdrawal or
modification of the restrictions. If the restrictions are not
withdrawn or modified in accordance with the recommendation of this
Organization within sixty days, the Organization may release any
Member from specified obligations under this Carter, towards the
Member applying the restrictions.
(e) In consultations between a Member and the Organization under
paragraph there shall be full and free discussion as to the
various causes and the nature of the Member's balance-of-payments
difficulties. It is recognized that premature disclosure of the
prospective application, withdrawal or modification of any restriction
under this Article might stimulate speculative trade and financial
movements which would tend to defeat the purposes of this Article.
Accordingly, the Organization shall make provision for the observance
of the utmost secrecy in the conduct of any consultation.
[5] 6 If there-is a persistent and widespread application of import
restrictions under this Article, indicating the existence of a general
disequilibrium which is restricting international trade, the Organization shall
initiate discussions to consider whether other measures might be taken, either
by those Members whose balances of payments are under pressure or by those
Members whose balance of payments are tending to be exceptionally favourable,
or by any appropriate inter-governmental organization, to remove the underlying
causes of the disquilibrium. On the invitation of the Organization, Members
shall participate in such discussions.
Interpretative Note to Article 21
[paragraph 3 (b) (i).
The phrase "notwithstanding the provisions of paragraph 2 of this Article"
has been included the text t make it quite clear that a Member's import
restrictions otherwise "necessary" within the meaning of sub-paragraph 2 (a)
shall not be considered unnecessary on the ground that a change in domestic
policies as referred to in the text could improve a Member's monetary reserve
position. The phrase is not intended to suggest that the provisions of
paragraph 2 are affected in any other way.]
/Consideration was E/CONF .2/C. 3/57 Page 10
Consideration was given to the special problems that might be created
for Members which, as a result of their programmes of full employment,
maintenance of high and rising levels of demand and economic development,
find themselves faced with a high level of demand for imports, and in
sequence maintain quantitative regulation of their foreign trade. It
was considered that the present text of Article 21 together with the
provision for export controls in certain parts of the Charter, e.g. in
Article 43, fully most the positoin of these economies. |
GATT Library | mv924fw3814 | Report to Committee III on Articles 16 and 42 | United Nations Conference on Trade and Employment, March 7, 1948 | Third Committee: Commercial Policy and Joint Sub-Committee of Committees II and III (Articles 15, 16 and 42) | 07/03/1948 | official documents | E/CONF.2/C.3/78 and E/CONF.2/C.3/78-89/ADD.3 | https://exhibits.stanford.edu/gatt/catalog/mv924fw3814 | mv924fw3814_90190183.xml | GATT_147 | 5,646 | 36,075 | United Nations Nations Unies
UNRESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.3/78
ON DU 7 march 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI
ORIGINAL: ENGLISH
THIRD COMMITTEE: COMMMERCIAL POLICY
JOINT SUB -COMMITTEE OF
COMMITTEES II AND III ON ARTICLES 15, 16 AND 42
REPORT TO COMMITTEE III ON ARTICLES 16 AND 42
PART I
1. Committees II and III at their eleventh and seventeenth meetings,
respectively, appointed a Joint Sub-Committee with the following terms of
reference:
"To consider and submit recommendations to both Committees
regarding Articles 13, 16 (2) and (3) and 42 and the relevant
proposals and amendments submitted in relation thereto with a
view to finding a solution of the question of new preferential
arrangements, including those for purposes of economic
development and reconstruction,. and of the maintenance of
existing preferences as an exception from the most-favoured-
nation clause."
2. The Joint Sub-committee consisted of representatives of the following
delegations:: Argentina, Belgium, Brazil, Canada, Chile, ll Salvador, France,
Haiti,I ran, Poland, Sweden, Syria, Turkey, UnitedK ingdmo, United States and
Venezuela. Mr. Stig SAHL##I (Sweden) was elected Chairman. At the eleventh
meeting, r.M Jean ROYER (France) was elected in the place of Mr. Sahlin who
had returned to Sweden.
3. The Sub-Committee examined the amendments proposed to Article 15
(Preferential Arrangements for Economic Development), Article 16 (General
Most-favoure-dnational Treatment) and Article 42 (Territorial Application of
Chapter IV, Frontier Traffic and Customs Unions) and at its tenth meeting
appointed a Working Party consisting of representatives of Belgium, Chile,
France, Syria, United Kingdom, United States and Veneuzela. This Working
Party held twenty-nine meetings, under the Chairmanship of Mr. Royer, and
its Report to the Sub-Committee is contained in documentF/ OCN.F2/C.2&3/A/l.4
It was recorded in htat Report that before the Working Party had completed
its work on Article 15, that Article, with others relating to eonocmic
development, was referred to the Co-ordinating Committee of the Conference.
/The work of the 3/CONF.2/C.3/78
Page 2
The work of the Sub-Committee on Article 15 and the recommendations of the
Co-ordinating Committee will be reported to Committee II in a second. Report.
The present Report will be confined to a record of the work of the
Sub-Cnmmittee on Articles 16 and 42 and to the Sub-Committee's recommendations
on these Articles.
4. Part II of this Report contains a brief statement on the main changes.
proposed in Articles 16 and 42 and on the manner in which the Sub-Committee
dealt with proposed amendments. The texts of Article 16, the Annexes relating
to that Article and Article 42 (now 42, 42A, and 42B) are contained in Part III,
in which the proposed changes in the Geneva text are indicated by square
brackets and underlining. For the convenience of Committee III those parts of
Article 16 and of the Annexes which were within the terms of reference of
Sub-Committee A and have already been adopted by Committee III are shown
together with the recommendations of the Joint Sub-Committee.
/PART II E/C0NF.2/C.3/78
Page 3
PART II
Article 16
General Most-favoured-nation Treatment
ParaGraph 1
5. The Sub-Committee considered the proposal of the delegation of Chile to
add the words "with the exception of the arrangements contemplated in
Article 15" at the end of the first paragraph. The Sub-Committee decided not
to accept this amendment and the delegations of Chile and Syria reserved their
position pending the decision of the Contracting Parties to the General
Agreement on the final text of Article I of the General Agreement.
Annexes relating to Paragraph 2.
6. The Sub-Committee recommends the addition of four new Annexes in order
that certain preferences existing on 10 April 1947 may quality tor exemption
from the provisions of paragraph 1. Of these new Annexes one is for the
territories under common Portuguese sovereignty or relations of protection or
suzerainty on 1 July 1939 and the other three are for neighbouring countries in
South and Central America. There are a few consequential amendments in other
Annexes and in paragraph 2 of Article 16. Also, additions are recommended
in Annexes A and B at the request of the delegations of Pakistan and France
respectively.
7. In connection with Annex F the delegate for Peru enquired Whether it
was meant to include preferences granted by Chile to Peru as well as those
granted by Peru to Chile. Members of the Sub-Committee replied in the
affirmative and at the request of Peru it was agreed that this interpretation
of the Annexes relating to paragraph 2 (e) should be included in the
Sub-Committees Report.
Paragraph 2 (c)
8. The Sub-Committee is unable to recommend the deletion of this
sub-paragraph as proposed -by the delegation of Peru (C.3/6, Item 8).
9. The Sub-Committee considered the proposal of the Dominican Republic
(C.3/6, Item 9) to delete this sub-paragraph or alternatively to provide that
the preferences between the United States and Cuba shall not operate to the
detriment of products of the Dominican Republic, which products should receive
unconditionally the same advantages as like products of Cuba. Subsequently
the delegation of the. Dominican Republic put forward the following alternative
proposal:
"That under Article 16 of .the Charter the Dominican Republic and
Haiti, or one or other of them on the one hand, and the United States
of America on the other be permitted to Grant reciprocal preferences
similar in nature and duration to those now in force between the
United States and Cuba,.dealt with in paragraph 2 (c) of Article 16."
/10. The delegate E/CONF.2/C.3/78 Page 4
10. The delegate for the United States informed the Sub-Committee that there
was no possibility of his Government accepting the conditions proposed by
the Dominican Republic and therefore the Sub-Committee is unable to make any
recommendation in this connection.
11. The Sub-Committee also considered proposal of the delegation of
Haiti (C.3/6, Item 10) that this sub-paragraph should be extended to include
preferences Between the United States and othor countries in the Caribbean
area. During the discussions of the Sub-Committee the delegate for Haiti
stated that his delegation was prepared to support the proposal of the
Dominican Republic and would be satisfied with that solution, but since the
Sub-Committee decided not to recommend the amendment proposed he wished to
reserve the position of his delegation on Artiele 16 as a whole, pending the
final text of Article 15.
San 'Marino and Vatican City
12. The Sub-Committee discussed with the delegate for Italy the proposal
(C.3/ 6, Item 22) to exempt the special regime existing between the Republic
of Italy-and the Republic of San Marino and the State of the Vatican City
from the provisions of paragraph 1 Iof Article 16. The Sub-Committee was of
the opinion that the especial arrangements existing beteen Italy and these
two territories were not contrary to the Charter and offered to record this
opinion in report to Committee III. The delegate for Italy withdrew
his proposal on the understanding that this opinion would be included in the
Report.
Other Proposals on Article 16
13. The Sub-Committee examined the amendments proposed by the delegation of
Ecuador, Bolivia , Lebanon and Syria, Turkey, Egypt, Afghanistan, Burma,
Argentina and Czecholovakia (respectively, C.3/6, Iteme.15, 16, 17, 18, 19,
20, 21, 23 and C.3/6/Add.1), and whilst unable to accept them felt that their
substance was covered, in whole or in part, by the revised text of Article 15
as drafted by the Working party and as eventually recommended by the
Co-ordinating Committee and the Heads of Delegations.
14. The Turkish delegation, however, expressed the desire to discuss their
amedment again in Committee -s, as -tomankekheir attitude cl' ,ear on this
problem and to submit an alternative proposal.
15.The Brazilian reservation on Article 16 was provisionally maintained.
Article 42
Territorial Application of Chapter IV -
Frontier Traffic - Customs Unions
16. The text Article 42 has been redrafted on the basis of proposals by
the French delegation, the main change being to extend to free-trade areas
the provisions relating to customs unions, as requested by the delegations
/of Lebanon and E/CONF.2/C .3/78
Page 5
of Lebanon and Syria (C.3/11, Item 13). This subject was considered to be of
sufficient importance to require its separation from the other matters dealt
with in Article 42, and accordingly the Sub-Committee recommends a separate
Article devoted exclusively to customs onions and free-trad## areas.
17. The now text thus contains three Articles: Articles 42, dealing with
territorial application; Article 42A, dealing with frontier traffic; and
Article 42B, dealing with customs unions and free-trado areas.
Article 42 - Territorial Application
18. The Sub-Committee recommends that paragraph 1 of Article 42 of the
Geneva draft, which defines the territorial application of Chapter IV, and
the first part of paragraph 4, which contains a definition of "customs territory
"customs territory", should comprise a separate Article and be amended as
shown in the Annex to this Report. The Sub-Committee considered whether the
definition of "customs territory" should be moved to some other part of the.
Charter in view of the fact that this term appears also in Articles 68, 97
and 99, and. decided to recommend to Committee VI that it should consider
whether this definition applies to other Articles of the Charter and if so
whether it should be removed to a more suitable place.
19. The delegations of the United Kingdom and the United States expressed
some doubt about the substitution of "substantially all" for the words
"a substantial part of" in paragraph 2 and reserved their position pending
discussion in Committee III.
Article 42A - Frontier Traffic
20. The proposal of the delegation of Argentina (C.3/11, Item 9) to delete
the words "in order to facilitate frontier traffic" from paragraph 2 (a) of
Article 42 (Geneva text) was not adopted by the Sub-Committee which was of
the opinion that provisions for arrangements to facilitate frontier traffic
should be retained and should comprise a separate Article. Accordingly,
Article 42A is recommended without change in the words used in the Geneva
draft.
21. The proposal of the delegation of Italy (C.3/6, Item 22), requesting
exemption from then most-favoured-nation clause for a special regime between
Italy and the Free Territory of Trieste, was subsequently altored to refer
only to advantages accorded to trade with Trieste by continuous countries.
The Sub-Committee decided it could accept the modified proposal on condition
that trade advantages thus accorded were not contrary to the terms of the
Italian Peace Treaty. Accordingly a new provision has been inserted in
Article 42A, and the Sub-Committee suggests that the Central Drafting Committee
should consider whether the title should be altered The delegation of
Czechoslovakia (not a member of the Sub-Committee) joined in the discussion
of this item and requested that its reservation be recorded.
/Article 423 - E/ CONF.2/C.3/78
Page 6
Article 42B - Customs Unions and Freo Trade Areas
22. The first paragraph of Article 42B is new. It states that the general
purpose of a customs union of free trade area should be to facilitate trade
between the participating parties and not to create new obstacles to the
trade of these parties with other Members of the Organization.
23. The second paragraph, providing for the establishment of customs unions,
is based upon paragraph 2 (b) of the Geneva draft, but there has been.added
to it a new provision covering the establishment of free-trade areas. An
amendment proposed by the United Kingdom (C.3/11, Item 10) has been
incorporated, and it is felt that the new text of the Article largely covers
an amendment proposed by Chile (C.3/11, Item 11).
24. The Sub-Committee could not reach a unanimous decision on the question
whether the provisions of this paragraph should or should not apply to customs
unions and free-trade areas of which one or more parties are not Members.
A majority favoured the insertion of the words "as between the territories
of Members, in the second line of the preamble but the delegations of Argentina,
Chile and Venezuela asked that their reservations be recorded, and the
delegate for Syria said that he was not at that time able to give the decision
of his delegation. It was the view of the Members who supported the insertion
of these words, that Article 42B, including the new paragraph 6 mentioned
below, would not prevent the formation of customs unions and free-trade areas
of which one or more parties were non-Members but would give the Organization
an essential degree of control. The delegate for.Chile stated that this
question should be settled in connection with Article 93 and that in his
opinion the recommendation of the Sub-Committee should not be deemed to
prejudge the decision on Article 93.
25. The Sub-Committee recommends that the words "average level of the duties"
be replaced by "general incidence of the duties" in paragraph 2 (a). It is
the intention of the Sub-Committee that this phrase should not require a
mathematical average of customs duties but should permit greater flexibility
so that the voIume of trade may be taken into account.
26. The third paragraph is based on paragraph 3 of the Geneva draft. It
defines the powers of the Organization in respect of interim agreements for
the estoblishment of customs unions and free-trade areas. The
:Sub-Committee was unable to accept the. proposal of Argentina in regard to
sub-paragraph (a.) of the Geneva text (C.3/11, Item 14). The substance of a
proposal by the delegation of Italy (Item 15) has been Included in the
revised sub-paragraph (a). In regard to sub-paragraphs (b) and (c) it-was
felt that the revised text went some way to meet the views of Argentina,
Chile and Italy (C. 3/11; Items 16, 17, 18, 19, 20 and 21) .
-- . I/ ,.,- nTmhragrapb. 4 E/CONF.2/C.3/78
Page 7
27. In paragraph 4 the definition of a customs union, which was contained
in the second sentence of paragraph 4 of the Geneva draft, has been amended
and a definition of a free-trade area has been added. This describes a
free-trade area as a group of two or more customs territories within which
tariffs, etc. (except, where necessary, those permitted under Section B of
chapter IV and under Article 43) are eliminated on substantially all the trade
between the constituent territories or at least on substantially all the trade
in products originating in such territories.
28. A fifth paragraph has been added to cover the problems which will arise
in cases where there were preferential rates of duty in force between a
country entering a customs union or a free-trade area and a country
remaining outside. And a sixth paragraph has been added to provide that the
Organization may, by a two-thirds vote, approve proposals which do not fully
comply with the reqiurements of the Article provided that they lead to the
establishment of a customs union on a free-trade area in the sense of the
Article. It is the understanding of the Sub-Committee that this new
paragraph 6 will enable the Organization to approve the establishment of
customs unions and free-trado areas which include non-Members.
29. The proposal by Iraq (C .3/11, Item 22) to add a new paragraph regarding
economic relations between Members of the Arab League was not accepted; it
was felt that the revised texts of Articles 15 and 42 covered the point raised
by the amendment. These texts are also thought to cover to a large extent a
proposal by Argentina (C.3/11, Item 12).
/PART III, E/CONF.2/C.3/78
Page 8
Article 16
General Most-favoured-nation Treatment
(Paragraph 1 - as adopted by Committee III on the recommendation
of Sub-Committee A)
1. With respect to customs duties and charges of any kind imposed on or in
connection with importation or exportation or imposed on the international
transfer of payments for imports or exports, and with respect to the method
of levying such duties and charges, and with respect to all rules and
formalities in connection with importation and exportation, and with respect
to all matters within the scope of paragraphs 2 and 4 of Article 18 any
advantage, favour, privilege or immunity granted by any Member to any product
originating in or destined for any other country, shall be accorded immediately
and unconditionally to the like product originating in or destined for all
other Member countries respectively.
(Paragraph 2 - Preamble - as recommended by the Joint Sub-Committee)
2. The provisions of paragraph 1 of this Article shall not require the
elimination, exccept as provided in Article 17, of any preferences inr respect
of important duties or charges which do not exceed the [levels] margins provided
for in paragraph 3 of this Article and which fall within the following
descriptions:
(Sub-paragraph (a) - as in Geneva text)
(a) preferences in force exclusively between two or more of the
territories listed in Annex A to this Charter, subject to the conditions
set forth therein;
(Sub-paragraph (b) - as recommended by the Joint Sub-Committee)
(b) preferences in force exclusively between two or more territories
which on 1 July 1939 were connected by common sovereignty or relations
of protection or suzerainty and which are listed in Annexes B, C, D
and [...] E of this Charter, subject to the conditions set forth
therein;
(Sub-paragraph (c) - as in the Geneva text)
(c) preferences in force exclusively between the United States of
America and the Republic of Cuba;
/(Sub-paragraph (?) - E/CONF.2/C .3/78
Page 9
(Sub-paragraph (d) - as adopted by Comittee III on the recommendation
of Sub-Committee A)
(d) preferences in force exclusively between the Republic of the
Philippines and the United States of America, including the dependent
territories of the latter;
(Sub-paragraph (e) - formerly sub-paragraph (d) - as recommended by
the Joint Sub-Committee)
(e) preferences in force exclusively between neighbouring countries
listed in Annexes [E, F and ... ] F, G, H, I and J of this Charter.
(Paragraph 3 - as in the Geneva text)
3. The margin of preference on any product in respect of which a preference
is permitted under paragraph 2 of this Article shall not exceed (a) the
maximum margin provided for under the General Agreement on Tariffs and Trade
or any subsequent operative agreement resulting from negotiations under
Article 17, or (b) if not provided for under such agreements, the margin
existing either on 10 April 1947 or on such earlier date as may have been
established for a Member as a basis for negotiating the General Agreement on
Tariffs and Trade, at the option of such Member.
(Paragraph 4 - as adopted by Committee III on the recommendation
of Sub-Committee A)
4. The imposition of a margin of tariff preference not in excess of the
amount necessary to compensate for the elimination of a margin of preference
in an internal tax existing on 10 April 1947 exclusively between two or more
of the territories in respect of which preferential import duties or charges
are permitted under paragraph 2 of this Article shall not be deemed to be
contrary to the provisions of this Article, it being understood that any such
margin of tariff preference shall be subject to the provisions of Article 17.
Interpretative Note
(As adopted by Committee III on the recommendation of Sub-Committee A)
The term "margin of preference" means the absolute difference between
the most-favoured-nation rate of duty and the preferential rate of duty for
the like product, and not the proportionate relation between those rates.
As examples:
1. If the most-favoured-nation rate were 36 per cent ad Valorem and
the preferential rate were 24 per cent ad valorem, the margin of
preference would be 12 per cent ad valorem, and not one-third of the
most favoured-nation rate;
/2. If the most- E/C0NF.2/C.3/78
Page 10
2. If the most-favoured-nation rate were 36 per cent ad valorem and
the preferential rate were expressed as two-thirds of the most-favoured-
nation rate, the margin of preference would be 12 per cent ad valorem;
3. If the most-favoured-nation rate were 2 francs per kilogram and the
preferential rate wer 1.50 francs per kilogram, the margin of Preference
would be 0.50 francs per kilogram.
The following kind of customs action, taken in accordance with
established uniform procedures, would not be contrary to a general binding of
margins of preference:
(i) the re-application to an imported product of a tariff classification
or rate of duty, properly applicable to such product, in cases in
which the application of such classification or rate to such product
was temporarily suspended or inoperative on 10 April 1947; and
(ii) the classification of a particular product under a tariff item other
than that under which importations of that product were classified
on 10 April 1947, in cases in which the tariff law clearly
contemplates that such product may be classified under more than
one tariff item.
ANNEXES PERTAlNING TO PARAGRAPH 2 OF ARTICLE 16
ANNEX A
(Annex.A - as adopted by Committee III on the .recommendation of
Sub-Committe A and with the addition of a fourth paragraph in
the text recommended by the Joint Sub-Committee)
Liat of Territories Referred to in Paragraph 2 (a) of Article 16
United Kingdom of Great Britain and Northern Ireland
Dependent territories of the United Kingdom of Great Britain and
Northern Ireland
Canada
Commonwealth of Australia
Dependent Uerritories of the Conmonwealth of Australia
New Zealand
Dependent territories of New Zealand
Union of South Africa including South West Africa
Ireland
India (as at 10 April 1947)
Newfoundland
Southern Rhodesia
Burma
Ceylon /Certain of E/CONF.2/C.3/78
Page 11
Certain of the territories listed above have two or more preferential
rates in force for certain products. Any such territory may, by agreement
with the other Members which are principal suppliers of such products at the
most-favoured-nation rate, substitute for such preferential rates a single
preferential rate which shall not on the whole be less favourable to suppliers
at the most-favoured-nation rate than the preferences in force prior to such
substitution.
The preferential arrangements referred to in paragraph 5 (b) of Article 23
are those existing in the United Kingdom on 10 April 1947, under contractual
agreements with the Governments of Canada, Australia and New Zealand, in
respect of chilled and frozen beef and veal, frozen mutton and lamb, chilled
and frozen pork, and bacon. Without prejudice to any action taken under
sub-paragraph (a) (x) of paragraph 1 of Article 43, negotiations shall be
entered into when practicable among the countries substantially concerned or
involved in the manner provided for in Article 17, for the elimination of
these arrangements or their replacement by tariff preferences. If after such
negotiations have taken place a tariff preference is created or an existing
tariff preference is increased to replace these arrangements such action shall
not be considered to contravene Article 16 or Article 17.
The film hire tax in force in New Zealand on 10 April 1947 shall, for the
purpose of this Charter, be treated as a customs duty falling within
Articles 16 and 17. The renters' film quota in force in New Zealand on
10 April 1947, shall for the purposes of this Charter be treated as a screen
quota falling within Article 19.
The Dominions of India and Pakistan have not been mentioned separately
in the above list since they had not come into existence as such on the base
date of 10 April 1947.
ANNEX B
(Annex B - as recommended by the Joint Sub-Committee)
List of Territories of the French Union Referred to in Paragraph 2 (b)
of Article 16
France
French Equatorial Africa (Treaty Basin of the Congo* and other
territories)
French West Africa
Cameroons under French Mandate*
* For imports into Metropolitan France and territories of the French Union.
/French E/CONF.2/C.3/78
Page 12
French Somali Coast and Dependencies
French Establishments in India*
French Establishments in Oc?ania
French Establishments in the Condominium of the New Hebrides*
Guadeloupe and Dependencies
French Guisna
Indo-China
Madagascar and Dependencies
Morocco (French zone)*
Mertinique
New Caledonia and Dependencies .
Reunion : --
Sin-Pierre and Miquelon
T under French Mandate*
. . .
(AnexC - as ine the Gcnva Draft)
List of Territories of the Customs Unioelgn of Bium, Luxembourg and
The Netherlands Referred to igrnp Paraah 2 (b) of Articlo 16
The Economic Union of Belgium and Luxembourg
Belgian Congo
Ruanda Urundi
he Netherlands
Netherlands Indies
Smurina
Curacao
(For imports into the metropolitan territori es ofthe Cu stomsUnion.)
(Anex D - as adopted by Committee III on the recommendation
of Sub-Comittee A)
List of Territories of the United States of America Referred to in
gPapararh 2 (b) of Article 16
United St atesof Ame rica(customs territory)
Dependent territories of the United States of America
* For imports into Metropolitan France and territor ie s of the chhFre U.nion
EX Ee/A E/CONF.2/C.3/78
page 13
ANNEX E
(Annex E - as recomended by the Joint Sub-Committee)
List of Portuguese Territories Referred to in Paragraph 2 (b) of Article 16
Portugal and the Archipelagoes of Medeira and the Azores
Archipelago of Cepe Varte
Guinea
St. Tome and Principe and Dependencies
S. Joao Batista de Ajuda
Cabinda
Angola
Mozambique
Stato of India and Dependencies
Macao and Dependencies
Timor and Dependencies
ANNEX F
(Annex F - formerly "E", as recommended by the Joint Sub-Committee)
List of Territories Covered by Preferential Arrangements Between Chile and
Neighbouring Countries Referred to in Paragraph 2 [(a)] (e) of Article 16
Preferences in force exclusively between, on the one hand,
Chile
and, on the other hand,
1. Argentina
2. Bolivia
3. Peru,
respectively.
(Annex G - formerly "F", as recommonded by the Joint Sub-Committee)
List of Territories Covered by Preferential Arrangements Between the
Syro-Lebanese Customs Union and Neighbouring Countries Referred to in
Paragraph 2 [(d)] (e) of Article 16
Preferences in force exclusively between, on the one hand,
The Syro-Lebanese Customs Union
and, on the other hand,
1. Palestine
2. Transjordan,
respectively. E/CONF.2/C .3/78
Page 14
ANNEX H
(Annex H - as recommended by the Joint Sub-Comittee)
List of Territories Covered by Preferential Arrangements Among Colombia, Ecuador
and Venezuela Referred to in Paragraph 2 (e) of Article 16
Preferences in force exclusively between two or more of the following
countries:
Colombia
Ecuador
Venozuela
ANNEX I
(Annex I - as recomended by the Joint Sub-Committee)
List of Territories Covered by Preferential Arrangements Among the Republics
of Central America Referred to An Paragraph 2 (e) of Article 16
Preferences in force exclusively between two or more of the following
countries:
Costa Rica
El Salvador
Guatemala
Honduras
Nicaragua
ANNEX J
(Annex J - as recommended by the Joint Sub-Committee)
List of Territories Covered by Preferential Arrangements between Agentina
and neighbouring countries Referred to in Paragraph 2 (e) of Article 16
Preferences in force exclusively between, on the one hand,
Argentina
and, on the other hand,
1. Bolivia
2. Chile
3. Paraguay
respectively
/REVISION. OF E/CONF.2/C .3/78
Page 15
REVISION OF ARTICLE 42
(Showing the changes from the Geneva text
*recommended by the Joint Sub-Committee)
Article 42
Territorial Application of Chapter IV
1. The rights and obligations arising under this Chapter shall be deemed
to be in force between each and every customs territory [which is a separate
customs territory and] in respect of which this Charter has been accepted
by a Member in accordance with Article 99.
2. For the purposes of this [Article] Chapter a customs territory shall
be understood to mean any territory with respect to which separate tariffs
or other regulations of commerce are maintained for [a substantial part of]
substantially all the trade of such territory with other territories*
Article 42A . . .
Frontier Traffic
The p 000rovisionsthis Chapter shall not be construed to prevent:
(as ) advan tageaccordedby any Member to adjacent countries in
order to facilitate frontier traffic; or :. ---.-'
( b) advantages accord''the tre with the free Territory of
Trieste bycountri-s contiguous to that territory, provided that-
such advantages are Tnotin conflict with -he -eaties of Peace.
Article 42B
Customs Unions and Free-Trade Areas
1.Members recodze -tat the purpose of of a customs union or'b free-trade
area should be to facilitate trade between the parties to it and not to
raise obstacles to the trade of o pt her Members with sucarties.
2 e provlions of this Chapter se conpthaell-no therefore bo.uddt. pevent
as between the ter [: (a) ......ri]ttorifes of Me ombers.; he ormationf a
cu stoms unionor-the-etablishment of aor fre e-trade- rea: xhe'.option- f an
interim ageemfea ne [ cessary ] r- he-tai nmentc7 oomr mation.. a 6ut- uion
or afree-tbde area; ':Povided,- hat-
a) with respect to a customs union, or an interim agreement
leading to theof cestablishment austoms union, the duties and
other regulations of com[by, or tmermargics ofe imposed any n
/preference E/CONF.2/C.3/78 Page 16
preference maintained by,] at institution of any such union
or interim agreement in respect of trade with Members of the
Organization shall not on the whole be higher or more [stringent]
restrictive than the [average level] general incidence of the duties
and regulations commerce [or margins of preference] applicable
in the constituent territories prlor to the formation of such union
or the adoption of such interim agreement, as the case may be;
(b) with respect to a free-trade area, or an interim agreement
leading to the establishmentt of a free-trade area, the duties and
other regulations of commerce maintained in each of the constituent
territories and applicable at the establishment of such free-trade
area, or the adoption of such interim agreement to the trade of
Members not participating in the arrangement shall not be higher
or more restrictive than the corresponding tariffs and ther
regulations of commerce existing in the same constituent territory
prior to the establishment of the free-trade area, or interim
agreement, as the case may be; and [provided further]
(c) any [such] interim agreement referred to in sub-paragraphs
(a) and (b) above shall include a [definite] plan and schedule
for the attainment of such a customs union or the establishment
of such a free-trade area within a reasonable length of time.
3. (a) Any Member [proposing] deciding to enter into a customs union
or a free-trade area, or an interim agreement leading to the
formation of such a union or free-trade area, shall [consult with]
promptly notify the Organization and shall make available to it
such Information regarding the proposed union or free-trade area
as will enable the Organization to make such reports and
recommendations to Members as it may deem appropriate.
(b) [No Member shall institute or maintain any lnterim agreemeent
under the provisions of paragraph 2 (b) of this Article] If,
after [a study of then plan and schedule proposed in such agreement]
having studied the Plane and schedules provided for in an interim
agreement under paragraph 2; in consultation with the parties to
that agreement and giving due account to the information made
available in accordance with the terms of sub-paragraph (a), the
Organization finds that such agreement is not likely to result in
[such] a customs union or in the establishment of a free-trade area
within [a reasonable Iength of time] the period contemplated by
the parties to the agreement or that such period is not a reasonable
/one, the E/CONF.2/C. 3/78
Page 17
one, the Organization shall make recommendations to the parties to
the agreement. If the parties are not prepared to modify the
agreement in accordance with such recommendations they shall not
maintain it in force or institute such agreement if it has not yet
been concluded.
(c) Any substantial change in the plan or schedule shall [not
be substantially altered without consultation with] be notified
to the Organization which may request the Members concerned to
consult wilth it if the change seems likely to jeopardize or delay
unduly the achievement of the customs union or the free-trade area.
4. For-the purposes of this Charter:
(a) A customs union shall be understood to mean the substitution
of a single customs territory for two or more customs territories,
so that
(i) [a11] tariffs and other restrictive regulations of
commerce except, where necessary, those permitted under
Section B of Chapter IV and under Article 43) [as
between the territories of members of the union are
substantially eliminated] are eliminated on substantially
all the trade between the constituent territories of
the union or at least on substantially all the trade in
products originating in such territories and
(ii) substantially the same tariffs and other regulations
of commerce are applied by each of the members of the
union to the trade of territories not included in the
union, subject to the provisions of paragraph 5;
(b) A free-trade area shall be understood to mean a group of two
or more customs territories in which the tariffs and other restrictive
regulations of commerce (except, where necessary, those permitted
under Section B of Chapter IV and under Article 43) between such
territories are eliminated on substantially all the trade in
Products originating in constituent territories of the free-trade area.
5. The preferences referred to in paragraph 2 of Article 16 shall not be
affected by the constitution of a customs union or a free-trade area but
may be eliminated or adjusted by means of negotiations with Members
affected. This procedure of negotiations with affected Members shall in
particular apply to the elimination of preferences required to confirm
with the provisions of sub-paragraphs (a) (i) and (b) of paragraph 4.
/6. The Organization E/CONF.2/C.3/78
Page 18
6. The Organization may by a two-thirds majority of the Members present
and voting approve proposals which do not fully comply with the requirements
of the preceding paragraphs, Provided that they lead to the establishment
of a Customs Union or a free-trade area in the sense of this Article.
INTERPRETATIVE NOTE
Paragraph 5
It is understood that the provisions of Article 16 would require
that, when a product which has been imported into the territory of a
member of a customs union or free-trade area at a preferential rate of
duty and is re-exported to the territory of another-member of such union
or area, the latter member should impose a duty equal to the difference
between the duty already paid and the most-favoured-nation rate. |
GATT Library | xz273tq2435 | Report to Committee III on Articles 16 and 42 | United Nations Conference on Trade and Employment, March 9, 1948 | Third Committee: Commercial Policy and Joint Sub-Committee of Committees II and III (Articles 16 and 42) | 09/03/1948 | official documents | E/CONF.2/C.3/78/Corr.1 and E/CONF.2/C.3/78-89/ADD.3 | https://exhibits.stanford.edu/gatt/catalog/xz273tq2435 | xz273tq2435_90190185.xml | GATT_147 | 133 | 983 | United Nations Nations Unies UNRESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.3/78/
ON DU 9 March 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
THIRD COMMITTEE : COMMERCIAL POLICY
JOINT SUB-COMMITTEE OF
COMMITTEE II AND III ON ARTICLES 16 AND 42
REPORT TO COMMITTEE III ON ARTICLES 16 AND 42
Corrections
1. On page 4, insert the following new paragraph after paragraph 15:
"The delegate for El Salvador wished to have recorded
in the Report to Committee III that his delegation's amendment
to Article 16 (C.3/6, Item 12) had been withdrawn in view of
the Sub-Committee's decision to insert the new annex relating
to the Republics of Central America."
2. On page 16, paragraph 3 (b), the sixth line should read as follows:
"that agreement and [giving] taking due account [to] of the
information made" |
GATT Library | gd096rv7162 | Report to Committee III on Articles 23 and 24 | United Nations Conference on Trade and Employment, March 15, 1948 | Third Committee: Commercial Policy and Sub-Committee F (Articles 21, 23, 24) | 15/03/1948 | official documents | E/CONF.2/C.3/91 and E/CONF.2/C.3/89/ADD.3-95 | https://exhibits.stanford.edu/gatt/catalog/gd096rv7162 | gd096rv7162_90190208.xml | GATT_147 | 5,137 | 32,861 | United Nations Nations Unies UNRESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.3/91 15 March 1948
ON DU
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
THIRD COMMITTEE: COMMERCIAL POLICY
SUB-COMMITTEE F ON ARTICLES 21, 23 AND 24
REPORT TO COMMITTEE III ON ARTICLES 23 AND 24
Chairman: Mr. J. MELANDER (Norway)
PART I
1. Sub-Committee F was appointed on 5 January 1948 to examine and submit
recommendations on all proposed amendments to Articles 21, 23 and 24.
2. The Sub-Committee was composed of representatives of Argentina, Australia,
Belgium, Brazil, Canada, Cuba, Czechoslovakia, France, Greece, India, Italy,
Lebanon Liberia, Norway, Philippines, Unittd Kingdom and the United States
of America.
3. Mr. J. Melander (Norway) was unanimously elected Chairman.
4. The Sub-Committee has held fourteen meetings. A list of the amendments
considered is attached in Part III.
5. A number of representatives of delegations who were not members of the
Sub-Committee attended as observers and also took part in the discussion of
amendments which they had submitted. The Sub-Committee also heard statements
by the representatives of the International Monetary Fund.
6. The Sub-Committee has already submitted its report on Article 21
(E/CONF.2/C.3/57). The present report deals with Articles 23 and 24.
7. Having examined, in Working Party and in Sub-Committee, the amendments
to Articles 23 and 24 and proposals arising out of those amendments the
Sub-Committee recommends to Committee III the approval of the revised text
of these Articles together with the Annex and Interpretative Notes appended
thereto as set forth in Part IV of this Report.
/PART II E/CONF.2/C. 3/91
Page 2
PART II
Article 23
8. In addition to the amendments to Article 23 listed in Part III, the
Sub-Committee also considered an amendment to Article 22 proposed by Syria
and Lebanon (Item 60 of the Annotated Agenda) which was referred to it by
Sub-Committee E of Committee III as falling more properly under Article 23.
9. After a thorough consideration of the amendments mentioned above, the
Working Party has concluded that a substantial redraft of Article 23 is
desirable. Since, however, certain Members will have already accepted the
principle3 of Article 23 of the Geneva text and will have begun to apply
them, the Working Party considers that such Members should be allowed, if
they so desire, to continue to apply these principles during the transitional
period as defined below in paragraph 8. The Working Party accordingly
submitt the text which appears at the end of this report together with a
proposed new Annex which embodies these principles. Two Interpretative Notes
have been attached to the text of the Article and one to the Annex.
The new text does not require the Interpretative Note to paragraph 3 of
Article 23 of the Geneva Draft and it has accordinly been dropped.
10. Major changes from the Geneva text of Article 23 are to be found in
paragraphs 1, 2 and 4 of the revised Article.
11. In conjunction with the proposed revision of Article 23, it is
considered desirable that paragraph 9 of Article 24 of the Geneva text
(renumbered paragraph 8 in the text submitted by the Sub-Committee and
subsequently described by that number) be amended by the deletion of the
phrase "Subject to paragraph 4 of this Article," at the beginning of the
paragraph. As a consequence of this change the Sub-Committee recommends that
the interpretative note now attached to paragraph 4 of Article 24 of the
Geneva text be attached to paragraph 8 of that Article, that the first
sentence of the note be deleted, and that certain consequential drafting
changes be made as shown in the attached text.
12. Paragraph 1 of the revised Article defines the exceptions to the rule
of non-discrimination permissible during the post-war transitional period.
This transitional period and its application in respect of individual members
are defined by reference to the provisions of Article XIV of the International
Monetary Fund or by reference to an analogous provision of a special
exchange agreement pursuant to paragraph 6 of Article 24. The discriminatory
measures, including adaptations thereof, permitted under paragraph 1 may be
applied by a Member during the transitional period without the prior approval
/of the Organization E/CONF.2/C.3/91
Page 3
of the Organization.
13. Sub-paragraph 1 (d) provides that a Member may under certain conditions
elect to operate during the transitional period under the Annex rather than
under sub-pararaphs (b) and (c) of the Article. The subject matter of the
Annex is dealt with in paragraph 17 below. Sub-paragraphs (g) and (h) deal
with the administrative control which is to be exercised by the Organization
over measures taken by a Member under this Article. The attention of the
Sub-Committee was particularly directed to ensuring that Members operating
under sub-paragraphs (b) end (c) and Members operating under the Annex
enjoyed equality of treatment in this respect. As a consequence, the Sub-
Committee in drafting these sub-paragraphs took account of the procedures
laid down in Article XIV of the Articles of Agreement of the International
Monetary Fund.
After the termination of the transitional period for a Member, paragraph 2
makes provision, subject to the prior approval of the Organization, for
limited departures from the rule of non-discrimination.
14. Paragraph 4 permits a Member applying import restrictions in accordance
with Article 21 to control its exports in such a manner as to increase its
earning of currencies which it can use without deviation from the provisions
of Article 22.
15. The effect of the Amendment to paragraph 8 of Article 24 is that the
measures defined in that paragraph are not precluded by the provisions of
this Section of the Charter.
16. Paragraph 3 is identical with paragraph 4 of the Geneva text and
paragraph 5 is substantially the same as paragraph 5 of the Geneva text.
Paragraph 5 (b) of the revised article incorporates an amendment which is a
consequential change resulting from certain amendments to Anex A of
Article 17 which have been approved by Committee III with reservation by
the delegations of Brazil and Uruguay. (See E/CONF.2/C.3/59, page 17).
17. The Annex contains a substantial part of the provisions of the Geneva
text of Article 23. Certain sections of that text have, however, been
transferred to the Article proper and the declaration in sub-paragraph 1 (a)
has been omitted in view of sub-paragraphs 1 (a) and 1 (f) of the Article.
The procedures for adminsitrative control in sub-paragraphs 3 (a) and 3 (c)
in the Geneva text have been replaced by sub-paragraphs 1 (f), 1 (g) and
1 (h) of the Article. The criteria in sub-paragraph 1 (b) of the Geneva
text remain the same.
18. Certain delegations suggested that the provisions of paragraph 4 of
Annex [ ] be transferred to the body of Article 23 so that they would be
/applicable E/CONF.2/C.3/91
Page 4
applicable both to Members who elect Annex [ ] and those who do not so elect.
The Working Party felt that this purpose was covered in part by the procedures
available under Article 21,and that the change need not therefore be made.
19. It is considered by the Sub Committee that the above changes meet a
large number of the objectives to which the amendments submitted were directed,
In view of the extensive revision of Article 23 it is not practicable to
indicate how particular amendments have been accommodated. However, the
amendments submitted by the following countries are considered by the delegates
of those countries to be covered by the new text:
(a) Belgium
(b) Czechoslovakia
Amendments to paragraphs 1 (a), 1 (b), 2, 3 (a), and 3 (c)
are covered. by article 23 and the proposed amendment to paragraph 5
is covered by the proposed revision of paragraph 8 of Article 24.
(c) Denmark
(d) France
(e) Lebanon
(f) Norway (amendment to paragraph 1 (b) (i))
(g) Syria
20. The Norwegian delegate indicated that the new text of Article 93 on
Relations with non-Members which has been approved by the Sixth Committee
(E/CONF.2/C.6/103/Add.1), met the major part of the problem to which his
amendment on long-term agreements (E/CONF.2/C.3/F/W.4) was directed, and,
accordingly, withdrew this amendment.
21. With respect to the amendment submitted by Italy (Item 69) the Sub-
Comittee considers that paragraph 2 of the revised text take account of
the concept of relative injury.
22. The delegate of Mexico has stated that his delegation is now reviewing
the new text to see whether the purpose of its amendment (Item 68) is met.
23. The amendment submitted by Greece proposing a new Article 23A (Item 78)
was replaced by an amendment to paragraph 5 of Article 23 submitted by the
delegate of Greece. When the new text of Article ?3, together with the
change proposed in Article 24, were before the Working Party dealing with
this matter, the delegate of Greece agreed that these new texts went a long
way to meet the problem of his country. However, he did not feel that his
point was met entirely, particularly in the post transitional period. The
Sub-Committee believes that further amendment in this respect would provide
too wide an exception, and therefore recommends no further chage in the
text. The delegation of Greece reserved its position.
/24. The delegation E/CONF.2/C.3/91
Page 5.
24. The deletion of Argentina reserved its position on Article 23. The
delegation of Brazil expressed no opinion on the Article.
25. Owing to the substantial changes made in the text of Article 23 the
text as shown in Part IV has not been printed with square brackets and
underlinings.
Article 24
26. After consideration of paragraph 2 of Article 24 in the light of the
amendments proposed by Australia and New Zealand (Items 79 and 80 of the
Annotated Agenda), the Sub-Committee recommends the revision of the text
of paragraph 2 as shown in Part IV (deletions from the Geneva text are shown
in square brackets and additions to it are underlined).
27. The Sub-Committee gave consideration to an amendment to paragraph 6
proposed by the delegate for Liberia, referring to the case of a country
which does not use its own currency. The Sub-Committee recommends that to
meet this case a new sub-paragraph 6 (d) should be included as set out in
Part IV.
28. In this connection, two members of the Sub-Committee, while having no
objection in substance to the text shown below, thought that the Committee
should consider whether such a provision should be included in the text of
Article 24, or whether the special situation of Liberia could be suitably
dealt with under Article 74, which provides for the waiver of obligations
under the Charter.
29. The Sub-Committee also considers that paragraphs 6 and 7 of Article 24
can be combined with advantage, since they deal with the same subject. It
also recommends that a consequential amendment should be included in the
present paragraph 8 (new paragraph 7). These modifications are indicated in
the text of Article 24 in Part IV.
30. The Sub-Committee, while aware of the desirability of keeping
interpretative notes to a minimum, considers that the interpretative footnote
to paragraph 4 of Article 24 of the Geneva text relating to "frustration"
(Item 81 of the Annotated Agenda) is both essential and too detailed for
inclusion in the text of Article 24. It therefore recommends that this
interpretative note with the amendment thereto proposed in paragraph 11 of
Part II of this Report be appended to the text of Article 24.
31. The Sub-Committee took note of the amendment of Mexico (Item 82) but
felt that it would be desirable that a more specific amendment be submitted
by Mexico.
Having heard a further explanation by the delegation of Mexico, the
/Sub-Committee E/CONF.2/C.3/91
Page 6
Sub-Committee does not consider that the text of Article 24 requires any
change in the light of the proposed Mexican amendment. It took note that
the problem to which the delegation of Mexico, had directed its amendment was
Similar to that being considered by Sub-Committee of Committee III.
In the light of the Sub-Committee a recommendation the Mexican delegate
stated that his delegation reserved its position on Article 24.
32. The Sub Committee considers that the title of Article 24 would more
clearly indicate its content if it were changed to read as follows:
"Relationship with the International Monetary Fund and Exchange Arrangements".
33. It recommends also that the title of Section B of Chapter IV would more
clearly indicate the content of the section if it were to read: "Quantitative
Restrictions and Related Exchange Matters" instead of "Quantitative
Restrictions and Exchange Controls".
/PART III E/CONF.2/C.3/9 Page 7
PART III
AMENDMENTS SUBMITTED TO ARTICLES 21, 23 AND 24
Article (Geneva text) Country
21 Proposed new Belgium
Paragraph 1
21 1
21 1
21 2(a)
21 2(a)
21 2(a)
21 2(a)
21 2(b)
21 3(a)
21 3(b)
21 3(b)
21 3(b)
21 3(c)
21 3(c)
21 4(a)
21 4(a)
21 4(b)
21 4(b)
21 4(c)
21 4(c)
21 4(c)
21 4(d)
21 4(e)
21 Reservation
on Article
21 Footnote
23 1(a)
23 1(a)
PART III AMENDMENTS SUBMITTED TO ARTICLES 21, 23 AND 24
Reference*
E/CONF.2/C.3/F/W.6
Ceylon
Australia
Argentina
Venezuela
Chile
Ceylon
Australia
Argentina
Denmark
Geneva Draft Note
Belgium
Ceylon
Argentina
Brazil
Ceylon and Venezuela
Argentina
Italy
Uruguay
Uruguay
Venezuela
Uruguay
Venezuela
Italy
Italy
Italy
Belgium
on Article
New Zealand
Uruguay
Mexico
27
28
29
31
33
34
35
36
37
38
E/CONF.2/C.3/F/W.24
39
40
42
44
45
46
47
48
49
50 (Replaced by
E/CONF.2/C .3/W.23
62
63
* The numbers refer to items the Anotated Agenda (E/CONF.2/C.3/7)
unless otherwise stated.
/23 1(b) Norway ECONF.2/C.3./91
Page 8
Paragraph
Article (Geneva text)
23 l(b)
23 1(b)
23 1(b)
23 3(a)
23 3(a)
23 3(c)
23 3 (new
sub-paragraph)
23 3
23 3
23 4
23 5(b)
23 5 (new
sub-paragraph)
23 New
Paragraph 6
23 Entire Article
23 Entire -Article
23 Entire Article
23 Entire Article
23 Proposed New
Article
24
24
24
2
2
4
24 6
24 Proposed New
Country
Norway
United Kingdom
Belgium
Italy
Denmark
Mexico
Italy
Uruguay
Geneva Draft Note
Uruguay
Brazil
Norway
France
Argentina
Czechoslovakia
Belgium
Chile
Greece
New Zealand
Australia
Geneva Draft Note
Liberia
Mexico
Article
24 Entire Article Argentina
24 Entire Article Belgium
Reference*
64 (Replaced by
E/CONF.2/C.3/F/W.5)
65 (Withdrawn in
Committee III)
E/CONF.2/C.3/F/W.6
66
67
68
69
70
71
72
73
E/CONF.2/C.3/F/W.4
74
75
76 (Replaced by
77 (Replaced by ;
E/C/CNFF.273/PW.6)
77
7 (Replaced in oSmub-cfittee
by an amendment to
paragraph 5 of Article 23)
79
80
1
BNF.rC5/c /F/15W.l-
82
83
84
* nTmhees ruber efr temo its in the Annotated Agenda (NF.E/CO2/C.3/7)
less otrwhe-ie stat.ed,
/PAIVRT E/CONF. 2/C.3/91
Page 9
Article 23
Exceptions to the Rule of Non-Discrimination
1. (a) The Members recognize that the aftermath of the war has brought
difficult problems of economic adjustment which do not permit the
immediate full achievement of non-discriminatory administration of
quantitative restrictions and therefore require the exceptional
transitional period arrangements set forth in this paragraph.
(b) A Member applying restrictions under Article 21 may, in the use
of such restrictions, deviate from the provisions of Article 22 in a
manner having equivalent effect to restrictions on payments and
transfers for current international transactions which that Member may
at that time apply under Article XIV of the Articles of Agreement of
the international Monetary Fund, or under an analogous provision of a
special exchange agreement pursuant to Article 24, paragraph 6.
(c) A Member which is applying restrictions under Article 21 and which
was applying import restrictions to safeguard its balance of payments on
1 March 1948 in a manner which deviated from the rules of non-
discrimination set forth in Article 22 may, to the extent that such
deviation would not have been covered on that date by sub-paragraph (b)
of this paragraph, continue so to deviate, and may adapt such deviation
to changing circumstances.
(d) Any Member which before 1 July 1948 has signed the Protocol of
Provisional Application agreed upon at Geneva on 30 October 1947, and
which by such signature has provisionally accepted the principles of
paragraph 1 of Article 23 of the Draft Charter submitted to the Havana
Conference by the Preparatory Committee, may elect by written notice to
the Interim Commission or to the Organization before 1 January 1949,
to be governed by the provisions of Annex [ ], which embodies
such principles, in lieu of the provisions of sub-paragraphs (b) and (c)
of this paragraph. Anex [ ] shall not be applicable to any Member
which does not so elect. Sub-paragraphs (b) and (c) of this paragraph
shall not be applicable to any Member which does so elect.
(e) The policies applied in the use of import restrictions under sub-
paragraphs (b) and (c) of this paragraph or under Annex [ ] in the postwar
transitional period shall be designed to promote the maximum development
of multilateral trade possible during that period and to expedite the
attainment of a balance of payments position which no longer require
resort to Article 21, or to transitional exchange arrangements.
/(f) A Member E /CONF.2/C.3/91.
Page 10
(f) A Member may deviate from the provisions of Article 22 pursuant
to sub-paragraphs (b) or (c) of this paragraph or pursuant to
Annex [ ] only so long as it is availing itself of the post-war
transitional period arrangements under Article XIV of the Articles of
Agreement of the InternationaI Monetary Fund, or of an analogous
provision of special exchange agreement under Article 24, paragraph 6.
(g) Not later than 1 March 1950 (three years after the date on which
the International Monetary Fund began operations) and in each year
thereafter, the Organization shall report on any action still being
taken by Members under subparagraphs (b) and (c) of this paragraph
or under Annex [ ]. In March 1952, and in each year thereafter,
any Member still entitled to take action under the provisions of
sub-paragraph (c) or of Annex [ ] shall consult the Organization
as to any deviations from Article 22 still in force pursuant to
such provisions and as to it continued resort to such provisions.
After 1 March 1952 any action under Annex [ ] going beyond the
maintenance in force of deviations on which consultation has taken
place and which the Organization has not found unjustifiable, or their
adaptation to changing circumstances, shall be subject to any limitations
of a general character which the Organization may prescribe in the
light of the Member's circumstances.
(h) The Organization may, if it deems such action necessary in
exceptional circumstances make representations to any Member entitled
to take action under the provisions of sub-paragraph (c) that
conditions are favourable for the termination of any particular
deviation from the provisions of Article 22, or for the general
abandonment of deviations, under the provisions of that
sub-paragraph. After 1 March 1952, the Organization may make such
representations, in exceptional circumstances to any Member
entitled to take action under Annex [ ]. The Member shall be
given a suitable time to reply to such representation. If the
Organization finds that the Member persists in justifiable deviation
from the provisions of Article 22, the Member shall within sixty
days, limit or terminate such deviations as the Organization may specify.
2. Notwithstanding the termination of the Member's transitional period
arrangements pursuant to sub-paragraph 1 (f) of this Article, a Member which
is applying import restrictions under Article 21 with the consent of
the Organization temporarily deviate from the principles of Article 22 in
respect of a small part of its trade where the benefits to the Member or
Members concerned substantilly outweigh any injury which may result to the
trade of other Members.
/ /3. The provisions E,/CONF.2/C.3/91
Page 11
3. The provisions of Article 22 shall not preclude restrictions in accordance
with Article 21 which either
(a) are applied against imports from other countries, but not as
among themselves, by a group of territories having a common quota
in the International Monetary Fund on condition that such restrictions
are in all other respects consistent with Article 22, or
(b) assist, in the period until 31 December 1951, by measures not
involving substantial departure from the provisions of Article 22,
another country whose economy has been disrupted by war.
4. A Member applying import restrictions under Article 21 shall not be
precluded by this Section [until the termination of its postwar transitional
period arrangements pursuant to sub-paragraph 1(f) of this Article]* from
applying measures to direct its exports in such a manner as to increase its
earnings of currencies which it can use without deviation from Article 22.
5. A Member shall not be precluded by this Section from applying
quantitative restrictions:
(a) having-equivalent effect to exchange restrictions authorized
under Section 3 (b) of Article VII of the Articles of Agreement of
the International Monetary Fund; or
(b) under the preferential arrangements provided for in Annex A of
this Charter, pending the outcome of the negotiations referred to
therein.
Interpretative Note to Sub-paragraph 1 (g) of Article 23
The provisions of paragraph 1 (g) shall not authorize the Organization
to require that the procedure of consultation be followed for individual
transactions unless such a transaction is of so large a scope as to constitute
an act of general policy. In that event, the Organization shall, if the
Member so requests, consider the transaction, not individually, but in relation
to the Member's policy regarding imports of the product in question taken as a
whole.
Interpretative Note to Paragraph 2 of Article23
One of the situations contemplated in paragraph 2 is that.of a Member
holding balances acquired as a result of current transactions which it finds
itself unable to use without a measure of discrimination.
* These words in square brackets have been provisionally included in the text
pending further consideration by the Committee. E/CONF. 2/C. 3/91
Page 12
(Applicable to Members who so elect, in accordance with paragraph 1 (d) of
Article 23, in lieu of paragraphs 1 (b) and 1 (c) of Article 23.)
1. (a) A Member applying import restrictions under Article 21 may
relax such restrictions in a manner which departs from the provisions
of Article 22 to the extent necessary to obtain additional imports
above the maximum total of imports which it could afford in the light
of the requirements of paragraphs 3 (a) and 3 (b) of Article 21 if
its restrictions were fully consistant with Article 22; Provided that
(i) levels of delivered prices or products to imported are not
established substantially higher than those ruling for
comparable goods regularly available from other Members
and that any excess of such price levels for products so
imported is progressively reduced over a reasonable period;
(ii) the Member taking such action does not do so as part
of any arrangement by which the gold or convertible
currency which the Member currently receives directly or
indirectly from its exports to other Members not party to
the arrangement is appreciably reduced below the level it
could otherwise have been reasonably expected to attain;
(iii) such action does not cause unnecessary damage to the
commercial or economic interests of any other Member,
including interests under Articles 3 and 9.
(b) Any Member taking action uner this paragraph shall observe
the principal of sub-paragraph (a) of this paragraph. A Member
shall desist from transactions which prove to be inconsistent with
that sub-paragraph but the Member shall not be required to satisfy
itself, when it is not practicable to do so, that the requirements of
that sub-paragraph are fulfilled in respect of individual transactions.
2. Any Member tag action under paragraph 1 of this Annex shall keep the
Organization regularly informed regarding such action and shall provide such
available relevant information as the Organization may request.
3. If at any time the Organization finds that import restrictions are being
applied by a Member in a discriminatory manner inconsistent with the exceptions
provided for under paragraph 1 of this Anne, the Member shall, within sixty
days, remove the discrimination or modify it as specified by the Organization;
Provided that any action under paragraph 1of this Annex, to the extent that it
has been approved by the Organization at the request of a Member under a
procedure analogous to that of paragraph 5 (c) of Article 21, shall not be open
/to challenge ECONF.2/C./3/91
Page 13, . : O°13iF,7f ._
derto chalaghr5elenge ude this phrgr:1 ora1 ap6 S ()o Article 21 on
the g ound that .l 1BIncent wih'-Article ., * *-
ter~petatt~eot to Annez
Iist is unartt6 that the fact that a Member I oerating under the
provtosn od ti 43 a ahgr'aemph 1 1() d eo no preclued e.t at Moo
ouperation eApro, ier: sa"Ainecx'b 3ethat h ju'ovlsiofArti 2- ' -.
in any w; tic~lwn -$sAa) w -vyeri6hts Mmbers uder
uding 1+34; i3'gAnh A d(.b)o(' ) ; . ,
ARTICE 24
change Arrangement ' . .
- elati shi, ith the International Monet!!yFund
.ndEchat~e Arranmein. -
1. The Ori2zplc wk coerating with thInternhtionbl Montary
und or'io th;enand the Orgaizatioij enth luoncmapuse a co di-nated
Poi vit regard, to exchange questions within the jurisdiction of the Fund.
andSseosins of quantitative iearition and other traeo meaures within
the urivition of the OrganizatiQn . . -.
In all casesa 4f- ,thrgeuztio, i caUedupono csider 'or: -
deal with problem concrernin monetary reserves, balance of paments os-
forei l)agp arragements,w the Orgsanitti: shal cosult. fully > ith e
cIDsui~aj~iaJ, M.et9y ruia: onIshall sh ngltation hOrganiz~tiqp $4
iQland5X g > '. facetnsed pr heseutQi-by-*tQ;,
onetary ftadrlPAfo " ~ntug htn ecliae -ry-rmoataXseseea
wlance l~q aymen-p, ants:--ahlsl.c cep. te determnai tio 9of he : .-
toa3 cthone yao'ibm ae tibein xchange matters is inc adaccorwinortee th1;h
Artioclegs mef Areent of the International MonFund, or etary w th hj erm th ets
hofg a xchangp agreemecia excba9ea9zetem between that M n r and the Orgauia tont
zaWhen [ ] the hazsurposta ,jg ch p s inal eaobsinng F Ifih-iow
olving n he § te''riti et forth-. paragrinh (a) faArticle1 1,2 o 22
g.a n ett oB inseii~loghn j t of hle re3vcons;ant fion6i&u5di pnd-uer-
n-ern1tionma;aMone ary `fi ieI .t. wh at d
!E.ipro .,, , Ar tcer lw--it ehl oa AXcpt. .d -
aor~aQ b1a> qjr ae ;. its 'zo~etaz :~rgeaor and.> + - -.. :
04-.sr v.texa. Fur rs/ apy ch
.3 4ez T hr.e..-it
p-:h. E/CONF. 2/C 3/9l
Page 14:
Any such agreement other , than informal arrangements of a temporary or
administrative character, shall be subject to confirmation by the Conference
4. Members shall not, by exchage action, frustrate the intent of the
provisions of this Section, nor, by trade action, the intent of the provisions
of the Articles of Agreement of the International Monetary Fund.
5. If the organization considers, at any time, that exchange restrictions
on payments and transfers in connection with imports are being applied by a
Member in a manner inconsistent with the exceptions provided in this Section
for quantitative restrictions it shall report thereon to the International
Monetary Fund.
6. (a) Any Member of the organization which is not a member of the
International Monetary Fund shall, within a time to be determined by
the Organization after consultation with the International Monetary
Fund, become a member of the Fund or, failing that, enter into a
special exchange agreement with the Organization, A Member of the
Organization which ceases to be a member of the International Monetary
Fund. shall forthwith enter into a special exchange agreement with the
Organization. Any special exchange agreement entered into by a Member
under this paragraph shall thereupon become part of its obligations
under this Charter.
[7. (a)] (b) Such a special exchange agreement [between a Member and the
Organization under paragraph 6 of this Article] shall provide to the
satisfaction of the Organization that the objectives of this Charter
will not be frustrated as a result of action in exchange matters by the
Member in question.
[(b)](c) The terms of any such agreement shall not impose
obligations on the Member in exchange matters generally more restrictive
than those imposed by the Articles of Agreement of the International
Monetary Fund on members of the Fund.
(d)No special exchange agreement shall be required of a Member so long
as it uses solely the currency of another Member and so long as neither
the member nor the our the country whose currency is being used has exchange
restrictions. Nevertheless, if the Organization at any time considers
that the absence of a special exchange agreement may be permitting
action which tends to impair the purpose of any of the provisions of
this Charter, it may require the Member to enter into a special exchange
agreement in accordance with the provisions of the Articie. A Member
of the Organization which is not a Member of the International
Monetary Fund and which has no special exchange agreement may be required
/at any time E/CONF. 2/C. 3/91
Page 15
at any time to consult with the Organization on any exchange problem,
[8.] 7. A Member which is not a member of the International Monetary Fund,
whether or not it has a special exchange agreement, shall furnish such
information within the general scope of Section 5 of Article VIII of the
Articles of Agreement of the International Monetary Fund as the Organization
may require in order to carry out its functions under this Charter.
[9.] 8. [subject to paragraph 4 of this Article] Nothing in this Section
shall preclude:
(a) the use by a Member of exchange controls or exchange restrictions
in accordance with the Articles of Agreement of the International
Monetary Fund or with that Member's special exchange agreement with the
Organization, or
(b) the use by a Member of restrictions or controls on imports or
exports, the sole effect of which, additional to the effects permitted
under Articles 20, 21, 22 and. 23, is to make effective such exchange
'controls or exchange restrictions.
Interpretative Note to Paragraph [4] 8.
[The word "frustrate" is intended to indicate, for example, that
infringements by exchange action of the letter of any Article of this Charter
shall not be regarded as offending against that Article if, in practice, there
is no appreciable departure from the intent of the Article.] Thus a Member
which, as part of its exchange control, operated in accordance with the
Articles of Agreement of the International Monetary Fund., required payment
to be received for its exports in its own currency or in the currency of one
or more members of the International Monetary Fund would not thereby be deemed
to be offending against Article 20 or Article 22. Another example would be
that of a Member which specified on an import licence the country from which
the goods might be imported for the purpose not of introducing any additional
element of discrimination in its Import licenses but of enforcing permissible.
exchange controls. |
GATT Library | vn330yt1766 | Reports of Central Drafting Committee : Note by the Executive Secretary | United Nations Conference on Trade and Employment, March 8, 1948 | General Committee | 08/03/1948 | official documents | E/CONF.2/BUR.37, E/CONF.2/W/1-15, E/CONF.2/BUR.1-39, and E/CONF.2/BUR/W.1 | https://exhibits.stanford.edu/gatt/catalog/vn330yt1766 | vn330yt1766_90180203.xml | GATT_147 | 196 | 1,428 | United Nations Nations Unies RESTRICTED
CONFERENCE CONFERENCE E/CONF.2/BUR.37
ON DU 8 March 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
GENERAL COMMITTEE
REPORTS OF CENTRAL DRAFTING COMMITTEE
NOTE BY THE EXECUTIVE SECRETARY
At the meeting of Committee III this afternoon, a great deal of time
was spent discussing points of drafting in the Reports of the Central
Drafting Committee on Articles 20 and 22 and 25 to 28. A large Committee
composed of the representatives of fifty-eight delegations is not the most
suitable body for the discussion of drafting points, and in order to
facilitate the work of the Conference, it is now suggested that all
delegations should examine the Reports of the Drafting Committee immediately
they are distributed and should in the first instance discuss any points
they have to raise directly with the Drafting Committee. The Drafting
Committee would then be in a position to present supplementary reports on
these points to the Committees of the Conference.
Accordingly, it would be appreciated if delegations would submit their
comments on the Drafting Committee Reports on Sections D, E, and F of
Chapter IV (documents E/CONF.2/C.8/6/Rev.1, E/CONF.2/C.8/4/Rev.1 and
E/CONF.2/C.8/5/Rev.1) by 6 p.m. tomorrow, Tuesday. |
GATT Library | km543qb3282 | Reports of Committees and Principal Sub-Committees : Held at Havana, Cuba from 21 November 1947 to 24 March 1948 | United Nations Conference on Trade and Employment, 1948-09-00 | 01/09/1948 | official documents | ICITO/W.1 and ICITO/W.1 | https://exhibits.stanford.edu/gatt/catalog/km543qb3282 | km543qb3282_90180096.xml | GATT_147 | 61,801 | 387,683 | UNITED NATIONS CONFERENCE ON TRADE
AND EMPLOYMENT
HELD AT
HAVANA, CUBA
FROM 21 NOVEMBER 1947 TO 24 MARCH 1948
REPORTS OF COMMITTEES
AND
PRINCIPAL SUB -COMMITTEES
INTERIM COMMISSION
FOR THE INTERNATIONAL TRADE ORGANIZATION
GENEVA
SEPTEMBER 1948 ICITO 1/8
September 1948
This collection of reports has been assembled and edited by the
Secretariat of the Interim Commission. These reports are to be read in
conjunction with The Final Act and Related Documents of the
Havana Conference (United Nations document ICITO/1/4 or
E/CONF. 2/78) and the Report of the Second Session of the Preparatory
Committee (United Nations document E/PC/T/186). The texts of the
Havana Charter and Resolutions appear in the former. The text
of the " Geneva Draft " appears in the latte . TABLE OF CONTENTS
Page
Introduction .... . . ...... . . . . . . . . . . . 5
I. Reports relating to the First Committee:
Employment and Economic Activity. 7
II. Reports relating to the Second Committee:
Economic Development .I9
III. Reports relating to the Third Committee:
Commercial Policy .39
IV. Reports relating to the Fourth Committee:
Restrictive Business Practices .120
V. Reports relating to the Fifth Committee:
Inter-governmental Commodity Agreements .127
VI. Reports relating to the Sixth Committee:
Organization .149
VII. Documents relating to the Co-ordinating Committee. 160
Reference List Identifying Proposals of Individual Delegations 164
Indices in terms of the Article, Section and Chapter Numbers
of the Geneva Draft and of the Havana Charter . . . . 177 INTRODUCTION
The terms of reference of the Interim Commission for the
International Trade Organization, after enumerating certain
specific functions, provide that the Commission shall " generally
perform such other functions as may be ancillary and necessary
to the effective carrying out of the provisions of this Annex ".
Among " such other functions " the Executive Committee decided
that arrangements should be made for the publication, as soon as
possible, of the principal background documents on the Havana
discussions. At its first meeting the Executive Committee directed
the Executive Secretary to " publish the reports of the principal
committees, supplemented by such sub-commitee reports and other
documents or extracts therefrom as may be necessary for an
understanding of such reports ". In the preparation of the present
collection of reports, and particularly in securing comparability
between the English and French texts, the Secretariat has had
the benefit of advice from the panel designated by the Executive
Committee consisting of Mr. Jean Royer (France), Mr. H. M.
Catudal (United States of America), Mr. J. E. S. Fawcett (United
Kingdom), Baron de Gaiffier (Belgium), and Mr. L. E. Couillard
(Canada).
The general aim in preparing this material has been to provide
a record of the principal discussions at the Havana Conference
which would give an indication of the origins of the various articles
in the Havana Charter, explaining particularly the changes made
in the Geneva draft, and which would preserve the comments or
observations of the committees and sub-committees regarding the
text of the Charter. The material covers also the origins of the
resolutions adopted by the Conference. It has not been feasible
to include the numerous proposals made by individual delegations
with respect to the Charter or to the resolutions. For convenience
of reference, however, a list of the principal formal proposals
made by individual delegations, with identifying document symbols,
appears in an annex to the present collection of reports. File
copies of the documents listed are available for reference in the - 6 -
Documents Office of the United Nations at Lake Success and at
the office of the Interim Commission in Geneva.
In preparing these reports for publication certain procedural
portions have been deleted as being unnecessary in the published
edition and certain other portions have been changed slightly,
particularly in order to reduce duplication as between the reports
of committees and their respective sub-committees. No change has
been made which would affect in any degree the substance of the
reports. It has been found impossible, without taking considerable
liberties with the original text, to present all of the reports in a
uniform manner, in view of differences in the form in which they
were approved. Accordingly, the section relating to each committee
has been prefaced by a brief note concerning the form in which the
reports in that section have been presented.
In general the chapter, section, article and paragraph numbers
used in the original reports (i.e., numbers based on those of the
Geneva draft) have been retained in the present edition, with the
corresponding number of the Havana Charter given in square
brackets in each case in which the Havana number differs from the
original number. When a number appears without any correspond-
ing number in square brackets the intention, unless otherwise
stated in the particular case, is to indicate that the original or
Geneva number and the Havana number dealing with that particular
subject are identical, although, of course, the two texts may not
be exactly the same.
This collection of reports is accompanied by an index indicating
the pages on which references will be found to each article, section
or chapter.
Concerning the status of these reports, the President of the
Conference at the final Plenary meeting on 24 March declared the
reports of the full Committees approved by the Conference. The
status of the reports of the various sub-committees is indicated
in the reports of the full Committees. I. REPORTS RELATING TO THE
FIRST COMMITTEE
EMPLOYMENT AND ECONOMIC ACTIVITY
This section contains the following documents relating to the
work of the First Committee:
(i) Report of the First Committee.
(ii) Report of Sub-Committee A: Fair Labour Standards.
(iii) Report of Sub-Committee B: Articles of Chapter II other
than the Article on Fair Labour Standards.
(iv) Report of Sub-Committee C: Resolution on Employment.
REPORT OF THE FIRST COMMITTEF: EMPLOYMENT
AND ECONOMIC ACTIVITY 1
I. The First Committee was responsible for the examination
of the Geneva draft text of Chapter II on "Employment and
Economic Activity ", together with proposals submitted by
delegations relating to the subject matter of that Chapter.
2. Mr. J. J. DEDMAN (Australia) was elected Chairman.
Mr. E. WAERUM (Denmark) was elected Vice-Chairman.
3. The Committee held thirteen meetings and succeeded in
resolving all issues before it. Mr. DEDMAN presided at the first
ten meetings and Mr. WAERUM at the last three meetings.
4. To facilitate its work the Committee established three sub-
committees.
5. Sub-Committee A was appointed to consider proposals relat-
ing to the article on " Fair Labour Standards ".
6. Sub-Committee B was appointed to examine proposals
relating to the other articles of the Chapter.
1 E/CONF.2/55. -8--
7. Sub-Committee C was set up to consider the draft resolution
on employment which had been prepared by the First Session of
the Preparatory Committee, together with any new proposals
which might be submitted relating to this subject.
8. In the preparation of the text of the Chapter assigned to it,
the First Committee took account of the suggestions put forward
by the Central Drafting Committee.
9. The reports of the Sub-Committees which examined these
proposals were accepted. Certain questions which the Sub-Com-
mittees were not able to resolve have now been resolved as indicated
in the attachment to the present Report. The text of Chapter II
was recommended unanimously by the First Committee for approval
by the Conference.
10. The First Committee transmitted to the Conference, and
a Plenary Session of the Conference acted upon, the text of a
resolution to the Economic and Social Council relating to employ -
ment.1
ATTACHMENT TO THE REPORT
OF THE FIRST COMMITTEE
DISPOSITION OF PROPOSALS REMAINING AFTER THE SUBMISSION
OF THE SUB-COMMITTEE REPORTS.
The following statement indicates, with reference to each Article,
the action taken on proposals which had not been satisfied by the
Sub-Committee texts or which arose after the submission of the
Sub-Committee reports.
Article 2.
All proposals were dealt with in the Sub-Committee's report.
Article 3.
The proposal of the delegation of N orway concerning fluctuations
in demand and prices, which had not been covered in the Sub-
Committee's report, was dealt with in a modified form through
1 The text recommended by the Committee was approved by a Plenary Meeting
of the Conference with the insertion of the word " may " before " need to be
combatted" in the third paragraph (E/CONF.2/SR.13). The approved text
appears on page 75 of the Final Act and Related Documents (ICITO/1/4 or
E/CONF.2/78). - 9 -
the amendment of Article 7 [6]1 at the eleventh meeting of the Com-
mittee. The question raised by this proposal was also mentioned
in the preamble of the Resolution on Employment.
The proposal by the delegation of Italy concerning the inter-
national mobility of labour was dealt with in a modified form by
introducing present paragraph 1 (b) in Article 6 [5] and by Section 3
of the Resolution on Employment.
The proposal by the delegation of Mexico concerning migratory
workers was dealt with in a modified form in Section 4 of the
Resolution on Employment.
Article 5 [4].
The proposal of the delegation of Peru regarding the disposal of
surpluses during periods of widespread balance-of-payments dif-
ficulties was withdrawn at the ninth meeting in view of the fact
that the Sub-Committee had not been prepared to recommend the
inclusion of a provision on this subject in Chapter II.
Article 6 [5].
As indicated above in connection with Article 3, sub-para-
graph (b) was added to paragrah 1 of Article 6 [5] as a result of
a proposal by the delegation of Italy.
Article 7 [6].
As in the case of the proposal relating to Article 3, mentioned
above, the proposal by the delegation of Norway relating to
Article 7 [6] concerning the stabilization of prices was dealt with in
a modified form through the amendment of Article 7 [6] and
through the preamble to the Resolution on Employment.
Article 4 [7].
The provisional reservation by the delegation of Mexico men-
tioned in paragraph 8 of the Report of the Sub-Committee on this
Article was withdrawn at the eighth meeting.
In the first sentence of paragraph 1 of the new text of the Article
the word " international ", referring to declarations, conventions
and agreements, was changed to " inter-governmental " at the
ninth meeting. At the thirteenth meeting some delegates indicated
1 As indicated in the introduction square brackets [ ] have generally been used
where appropriate throughout the present collection of reports to indicate the
corresponding number in the Havana Charter when it differs from the number in
the Geneva draft or in the original report. -10 -
that they would prefer to have retained the word " international "
as being wider than " inter-governmental " in its application.
Other changes in this sentence suggested by the Drafting Com-
mittee were not accepted.
The problem raised by the delegation of Belgium concerning a
possible misinterpretation of the last part of the second sentence
in paragraph 1 of the new text of this Article was initially discussed
at the tenth meeting. Subsequently a suggestion was put forward
by the Central Drafting Committee which was considered by the
First Committee at its eleventh and twelfth meetings. At the
twelfth meeting it was decided that the English text should read
" ... the improvement of wages and working conditions as productiv-
ity may permit ". At the thirteenth meeting, after receiving further
advice from the Central Drafting Committee, the First Committee
decided that the corresponding French text should read "aux
conditions de remuneration et de travail meilleures que cette
productivité rend possibles ".
The words " within its territory " were added after "condi-
tions " in the third sentence of paragraph 1 of the new text of this
Article at the eighth meeting.
At the eighth meeting the representative of the International
Labour Organisation proposed a change in the third paragraph
of the new text. This proposal was discussed at the ninth meeting
and was adopted in a modified form.
REPORT
OF SUB-COMMITTEE A OF THE FIRST COMMITTEE:
" FAIR LABOUR STANDARDS " 1
1. At the sixth meeting of the First Committee, 8 December
1947, the Chairman appointed a Sub-Committee which was
instructed to examine the text of Article 4 [7] with the new proposals
relating to the subject matter thereof and to prepare a text for
submission to the full Committee.
2. Representatives of the following delegations were appointed
members of the Sub-Committee: Argentina, Ceylon, China, Colom-
bia, Cuba, Czechoslovakia, Denmark, Mexico, Netherlands, New
Zealand, Turkey, Union of South Africa, United States of America
and Uruguay.
1 E/CONF.2/C.1/9. - 11 -
3. Mr. D. K. LIEU (China) served as Chairman of the Sub-
Committee.
4. The representatives of the delegations of the Philippines
and of Haiti attended the meetings of the Sub-Committee when
proposals originating with those delegations were under discussion.
The Sub-Committee also had the benefit of expert advice from
the representative of the International Labour Organization.
5. After a discussion of the points of substance in the Sub-
Committee a Drafting Group was constituted, comprising represent-
atives of the delegations of Mexico, the Union of South Africa and
the United States of America. The text prepared by this Drafting
Group was subsequently considered and modified by the full
Sub-Committee.
6. The Sub-Committee held four meetings and reached agree-
ment on a text. The representative of the delegation of Argentina
indicated that while he was prepared provisionally to agree with
the text produced by the Sub-Committee, it might be necessary for
his delegation, after it had had an opportunity to examine a
Spanish translation of the text, to express certain views concerning
that text in the full Committee. The representative of the
delegation of Mexico indicated that his delegation reserved its
position for discussion in the full Committee on the relation between
the present proposed text and the amendment put forward by that
delegation earlier for a provision relating to non-discriminatory
treatment of labour.
7. In the view of the Sub-Committee the text which it was
recommending for consideration and approval by the First Com-
mittee was in most respects self-explanatory. Accordingly in its
report the Sub-Committee confined its remarks largely to observa-
tions concerning the relation between the recommended text and
the amendments which were under consideration.
Paragraph 1.
8. In the drafting of the first sentence of paragraph 1 the
Sub-Committee was prompted by the amendment proposed by
the delegation of Mexico to the effect that a reference should be
made in the Article to the safeguarding of the rights acquired by
labour, especially those embodied in the Declaration of the Aims
and Purposes of the International Labour Organization adopted by
the ILO Conference at Philadelphia in May 1944. In the use
of the words " international declarations " the Sub-Committee had - 12 --
in mind particularly this Declaration. It was felt by the Sub-
Committee that this language (together with the reference else-
where in the Chapter to " large and steadily growing . . . effective
demand ") also covered the proposal of the delegation of the
Philippines concerning the importance of social security since the
Declaration of Philadelphia stresses the significance of social
security measures. The language of this first sentence was,
however, drafted sufficiently broadly to include not only the
Philadelphia Declaration but any other international instruments
whereby rights of workers were established.
9. In the second sentence the Sub-Committee incorporated
the proposal of the delegation of Argentina that " wages " should
be specifically mentioned. By its use of the word " improvement "
in this sentence the Sub-Committee felt that it also embodied the
substance of the amendment proposed by the delegation of Burma.
10. In the third sentence the Sub-Committee endeavoured to
take account of various proposals which were made concerning the
use previously of the words " production for export ". The
recommended language indicated that the sentence was concerned
with any unfair labour conditions which create difficulties in
international trade.
11. The Sub-Committee did not retain the words " throughout
its territory " which appeared in the text submitted by the Prepar-
atory Committee. The Sub-Committee was of the opinion that
these words were unnecessary since the sense was clear without
them, but that the Central Drafting Committee might consider
from a drafting point of view whether or not they should be
retained. The representative of the delegation of Turkey indicated
that his delegation might find it necessary during the discussion
of this matter in the First Committee to suggest that the words
"within its territory " be inserted.
Paragraph 2.
12. The proposed text of paragraph 2 was identical with the
corresponding sentence in the text submitted by the Preparatory
Committee.
Paragraph 3.
13. The text of the new paragraph 3 was prepared on the
basis of various suggestions which were made in the original amend-
ments concerning the division of functions between the ILO
and the ITO (e.g., the amendments proposed by the delegations - 13 -
of Ceylon, Colombia and the Union of South Africa). In view of
the special competence of the ILO in the field of labour standards
it was considered desirable to provide in the Article itself for
consultation between the ILO and the ITO This paragraph
was also designed to meet the requirements of those countries
which had proposed various procedures for dealing with situations
in which a Member felt it necessary to protect its industries from
the competition of products produced under unfair conditions of
labour (e.g., the amendments proposed by the delegations of
Colombia, Mexico and Uruguay). The proposed language of this
paragraph was intended to bring out explicitly the relationship
between this Article and the procedure established in Article 90
[94 and 95] for the reference of matters to the Organization.
14. The Sub-Committee recognized that in the proposed text
specific provision had not been made for non-discrimination in the
treatment of labour as proposed by the delegations of Mexico and
Haiti. During the discussion of this matter in the Sub-Committee
note was taken of the work being done on this subject by the
ILO and by such other bodies as the Commission on Human
Rights and its Sub-Commission on the Prevention of Discrimination
and the Protection of Minorities. The majority of members of the
Sub-Committee felt that the question of non-discrimination in
respect of the employment of labour could not be dealt with
appropriately or adequately in a charter of an international trade
organiaztion. To the extent, however, that provisions concerning
non-discriminatory treatment of labour might have been, or might
in the future be, incorporated in other " international declarations,
conventions and agreements " to which Members may subscribe
the proposed language of the Article recognized that measures
relating to employment must take fully into account any such
provisions.
Location of the Article.
15. The Sub-Committee learned that Sub-Committee B of the
First Committee proposed a re-arrangement of the Articles in the
Chapter whereby the Article on " Fair Labour Standards " would
be removed from its present position between two Articles on
balance-of-payments questions to a position at the end of the
Chapter in order to secure continuity in the provisions relating to
balances of payments. The Sub-Committee agreed with the
suggestion that for this reason the Article on fair labour standards
should appear at the end of Chapter II. -14 -
REPORT
OF SUB-COMMITTEE B OF THE FIRST COMMITTEE:
ARTICLES OF CHAPTER II OTHER THAN THE ARTICLE
ON FAIR LABOUR STANDARDS 1
1. At the sixth meeting of the First Committee, 8 December
1947, the Chairman appointed a Sub-Committee which was
instructed to examine the amendments relating to all Articles of
Chapter II with the exception of Article 4 [7] and to prepare texts
for those Articles.
2. Representatives of the following delegations were appointed
members of the Sub-Committee: Australia, Canada, France, India,
Italy, Lebanon, Norway, Mexico, Peru, Philippines, United
Kingdom and the United States of America.
3. M. J. ROYER (France) served as Chairman of the Sub-
Committee.
4. The representative of the delegation of Denmark attended
the meeting of the Sub-Committee when the proposal originating
with that delegation was under discussion. The Sub-Committee
also had the benefit of expert advice from the representatives of
the International Labour Organization and the International
Monetary Fund.
5. It was agreed that the amendment proposed to Article 6 [5]
by the delegation of Mexico concerning the safeguarding of the
rights of workers should be transferred to Sub-Committee A and
discussed in connection with Article 4 [7]. Accordingly Sub-
Committee A reported on this proposed amendment.
6. The Sub-Committee held five meetings and agreed to
recommend a text to the First Committee for its approval in
respect of the matters covered therein. On other points not
covered specifically in the proposed text certain members, as
indicated below, stated that in the full Committee, they might wish
to have these points discussed further. In respect of the various
amendments originally proposed the delegations concerned were
able in most cases either to withdraw their proposals after some
discussion, or to consider their proposal as satisfactorily covered
by the changes suggested in the present text. Accordingly the
1 E/CONF.2/C.1/10. -15 -
comments of the Sub-Committee in its report were confined to
only certain of the amendments proposed earlier.
7. The Sub-Committee agreed with a suggestion by the
representative of the United States of America that, in order to
secure continuity in the balance of payments provisions, it would
be desirable to move the Article on fair labour standards from its
earlier position to a position at the end of the Chapter.
8. The Sub-Committee discussed the proposal presented by
the delegation of Italy for the inclusion of a provision for inter-
national co-ordination of employment services with a view to
facilitating the migration of labour where desirable. In the
course of the discussions information was supplied concerning the
activities of the Permanent Migration Committee of the Inter-
national Labour Organization in this field and reference was also
made to the Population Commission of the Economic and Social
Council. It was the view of the Sub-Committee that the question
of the international movement of labour was only one aspect,
although an important one, of the general question of international
action to assist in securing high levels of employment and that if
mention were to be made of this aspect reference to other aspects
would also have to be included at some length. It was the view
of the Sub-Committee that it was unnecessary to include in
Chapter II any specific reference to this particular aspect of the
question since the present language of the Chapter included all the
various aspects. The Sub Committee considered that in connec-
tion with the proposed Resolution on Employment consideration
might be given to the desirability of drawing the attention of the
Economic and Social Council to the importance of international
mobility of labour and of securing an international co-ordination
of employ ment services for this purpose. The representative of
Italy indicated that his delegation reserved its position pending
discussion in the First Committee.
9. The Sub-Committee considered the proposal by the dele-
gation of Mexico concerning the treatment of migrant workers and
concluded that particular situations of the sort referred to in the
discussion of the amendment should be the subject of special
agreements and could not appropriately be included in the charter
of an international trade organization. Reference was made also
to the work being done by the International Labour Organization
and particularly its Permanent Migration Committee on the
general question of the treatment of migrant workers. The - 16 -
representative of the delegation of Mexico reserved the right of
his delegation to raise the question again in the full Committee.
10. Concerning the proposal by the delegation of Denmark
relating to the initiative of the Organization in the event of
Members experiencing balance-of-payments difficulties, the Sub-
Committee was of the view that, even if the particular case were
not of sufficient urgency to come under paragraph 2 of Article 6 [5],
the Member would be permitted under Articles 89 and 90 [93-95]
to make representations to other Members and to the Organization
and that if such representations were made to the Organization it
was already empowered under the present text of the Charter to
consult with, and make recommendations to, any or all Members.
Accordingly the Sub-Committee felt that the inclusion of a special
reference to the initiative of the Organization in connection with
this Article was not required and that the insertion of such a
reference might appear to cast doubt on the Organization's
right of initiative in connection with other Articles if that right
were not also specifically mentioned in such cases.
11. The Sub-Committee discussed the proposal of the dele-
gation of Peru regarding the disposal of surpluses during periods
of widespread balance-of-payments difficulties. It was generally
agreed that this problem related closely to the provisions of Chap-
ter VI and that the courses of action contemplated by the repre-
sentative of Peru were already provided. for, so far as feasible, in
Article 55 [58] (and the other Articles of Chapter VI) and Article 69
[72]. Accordingly the Sub-committee decided not to recommend
the inclusion of any provision on this subject in Chapter II. The
representative of Peru indicated that his delegation reserved its
position pending discussion in the full Committee.
12. The Sub-Committee discussed at some length the propo-
sals by the delegation of Norway concerning price stabilization
and the prevention of inflationary developments. The Sub-
Committee was of the opinion that rather than consider the need
for a. modification in the Chapter at the present time it would be
preferable to await the examination of the various Articles which
relate to measures available to governments pursuing a policy of
price stabilization, such as Articles 18, 20, 25-29 [25-28] and
43 [45], reserving the right of the delegation of Norway to raise
the question again after those Articles had been examined by the
appropriate Committees. - 17 -
REPORT OF SUB-COMMITTEE C OF THE
FIRST COMMITTEE: RESOLUTION ON EMPLOYMENT1
As authorized by the First Committee at its ninth meeting,
20 December 1947, the Chairman of the Committee appointed a
Sub-Committee to consider whether or not a resolution was required
and, if so, to recommend a text for such a resolution in the light of
the draft prepared by the First Session of the Preparatory Com-
mittee and any further proposals which might be received from
individual delegations. The Sub-Committee was instructed to
take account also of the new text of Chapter II and of the infor-
mation reported in a document reporting on activities of the United
Nations and Specialized Agencies in the field of employment 2.
Representatives of the following delegations comprised the
Sub-Committee: Australia, Belgium, Brazil, France, Italy, Lebanon,
Mexico, Pakistan, Poland, El Salvador, Sweden, the United
Kingdom and the United States of America.
Mr. J. H. G. PIERSON (United States of America) was elected
Chairman.
After some discussion the Sub-Committee agreed that it would
be appropriate and desirable to recommend that the Conference
adopt a resolution relating to employment.
The Sub-Committee concluded that it would not be desirable
to reiterate the text of the draft resolution prepared by the First
Session of the Preparatory Committee since that resolution had
already been mentioned in a resolution of the Economic and Social
Council and, at least in part, had been included in instructions
to the Sub-Commission on Employment and Economic Stability.
It was felt, however, that it would be useful to affirm in the pre-
sent text the interest of the Conference in all four of the measures
dealt with in the draft resolution of the Preparatory Committee.
In the preparation of a text the Sub-Committee examined pro-
posals submitted by the delegations of Australia, Brazil, Denmark,
Italy, Mexico and Poland. and an informal draft put forward by
the Chairman of the Sub-Committee. The Sub-Committee also
took account of suggestions presented orally by the representatives
of Czechoslovakia, France, Lebanon and Pakistan.
1 E/CONF. 2/C.1/17.
2 E/CONF.2/5. - I8 -
The Sub-Committee appointed a Drafting Group, comprising
representatives of the delegations of Australia, Mexico and the
United Kingdom, which met under the chairmanship of Miss N. K.
FISHER (United Kingdom) and prepared a text which was sub-
sequently considered and modified by the full Sub-Committee.
The Sub-Committee held four meetings and reached agreement
on a text which it recommended to the First Committee for
approval. II. REPORTS RELATING
SECOND COMMITTEE
ECONOMIC DEVELOPMENT
The Report of the Second Committee as approved by that
Committee and by the Conference indicated in detail with respect
to each Sub-Committee the changes which the Committee considered
necessary in the reports which had been submitted by the
Sub-Committees, but did not reproduce the texts of the Sub-
Committees' reports. Since the texts of the Sub-Committees' reports,
with the changes indicated in the Committee's Report, had been
approved by the Committee it has been considered desirable and
appropriate, particularly for reasons of convenience, to insert the
various Sub-Committee reports in the Committee Report, indicating
with square brackets and footnotes the changes which the
Committee made in approving these reports.
REPORT OF THE SECOND COMMITTEE:
ECONOMIC DEVELOPMENT 1
1. The Second Committee was responsible for the examination
of the Geneva draft text of Chapter III on " Economic Develop-
ment" together with proposals submitted by delegations relating
to the subject matter of the Chapter.
2. Mr. Ramon BETETA (Mexico) was elected Chairman at the
first meeting of the Committee and Mr. Emilio ABELLO (Philippines)
was elected Vice-Chairman at the second meeting. On the depar-
ture of Mr. Abello, Mr. Jose GARRIDO TORRES (Brazil) was elected
Vice-Chairman at the twenty-first meeting.
3. The Committee held twenty-six meetings and succeeded in
solving all the issues before it. Mr. Beteta presided at all meetings
except the seventh to nineteenth inclusive, presided over by
Mr. Abello and the twenty-second presided over by Mr. Garrido
Torres.
1 E/CONF.2/69 and Corr 1.
TO THE - 20 -
4. To facilitate its work the Committee established six sub-
committees, two of them jointly with other committees. The
Reports of the Sub-Committees as submitted to and as approved
by the Committee, and any reservations made, are set out below
in six Parts 1, viz.
Part I Sub-Committee A on Article 8
Part II Joint Sub-Committee of Committees II and VI on
Articles 9, 10 and 11 and on the Mexican proposal for
the establishment of a Committee for Economic
Development
Part III Sub-Committee B on Article 12
Part IV Sub-Committee C on Articles 13 and 14
Part V joint Sub-Committee of Committees II and III on
Articles 15, 16 (2) and 16 (3) and 42 [15, 16 (2), 16 (4),
42, 43 and 44]
Part VI Sub-Committee D on footnote to Chapter III on
"Reconstruction ".
PART I
SUB-COMMITTEE A OF THE SECOND COMMITTEE ON ARTICLE 8
Sub-Committee A on Article 8, consisting of representatives
of Australia, China and the United Kingdom was set up at the
fifth meeting of Committee II to examine the Article in the light
of the discussion at that meeting. Mr. D. K. LIEU (China) was
elected Chairman of the Sub-Committee. A recommendation 2
was submitted to the sixth meeting of Committee II but after
further discussion at that meeting the Sub-Committee was
reconstituted with the addition of the representatives of
Argentina, Iran and New Zealand. A further recommendations
was submitted to and aproved by the ninth meeting of Com-
mittee II as follows:
1 In the case of Sub-Committee A no formal report was issued and the recom-
mendation of the Sub-Committee is to be found in a Secretariat Note. In the case
of the Joint Sub-Committee of Committee II and III the report reproduced here
is that on Article 15. The report of this Sub-Committee on other Articles is to
be found in the collection of reports relating to the Third Committee.
2 Secretariat Note E/CONF.2/C.2/A/1.
2 Secretariat Note E/CONF.2/C.2/A/3 considered by the Committee at its
ninth meeting. - 21 -
"It was agreed to accept the following text 1:
The Members recognize that [all countries have a common interest in]
the productive use of the world's human and material resources is of
concern to and will benefit all countries, and that the industrial and general
economic development of all countries,
" It was furthermore agreed that the phrase is of concern to all
countries' was to be understood in a completely general sense,
i.e. that all countries have a collective concern in the development of
resources of the world at large. It in no way implied a right of
interference in the internal affairs or national policy of a Member,
either on the part of any other individual Member or Members
generally.
"The delegation of Argentina accepted the above text subject
to a satisfactory translation of the word ' concern ' into Spanish."
PART II
JOINT SUB-COMMITTEE OF THE SECOND AND SIXTH COMMITTEES
ON ARTICLES 9. 10 AND II AND ON THE MEXICAN PROPOSAL
FOR THE ESTABLISHMENT OF A COMMITTEE FOR ECONOMIC
DEVELOPMENT
The following is the Report 2 of the Joint Sub-Committee on
Articles 9, 10 and 11 considered by Committee II at its twentieth,
twenty-first and twenty-second meetings, together with the
modifications made by the latter.
1. The Joint Sub-Committee was appointed at the sixth
meeting of Committee II and the fifth and seventh meetings of
Committee VI with terms of reference:
"1. To examine Articles 9, 10 and 11 of Chapter III, proposed
amendments thereto and any proposed new articles relating to the
positive functions of the organization in promoting economic
development in the light of discussion in Committee II with a view to
making recommendations as to the texts of these articles and any
organizational provisions which may be required as a consequence
thereof.
" 2. To examine the proposal of the Mexican delegation for the
establishment of an Economic Development Committee of the
Organization taking into account any conclusions reached under
paragraph 1 and any other relevant considerations.
" 3. In making recommendations under paragraphs 1 and 2
to take into account the functions of other organs of the Organization
and of the United Nations and Specialized Agencies in general in the
field of economic development and any financial implications.
" 4. To report to both Committee II and Committee VI."
1 In this instance [ ] signifies deletion from the Geneva text, and words in
italics signify addition to the Geneva text.
2 E/CONF.2/C.2/36, E/CONF.2/C.6/72. - 22 -
2. The Joint Sub-Committee was composed of representatives
of:
Australia France Turkey
Belgium Iraq United Kingdom
Brazil Mexico United States
China Pakistan Venezuela
Colombia South Africa
Dr. H. C. COOMBS (Australia) was elected Chairman of the Sub-
Committee.
3. A number of representatives of delegations who were not
members of the Sub-Committee attended as observers and in
many cases took part in the discussion on particular amendments
for which they were primarily responsible or in which they had
special interest. Representatives of the International Bank for
Reconstruction and Development and of the Food and Agriculture
Organization, as well as the Director of the Fiscal Division of
the Economic Affairs Department of the United Nations gave
their views to the Sub-Committee.
4. The Sub-Committee had held twenty-seven meetings at the
date of approval of this Report. It examined Articles 9, 10 and 11
and all the amendments and proposals submitted to it in connection
with these articles in accordance with paragraphs 1 and 3 of its
terms of reference.1 As a result of its examination the Sub-
Committee decided to recommend:
(i) revised texts of Articles 9, 10 and 11;
(ii) a resolution for adoption by the Conference ;2
(iii) changes in Article 69 [72],3 and
(iv) inclusion of a new Article in Chapter IX.4
It was agreed that the aforementioned recommendations dispos-
ed of all the amendments and proposals submitted.
5. The constitutional provisions of certain Members were
brought to the attention of the Sub-Committee. [These provide
that all controversies which may arise out of contracts in which
the State or one of its sub-divisions are parties are to be resolved
1 As regards the consideration of paragraph 2 of the terms of reference see
Secretariat Note on page 25.
2 See page 76 of the Final Act and Related Documents (ICITO/1/4 or
E/CONF.2/78.)
3 See paragraphs 1 (c) (iii), i (c) (iv), and 1 (f) of Article 72 of the Havana
Charter.
4 See paragraph 2 of Article 72 of the Havana Charter. - 23 -
by national tribunals.]1 It was agreed that these constitutional
requirements are not in conflict with any provisions of the articles
with which the Sub-Committee was concerned and that the Orga-
nization would not in any manner have jurisdiction over facts
resulting from such a situation nor over the decisions of the national
tribunals. The action which the Organization would be able to
take in relation to such cases would be limited to a release or a
diminution of the obligations assumed or concessions granted by
the Member which asserts a nullification or impairment of a benefit
under the Charter, if the Organization finds that the situation
which has been created justifies such action.
6. The representatives of Belgium and the United States
expressed the view that Article 11 did not prevent any government
from taking such action as might be reasonable or justifiable to
protect the savings of its nationals, such action being subject to
review by the Organization. However, the Sub-Committee
considered the text of the article to be clear and., therefore, agreed
unanimously that it was not necessary to include any explanation
in the report.
7. With respect to paragraph 2 of Article 11 the Sub-Com-
mittee took the view that agreements promoted or recommended
for adoption under paragraph 2 of Article 11 would not fall within
paragraph 4 of Article 74 [77].
8. With respect to paragraph 2 (b) of Article 11 the Sub-
Committee took the view that, while it was difficult to be precise
at this stage as to the nature of appropriate measures, more equit-
able and widely spread use of the means to economic development
could be achieved by joint action by Members. It seemed desir-
able, therefore, that it should be made clear that the Organization
had the necessary authority, with due respect to the functions and
activities of other inter-governmental organizations, to make
recommendations for and promote agreements whether bilateral
or multilateral to provide for such joint action, if study of the cir-
cumstances suggested that such a course were desirable. The
Sub-Committee drew attention to the fact that whether any agree-
ments would in fact be concluded was dependent upon the willing-
ness of governments to enter into them and that the scope of such
1 The Committee decided to approve the following two sentences in place of
the sentence in square brackets approved by the Sub-Committee:
" These provide that controversies, which are within the domestic jurisdic-
tion of such states, are to be resolved by national tribunals. In some cases
such controversies may arise in connection with matters dealt with in Article 11." - 24 -
agreements would be dependent upon the discretion of the govern-
ments concerned. The Sub-Committee felt that the proposed
paragraph 2 (b) would enable the Organization to make recom-
mendations and promote agreements to assist countries encounter-
ing difficulties as a result of actual or prospective shortages. The
Sub-Committee considered that:
(a) the promotion of an agreement to facilitate an equitable
distribution of skills, arts, technology, materials and equip-
ment, was not restricted by the use to which these facilities
were put, i.e. if these facilities were essential to established
industries as well as to economic development, the Orga-
nization could recommend an agreement in appropriate
circumstances;
(b) without presuming to judge whether such action would in
fact be desirable, the text approved would permit the
Organization, if it believed that speculation was affecting
the equitable distribution of the facilities referred to in
paragraph 1 and it judged that such action was relevant
and appropriate, to recommend and promote agreements
between governments providing for measures against
speculation;
(c) the authority granted to the Organization to make recom-
mendations and promote agreements designed to facilitate
an equitable distribution of skills, arts, technology, materials,
and equipment would enlarge the scope of the co-operation
and the assistance which the Organization could give to
Members in accordance with Article 10 and would be of
assistance to countries which were having difficulties in
obtaining the capital goods, equipment and materials
which they required;
(d) "industrial patents " were included in the term " techno-
logy ".
9. With reference to the text recommended to be included in
Chapter IX as a new article, the Sub-Committee noted that this
text would be acceptable to the Italian delegation in disposing of
the new article proposed by it to be inserted between Articles 69
and 70 of the Geneva draft 1 and the amendment submitted by
that delegation to Article 81 of the Geneva draft 2. The Sub-
1 E/CONF.2/C.6/12, page 4.
2 E/CONF.2/C.6/12, page 13. - 25 -
Committee agreed that this text would require the Organization
in cases where the economic circumstances of Members were
relevant, to give consideration to all of the factors affecting those
economic circumstances. Among such factors might be the degree
of assistance extended to a Member by other Members or by
existing inter-governmental organizations.
Note: The Committee approved the following paragraphs with
regards to the deletion of paragraph 4 of Article 11of the Geneva
draft:
" In connection with the deletion of paragraph 4 of Article 11
of the Geneva Draft Charter it was pointed out that the paragraph
merely stated that the term ' nationals' as used in that Article
and in Article 12 comprised natural and legal persons. However,
certain delegations called the attention of the Committee to
provisions in their constitutions requiring certain types of
activities to be carried on by legal entities incorporated under
their domestic laws and also affecting the rights of persons
holding shares of such entities. It was further suggested by
certain delegations that the problem of the determination of the
nationality of legal entities was very complicated and raised
many questions of international law.
" The deletion is to be taken as reflecting only the view of
the Committee that the constitutional provisions referred to are
not prejudiced and are outside the scope of the Charter, though
in their opinion this does not affect the construction of the
term ' nationals' as used in Articles 11 and 12, without prejudice
to such provisions, as including both legal and natural persons.
The Committee also considered that the problem of the nationality
of legal entities was not raised by the paragraph or by its dele-
tion."
The following is the Note by the Secretariat 1 with regard to the
Action of the Joint Sub-Committee
as Regards Paragraph 2 of its Terms of Reference.
1. The Mexican proposal for the insertion of a new Section D bis
-Committee for Economic Development-in Chapter VIII3 was
referred by Committee VI to the Joint Sub-Committee of Com-
mittees II and VI in accordance with the terms of reference.
2. This proposal was considered by the Joint Sub-Committee and
a Working Party was set up to examine the proposal. However,
in view of the connection between the Mexican proposal for the
establishment of a Committee for Economic Development and the
proposal with regard to the establishment of a Tariff Committee
these questions were considered by a Joint meeting of Sub-Com-
mittee A of Committee III, of Sub-Committee D of Committee VI
and of the Joint Sub-Committee of Committees II and VI held on
3 February 1948 which considered suggestions of the Mexican,
Australian, United States and Pakistan delegations 2 and set up
1 E,/CONF.2/C.2/36/Add.1, E/CONF.2/C.6/72/Add.1.
2 E/CONF.2/C.2/6/Add.17, E/CONF.2/C.6/2/Add.18 and E/CONF.2/C.6/12,
pages 11, 12 and 13.
3 E/CONF.2/W.15 and E/CONF.2/W.15/Add.1. -- 26 -
a Working Party representing the three Sub-Committees. This
Working Party reached provisional agreement. At that stage, the
Co-ordinating Committee, which was considering a number of
unresolved issues affecting economic development, decided that the
questions before the Working Party should be transferred to it.
After consultation with the Chairmen of the Sub-Committees
concerned, the questions were so transferred 1. As no changes in
the text of the Charter were indicated. by the Co-ordinating Com-
mittee, no further action was required by the Joint Sub-Committee
of Committees II and VI 2 and the Report of the Joint Sub-Com-
mittee on Articles 9, 10 and 11 is its final Report. In view of the
agreement reached by the Heads of Delegations with regard to the
suppression of the proposed Tariff Committee and other related
matters, the Mexican delegation agreed that no further action was
required on its proposal.
PART III
SUB-COMMITTEE B OF THE SECOND COMMITTEE ON ARTICLE 12
The following is the Report 3 of Sub-Committee .3 on Article 12
considered by the Committee at. its seventeenth, eighteenth and
nineteenth meetings, together with the modifications made by the
latter.
1. At its thirteenth meeting Committee 11 appointed a Sub-
Committee to consider Article 12 and the amendments submitted
thereto. The Sub-Committee consisted of the delegates of Aus-
tralia, Brazil, Canada, Ceylon, Czechoslovakia, Egypt, India,
Mexico, Netherlands, New Zealand, Sweden, United Kingdom,
United States of America and Venezuela.
Mr. Jose GARRIDO TORRES (Brazil) was elected Chairman of the
Sub-Committee
2. The Sub-Committee held seven meetings and agreed on a
text of Article 12. In the course of the discussion of Article 12
certain members of the Sub-Committee withdrew their proposed
amendments. The Sub-Committee considered that the amend-
ments not so disposed of were either taken into account or disposed
of by the text of Article 12. The Sub-Committee also considered
that certain amendments relating to the provision of capital on
reasonable terms by capital-exporting countries were met to a
reasonable extent by the provisions of Article 11. It was considered
1 The Report of the Co-ordinating Committee on this matter is contained in
Annex 3 of E/CONF.2/45/Rev.1 and the recommendations thereon of the Heads
of Delegations in E/CONF.2/51 (see page 126 et seq.) of the present Reports.
2 E/CONF.2/58.
3 E/CONF.2/C.2/29. - 27 -
that the Chilean amendment relating to adequate participation
of nationals of a capital-importing country in the financing, mana-
gement, and administration of enterprises referred to in paragraph 3
of Article 12 was covered to the extent appropriate in the text of
Article 12.
3. In the course of considering Article 12 the Sub-Committee
agreed on several interpretations of the Article as follows:
[(a) The requirements referred to in paragraph 1, sub-paragraph (c)
(iv) of the Havana Charter may, provided they are reasonable,
relate either to foreign investments only or to investments
generally.
(b) Legislative or constitutional requirements, existing at the time
that an investment is made and providing for recourse only to
national courts, would not in themselves be reviewable pursuant
to Chapter VIII. Chapter VIII provides for review by the
Organization of whether nullification or impairment of a benefit
accruing to a Member under the Charter has taken place, even if
the nullification or impairment arises out of a measure com-
pletely consistent with the Charter, or " any other situation ",
even if there is no violation of the Charter, and without
involving the power of the Organization to pass or judge upon
the validity of the measure itself taken by a Member, or of a
decision taken by a Member's national courts.
(c) The Articles of Agreement of the International. Monetary Fund
are included among the international agreements referred to
in paragraph 2, sub-paragraph (b) of the Havana Charter.] 1
4. The Indian delegation reserved its position on paragraph 2
of the text of Article 12 of the Havana Charter, pending instructions
from its Government.2
1 The Committee approved the following text in place of sub-paragraphs (a),
(b) and (c) of paragraph 3:
" (a) legislative or constitutional requirements, existing at the time that an
investment was made and providing for recourse only to national courts,
would not in themselves be reviewable pursuant to Chapter VIII. Chap-
ter VIII provides for review by the Organization of whether nullification
or impairment of a benefit accruing to a Member under the Charter has
taken place, even if the nullification or impairement arose out of a measure
completely consistent with the Charter, or " any other situation ", even
if there was no violation of the Charter, but without involving the power
of the Organization to pass or judge upon the validity of the measure itself
taken by a Member, or of a decision taken by a Member's national courts;
and
" (b) the Articles of Agreement of the International Monetary Fund were
included among the international agreements referred to in paragraphs 1 (c)
and 2 (b) of the text of the Havana Charter."
2 This reservation was subsequently withdrawn. - 28 -
PART IV
SUB-COMMITTEE C OF THE SECOND COMMITTEE ON
ARTICLES 13 AND 14
The following is the Report 1 of Sub-Committee C on Articles 13
and 14 considered by Committee II at its twenty-third and
twenty-fourth meetings, together with the modifications made by
the latter.
1. Sub-Committee C was appointed at the sixteenth meeting
of Committee II with terms of reference as follows:
" To examine and submit recommendations to Committee II
concerning the proposals on Articles 13 and 14 with authority
to consult, if considered necessary, with the Sub-Committee of
Committee III on Articles 20 and 22."
2. The Sub-Committee was composed of representatives of:
Argentina China Iraq Philippines
Australia Colombia Mexico United Kingdom
Brazil Cuba Netherlands United States
Canada India Norway Uruguay
Dr. Gustavo GUTIERREZ (Cuba) was elected Chairman of the
Sub-Committee.
3. A number of representatives of delegations who were not
members of the Sub-Committee attended as observers and in many
cases took part in the discussion on particular amendments for
which they were primarily responsible or in which they had a
special interest.
4. The Sub-Committee held fourteen meetings. It examined
Articles 13 and 14 and the amendments submitted thereto. The
delegation of Brazil submitted two working papers, which redrafted
paragraphs 2 to 5 inclusive of the Geneva draft of Article 13.
These were adopted as the basis for discussion. After the Sub-
Committee had almost completed its work on Article 13 and the
amendments submitted thereto, the Article was also examined by
the Co-ordinating Committee. The Sub-Committee took into
account the text submitted by the Co-ordinating Committee 2 in
accordance with the recommendations of the Heads of Delegations3.
1 E/CONF.2/C.2/41.
2 E/CONF.2/45/Rev.1.
3 E/CONF.2/51. - 29 --
As a result the Sub-Committee recommended texts of Articles 13
and 14. It was agreed that these recommended texts disposed
of all the amendments submitted.
5. The Sub-Committee considered the amendment of Cuba to
insert the word " maintenance " and the amendment of New
Zealand to insert the word " maintain " in paragraph 1 of Article 13
and the amendments arising as a consequence thereof and expressed
the view that the amendments were already covered in the texts
proposed. It was agreed that the word " development ", as used
in Article 13, might cover cases in which the branch of industry
or agriculture to be developed had been established before the date
of the Member's application to the Organization.
6. The Sub-Committee considered it desirable to record that
paragraph 7 (a) (ii) of Article 13 of the Havana Charter as originally
submitted to the Co-ordinating Committee ended with the words
" reduced as a result of new or increased restrictions imposed by
some other government or governments ".
7. [With regard to the meaning of the word " processing"
appearing in paragraphs 7 (a) (ii) and 7 (a) (iii) of Article 13 of the
Havana Charter, it was agreed that processing meant the trans-
formation of a primary commodity into semi-finished or finished
goods but did not refer to highly developed industrial processes
such as the manufacture of precision instruments.]1
8. [With regard to the reference to international trade at the
end of paragraph 7 (a) (ii) of Article 13 of the Havana Charter it
was agreed that this was a reference to international trade in
general and not to trade in the specific product to which the measure
in question related.] 2
1 The Committee approved the deletion of this paragraph and its substitution
by the following:
With regard to the meaning of the word ' processing' appearing in para-
graphs 7 (a) (ii) and (iii) of Article 13 of the Havana Charter consideration was
given to the view of the Co-ordinating Committee and the proposal of the
delegation of Pakistan. It was agreed that processing meant the transformation
of a primary commodity or of a by-product of such transformation into semi-
finished or finished goods but did not refer to highly developed industrial
processes such as the manufacture of precision instruments. Accordingly it was
decided to insert the interpretative note set out in the Havana Charter."
2 The Committee approved the deletion of this paragraph and its substitution
by the following:
" With regard to the references to international trade in paragraphs 7 (a) (iii)
and 8 (b) (ii) of Article 13 of the Havana Charter it was agreed that these were
references to international trade in general and not to trade in the specific
product to which the measure in question related." - 30 -
9. [With regard to the interpretation of the words " materially
affected" in paragraphs 5 and 8 of Article 13 of the Havana
Charter, it was agreed that this term was not restricted to those
countries which in the past were the principal suppliers and that it
would be proper for the Organization to have regard, for instance,
to the interests of those Members which supplied a large proportion
of the imports of the applicant Member in the product concerned,
those Members which were substantially interested in exporting
the product to world markets, and those Members whose economies
were materially dependent on exports of the product.] 1
10. With regard to paragraph 9 of Article 13 of the Havana
Charter the Sub-Committee agreed that the powers of the Orga-
nization under Article 13 were vested in the Conference in accord-
ance with paragraph 1 of Article 74 [77] and that it would be for
the Conference under the provisions of paragraph 2 of Article 74 [77]
to assign any of these functions to the Executive Board. At that
time the Conference would determine the extent and conditions of
appeal to the Conference from any decision of the Executive Board
and the circumstances in which appeals could be made. The
Sub-Committee further agreed that the phrase " pending a decision
by the Organization " should refer to the final decision, which would
be taken by the Conference in the event of previous adverse deci-
sions being followed by an appeal to the Conference by the applicant
Member.
11. It was agreed that the proviso at the end of paragraph 9
of Article 13 of the Havana Charter would permit a Member to
prohibit entirely or reduce the imports of a product to the extent
needed to ensure that, over the whole period following the increase
in imports referred to in that paragraph, that product was not
imported at a rate greater than in the most recent representative
period proceding the date of notification.
1 The Committee approved the deletion of this paragraph and its substitution
by the following:
" With regard to the interpretation of the words ' materially affected'
in Article 13 of the Havana Charter it was agreed that this term was not
restricted to those countries which in the past were principal suppliers. With
regard to the use of these words in sub-paragraph 3 (b) it was assumed that the
Organization would have due regard to the contractual rights of Members.
In interpreting these words in paragraphs 5 and 8, it would be proper for the
Organization to have regard, for instance, to the interests of Members which
supplied a large proportion of the imports of the applicant Member in the
product concerned, those Members which were substantially interested in
exporting the product to world markets, and those Members whose economies
were materially dependent on exports of the product." - 31 -
12. With regard to paragraph 10 of Article 13 of the Havana
Charter it was agreed that the date cited therein by which the
applicant Member would be notified whether or not it would be
released from its obligations should be the date on which the
competent organ of first jurisdiction would give its ruling. It was
also noted that paragraph 2 of Article 73 [76] permitted the Con-
ference to establish rules of procedure appropriate for the carrying
out of its functions during the intervals between its sessions, e.g.
voting by cable or airmail.
13. In connection with Article 14 the attention of the Sub-
Committee was invited to the possibility that in certain special
circumstances beyond their control some signatories to the Final
Act of the Second Session of the Preparatory Committee of the
United Nations Conference on Trade and Employment may find
themselves unable for some time to apply the provisions of the
General Agreement on Tariffs and Trade. The Sub-Committee
noted that an application could be made to the Contracting Parties
for an amendment to that Agreement to meet these cases. If the
amendment were accepted, it would then be possible for the Contract-
ing Parties to consider an application for new dates to be established
and to replace those of 1 September 1947 and 10 October 1947 at
present specified in paragraph 6 of Article XVIII of the Agreement.
In order to prevent any decision under the provisions of such an
amendment, if it were accepted by the Contracting Parties, from
becoming ineffective on the date of entry into force of the Charter
the Sub-Committee agreed to insert the exception appearing at the
end of paragraph 1(a) of Article 14 of the Havana Charter. The
representative of Brazil reserved his position pending a decision
by the Contracting Parties with regard to such an amendment to
the agreement.1
14. The representative of Argentina reserved the position of
his country with respect to Articles 13 and 14.2
1 The Brazilian reservation contained in this sentence was withdrawn at the
twenty-sixth meeting of the Committee.
2 In addition a reservation on Article 13 was made by the representative of
Ceylon at the twenty-third meeting of the Committee. -- 32 -
PART V
JOINT SUB-COMMITTEE OF THE SECOND AND THIRD COMMITTEES
ON TARIFF PREFERENCES
The following is the Report <R>1</R> of the Joint Sub-Committee to
Committee II on Article 15, considered by Committee II at its
twenty-fourth and twenty-fifth meetings, together with the modifica-
tions made by the latter.
1. The Joint Sub-Committee of Committees II and II was
established with the following terms of reference:
" To consider and submit recommendations to both Committees
regarding Articles 15, 16 (2) and (3) ard 42 and the relevant proposals
and amendments submitted in relation thereto with a view to finding
a solution of the question of new preferential arrangements, including
those for purposes of economic development and reconstruction
and of the maintenance of existing preferences as an exception from
the most-favoured-nation clause."
2. The Joint Sub-Committee consisted of representatives of
the following delegations: Argentina, Belgium, Brazil, Canada,
Chile, El Salvador, France, Haiti, Iran, Poland, Sweden, Syria,
Turkey, United Kingdom, United States and Venezuela.
3. Mr. Stig SAHLIN (Sweden) was elected Chairman. At the
eleventh meeting, Mr. Jean ROYER (France) was elected in the
place of Mr. Sahlin who had left Havana.
4. The Sub-Committee held fourteen meetings. At the tenth
meeting, it was decided to set up a Working Party, consisting of
representatives of Belgium, Chile, France, Syria, United Kingdom,
United States and Venezuela. The Working Party held twenty-
nine meetings, under the Chairmanship of Mr. Royer, and reported
to the Sub-Committee.2
5. The Working Party made substantial progress in drafting
a revised text of Article 15. Certain major points of difference were,
however, taken up by the Co-ordinating Committee whose proposals
were endorsed by the Heads of Delegations.3 Acting on the basis
of these recommendations, the Sub-Committee submitted the text
of Article 15. In doing so, it emphasized that in its consideration
of the text received from the Co-ordinatingCommittee, it had confined
itself to matters of drafting and clarification and, in accordance
with the recommendation of Heads of Delegations, had made no
1 E/CONF.2/C.2/42.
2 E/CONF.2/C.2 and 3/A/14.
3 E/CONF.2/45/Rev.1 and E/CONF.2/51. - 33 -
changes of substance. Support of the compromise text by members
of the Sub-Committee did not mean that they entirely agreed
with it, but only that they were willing to approve the text as a
whole in order to reach the general settlement recommended by the
Heads of Delegations.
6. The recommendations of the Sub-Committee in regard to
Articles 16 and 42 [16, 42, 43 and 44] are contained in its Report
to Committee III.
7. Paragraphs 8 to 20 of this Report contain a brief statement
on the main changes in the text of Article 15 of the Geneva draft
and on the manner in which the Sub-Committee dealt with the
proposed amendments.
8. The main change in Article 15, originating in a proposal by
the Polish delegate, was the introduction of specific " conditions
and requirements " relating to proposed new preferential agree-
ments. If the Organization finds that a proposed agreement fulfils
these conditions and requirements, its approval of it will in effect
be automatic, provided only that the Organization also finds that
the agreement is unlikely to injure substantially the external trade
of Members not parties to it; moreover, even if substantial injury
is found to be likely, provision is made for negotiation and com-
pensation, so that under certain specified conditions the Orga-
nization shall nevertheless approve the agreement. As a result
of this elaboration of Article 15, it was possible to confine the more
stringent procedure of prior approval as set out in the second sen-
tence of paragraph 1 of the Geneva draft to new preferential
agreements which do not conform to the above-mentioned condi-
tions and requirements. It was felt that the introduction of a
procedure for automatic approval partly covered proposals by
Chile and Venezuela. The delegation of Brazil withdrew its
reservation on condition that the recommendations of the Heads
of Delegations were accepted as a whole. Proposals by Argentina
relating to the powers of the Organization were not accepted, and
the delegation of Argentina reserved its position as it considered
that sovereign powers should not be placed in the hands of an
international organization. The delegations of Haiti and Turkey
reserved their positions on the whole Article [pending decisions on
Article 16].1 The delegation of Chile maintained the reservation
1 On approval by the Committee it was agreed that the words " pending
decisions on Article 16 "should be deleted. The reservation of Haiti was withdrawn
at the eighteenth plenary meeting. - 34 -
with respect to the whole Article which it had put on record at the
meeting of Heads of Delegations.
9. Paragraph 1 of Article 15 of the Havana Charter consists
only of the first sentence of paragraph 1 in the Geneva draft, which
remains substantially unchanged. An interpretative note has been
added to make it clear that the special circumstances mentioned
are those referred to in the Article itself.
10. Paragraph 2 of Article 15 of the Havana Charter, regarding
notification, is substantially the same as the first sentence of
paragraph 2 in the Geneva draft.
11. Paragraph 3 of Article 15 of the Havana Charter contains
the substance of the second sentence of paragraph 1 of the Geneva
draft, but now in effect applies only to new preferential agreements
which do not fulfil the conditions and requirements of paragraph 4.
Proposals by Argentina, Chile and Venezuela to delete this sentence
in the Geneva draft were not accepted.
12. Paragraph 4 of Article 15 of the Havana Charter is entirely
new, and states the conditions and requirements determining the
Organization's approval of a proposed new preferential agreement.
It is thought that these new provisions go some way to meet the
proposal by Chile for a new paragraph designed to permit prefer-
ential arrangements between adjacent underdeveloped countries.
13. A proposal was considered to delete the words " between
Members " from the preamble to paragraph 4 of Article 15, it being
argued that this limitation had been introduced without adequate
discussion. It was the view of the Sub-Committee, however, that
the words should remain. [The delegates of Argentina, Chile,
Poland, Syria and Venezuela wished it put on record that in their
view no final decision should be taken on this point until a definitive
text of Article 93 [98] was available, and the delegate of Argentina
reserved his position.] 1
14. The delegate of the United Kingdom entered a formal
reservation on paragraph 4 (a) of Article 15 of the Havana Charter
and the interpretative note pending instructions from his
Government.2R>
1 The Committee approved paragraph 13 of this Report with the deletion of
the last sentence and its substitution by the following:
" The Delegate of Syria wished it put on record that, in the light of the
definitive text of Article 93 [98], he was still opposed to their inclusion."
2 This reservation was withdrawn at the twentieth plenary meeting. - 35 --
15. [The delegate of Poland presented an amendment to
paragraph 4 (d) of Article 15 of the Havana Charter designed to
permit compensatory tariff preferences on products not conforming
to the development and reconstruction criteria of paragraph 4 (b),
subject to progressive elimination and limits as to duration and
margins of preference. The Sub-Committee could accept neither
this proposal nor an alternative proposal by the delegate of
Argentina to insert a text previously discussed by the Working
Party. The delegates of Argentina, Chile and Poland asked for
their view to be recorded that rejection of these proposals would
make the introduction of new preferential arrangements very
difficult, if not impossible.] 1
16. Paragraph 5 of Article 15 of the Havana Charter is a new
provision by which the Organization may require a reduction in
an unbound most-favoured-nation rate of duty on a product
covered by a proposed preferential agreement, if, on appeal by an
affected Member, it considers the rate to be excessive. [A number
of delegates would have preferred greater clarity in this paragraph,
but, taking into account the recommendations of the Heads of
Delegations, the Sub-Committee was unable to draft a clearer
text which would have been acceptable to all its members.] 2
17. Paragraph 6 of Article 15 of the Havana Charter provides
for approval by the Organization within two months if it finds that
an agreement fulfils the conditions of paragraph 4 of the Havana
Charter and would not injure substantially the external trade of
other Members. Moreover, conditions are laid down in regard to
compensation for injured Members, etc.
1 The Committee approved the following in substitution of the text of para-
graph 15 of the Report of the Sub-Committee.
" The Polish delegation presented an amendment designed to permit
temporarily compensatory preferences on products not conforming to the
development and reconstruction criteria of paragraph 4 (b) of the Havana
Charter and subject to progressive elimination and limits as to duration and
margins of preference. The amendment was not accepted. The Polish
delegation asked for its view to be recorded that paragraph 4 (d) of Article 15
of the Havna Charter concerning preferential concessions nullified to a large
extent the advantages of paragraphs 4, 5 and 6 of the Havana text and
made the introduction of new preferential arrangements very difficult if not
impossible. An alternative proposal by the delegate of Argentina to insert
a text previously discussed by the Working Party was also rejected. The
delegates of Argentina and Chile asked for it to be recorded that they were in
general agreement with the views expressed by the delegate of Poland in this
matter."
2 The Committee aproved paragraph 16 of this Report with the deletion of
the second sentence. - 36 -
18. In regard to the compensation provided for in para-
graph 6 (b) of Article 15 of the Havana Charter, it was understood
that this might be of either a negative or positive character; that
is to say, the Organization might, in appropriate circumstances,
allow compensation to take the form of withdrawal of concessions
by an injured Member, and not merely the establishment of new
concessions in favour of the latter.
19. Provision was made regarding existing agreements, such
as those deriving from the Treaty of Lausanne, entitling Members
to depart from most-favoured-nation treatment for the purpose of
establishing regional preferences. An interpretative note was also
added in regard to rights to conclude preferential agreements which
may have been recognized in respect of mandated territories which
became independent before 21 November 1947.
20. In regard to paragraph 6 (d) of Article 15 of the Havana
Charter, the delegate of Iraq (not a member of the Sub-Committee)
proposed that the provision relating to substantial injury should
be limited to Members which, in their most-favoured-nation treaties
with the parties to the agreement, have not recognized the right
in question to depart from most-favoured-nation treatment.
[The sense of the Sub-Committee was against this proposal, there-
fore the delegates of Iraq and Syria reserved their right to reopen
the question in Committee.] 1 The word " procedure " agreed by
the Co-ordinating Committee in the last sentence of this sub-
paragraph was changed to " provisions " in order to make it
clear that sub-paragraph (d) was not subject to the provisions of
sub-paragraph (c).
Note: The reservations on Article 15 made or maintained at the
time of approval of the Report of the Sub-Committee by Committee II
at its twenty-fourth meeting were as follows:
Afghanistan Haiti
Argentina Iraq (on paragraph 6 (d))
Chile Turkey
China United Kingdom (on paragraph 4 (a) and on the
interpretative note thereto)
The reservation of Afghanistan was withdrawn at the twenty-fifth
meeting of Committee II. The reservations of China, Haiti and
the United Kingdom were withdrawn at the nineteenth, eighteenth
and twentieth plenary meetings respectively. The reservation of
Turkey was also withdrawn (E/CONF.2/76).
There therefore remained at the end of the Conference reserva-
tions by Argentina, Chile and Iraq.
1 The Committee approved paragraph 20 of the Report with the substitution
of the following for the second sentence:
" The sense of the Sub-Committee was against this proposal." 37
PART VI
SUB-COMMITTEE D OF THE SECOND COMMITTEE ON FOOTNOTE
TO CHAPTER III OF THE GENEVA DRAFT ON RECONSTRUCTION
The following is the Report 1 of Sub-Committee D on the footnote
to Chapter III of the Geneva draft on " Reconstruction " considered
at the twentieth and twenty-second meetings of Committee II and
approved without modification and with endorsement of the recom-
mendation that reconstruction and development should be treated
on equal terms.
1. At the sixteenth meeting of Committee II the Chairman
appointed a Sub-Committee composed of representatives of
Australia, El Salvador, France, Mexico, Poland and. the United
Kingdom with terms of reference as follows:
" To examine and submit recommendations concerning the footnote
to Chapter III on " reconstruction " appearing at the bottom of
page 12 of the Draft Charter".
2. The Sub-Committee held three meetings on 3, 13 and
28 January 1948. Mr. C. NOVOA (Mexico) was appointed Chairman.
3. While the Sub-Committee agreed that there was a difference
between reconstruction and development, they also agreed that
for the purpose of the provisions of Chapter III reconstruction and
development should be treated on equal arms. It was accordingly
agreed to recommend the following changes in Article 8 and in
paragraphs 2 and 3 of Article 10 of the Geneva draft as amended
by the Sub-Committees concerned. In the text below the words
in italics are those recommended by the Sub-Committee:
Article 8.
" The Members recognize that .and that the
industrial and general economic development of all countries,
and particularly of those in Which resources are as yet relatively
undeveloped, together with the reconstruction of those countries
whose economies have been devastated by war, will improve
opportunities . . . . . "
Article 10, paragraph 2.
" With a view to facilitating and promoting industrial and
general economic development and consequently higher
standards of living, especially of those countries which are
1 E/CONF.2/C.2/35. -38 -
still relatively undeveloped, together with the reconstruction of
those countries whose economies have been devastated by war, and
subject to any arrangements.
Article 10, paragraph 3.
" With a view to facilitating and promoting industrial and
general economic development especially of those countries
which are still relatively undeveloped, together with the recons-
truction of those countries whose economies have been devastated
by war, the Organization shall .... ."
With respect to other parts of Chapter III it was agreed to
recommend that the Central Drafting Committee be asked to
include at the appropriate places such references to reconstruction
as will result in the treatment of reconstruction and development
on equal terms.
Note: The Central Drafting Committee made recommendations
for the inclusion of appropriate references to reconstruction in
Chapter III and these were incorporated in the Havana Charter. II. REPORTS RELATING TO THE
THIRD COMMITTEE
COMMERCIAL POLICY
This section contains the following documents relating to the
work of the Third Committee:
(i) Report of the Third Committee.
(ii) Report of the Joint Sub-Committee of the Second and
Third Committees on Articles 16 and 42 [16, 42, 43 and 44].
(iii) Report of Sub-Committee A on Articles 16, 17, 18 and 19.
(iv) Report of Sub-Committee B on proposed new Article 18 A.
(v) Report of Sub-Committee C on Articles 32-39-
(vi) Report of Sub-Committee D on Articles 40, 43
(40, 41 and 45].
(vii) Report of Sub-Committee E on Articles 20 and 22.
(viii) Report of Sub-Committee F on Articles 21, 23 and 24.
(ix) Report of Sub-Committee G on the Swiss Proposal.
(x) Report of Sub-Committee H on Articles 25-29 [25-28].
(xi) Report of Sub-Committee J on Articles 30 and 31 [29-32].
REPORT OF THE THIRD COMMITTEE:
COMMERCIAL POLICY1
The Third Committee was responsible for the examination of
the Geneva draft text of Chapter IV and related matters.
The Honourable L. D. WILGRESS (Canada) was unanimously
elected Chairman, and Mr. Walter MULLER (Chile) was elected
Vice-Chairman, but it was learned that Mr. Muller would be
unable to accept office and Mr. E. PUIG AROSEMENA (Ecuador)
was then appointed in his stead. Later Mr. E. Puig Arosemena
returned to Ecuador and on1i8 December Mr. LLKIAS RESTREPO
(Colombia) was elected Vice-Chairman.
The first reading of the Chapter and the preliminary discussion
of the amendments proposed by delegations continued up to and
including the twenty-eighth meeting on 8 January. During the
I E/CONF.2/70. - 40 -
first reading of the six sections of the Chapter, ten Sub-Committees
wee appointed including a Joint Sub-Committee with Committee II
on Tariff Preferences.
The second reading of the Chapter and consideration of the
Sub- Committee reports began at the thirtieth meeting on 31 January
and were completed at the forty-seventh meeting on 17 March.
All of the Sub-Committee reports were approved in full, subject
to a few changes in the text of the articles as noted in this Report.
SUMMARY OF SUB-COMMITTEE REPORTS
Joint Sub-Committee of the Second and Third Committees
on Tariff Preferences (Articles 16 and 42 [16, 42, 43 and 44]).
1. The Joint Sub-Committee, in its study of Articles 15, 16 and 42
[15, 16, 42, 43 and 44] and in its examination of the amendments pro-
posed by delegations, took into account most of the problems which
arise from exceptions to the most-favoured-nation clause for the establish-
ment of tariff preferences. The detailed examination of the amendments
was consigned to a Working Party which held twenty-nine meetings.
2. With regard to Article 15, a Report was submitted by the Joint
Sub-Committee to the Second Committee (see Part V of the Report of
that Committee on pages 32-36.
3. With respect to Articles 16 and 42 [16, 42, 43 and 44], the
Sub-Committee's Report was submitted to Committee III. The changes
proposed in Article 16 were accepted without much discussion and the
Committee also approved the request of the delegation of Turkey for the
insertion of a paragraph providing for preferences established under
Article 15 between countries belonging to the Ottoman Empire prior
to 1923, and the request of Venezuela for exemption for a period
of five years for special surcharges levied on products imported via
certain territories.
4. Committee III adopted the recommendation that Article 42
should be devided into three Articles dealing separately with the Territo-
rial Application of Chapter IV, Frontier Traffic, and Customs Unions and
Free-Trade Areas. The first of these three Articles was amended by a
Working Party prior to final approval.1 The recommendation of the
Sub-Committee extending the third to cover free-trade areas as well as
customs union's was accepted, but the Committee decided to preface the
first paragraph with a statement recognizing the desirability of increasing
freedom of trade by the development of close integration between
national economies through voluntary agreements.
Sub-Committee A of the Third Committee on Tariff Negotiations,
Internal Taxation and Regulation (Articles 16 to 19).
5. In Article 16 two paragraphs were added: (1) to bring into the
text of the Article, from two of the Annexes, a provision relating to the
imposition of a margin of tariff preference to compensate for the elimina-
1 E/CONF.2/C.3/87. - 41 -
tion of a margin of preference in an internal tax, and (2) to give recog-
nition to the principle that tariff descriptions based on distinctive
regional or geographical names should not be used in such a manner
as to discriminate against products of Member countries. Committee III
decided to transfer the second new paragraph to Article 35 [36]. Further,
an interpretative note defining the term " margin of preference " was
appended to Article 16 as had been done in the corresponding Article of
the General Agreement on Tariffs and Trade. In Annex A the Sub-
Committee altered the provisions for the elimination, or replacement by
tariff preferences, of certain preferential quota arrangements between the
United Kingdom and Canada, Australia and New Zealand on the trade
in meat.
6. In Article 17, the rules for the conduct of tariff negotiations
between Members were extended and clarified. Paragraph 2 [4],
relating to the failure of a Member to carry out negotiations, was revised
by the Sub-Committee, and Committee III added " reconstruction
to the specified needs of Members to be taken into account along with
other relevant circumstances by the Organization in judging the justifica-
tion for a failure to carry out negotiations. This paragraph was further
amended by the Co-ordinating Committee of the Conference in conjunc-
tion with the over-all settlement of issues on economic development
which included also the decision that the Charter should not provide
for the establishment of a Tariff Committee. This involved the deletion
of the relevant paragraph (3 of Geneva draft). The Sub-Committee
added two interpretative notes to Article 17: the first provides that an
internal tax, applied to a product which is not produced domestically,
shall be treated as a. customs duty in certain circumstances; and the
second provides that the effects of the devaluation of a Member's
currency or of a rise in prices would be a matter for consideration
during tariff negotiations.
7. Article 18, which deals with national treatment on internal
taxation and regulations, was extensively revised and clarified, but the
general principle that internal taxes and regulations should not be
applied in such a manner as to afford protection to domestic production
was preserved. During consideration of the Sub-Committee's. Report
certain delegations suggested that a special exception would be warranted
for certain discriminatory internal taxes, and a Working Party was
appointed to review the problem once more. The Report 1 of the
Working Party contained no definite recommendations; it was discussed
at the forty-second meeting of the Committee on 8 March but it was
found that there was no substantial support for any change in the text.
Sub-Committee B of the Third Committee on
Discrimination in Shipping and Insurance Services
(Proposed Article 18 A).
8. The Sub-Committee concluded that it was desirable to avoid an
overlapping of functions and a possible conflict of activities between the
International Trade Organization and the Inter-Governmental Maritime
Consultative Organization and that therefore questions of shipping
should not be dealt with in the Havana Charter. Accordingly, the
Sub-Committee recommended that Article 18 A should not be adopted
and that Committee IV be asked to amend Article 50 [53] to take into
1 E/CONF.2/C.3/71. - 42 -
account the considerations mentioned above. The Committee decided
to recommend to Committee IV that a satisfactory solution be sought for
the relation of shipping services to Chapter V in order to avoid conflict
with the IMCO. Committee IV inserted an interpretative note to
Article 50 [53] stipulating that the provisions of that Article would not
apply to matters relating to shipping services which are subject to the
Charter of the IMCO. In the light of the action taken by Committee IV,
Committee III decided at the forty-sixth meeting to adopt the first of the
Sub-Committee's recommendations, rejecting Article 18 A.
Sub-Committee C of the Third Committee on General Commercial Provisions
(Articles 32 to 39 [33 to 39]).
9. The amendments introduced by the Sub-Committee include:
(i) In Article 33 [34], the insertion of a statement recognizing that
dumping is to be condemned if it causes or threatens material
injury to an established industry in a Member country or
materially retards the establishment of a domestic industry;
(ii) The insertion of an additional interpretative note on para-
graph 3 of Article 34 [35] allowing Members to continue in
certain circumstances existing systems of applying ad valorem
rates of duty on the basis of fixes values;
(iii) The addition of a new paragraph to Article 35 [36] giving
recognition to the principle that tariff descriptions based on
distinctive regional or geographical names should not be used
in such a manner as to discriminate against products of Member
countries; and
(iv) The deletion of Article 39 on Boycotts.
10. In the course of discussion in second reading, Committee III
established two Working Parties, whose Reports 1 were approved by
Committee III at the thirty-first and thirty-fourh meetings; the first
involved the insertion of an interpretative note on paragraph 9 [6] of
Article 32 [33] and the second introduced an extension of the Note on
paragraph 3 of Article 34 [35] mentioned under (ii) above. Also the
Committee agreed to the deletion of a paragraph inserted by the Sub-
Committee in Article 32 [33] which provided that transportation
charges on traffic in transit were not to be considered as falling within
the purview of that Article, and added instead an interpretative note
to paragraphs 3, 4and 5 explaining that the wodr " charges in the English
text is not to bedeemed to include transportation charges.
11. At the thirty-sixth meeting, the Committee added a aragraph to
Article 33 [34] dealing with systems for the stabilization of domestic
prices which result at times in the sale of products for export at prices
lower than the comparable prices charged for the like products to buyers
in domestic markets. The paragraph thus added to Article 33 [34] is
similar to a paragraph in the corresponding Article of the General
Agreement on Tariffs and Trade.
Sub-Committee D of the Third Committee on Special Provisions
(Articles 40, 41 and 43 [40, 41 and 45]).
12. Only slight changes in the texts of Articles 40 and 41 were
introduced by the Sub-Committee. In Article 43 [45], two new excep-
1 E/CONF.2/C.3/41 and E/CONF.2/C.3/48. - 43 -
tions to the provisions of Chapter IV were inserted, namely, for measures
necessary to the enforcement of laws and regulations relating to public
safety (a) (ii), and for measures taken in pursuance of inter-governmental
agreements relating to the conservation of fisheries resources, etc., (a) (x).
13. During the second reading by Committee III, two Working
Parties were established; their Reports <R>1</R> were approved at the
thirty-fourth and thirty-fifth meetings. The former introduced an
amendment of the interpretative note to Article 40, dealing with the
non-discriminatory aspect of emergency action on imports of particular
products, while the latter provided that situations developing from the
fulfilment by a Member of its obligations under Article 3 or 9 might
constitute an " unforeseen development " for the purpose of Article 40.
14. The Committee also considered and approved the proposal of the
representatives of Argentina, Ecuador, Guatemala and Uruguay to add
an, interpretative note to Article 41 on the obligations of Members to
supply information on regulations for the protection of human, animal
or plant life or health.
Sub-Committee E of the Third Committee on Quantitative Restrictions
(Articles 20 and 22).
15. The Sub-Committee established nine Working Parties to con-
sider in detail the proposals contained in the Annotated Agenda. In its
Report to Committee III, the Sub-Committee recommended a few
changes in the text of the Articles and the addition of several inter-
pretative notes explaining and clarifying certain passages of the text.
16. In Article 20, the Sub-Committee inserted two sub-paragraphs.
The first (paragraph (3) (a)) provides that import restrictions on agricul-
tural or fisheries products, applied in connection with the enforcement of
governmental measures of control on domestic production or marketing,
shall be applied only so long as those measures are in force and shall not
operate in such a way as to prevent imports in quantities sufficient to
satisfy demand for current consumption during times of the year when
domestic supplies are not available. The second (paragraph (3)(b) )
requires that notice in writing of an intention to introduce import
restrictions on agricultural or fisheries products shall be given to the
Organization and to Members having a substantial interest in supplying
the products concerned with a view to the holding of prior consultations.
17. In Article 22, a sub-paragraph was inserted providing that
the Organization may release delete Members from the obligation of giving
public notice of the total quantity or value of quotas when the interests
of the Member concerned would be prejudiced by reason of the fact that
a large part of the imports of the products affected are supplied by
non-Members.
Sub-Committee F of the Third Committee on
Restrictions to Safeguard Balance of Payments (Articles 21 23 and 24).
18. The main change introduced by the Sub-Committee in Article 21
was the insertion of a paragraph stating that it is primarily the
responsibility of each Member to safeguard its external financial position
and to achieve and maintain stable equilibrium in its balance of pay-
ments, that the Organization should promote consultations and action
i E/CONF.2/C.3/49 and E/CONF.2/C.3/52. - 44 -
for the purpose of correcting maladjustments in the balance of payments,
and that the methods employed by Members to restore equilibrium
should be those which will expand rather than contract international
trade. This new paragraph and the other changes proposed by the Sub-
Committee in Article 21 were adopted by Committee III.
10. The revision of Article 23 proved the most difficult part of the
Sub-Committee's work. The Working Party on this Article held
meetings regularly from 17 January until 15 March and eventually
agreed to recommend a substantially new text. It was evident, how-
ever, that the revised provisions governing the exceptions to the rule of
non-discrimination might not meet the needs of all Members during the
difficult transitional years which still lie ahead, and therefore the prin-
ciples of the original Geneva draft were retained in an Annex. It has
been laid down that a Member which, before 1 July 1948, provisionally
accepts the principles of paragraph 1 of Article 23 of the Geneva text
by its signature of the Protocol of Provisional Application to the General
Agreement on Tariffs and Trade, may elect, prior to the end of 1948,
to operate during the transitional period under the provisions of the
Annex.
20. Article 23 itself defines the exceptions to the rule of non-
discrimination permissible during the post-war transitional period.
This transitional period and its application in respect of individual
Members are defined by reference to the Articles of Agreement of the
International Monetary Fund. The discriminatory measures, including
adaptations thereof, permitted under paragraph 1 of Article 23 may be
applied by a Member during the transitional period without the prior
approval of the Organization. , After the termination of the transitional
period for a Member provision is made for limited departures from the rule
of non-discrimination with the prior approval of the Organization.
21. The title of Article 24 was altered to read " Relationship with the
International Monetary Fund and Exchange Arrangements ". A
drafting change was made in paragraph 2 while other changes were made
in paragraphs 6 and 8 (formerly 9) of the Article.
22. The Sub-Committee recommended a change in the title of
Section B to read " Quantitative Restrictions and Related Exchange
Matters ". This was approved by the Committee.
Sub-Committee G of the Third Committee on the Swiss Proposal
(Proposed New Article in Section B).
23. The Sub-Committee based its enquiries on the assumption
that the Member concerned was not eligible to impose quantitative
restrictions under Article 21 but was liable to suffer damage from
restrictions imposed by other Members under that Article. A variety
of factors were discussed by the Sub-Committee as possibly justifying
special measures and while no single factor was judged to be sufficient
by itself to justify special treatment the Sub-Committee agreed that a
number of factors when taken together might represent a combination of
circumstances requiring special consideration.
24. The Sub-Committee found that the solution proposed by the
delegation of Switzerland would constitute too great a weakening of the
principles of the Charter. However, in view of the recognition of the
special consideration required to be given to the case of Switzerland, the -- 45 -
Sub-Committee recommended that the Conference should direct the
Interim Commission to invite the Swiss Government to participate in a
study of the problems facing the Swiss economy with a view to submitting
to the first Conference of the Organization a report as to the measures
for dealing with the Swiss problem which could be taken in accordance
with the procedures established in the Charter.
25. The Committee approved this recommendation.
Sub-Committee H of the Third Committee on Subsidies
(Articles 25 to 29 [25 to 28]).
26. A large part of the work of the Sub-Committee was performed
by a Working Party which held ten meetings. The main changes in
Section C are in Articles 27 and 28. The new paragraph 5 (replacing
paragraph 3 of the Geneva text) of Article 27 now permits Members,
who consider their interests seriously prejudiced, to apply or maintain
export subsidies on primary commodities, without prior approval by the
Organization where Chapter VI procedure has failed or does not promise
to succeed or where an inter-governmental agreement is not an appro-
priate solution Paragraph 4 of Article 27 is a new provision prohibiting
a Member from granting a new subsidy or increasing an existing subsidy,
affecting the export of a primary commodity, during a Commodity
Conference dealing with that commodity, unless the Organization
concurs.
27. In the light of the relaxation of the provisions of Article 27, the
safeguards contained in Article 28 have been strengthened. In parti-
cular, provision has been made, where consultation fails, for the Organiza-
tion to make determinations as to what constitutes an equitable share of
world trade in the commodity concerned for the subsidizing country.
Members are required to conform to such determinations and factors
are specified to which, amongst others, the Organization shall have
particular regard when making determinations. Under the new text,
Article 28 applies to all subsidies affecting the exports of primary
commodities.
Sub-Committee J of the Third Committee on State Trading
(Articles 30 and 31 [29 to 32]).
28. Articles 30 [29] and 31 were not substantially altered by the
Sub-Committee but two new Articles were introduced. Article 30A [30]
entitled " Marketing Organizations " provides that marketing boards,
commissions or similar organizations established or maintained by
Members shall be subject to the provisions of paragraph 1 of
Article 30 [29] with respect to their purchases and sales and shall be
subject to the other relevant provisions of the Charter with respect
to their regulations governing the operations of private enterprises.
29. The second new Article [32] introduced by the Sub-Committee
is entitled " Liquidation of Non-commercial Stocks ". This provides
that any Member deciding to liquidate stocks of a primary commodity
accumulated for non-commercial purposes shall give four months prior
notice either publicly or to the Organization and shall, upon request,
consult with other Members as to the best means of avoiding substantial
injury to the economic interests of producers and consumers of the
commodities concerned. 46 -
30. Committee III referred Article 32 to a Working Party whose
Report 1 was approved at the forty-first meeting on 23 February, invol-
ving a few modifications in the text of the Article.
REPORT OF JOINT SUB-COMMITTEE OF THE SECOND
AND THIRD COMMITTEES ON
ARTICLES 16 AND 42 [16, 42, 43 and 44] 2
1. Committees II and III at their eleventh and seventeenth
meetings, respectively, appointed a Joint Sub-Committee with the
following terms of reference:
" To consider and submit recommendations to both Committees
regarding Articles 15, 16 (2) and (3) and 42 and the relevant proposals
and amendments submitted in relation thereto with a view to finding
a solution of the question of new preferential arrangements, including
those for purposes of economic development and reconstruction, and
of the maintenance of existing preferences as an exception from the
most -favoured-nation clause."
2. The Joint Sub-Committee consisted of representatives of
the following delegations: Argentina, Belgium, Brazil, Canada,
Chile, El Salvador, France, Haiti, Iran, Poland, Sweden, Syria,
Turkey, United Kingdom, United States and Venezuela. Mr. Stig
SAHLIN (Sweden) was elected Chairman. At the eleventh meeting,
Mr. Jean ROYER (France) was elected in the place of Mr. Sahlin
who had returned to Sweden.
3. The Sub-Committee examined the amendments proposed
to Article 15 (Preferential Arrangements for Economic Develop-
ment), Article 16 (General Most-favoured-national Treatment) and
Article 42 (Territorial Application of Chapter IV [42], Frontier
Traffic [43] and Customs Unions [44]) and at its tenth meeting
appointed a Working Party consisting of representatives of
Belgium, Chile, France, Syria, United Kingdom, United States and
Venezuela. This Working Party held twenty-nine meetings, under
the Chairmanship of Mr. Royer. The present Report is confined
to a record of the work of the Sub-Committee on Articles 16 and
42 [16, 42, 43 and 44] and to the Sub-Committee's recommenda-
tions on these Articles.
I E/CONF.2/C.3/64.
2 E/CONF.2/C.3/78. The report of this Sub-Committee relating to Article 15
appears with the report of the Second Committee. - 47-
Article 16 - General Most-favoured-nation Treatment.
Paragraph 1.
4. The Sub-Committee considered the proposal of the dele-
gation of Chile to add the words " with the exception of the arran-
gements contemplated in Article 15 " at the end of the first para-
graph. The Sub-Committee decided not to accept this amendment
and the delegations of Chile and Syria reserved their position
pending the decision of the Contracting Parties to the General
Agreement on the final text of Article I of the General Agreement.<R>1</R>
Annexes relating to Paragraph 2.
5. The Sub-Committee recommended the addition of four
new Annexes in order that certain preferences existing on 10 April
1947 may qualify for exception to the provisions of para-
graph 1. Of these new Annexes one relates to Portuguese territories
and the other three, to neighbouring countries in South and
Central America. There are a few consequential amendments in
other Annexes and in paragraph 2 of Article 16. Also, additions
were recommended in Annexes A and B at the request of the dele-
gations of Pakistan and France respectively.
6. In connection with Annex F (E in the Geneva draft) the
delegate of Peru enquired whether it was meant to include prefer-
ences granted by Chile to Peru as well as those granted by Peru to
Chile. Members of the Sub-Committee replied in the affirmative
and at the request of Peru it was agreed that this interpretation of
the Annexes relating to paragraph 2 (e) of Article 16 (Paragraph 2
(d) of the Geneva draft), should be included in the Sub-Committee's
Report.
Paragraph 2 (c).
7. The Sub-Committee decided not to recommend the deletion
of this sub-paragraph as proposed by the delegation of Peru.
8. The Sub-Committee considered the proposal of the Domi-
nican Republic to delete this sub-paragraph or alternatively to
provide that the preferences between the United States and Cuba
shall not operate to the detriment of products of the Dominican
Republic, which products should receive unconditionnally the
same advantages as like products of Cuba. Subsequently, the
1 The reservation of Chile was withdrawn at the final Plenary Meeting of the
Conference. -- 48 --
delegation of the Dominican Republic put forward the following
alternative proposal:
" That under Article 16 of the Charter the Dominican Republic
and Haiti, or one or other of them, on the one hand, and the United
States of America on the other be permitted to grant reciprocal
preferences similar in nature and duration to those now in force
between the United States and Cuba, dealt with in paragraph 2 (c)
of Article 16."
9. The delegate of the United States informed the Sub-
Committee that there was no possibility of his Government accepting
the conditions proposed by the Dominican Republic and therefore
the Sub-Committee was unable to make any recommendation in
this connection.
10. The Sub-Committee also considered the proposal of the
delegation of Haiti that this sub-paragraph should be extended to
include preferences between the United States and other countries
in the Caribbean area. During the discussions of the Sub-Com-
mittee the delegate of Haiti stated that his delegation was prepared
to support the proposal of the Dominican Republic and would
be satisfied with that solution, but since the Sub-Committee decided
not to recommend the amendment proposed he wished to reserve
the position of his delegation on Article 16 as a whole, pending the
final text of Article 15.1
San Marino and Vatican City.
11. The Sub-Committee discussed with the delegate of Italy
the latter's proposal to except the special regime existing between
the Republic of Italy and the Republic of San Marino and the State
of the Vatican City from the provisions of paragraph 1 of Article 16.
The Sub-Committee was of the opinion that the special arrange-
ments existing between Italy and these two territories were not
contrary to the Charter and offered to record this opinion in its
report to Committee III. The delegate of Italy withdrew his
proposal on the understanding that this opinion would be included
in the Report.
Other Proposals on Article16.
12. The Sub-Committee examined the amendments proposed
by the delegations of Ecuador, Bolivia, Lebanon and Syria, Turkey,
Egypt, Afghanistan, Burma, Argentina and Czechoslovakia and
1 When this Report was approved by Committee III, the delegate of the
Dominican Republic also reserved his position, but at the final Plenary Meeting
of the Conference, the reservation of Haiti was withdrawn. - 49 -
whilst unable to accept them felt that their substance was covered,
in whole or in part, by the revised text of Article 15 as drafted by
the Working Party and as eventually recommended by the Co-
ordinating Committee and the Heads of Delegations.
13. The Turkish delegation, however, expressed the desire to
discuss their amendment again in Committee III, so as to make
their attitude clear on this problem and to submit an alternative
proposal.
I4. The Brazilian reservation on Article 16 was provisionally
maintained 1.
Article 42 [42, 43 and 44] -- Territorial Application
of Chapter IV.
Frontier Traffic --- Customs Unions.
15. The text of this Article was redrafted on the basis of
proposals by the French delegation, the main change being to extend
to free-trade areas the provisions relating to customs unions, as
requested by the delegations of Lebanon and Syria. This subject
was considered to be of sufficient importance to require its sepa-
ration from the other matters dealt with in Article 42, and accord-
ingly the Sub-Committee recommended a separate Article devoted
exclusively to customs unions and free-trade areas.
16. The new text thus contains three Articles: Article 42,
dealing with territorial application; Article 42A [43], dealing with
frontier traffic; and Article 42B [44], dealing with customs unions
and free-trade areas.
Article 42 - Territorial Application.
17. The Sub-Committee recommended that paragraph 1 of
Article 42 of the Geneva draft, which defines the territorial appli-
cation of Chapter IV, and the first part of paragraph 4, which
contains a definition of " customs territory ", should comprise a
separate Article and be amended as shown in the revised text.
The Sub-Committee considered the question of moving the defi-
nition of " customs territory" to some other part of the Charter
in view of the fact that this term appears also in Articles 68 [71],
97 [102] and 99 [104], and decided to recommend to Committee VI
that it should consider whether this definition applies to other
1 When this Report was approved by Committee III, the reservation of Brazil
was not maintained, but Bolivia, Ecuador and Iraq recorded reservations. -- 50 -
Articles of the Charter and if so whether it should be removed to
a more suitable place.
18. The delegations of the United Kingdom and the United
States expressed some doubt about the substitution of "sub-
stantially all " for the words "a substantial part of " in the new
paragraph 2 and reserved their position pending discussion in
Committee III. A Working Party was subsequently set up by
the Committee which recommended returning to the words " a
substantial part of ", which was approved by the Committee.
Article 42 A [43] - Frontier Traffic.
19. The proposal of the delegation of Argentina to delete the
words " in order to facilitate frontier traffic " from paragraph 2 (a)
of Article 42 [43] was not adopted by the Sub-Committee, which
was of the opinion that provisions for arrangements to facilitate
frontier traffic should be retained and should comprise a separate
Article. Accordingly, the text recommended for Article 42 A [43]
is reproduced without changing the words used in the Geneva
draft.
20. The proposal of the delegation of Italy, requesting an
exception to the most-favoured-nation clause for a special regime
between Italy and the Free Territory of Trieste, was subsequently
altered to refer only to advantages accorded to trade with Trieste
by contiguous countries. The Sub-Committee decided it could
accept the modified proposal on condition that trade advantages
thus accorded were not contrary to the terms of the Italian Peace
Treaty. Accordingly a new provision was inserted in Article 42 A
[43], and the Sub-Committee suggested that the Central Drafting
Committee should consider whether the title should be altered.
The delegation of Czechoslovakia (not a member of the Sub-Com-
mittee) joined in the discussion of this item and requested that its
reservation be recorded. 1
Article 4 B [44] - Customs Unions and Free Trade Areas.
21. The first paragraph of Article 42 B [44] is new. It states
that the general purpose of a customs union or free-trade area
should be to facilitate trade between the participating parties and
not to create new obstacles to the trade of these parties with other
Members of the Organization.
1 When the Report was adopted by Committee III, this reservation was
withdrawn. -- 51 -
22. The second paragraph, providing for the establishment of
customs unions, is based upon paragraph 2 (b) of Article 42 of the
Geneva draft, but there was added to it a new provision covering
the establishment of free-trade areas. An amendment proposed
by the United Kingdom was incorporated, and it was felt that tile
new text of the Article largely covered an amendment proposed by
Chile.
23. The Sub-Committee could not reach a unanimous decision
on the question whether the provisions of this paragraph should
or should not apply to customs unions and free-trade areas of
which one or more parties are not Members of the Organization.
A majority favoured the insertion of the words " as between the
territories of Members" in the second line of the preamble to
paragraph 2 but the delegations of Argentina, Chile and Venezuela
asked that their reservations be recorded, and the delegate of
Syria said that he was not at that time able to give the decision
of his delegation.' It was the view of the members who supported
the insertion of these words, that this Article, including the new
paragraph 6 mentioned below, would not prevent the formation
of customs unions and free-trade areas of which one or more parties
were non-Members but would give the Organization an essential
degree of control. The delegate of Chile stated that this question
should be settled in connection with Article 93 [98] and that in his
opinion the recommendation of the Sub-Committee should not be
deemed to prejudge the decision on Article 93 [98].
24. The Sub-Committee recommended that the words
"average level of the duties " be replaced by " general incidence of
the duties" in paragraph 2 (a) of the new Article. It was the
intention of the Sub-Committee that this phrase should not require
a mathematical average of customs duties but should permit
greater flexibility so that the volume of trade may be taken into
account.
25. The third paragraph is based on paragraph 3 of the Geneva
draft. It defines the powers of the Organization in respect of
interim agreements for the establishment of customs unions and
free-trade areas. The Sub-Committee was unable to accept the
proposal of Argentina in regard to sub-paragraph (a) of the Geneva
text. The substance of a proposal by the delegation of Italy was
1 When the Report was adopted by Committee III, the delegation of Peru
also recorded a reservation. At the final Plenary Meeting the reservation of
Venezuela was withdrawn. - 52 -
included in the revised sub-paragraph (a). In regard to sub-
paragraphs (b) and (c) it was felt that the revised text went some
way to meet the views of Argentina, Chile and Italy.
26. In paragraph 4 of the new Article the definition of a
customs union, which was contained in the second sentence of
paragraph 4 of the Geneva draft, was amended and a definition of
a free-trade area was added. This describes a free-trade area as
a group of two or more customs territories within which tariffs,
etc. (excpt, where necessary, those permitted under Section B of
Chapter IV and under Article 43 [45] are eliminated on substantially
all the trade between the constituent territories in products origi-
nating in such territories.1
27. A fifth paragraph was added to cover the problems which
would arise in cases where there were preferential rates of duty in
force between a country entering a customs union or a free-trade
area and a country remaining outside. And a sixth paragraph
was added to provide that the Organization may, by a two-thirds
vote, approve proposals which do not fully comply with the requi-
rements of the Article provided that they lead to the establishment
of a customs union or a free-trade area in the sense of the Article.
It was the understanding of the Sub-Committee that this new
paragraph 6 will enable the Organization to approve the establish-
ment of customs unions and free-trade areas which include non-
Members.
28. The proposal by Iraq to add a new paragraph regarding
economic relations between members of the Arab League was not
accepted; it was felt that the revised texts of Articles 15 and 42 [44]
covered the point raised by the amendment. These texts are also
thought to cover to a large extent a proposal by Argentina.
REPORT OF SUB-COMMITTEE A
OF THE THIRD COMMITTEE ON ARTICLES 16, 17, 18 AND 192
1. Sub-Committee A was appointed at the ninth meeting of
the Third Committee, 12 December, to examine the proposals
and amendments relating to Articles 16 and 17 (other than those
relating to paragraphs 2 and 3 [4] of Article 16 which were referred
1 When the Report was adopted by Committee III, Australia and New Zealand
reserved their positions on paragraphs 4 and 5.
2 E/CONF.2/C.3/59. - 53 -
to the Joint Sub-Committee of the Second and Third Committees)
with a view to reaching agreement on a text to be recommended
to the Third Committee. At the thirteenth meeting of the Third
Committee, 17 December, it was also agreed to refer the amend-
ments on Articles 18 and 19 to Sub-Committee A.
2. The Sub-Committee consisted of representative of the
following delegations: Australia, Brazil, China, Colombia, Cuba,
Denmark, France, Mexico, Netherlands, New Zealand, Peru,
Turkey, United Kingdom, United States and Uruguay. The
delegate of Norway replaced the delegate of Denmark when
Articles 18 and 19 were under discussion. The Sub-Committee
had the benefit of consultation with representatives of the following
delegations, not members of the Sub-Committee: Argentina,
Ceylon, Chile, Czechoslovakia, Ecuador, Ireland, the Philippines,
Sweden, Syria and Venezuela, and with a representative of the
International Monetary Fund. A considerable number of observers
regularly attended the Sub-Committee meetings.
3. Dr. G. A. LAMSVELT (Netherlands) was elected Chairman.
The Sub-Committee held thirty eight meetings. Four Working
Parties were established which drafted revised texts of the note to
Annex A of Article 16 and of Articles 17, 18 and 19, respectively,
and a drafting group was named which produced the new para-
graph 4 [5] of Article 16.
Article 16. - General Most-Favoured-Nation Treatment.
Annexes A and D and Paragraph 4 [5].
4. The note to Annex A was redrafted with respect to the
imposition of a margin of tariff preference to replace the prefe-
rential quantitative arrangements described therein, and the
reference to the imposition of a margin of tariff preference to
replace a margin of preference in an internal tax existing on
10 April 1947 exclusively between two or more of the territories
listed was deleted, as well as the entire note to Annex D.
In lieu of the provisions deleted, a new paragraph 4 [5] was
added to Article 16 which also provides that any such margin of
tariff preference shall be subject to the provisions of Article 17.
5. The Danish proposals to amend the note to Annex A with
respect to the imposition of a margin of tariff preference to replace
the existing quantitative arrangements, and the Cuban proposal
to amend the notes to Annexes A and D with respect to a margin
of tariff preference to replace a margin of preference in an internal - 54 -
tax, were met by these changes. The Cuban delegation accordingly
withdrew its reservation recorded in the Geneva draft.
6. As a consequential change, the Sub-Committee recommends
amending paragraph 5 (b) of Article 23 by changing the words
" subject to the conditions set forth therein " to read " pending
the outcome of the negotiations referred to therein".
7. The Brazilian delegation maintained provisionally its
reservation on sub-paragraph 5 (b) of Article 23 which appears in
the Geneva draft both in connection with Article 23 and with
Annex A. The Peruvian delegation reserved its position on
Article 16, paragraphs 2, 3 [4] and 4 [5] of Article 16 and on the
interpretative note to Article 16, pending final settlement of
Article 15. The Uruguayan delegation reserved its position on
Annex A pertaining to Article 16 and on sub-paragraph 5 (b) of
Article 23.1
Annex D and Sub-paragraph 2 (c) bis [2 (d)].
8. On the suggestion of the delegate of the Philippines, it
was agreed to delete from Annex D the reference to the Republic
of the Philippines and to insert in paragraph 2 a new sub-paragraph
referring to the preferential arrangements in force between the
United States of America and the Republic of the Philippines.
Proposed New Paragraph.
9. The Cuban proposal to add to paragraph 1 of Article 16 a
provision to the effect that tariff descriptions based on distinctive
regional or geographical names should not be used in such a manner
as to discriminate against products of Member countries was
referred to Sub-Committee C by the Third Committee. Sub-
Committee C recommended the inclusion in Article 35 [36] of a
new paragraph along these lines unless its substance were added
to Article 16. Sub-Committee A considered both Sub-Committee
C's recommendation and the suggestion of the Chairman of the
Third Committee, i.e., that an even broader provision be included
in Article 16, but decided not to recommend any such addition on
the grounds that it might have the effect of limiting the scope of
the most-favoured-nation clause. The Third Committee sub-
sequently requested Sub-Committee A to incorporate the pro-
1 When the Report was adopted by Committee III, the reservation of Brazil
and Peru were not maintained, but that of Uruguay was maintained in respect of
Annex A. - 55 -
vision recommended by Sub-Committee C in Article 16, and a new
paragraph was accordingly added.1
Interpretative Note.
10. The Sub-Committee recommended as an interpretative
note to Article 16 the note to paragraph 3 of Article I of the
General Agreement on Tariffs and Trade which includes the inter-
pretative note to Article 16 appearing in the Geneva draft.
Article 17. - Reduction of Tariffs and Elimination
of Preferences.
Paragraph 1.
11. Most of the amendments proposed to paragraph 1 of the
Geneva draft, whether relating to the principles laid down in the
first sentence or to the rules for negotiations, were either met by,
or withdrawn in view of the revised text which specified in greater
detail the rules for negotiations, without altering the principles.
In addition to the amendments referred to the Sub-Committee,
suggestions submitted by Australia, Colombia, France, Mexico,
the United Kingdom and the United States were taken into con-
sideration in revising the text.
12. The Argentine, Mexican and Uruguayan proposals re-
lating to the initiation of and the participants in negotiations were
substantially covered by redrafting the first part of paragraph 1.
The Argentine amendment to the effect that negotiations should
be directed to the " progressive " rather than " substantial "
reduction of tariffs received no support, and the Mexican amend-
ment also relating to the purpose of negotiations, was withdrawn
in view of the incorporation of more detailed rules for negotiations.
13. The proposal by the delegation of the Philippines to modify
the phrase " elimination of preferences " by the word " gradual "
was withdrawn in view of the provisions of new paragraph 2 (a).
Paragraph 2 (formerly included in paragraph 1).
14. The Mexican proposals to insert additional rules for
negotiations were net to a considerable extent by the revised text,
particularly new paragraphs 2 (a) and (b). The Mexican delegate
accepted the revised text and did not press those amendments
which were not specifically adopted.
1 Subsequently Committe III transferred this new paragraph to Article [36]. - 56 -
15. The Peruvian and Colombian amendments relating to the
effects of currency devaluation on tariffs were withdrawn because:
(a) prior to negotiations, a Member would be free to increase the
specific duty on any unbound item since Article 17 does not
provide for a general binding of all items;
(b) subsequent to negotiations, should a Member's currency be
devalued consistently with the Articles of Agreement of the
International Monetary Fund by more than twenty per
cent, the General Agreement (Article II, 6 (a)) permits the
readjustment of specific duties to take account of such
devaluation, subject to certain safeguards;
(c) an interpretative note was recommended to sub-paragraph 2
(d) (1 (b) of the Geneva Draft), stating that the effects of
currency devaluation would be a. matter for consideration
during negotiations.
16. The Sub-Committee considered, and the Turkish delegate
agreed., that this interpretation would also cover the Turkish
delegation's proposed amendment to Article 14.
New Sub-Paragraph 2 (a).
17. It was the Sub-Committee's understanding that the words
undertake not to raise it (i.e., a tariff duty) above a specified
higher level " merely mean that in certain cases it might be advan-
tageous to any Member to obtain a tariff binding, even though at
a higher level, and that the provisions of sub-paragraph 2 (a) are
therefore not inconsistent with the aims of paragraph 1, i.e., the
substantial reduction of tariffs and elimination of preferences.
18. It was considered necessary to describe the " basis " for
negotiations by the word "selective " as well as by the term
" product-by-product ", in order to make it clear that negotiations
would not proceed on a product-by-product basis with respect to
all products, but rather on the basis of lists of requests and offers
of concessions on products in which there was mutual interest.
Sub-Paragraph 2 (b).
19. Former sub-paragraph 1(c) of the Geneva draft was
expanded to assure that concessions incorporated in the General
Agreement on Tariffs and Trade which were previously provided
for in bilateral agreements would be considered as concessions
under Article 17 in the same way as concessions already granted - 57 -
by original contracting parties to the General Agreement for
which compensation could be asked.
New Sub-Paragraph 2 (e).
20. The Cuban amendment relating to prior international
commitments as subsequently amended by the Sub-Committee
was incorporated in the text as sub-paragraph 2 (e) of the
Havana Charter. The interpretative note to paragraph 1 of the
Geneva draft was accordingly deleted. In connection with this
sub-paragraph, the Sub-Committee considered that, since all
agreements concluded under this Article are to be on a reciprocal
and mutually advantageous basis, the phrase " carry out nego-
tiations " appearing in paragraph 1 of this Article does not mean that
agreements must invariably result from negotiations which have
been initiated.
Paragraphs 2 and 4 (in part, 1 and 2 of the Geneva draft).
21. The Ceylonese, Chilean, Colombian, Mexican and Peruvian
amendments, proposing that account be taken by Members during
negotiations and by the Organization in making determinations
under new paragraph 4 of the needs of countries in special categories,
particularly underdeveloped and ward-amaged countries, and of the
revenue aspect of Members' tariffs, were met by the addition of
sub-paragraph 2 (a) and (b) and by the addition of language in
paragraph 4 (formerly 2) with respect to the criteria which should
be taken into account by the Organization in determining whether
a Member had failed to fulfil its obligations under Article 17. The
Sub-Committee concluded that it would be impracticable and
unwise to attempt to set out in the Charter itself detailed descrip-
tions of all the specific criteria necessary to cover all possible future
situations. Accordingly, it was agreed that the Organization should
be instructed, broadly, to have regard to " all relevant circum-
stances ".
22. The specific language recommended by the Sub-Committee
was " all relevant circumstances, including the developmental and
other needs and the general fiscal structures of the Member coun-
tries concerned and the provisions of the Charter as a whole." It
was not felt necessary to refer specifically to the balance of reci-
procal concessions offered by the countries concerned, and the
probable effect or value of these concessions, since it was obvious
that these elements would comprise the very foundation of any
case before the Organization which would inevitably take them - 58 -
into account. With regard to the suggestion that language should
be included recognizing the need of countries to maintain reasonable
tariff protection, it was felt that (a) in general it is implicit in
Article 17 that reasonable tariff protection is consistent with the
principles of the Charter, and (b) the needs of underdeveloped
countries in this respect are recognized ir. paragraph 1 of Article 13
and would be given further specific recognition by the inclusion
of the reference to " developmental needs " in Article 17. This
means that the Organization, in assessing the total value of the
concessions which a Member may be willing to grant to another
Member, shall take into account the needs resulting from the
different general conditions prevailing in different Member countries
with respect to their ability to maintain or develop their industries.
It was understood that the term " developmental and other needs "
would cover, inter alia, a Member's need for reconstruction.
23. The Chilean delegate withdrew his proposal to add
"balance of payments " and " monetary reserves " as criteria to
be taken into account by the Organization on the grounds that
these subjects were more relevant to Articles 21, 23 and 24.
24. The amendments proposed by Haiti and El Salvador to
the effect that Members should be released from the obligation to
negotiate because of their economic development and revenue needs
were met in part by the addition to paragraph 4 of the phrase
" the general fiscal structures of the Member countries
concerned ".
Paragraph 3 (1 (d) of the Geneva draft).
25. The substance of the United States amendment was
adopted as the first and second sentences of this paragraph. The
third sentence of the paragraph was added to cover the substance
of the Norwegian amendment and the interpretative note to
Article 17 of the Geneva text relating to existing bilateral agree-
ments. The Interpretative Note shown in the Geneva text was
accordingly deleted, and the Cuban delegation withdrew its
reservation.
26. As regards any difficulties which might arise from a possible
conflict between the provisions of the Charter and the general
provisions of the General Agreement on Tariffs and Trade, the Sub-
Committee was of the opinion that the best method of eliminating
such difficulties would be for the Governments which signed the
Final Act adopted at the conclusion of the Second Session of the - 59 -
Preparatory Committee of the United Nations Conference on Trade
and Employment to hold a meeting before the signing of the Final
Act of the Havana Conference in order to agree with respect to
the supersession of the general provisions of the General Agreement
by the corresponding provisions of the Charter. Members of the
Conference would then be in a position to know the provisions of
the final text of the General Agreement on Tariffs and Trade,
referred to in paragraph 3, prior to signing the Final Act in Havana.
The desirability of amending the unanimity requirement with
respect to agreement on the terns of accession to the General
Agreement might also be considered at such a meeting.
27. The Mexican delegate did not press his amendment relating
to the revision of negotiated agreements in view of the revised text
of paragraph 3 (1 (d) of the Geneva draft) and the Sub-Committee's
opinion expressed above.
Paragraphs 4 and 5 (2 and 3 of the Geneva draft).
28. There was no substantial support in the Sub-Committee
for the Peruvian proposal that the Tariff Committee should be
only an investigatory and recommendatory body and that the
Executive Board rather than the Tariff Committee should have
the power to make determinations under paragraph 4. No agree-
ment was reached as to whether the decisions of the Tariff Com-
mittee should be final or whether an appeal from its decisions should
be provided for, although there was considerable support for pro-
viding some appeal procedure. At the time the present Report was
submitted the Uruguayan proposal to delete paragraph 2 of the
Geneva text was still pending. The Sub-Committee had made no
change in paragraph 5 (paragraph 3 of the Geneva text) and the
Uruguayan and Peruvian proposals to delete this paragraph were
being held in abeyance. The Sub-Committee indicated that it
might wish to make further recommendations to the Third Com-
mittee when the Report of the Tripartite Working Party of Sub-
Committee A of the Third Committee, Sub-Committee D of the
Sixth Committee and the Joint Sub-Committee of the Second and
Third Committees, which was considering matters relating both
to the Tariff Committee and the proposed Economic Development
Committee, was available.
29. The Cuban delegation proposed inserting in the thirteenth
line of new paragraph 4 of Article 17 the words " and/or the provi-
sions of the General Agreement on Tariffs and Trade ". This - 60 - amendment would enable the Organization to waive the require-
ments of Article II of the G.A.T.T., as well as of Article 16 of the
Charter, in order to authorize contracting parties to withhold
benefits embodied in the G.A.T.T. from another contracting party
with whom they had not completed negotiations, if it were determ-
ined that the latter contracting party had failed to fulfil its obliga-
tions under paragraph 1 of Article 17. The Cuban proposal,
although originally referred to the Joint Working Party of Sub-
Committee A of Committee III and Sub-Committee D of Com-
mittee VI, was being studied by the Tripartite Working Party
referred to above. The Cuban delegation reserved its position on
paragraph 4 of Article 17 pending the outcome of the consideration
of this amendment, and the final decision which the Contracting
Parties would take in respect of the amendment to Article II of the
G.A.T.T. suggested by the Tripartite Working Party. The Cuban
delegate stated, on instructions from his delegation, that this was
a reservation on the whole position of the Cuban delegation with
regard to the acceptance of the Charter by its Government.1
30. The Mexican and Peruvian delegations each reserved
provisionally its position on paragraph 5 of Article 17.1
General.
31. The Sub-Committee considered in principle, at the request
of Sub-Committee H of the Third Committee, paragraph 1 of
Article 27 as proposed by Brazil as follows:
" 1. No Member shall grant, directly or indirectly, any
subsidy on the domestic production of any commodity, in
respect of which the tariff has been reduced or bound by nego-
tiation pursuant to Article 17."
32. A majority of the Sub-Committee considered that, in view
of the provisions of Section C of Chapter IV, it was not necessary
to write into the Charter the proposed Brazilian amendment, either
in its original form or as revised during the Sub-Committee's
discussion, whereas a minority of the Sub-Committee supported
the principle contained in the Brazilian amendment. Sub-Com-
mittee H was advised accordingly.
33. The Brazilian delegation reserved its position on Article 17
1 See note to paragraph 35 below. - 61 -
pending the report of the Joint Sub-Committee of the Second and
Third Committees.1
34. The delegate of Venezuela withdrew his amendment which
would have permitted the adjustment of customs duties to
compensate for the elimination of an internal tax, in view of the
addition to Article 18 of new paragraph 3.
35. The Danish, Norwegian and the United Kingdom delega-
tions each reserved provisionally its position with respect to the
first interpretative note relating to the whole of Article 17.2
Article 18. - National Treatment on Internal Taxation
and Regulation.
General.
36. The recommended text differs considerably in form from
the Geneva text but has been changed substantially in only one
respect. The second sentence of paragraph 1 of the Geneva draft
provided that existing internal taxes which afford protection to
directly competitive or substitutable products in cases in which
there was no substantial domestic production of the like product
could be maintained, subject to negotiation for their elimination or
reduction in the manner provided for in Article 17. The Sub-
Committee recommended their outright elimination. Members
would, of course, be free to convert the protective element of such
taxes into customs duties. The new form of the Article makes
clearer than did the Geneva text the intention that internal taxes
on goods should not be used as a means of protection. The details
have been relegated to interpretative notes so that it would be
easier for Members to ascertain the precise scope of their obligations
under the Article.
37. The Norwegian delegation withdrew its reservation on the
whole of Article 18 recorded in the Geneva draft, but maintained
provisionally a reservation on new paragraphs 7 and 9.3
1 See note to paragraph 35 below.
2 These reservations and that of Brazil mentioned in paragraph 33, were not
maintained when the Report was adopted by Committee III. Switzerland,
however, recorded a reservation on the interpretation of the term " mutually
advantageous" to cover negotiations relating both to tariff and their related
matters, and Mexico on paragraph 3, pending decision of the contracting parties to
the General Agreement on the question of supersession. The delegation of Cuba
reserved their position on paragraph 4 but this was withdrawn at the final Plenary
Meeting.
3 This reservation was withdrawn when the Report was adopted by Com-
mittee III. - 62 -
Paragraphs 1 (new), 2 (formerly 1) and 3 (new).
38. The Sub-Committee considered the Argentine (insofar
as it related to local taxes for revenue purposes), Colombian, Irish
and Uruguyan amendments to paragraph 1of the Geneva text to
have been covered insofar as feasible by the revised text and by the
interpretative note to paragraph 1 relating to paragraph 3 of
Article 99 [104].
39. The Sub-Committee considered that charges imposed in
connection with the international transfer of payments for imports
or exports, particularly the charges imposed by countries employing
multiple currency practices, where such charges are imposed not
inconsistently with the Articles of Agreement of the International
Monetary Fund, would not be covered by Article 18. On the other
hand, in the unlikely case of a multiple currency practice which
takes the form of an internal tax or charge, such as an excise tax
on an imported product not applied on the like domestic product,
that practice would be precluded by Article 18. It may be pointed
out that the possible existence of charges on the transfer of pay-
ments insofar as these are permitted by the International Monetary
Fund is clearly recognized by Article 16.
40. The Sub-Committee agreed that a general tax, imposed
for revenue purposes, uniformly applicable to a considerable
number of products, which conformed to the requirements of the
first sentence of paragraph 2 would not be considered to be
inconsistent with the second sentence.
41. It was agreed further that a tax applying at a uniform
rate to a considerable number of products was to be regarded as a
tax of the kind referred to in the preceding paragraph and in the
parenthesis in the interpretative note to Article 17, notwithstanding
the fact that the legislation under which the tax was imposed also
provided for other rates of tax applying to other products.
42. The delegations of Chile, Lebanon, and Syria inquired
whether certain charges imposed by their countries on imported
products would be considered as internal taxes under Article 18.
The Sub-Committee, while not attempting to give a general defini-
tion of internal taxes, considered that the particular charges referred
to are import duties and not internal taxes because according to
the information supplied by the countries concerned (a) they are
collected at the time of, and as a condition to, the entry of the goods
into the importing country, and (b) they apply exclusively to
imported products without being related in any way to similar - 63 -
charges collected internally on like domestic products. The fact
that these charges are described as internal taxes in the laws of the
importing country would not in itself have the effect of giving them
the status of internal taxes under the Charter.
43. The delegation of Chile, not a member of the Sub-
Committee, maintained provisionally its reservation recorded in
the Geneva text.1 The Sub-Committee considered that the
Lebanese and Syrian amendment was covered in view of the revised
text and of the Sub-Committee's understanding set forth above.
The Chinese delegation withdrew its amendment and its reservation
recorded in the Geneva draft in view of the revised text.
44. The Peruvian delegate withdrew his amendment in view
of the Sub-Committee's interpretation that neither income taxes
nor import dutes fall within the scope of Article 18 which is
concerned solely with internal taxes on goods.
45. The Costa Rican proposal was not accepted on the grounds
that it was not necessary.
46. The Norwegian proposal, which would have exempted
from the provisions of Article 18 domestic price stabilization arran-
gements involving subsidies and internal taxes on imported pro-
ducts for the purpose of preventing or modifying inflationary or
deflationary pressures, received no substantial support, although
the Sub-Committee was in sympathy with the objectives the
Norwegian delegation had in mind in proposing this amendment.
47. The Brazilian delegation reserved its position on para-
graphs 1, 2 and 3 of the Havana text for the time being.
48. The Cuban delegation maintained provisionally its reser-
vation recorded in the Geneva text.2
Paragraph 4 (2 of the Geneva draft).
49. The Norwegian delegation had proposed to insert a new
paragraph in Article 18 to make sure that the provisions of this
Article would not apply to laws, regulations and requirements
which have the purpose of standardizing domestic products in
order to improve the quality or to reduce costs of production, or
have the purpose of facilitating an improved organization of internal
1 See note to paragraph 48 below
2 The Cuban reservation was withdrawn at the final Plenary Meeting while those
of Chile (paragraph 43) and Brazil (paragraph 47) were not maintained in Com-
mittee III. Argentina, on the other hand, subsequently recorded a reservation
on paragraph 3. - 64 -
industry, provided that they have no harmful effect on the expan-
sion of international trade. The Sub-Committee was of the opinion
that this amendment would not be necessary because the Article
as drafted would permit the use of internal regulations required to
enforce standards. In accordance with this opinion the Nor-
wegian delegation withdrew its amendment.
50. The Sub-Committee inserted the word " internal " to
make it clear that the phrase " differential transportation charges "
does not refer to international shipping.
51. Since parag aph 4 relates solely to the question of diffe-
rential treatment between imported and domestic goods, the
inclusion of the last sentence in that paragraph should not be
understood to give sanction to the use of artificial measures in the
form of differential transport charges designed to divert traffic
from one port to another.
52. The Cuban proposal to delete the word " transportation "
in the first sentence of this paragraph and to delete the second sen-
tence received no support.
53. The Mexican delegate withdrew his amendment which he
regarded as adequately covered elsewhere in the Charter.
Paragraph 5 (3 of the Geneva draft).
54. The Sub-Committee was in agreement that under the
provisions of Article 18 regulations and taxes would be permitted
which, while perhaps having the effect of assisting the production
of a particular domestic product (say, butter) are directed as much
against the domestic production of another product (say, domestic
oleomargarine) of which there was a substantial domestic produc-
tion as they are against imports (say, imported oleomargarine).
55. The Mexican proposal to delete paragraph 3 of the Geneva
draft was withdrawn in view of the revised text.
56. The first proposal made by the delegation of Ceylon, not
a member of the Sub-Committee, was considered to have been
covered by the revised draft of this paragraph and its second pro-
posal was withdrawn.
57. The Chilean delegation, not a member of the Sub-
Committee, maintained provisionally its reservation to paragraph 3
of the Geneva draft.1
1 This reservation was withdrawn in Committee III. - 65 -
Paragraph 6 (4 of the Geneva draft).
58. The exception permitting the continuance of existing
mixing regulations has been redrafted as suggested by the dele-
gation of Sweden so as to bring out more clearly that a Member
would be free to alter the details of an existing regulation provided
that such alterations do not result in changing the overall effect
of the regulation to the detriment of imports.
59. The delegate of Ireland inquired whether the phrase
shall not be modified to the detriment of imports " would permit
changes in the amounts or proportions of a product required to be
mixed under an existing regulation in Ireland, which changes are
the result of changes in crops from year to year. The Sub-
Committee decided that since the regulation in question clearly
contemplates such changes, the changes would not be precluded by
paragraph 6 and the Irish delegate withdrew his amendment.
60. The Mexican and the Argentine amendments were met
by the addition of the date of the signing of the Final Act of the
United Nations Conference on Trade and Employment.
61. Another Argentine proposal, except insofar as it related
to local taxes for revenue purposes, and the Brazilian proposal
received no support.
62. The amendment submitted by the delegation of Ceylon
received no substantial support and the Ceylonese delegation reser-
ved its position on this paragraph.
63. The New Zealand delegation withdrew its reservation to
paragraph 4 (b) of the Geneva draft.
64. The Brazilian delegation reserved provisionally its position
on this paragraph.
Paragraph 7 (new).
65. The Norwegian delegation reserved provisionally its
position on this paragraph.1
Paragraph 8 (5 of the Geneva draft).
Sub-Paragraph (a).
66. The Chinese delegation withdrew its amendment and its
reservation recorded in the Geneva draft in view of the revised
text of this sub-paragraph.
1 See note to paragraph 70 below. - 66 -
67. Ceylon and Mexico accepted the new text and withdrew
their proposal to delete paragraph 5 of the Geneva draft.
68. The Argentine amendment received no support.
Sub-Paragraph (b).
69. This sub-paragraph was redrafted in order to make it
clear that nothing in Article 18 could be construed to sanction the
exemption of domestic products from internal taxes imposed on
like imported products or the remission of such taxes. At the
same time the Sub-Committee recorded its view that nothing in
this sub-paragraph or elsewhere in Article 18 would override the
provisions of Section C of Chapter IV.
Paragraph 9 (new).
70. The Sub-Committee was in agreement that the addition
to this paragraph proposed by Australia was unnecessary because
the words " to the fullest practicable extent " in the recommended
text had the same intent as the words " having due regard for
the legitimate purposes of a particular price control measure and
the legitimate interests of the prejudicially affected Member or
Members" which Australia proposed adding at the end of the
paragraph. The Australian delegate accepted this view.
71. The Norwegian and United Kingdom delegations each
reserved provisionally its position on this paragraph.1
Recommended Consequential Changes.
72. If the proposed new paragraph 7 of Article 18 were adopted,
paragraph 5 of Article 22 would have to be amended by the deletion
of the words " and to any internal regulation or requirements under
paragraph 2 of Article 18 ".
73. The Sub-Committee recommended that paragraph 2 of
Article 30 [29] be amended, (a) to bring it in line with the wording
of paragraph 8 (a) of Article 18 so as to avoid difficulties of inter-
pretation, and (b) to extend the " fair and equitable treatment "
rule established in paragraph 2 of Article 30 [29] with respect to
imports for governmental purposes excepted from the provisions
of paragraph 1 of Article 30 [29] to the laws, regulations and
requirements relating to procurement for governmental purposes
referred to in paragraph 8 (a) of Article 18.
1 These reservations, and that of Norway mentioned in paragraph 65, were
withdrawn in Committee III. - 67 -
74. The delegate of Ecuador stated that imports into Ecuador
of tobacco and spirits by the state monopolies are subject to import
duty and, in addition, to an internal tax levied at the time of sale
which does not apply to the domestic products. He inquired
whether the maintenance of this tax would be contrary to the
provisions of Article 18. It was the view of the Sub-Committee
that if the tax were treated as a negotiable monopoly margin,
under Article 31 (i.e. an " import duty " in the sense of paragraphs 2,
3 and 4 of Article 31), it would not fall within the scope of Article 18.
The Sub-Committee considered that this would be accomplished
by notifying the Organization that the charge concerned is a
monopoly margin (or " import duty " in the sense of Article 31)
which is subject to the provisions of Article 31. It might also be
desirable to change the legal designation of the charge so as to
refer to it as a monopoly margin rather than an internal tax.
75. In connection with the opinion expressed above, the Sub-
Committee recommended the following interpretative note to
Article 31:
" The term ' maximum import duty ' would cover the monopoly
margin which has been negotiated or which has been published or
notified to the Organization, whether or not collected at the customs
as an ordinary customs duty."
76. The delegation of Ecuador reserved its position on Article
18 pending the Third Committee's consideration of this recommen-
dation.1
Article 19. - Special Provisions relating to
Cinematograph Films.
77. The Sub-Committee recommended the omission of sub-
paragraph 4 (a) of the Geneva draft of Article 18, which specifically
excepted any internal quantitative regulation relating to cine-
matograph films and meeting the requirements of Article 19 from
the provisions of paragraph 3 [5] of Article 18, and the introduction
at the beginning of Article 19 of the words " The provisions of
Article 18 shall not prevent any Member from establishing or
maintaining internal quantitative regulations....." so that all special
provisions relating to cinematograph films will be contained in
Article 19. No substantive change was made in this Article.
78. The delegate of Czechoslovakia reaffirmed the views
expressed by the head of his delegation in Committee III to the
1 This reservation was withdrawn in Committee III, but the delegation of
Switzerland reserved its position on the whole of Article 18. - 68 -
effect that cinematograph films should be explicity excluded from
the competence of the ITO on the grounds that films, being works
of art, are not just simple commercial commodities or industrial
products. However, if the majority of the Conference favoured
the retention of Article 19 his delegation would no longer press its
objections.
79. The delegate of Norway fundamentally agreed with the
view expressed by the Czechoslovakian delegation. However, as
this view had not been sufficiently supported, he did not reserve
his position.
80. The Argentine delegate withdrew his amendment in
view of the Sub-Committee's interpretation that the date fixed
in sub-paragraph (c) clearly relates only to discriminatory measures
as between foreign films, not as between domestic and foreign
films.
REPORT OF SUB-COMMITTEE B OF THE
THIRD COMMITTEE ON PROPOSED NEW ARTICLE 18A1
1. Sub-Committee B was established at the eleventh meeting
of the Third Committee, held on 16 December 1947, for the purpose
of studying, and making recommendations regarding the Norwegian
proposal for a new Article 18A as follows:
"The products of any Member country exported to any other
Member country shall not be subject to any measure imposed by
either the exporting or the importing country requiring such exports
to be financed, shipped or insured by enterprises of any prescribed
nationality."
2. Delegates of Argentina, France, Greece, India, Norway, the
Union of South Africa, United Kingdom and Venezuela were
appointed members of the Sub-Committee.
3. At the first meeting Dr. J. E. HOLLOWAY (Union of South
Africa) was unanimously elected Chairman of the Sub-Committee
which held five meetings.
4. The Sub-Committee discussed fully and in great detail the
Norwegian proposal as well as an alternative proposal submitted
by the United Kingdom delegation.
1 E/CONF.2/C.3/76. - 69 -
5. It also had the benefit of hearing the views of representatives
of Australia, Brazil, Ireland, New Zealand, Sweden and Switzerland.
6. Before the deliberations of the Sub-Committee were con-
cluded, the International Maritime Conference met in Geneva and
decided upon the establishment of the Inter-Governmental Maritime
Organization the functions of which cover the purpose of the
proposed Article 18A as well as of Chapter V insofar as it relates
to shipping.
7. In view of this the Sub-Committee arrived at the opinion
that in order to avoid an overlapping of functions and a possible
conflict of activities between the two organizations it would be
advisable not to deal with questions of shipping in the Havana
Charter.
8. Accordingly, the Sub-Committee agreed to recommend to
Committee III:
(a) that Article 18A should not be inserted in the Havana
Charter, the countries having made and supported the
proposal not insisting upon its insertion, and
(b) to recommend to Committee IV that shipping be excluded
from the provisions of Chapter V by adding to Article 50
[53] a new paragraph as follows:
"5. The provisions of this Chapter shall not apply to
shipping. "
9. The representative of Venezuela reserved the position of
his delegation on the decision of the Sub-Committee.1
REPORT OF SUB-COMMITTEE C OF THE
THIRD COMMITTEE ON ARTICLES 32-39 [33-39]2
1. In its fifteenth meeting, Committee III appointed Sub-
Committee C to deal with Section E of Chapter IV of the Geneva
draft.
2. The following terms of reference were given to the Sub-
Committee by Committee III:
(a) To consider all proposed amendments to Section E of Chapter IV
as contained in document E/CONF.2/C.3/10 together with
suggestions made during the discussions of Committee III and
1 This reservation was not maintained in Committee III.
2 E/CONF.2/C.3/38. - 70 -
any other amendments that may be presented during the work
of the Sub-Committee; and
(b) to recommend texts of Articles 32-39 which would reconcile the
various points of view expressed.
3. The representatives of the following countries were elected
members of the Sub-Committee: Afghanistan, Argentina, Australia,
Canada, Cuba, France, Lebanon, Mexico, Netherlands, Norway,
Pakistan. Portugal, United Kingdom, United States and Uruguay.
After the first two meetings the representative of Norway renounced
his membership on the Sub-Committee and the representative of
the Union of South Africa was elected. The Sub-Committee
unanimously elected at its first meeting Mr. C. E. MORTON (Aus-
tralia) as its Chairman.
4. A number of representatives of delegations who were not
members of the Sub-Committee attended as observers and in many
cases took part in the discussions on particular amendments for
which they were primarily responsible or in which they had special
interest. A representative of the International Monetary Fund
and a representative of the Statistical Office of the United Nations
also participated in the work of the Sub-Committee. The Sub-
Committee held nineteen meetings.
5. The Sub-Committee apppointed the following Working
Parties to deal with special points which emerged during the dis-
cussions:
Working Party I - composed of the representatives of Australia,
Brazil, Cuba, Lebanon, Netherlands, United Kingdom and
United States, to consider Article 33 [34].
Working Party II -- composed of the representatives of France,
United Kingdom, United States and Uruguay, to consider para-
graph 3 of Article 34 [35].
Working Party III - composed of the representatives of Australia,
Haiti, Lebanon, Peru, United Kingdom and the United States, to
consider paragraph 1 of Article 35 [36].
Working Party IV - composed of the representatives of Afgha-
nistan, Australia, France, Lebanon, Pakistan, United Kingdom
and the United States to consider an amendment calling for
studies directed towards improvement of transport facilities for
traffic in transit.
Working Party V - composed of the representatives of Australia,
Cuba, France, United Kingdom and the United States to consider
an amendment concerning the usage of regional and geographical
names for purposes of tariff classification.
Working Party VI - composed of the representatives of Australia,
Norway, United Kingdom, United States and of the Statistical
Office of the United Nations, to consider a redraft of Arti-
cle 38 [39]. - 71 -
These Working Parties, together with several Drafting Groups
which were concerned with the improvement of the text of several
Articles, greatly facilitated the work of the Sub-Committee; their
comprehensive report proved an excellent help towards speeding
up the progress of the discussions.
6. The Sub-Committee was aware of the decision of the
General Committee of the Conference to eliminate whenever possible
the interpretative notes appended to the Geneva draft. The
Sub-Committee could not fail to recognize, however, the special
character of the articles of Section E of Chapter IV in regard to
which many specific provisions of an administrative and/or pro-
cedural nature, rather than principles of commercial policy,
required recognition. It was therefore considered desirable to
retain certain interpretative notes as such in a number of cases
where the content of the note could not readily be incorporated in
the text of the article without rendering the text unduly cumber-
some. As a result of discussions and recommendations of Working
Parties certain additional notes were presented for acceptance by
Committee III, although certain Notes appearing to the Geneva
text were deleted. The Sub-Committee did not consider the
question of the manner in which the interpretative notes should
be appended to the Charter.
Article 32 [33]. - Freedom of Transit.
7. The delegate of Chile withdrew its reservation to this
Article as recorded in the Geneva Report.
8. The proposal of Argentina that the phrase " and also vessels
and other means of transport " be deleted from lines 1 and 2 of
paragraph 1 found no support in the Sub-Committee.1
9. To meet the proposal of Afghanistan a note to paragraph 1
was appended in order to clarify the " in transit " status of goods
which were assembled, or disassembled, or reassembled in the
transit country solely for convenience of transport.
10. At the suggestion of the representative of Chile (not a
member of the Sub-Committee) the Sub-Committee agreed to state
in its report that a movement between two points in the same
country passing through another country was clearly " in transit
through the other country within the meaning of paragraph 1.
1 When the Report was adopted by Committee III, the delegation of Argentina
reserved its position on paragraph 1. - 72 -
11. The proposal of the representative of Argentina to delete
paragraph 2 received no support in the Sub-Committee.
12. The proposal of the representative of Chile that a note be
appended to paragraph 2 to the effect that this Article does not
preclude agreements between neighbouring countries for the regu-
lation of transit in respect of their own trade was not approved
because such agreement are clearly permissible under the terms
of the Article if they do not prejudice the interests of other Members
in violation of the most-favoured-nation provisions of the Charter,
and if they do not limit freedom of transit for other Members. The
representative of Chile reserved, his position.1
13. At the suggestion of the representative of the Netherlands
and on the recommendation of a Working Party, the Sub-Committee
approved the deletion of the Note appended to paragraph 5 of the
Geneva draft. It was agreed that a new paragraph should be
added to the Article stating that transportation charges on traffic
in transit did not come within purview of Article 32 [33],
but were subject to the provisions of paragraph 2 of Article 18 of
the Geneva Draft. This would require the deletion of the words
" for transportation or those " from the third line from the end of
paragraph 3 of Article 32 [33]. Any subsequent amendment of
substance in Article 18 might necessitate a revision of the text of
this paragraph.
14. The proposal of the representative of France to delete the
provision in paragraph 6 [7] that requirements of " direct consign-
ment " should be limited to those existing on the day of signature
of the Charter and requisite to eligibility for entry at preferential
rates of duty, or related to the Member's system of valuation for
duty purposes did not receive any support in the Sub-Committee.
A further proposal of the representative of France for the conti-
nuance of a Member's requirement of " direct consignment " for
exemption from surtaxes likewise received no support.
15. The proposal of Afgnanistan (originally made with refe-
rence to Article 35 [36]) was regarded as appropriate for adoption
with some modification, but was considered to be more pertinent
to Article 32 [33]. On the recommendation of a Working Party
the Sub-Committee approved the ?onclusion in Article 32 [33] of a
new paragraph which specifically authorizes the Organization to
make studies and recommendations and promote international
1 See note to paragraph 18 below. - 73 -
agreement concerning measures designed to further the broad
objectives of the freedom-of-transit provisions of the Charter, and
under which Members agree to co-operate with each other directly
and through the Organization to this end.
16. Although there was no doubt that the general functions of
the Organization as set forth in Article 69 [72] are sufficiently
broad to authorize the action contemplated by the new paragraph,
the Sub-Committee felt, in view of the great importance of this
matter to many countries, particularly to those countries which
have no access to the sea, that it was desirable to make specific
provision for the matter, as had been done with regard to other
matters of outstanding importance in other articles of the Charter.
17. While the implementation of the provisions of this paragraph
must be left to the Organization and to the Members directly
concerned, it is the Sub-Committee's understanding that these pro-
visions would afford a specific basis for studies and recommenda-
tions by the Organization, and for one Member to seek the co-
operation of another, concerning measures to facilitate " traffic in
transit " generally, and with regard to special arrangements for
transit to and from countries which do not have access to the sea.
The Sub-Committee believes that, in the case of such countries,
special arrangements regarding transport, loading and unloading,
storage and warehousing et cetera may be necessary to enable such
countries fully to participate in and promote the expansion of
international trade envisaged by the Charter.
18. The representative of Chile reserved his position with
regard to the text of the new paragraph 6.1
Article 33 [34]. -- Anti-dumping and Countervailing Duties.
19. This Article and the proposals to amend its content deve-
loped considerable discussion in the Sub-Committee as a result of
a wide divergency of views amongst Members as to the requisite
means to afford protection agains dumping.
20. At one end of the range of views certain countries believed
that the primary object of the Article should be to restrict abuses and
evasion of commitments by Members under the guise of measures
against dumping or subsidization. At the opposite end, other
countries proposed that the Article should be expanded to include
a condemnation of dumping and to cover forms of dumping other
1 This reservation was maintained by the Chilean delegation in Committee III,
but that recorded in paragraph 12 above was withdrawn. - 74 -
than the injurious sale of merchandise for export at less than its
normal value; it was sought to include in the Charter an express
authorization for any Member to combat all forms of dumping and
subsidization by any measures the Member should see fit to adopt.
21. The various proposals were thoroughly discussed and
statements by representatives of countries not members of the Sub-
Committee were taken into account. All proposals and suggestions
were referred to a Working Party whose first report led to further
discussion in the Sub-Committee with a view to arriving at a
compromise. The matter was then referred to an enlarged
Working Party for further consideration.
22. The Working Party finally produced a compromise text
which was approved by all Members of the Sub-Committee except
the representative of Argentina who reserved his position. The
representative of Czechoslovakia, whose delegation was not repre-
sented on the Sub-Committee, indicated that. he was not fully
satisfied with the compromise achieved. It was, however, the
general view of the Sub-Committee that the point of chief concern
to Czechoslovakia and some other countries (i. e. adequate means for
dealing with abuses by a Member unnecessarily levying anti-
dumping or countervailing duties) was adequately covered by the
general provisions of the Charter, particularly by Articles 41 and
89 [93].
23. The Article as agreed to by the Sub-Committee condemns
injurious " price dumping " as defined therein and does not relate
to other types of dumping.
24. The Sub-Committee desired it to be understood that,
where the word " industry " is used in the Article, it includes such
activities as agriculture, forestry, mining, etc., as welle as manu-
facturing.
25. The Sub-Committee agreed to the deletion of paragraph 6
of the Geneva Draft which expressly prohibited the use of measures
other than anti-dumping or countervailing duties against dumping
or subsidization. It did so with the definite understanding that
measures other than compensatory anti-dumping or countervailing
duties may not be applied to counteract dumping or subsidization
except in so far as such other measures are permitted under other
provisions of the Charter.
26. The Interpretative Note to paragraph 1 was revised to
clarify the basis for calculating the " margin of dumping " in cases - 75 -
within its purview and to conform in certain other respects to the
corresponding Note in the General Agreement on Tariffs and
Trade.
27. It was agreed that a new note should be
appended to paragraph 2 to answer any doubt that a Member
could require security for the " payment of anti-dumping or
countervailing duty pending final determination of the facts in
cases of suspected dumping or subsidization ".
28. The final sentence of paragraph 5 of the Geneva text
(paragraph 6 of the proposed text) which contains a reference to
conditions prescribed in Article 27 ", would require review should
a substantial change be made at this Conference in the " conditions "
laid down in paragraph 1 of Article 27 of the Geneva text in relation
to systems for the stabilization of primary products.
Article 34 [35]. - Valuation for Customs Purposes
29. The Sub-Committee found very little to change in this
Article. It agreed that it would not be feasible now or in the rea-
sonably near future to fix a specific time limit for compliance with
paragraph 2, and that the expression " at the earliest practicable
date " sufficiently and correctly expresses the time for compliance.
It was of the opinion further that the Note to paragraph 2 of the
Geneva draft was unnecessary and should be ommitted.
30. To meet the purpose of an amendment proposed by
Argentina it was agreed that words should be inserted in para-
graph 2 to make it clear that a Member need respond to a request
for a review of its customs valuation procedures only if such request
is made by another Member directly affected by such procedures.
31. During the discussions of the proposals of Uruguay and
Chile it was revealed that in certain countries it had been the
practice to apply ad valorem tariffs to established values of goods
which remain fixed for various periods of time. It was agreed
that, in such cases, the ad valorem rates are, in practical result,
the equivalent of specific duties so long as the established values
of goods are not changed. It was agreed that a note recognizing
this fact should be appended to paragraph 3. However, it was
agreed (the representative of Chile, non-member of the Sub-
Committee reserving his position)1 that it would not, and should
not be compatible with the letter or spirit of the Article to accept
1 This reservation was withdrawn at the final Plenary Meeting. - 76 -
the principle of variable schedules of " fixed values " for products
subject to ad valorem rates of duty.
32. The Sub-Committee adopted the substance of a proposal
of Uruguay and it was agreed that the first paragraph of the Note
to paragraph 3 of the Geneva draft should be amended so as to
provide expressly for the presumption that contract prices may
represent the basis for establishing "actual values" in the case of
government contracts in respect of primary products.
33. The proposal of the delegation of Argentina that para-
graph 5 be deleted found no support in the Sub-Committee.1
The Sub-Committee agreed to accept the substance of the proposal
of Uruguay, and. an interpretative note was appended to para-
graph 5 stating that if compliance with that paragraph would
result in decreases in amounts of duty payable, the Member con-
cerned was allowed a reasonable time to obtain adjustment of any
international agreement which bound the rates of duty.
34. In order to obviate any misunderstanding of the concept
of paragraph 5, sub-paragraph (d) of that paragraph in the Geneva
draft was set up as a special paragraph [6].
Article 35 [36].- Formalities Connected with Importation
and Exportation.
35. The discussion of amendments proposed by Argentina,
Turkey and Peru revealed that the intended scope of this Article
was not clearly indicated in the Geneva draft. Particular diffi-
culty was occasioned by a distinction observed in the Spanish
translation of certain types of governmental charges. It was
accordingly agreed that paragraph 1 should be revised and care
should be taken in the translation to show definitively that this
Article relates to all payments of any character required by a
Member on or in connection with importation or exportation, other
than import and export duties, and other than taxes within the
purview of Article 18 of the Geneva draft.
36. The representative of Haiti (not member of the Sub-
Committee), who appeared as an observer, stated that the resultant
change in the Article did not meet the purpose of his proposal and
he therefore reserved his position.
37. The representative of Chile, likewise present as an observer,
also reserved his position.
1 When the Report was adopted by Committee III, the delegation of Argentina
reserved its position on paragraph 5. - 77 -
38. In this connection the Sub-Committee was of the unani-
mous opinion that, although this Article established the principle
that fees and charges of the types therein covered should not
represent any taxation on imports or exports for fiscal or pro-
tective purposes, adequate provision was made in other parts of
the Charter for the raising of revenue by means of duties on imports
and exports or by non-discriminatory internal taxes collected on
imports at the time of importation.
39. At the suggestion of the representative of Argentina it
was agreed that paragraph 2 should be amended to show clearly
that a Member need respond to a request to undertake the review
of its laws and regulations only if such request is made by another
Member directly affected.
40. The Sub-Committee adopted the substance of the proposal
of the delegation of Uruguay by agreement that an express autho-
rization should be included in paragraph 3 [4] of the Geneva draft
for studies and recommendations by the Organization in relation
to customs requirements in respect of advertising matter and sam-
ples for use only in taking orders for merchandise.
41. At the joint instance of the representatives of Peru (not
member of the Sub-Committee) and the International Monetary
Fund it was agreed that the Interpretative Note to this Article
should be amended by replacing the words " with the approval of
the International Monetary Fund " by the words " not inconsis-
tently with the Articles of Agreement of the International Monetary
Fund," since the express approval of the Fund was not required
in all cases covered by the Note.
42. In view of the retention of this Note the representative
of Brazil (not member of the Sub-Committee) withdrew his reser-
vation concerning certain charges imposed on the international
transfer of payments.
43. The proposal of Cuba to add to paragraph 1 of Article 16
of the Geneva draft a reference to tariff discriminations resulting
from the use of distinctive regional or geographical names in tariff
descriptions was referred by Committee III to Sub-Committee C.
Although some Members of the Sub-Committee felt that this matter
was appropriate for Article 16, there was a general agreement that
the principle of the Cuban proposal should be expressed in some
article of Chapter IV of the Charter. It was agreed that the prin-
ciple should be stated provisionally in a new paragraph at the end
of Article 35 [36]. - 78 -
44. At the request of the Chairman of Committee III the
matter was accordingly referred to Committee III to be considered
by that Committee in the light of any views which might be obtained
later from Sub-Committee A of Committee III on the inclusion of
some similar provision in Article 16. Although the new paragraph
is limited to discrimination effected through the use of distinctive
regional or geographical names, the Sub-Committee recognized
that discrimination against the products of Member countries by
tariff descriptions can occur other than by the use of distinctive
regional or geographical names. It was not considered practical
at this time either to list all the discriminatory practices or to
formulate a general provision covering them. The matter is
undoubtedly one which the Organization will study under the
authority provided for elsewhere in the Charter. The Sub-Com-
mittee desired however, to make it clear that the presence in the
Charter of a provision directed against the use of distinctive regional
or gerographical names in such a manner as to result in discrimi-
nation against the products of Member countries, is in no sense to
be understood as implying that other discirminatory practices in
tariff descriptions are thereby authorized.
45. The Sub-Committee agreed that the order of the para-
graphs of Article 35 would be more systematic if paragraph 5 of
the Geneva Draft were made paragraph 3 of the Article since it
relates only to the matters covered by paragraphs 1 and 2.1
Article 36 [37]. - Marks of Origin.
46. There were only two suggested amendments to this
Article. The delegation of Argentina proposed that paragraph 7
be deleted, and the delegation of Chile (not member of the Sub-
Committee) proposed that paragraph 7 be amended to include an
express statement to the effect that consumers would not be misled
as to the true origin of products bearing certain types of names if
the name of the country of actual origin were to appear legibly
on the label affixed to the product. Neither of these proposals
received any support and the Sub-Committee accordingly recom-
mended that the Geneva draft of Article 36 be adopted without
change.
47. The representative of Argentina reserved the position of
his Government.
1 In Committee III reservations were recorded by Bolivia on the whole Article,
by Haiti on paragraph 1, 2 and 3, and by Chile on paragraph 1: the last named was
withdrawn at the final Plenary Meeting. - 79 -
48. As a result of the discussions on paragraph 7 which had
taken place in the Sub-Committee and at the request of the repre-
sentative of Chile, it was agreed that the text of paragraph 7 should
not have the effect of prejudicing the present situation as regards
certain distinctive names of products, provided always that the
names affixed to the products cannot misrepresent their true origin.
This is particularly the case when the name of the producing country
is clearly indicated. It will rest with the governments concerned
to proceed to a joint examination of particular cases which might
arise if disputes occur as a result of the use of distinctive names of
products which may have lost their original significance through
constant use permitted by law in the country where they are used.
49. The representative of Chile maintained his reservation on
this Article pending consideration by his Government as to whether
the statement by the Sub-Committee appearing immediately above
satisfies the Chilean position on this matter.
Article 37 [38]. - Publication and administration of
Trade Regulations.
50. The proposal of Argentina to delete from paragraph 3 (c)
the provision for the right of determination by the Organization
as to whether or not a Member's procedures for review of admi-
nistrative action comply with Charter requirements, was not
supported by any other Member of the Sub-Committee.1
51. The proposal of New Zealand and the United Kingdom
to the effect that the reference to sub-paragraph (b) at the end of
paragraph 3 (c) was erroneous and should be deleted, was adopted
by the Sub-Committee. The substance of a proposal of Uruguay
originally proposed to Article 34 [35] was adopted by the Sub-
Committee with some expansion of its scope and a sentence was
added to paragraph 3 (a) to require that suitable facilities to
consult with the proper governmental authorities should be afforded
to traders directly affected by any law, regulation, decision or
ruling of a kind described in paragraph 1.
52. At the suggestion of the representative of the United States
it was agreed that the word " published " at the end of paragraph 2
should be replaced by the expression " made public ". In the
opinion of the Sub-Committee this would make clearer the intention
that the term " published " did not require the prior public issue
1 In Committee III the delegation of Argentina reserved its position on para-
graph 3 (c). - 80 -
of an official document, but that the effect could also be accom-
plished by an official announcement made in the legislature of the
country concerned.
Article 38 [39]. - Information, Statistics
and Trade Terminology.
53. The delegation of Norway proposed a redraft of this
Article and the delegations of Australia and Czechoslovakia
proposed some changes in this redraft.
54. During the course of its discussions of this Article the
Sub-Committee had the opportunity of hearing from a represen-
tative of the Statistical Office of the United Nations particulars of
the types of activities which were being carried out by that Office
in the field of international statistics. Members of the Sub-
Committee were impressed by the work being undertaken by the
Statistical Office with the object of providing an international
centre for statistics and avoiding duplication of demands for
statistical information made on countries by various Specialized
Agencies of the United Nations. They were also impressed with
the need for the Organization to collaborate with the United Nations
and other inter-governmental agencies, as provided in Article 84
[87], to ensure that the statistics of external trade of Members are
available in a form that will enable the statistical information to fit
into the general pattern of international statistics. They accordingly
considered it important that contact be established as early as pos-
sible between the Organization and the United Nations (Economic
and Social Council) with a view to suitable arrangements being made
for co-operation in the fields related to international statistics.
55. The Sub-Commmittee agreed that the Organization has
an obligation to satisfy itself that the statistical information it
requires (other than that referred to in paragraph 1 of the Article)
cannot be obtained from other inter-governmental organizations
before requesting such information from Members.
56. The Sub-Committee considered the inter-relation of
paragraph 4 and 7 and agreed that paragraph 4 relates to the
obligation of Members to give careful consideration to recommen-
dations made to them by the Organization, while paragraph 7,
on the other hand, provides for the Organization to co-operate
in studies and make consequent recommendations to Members.
57. In view of the opinions expressed by the Sub-Committee
the representative of Norway withdrew his amendment. - 81 -
Article 39 (Geneva draft). - Bovcotts.
50. The representative of the United States stated during the
discussions that the original draft of this Article (Article 17 of the
suggested Draft Charter) was designed to preclude " Buy National
Goods " measures and campaigns by Members on the ground that
they were detrimental to the expansion of international trade.
He further stated that, since there was no agreement at London or
later for any such prohibition in the Charter, and since Article 39
of the Geneva draft related only ot the trade of individual coun-
tries and not to any matter likely to affect the total of external
trade, this Article should be deleted in its entirety and the subject
matter should be omitted from the Charter.
59. There was unanimous agreement in the Sub-Committee
that the matters covered by Article 39 of the Geneva draft were
not appropriate for inclusion in the Charter and that this Article
should be deleted.
REPORT OF
SUB-COMMITTEE D OF THE THIRD COMMITTEE ON
ARTICLES 40, 41 AND 43 [40, 41 AND 45]1
1. The Third Committee at its seventeenth meeting on
22 December 1947 approved the formation of a Sub-Committee
on Section F-Special Provisions-of Chapter IV consisting of the
representatives of Argentina, Belgium, Colombia, Denmark,
France, Italy, Peru, Southern Rhodesia, United Kingdom and the
United States of America.
2. The terms of reference of the Sub-Committee were to con-
sider and make recommendations upon Articles 40 to 43 of the
Geneva text and the amendments submitted to these Articles,
with the exception of those amendments to Article 42 which
affected the question of preferences and were referred to the Joint
Sub-Committee of Committees II and III, and the Swiss proposal
for a new provision, which was referred to Sub-Committee G of
Committee III.
3. At its twentieth meeting on 31 December 1947, the
Third Committee adopted a recommendation by the Joint Sub-
Committee of Committees II and III to refer to that Sub-Committee
1 E/CONF.2/C.3/37. - 82 -
also those proposals relating to Article 42, which had been pre-
viously referred to Sub-Committee D.
4. The Sub-Committee held its first meeting on 29 De-
cember 1947, and unanimously elected Mr. R. J. SHACKLE (United
Kingdom) its Chairman.
5. The Sub-Committee held eight meetings. Delegates for
several countries not members of the Sub-Committee attended
its meetings. Representatives of Afghanistan, Cuba, Netherlands,
Norway and Turkey took an active part in the disucssion on points
of special interest to them.
6. In the course of its work the Sub-Committee examined the
text of Articles 40, 41 and 43 [40, 41 and 45], all outstanding
amendments to these Articles as listed in the annotated agenda,
as well as amendments and observations subsequently submitted
by members and recommendations received from other committees
and sub-committees. The Sub-Committee did not examine the
text of Article 42 which it considered to be outside its terms of
reference, all amendments to that Article having been referred to
another sub-committee.
7. The Sub-Committee was able to reach unanimous agree-
ment on most points, only a small number of decisions taken being
subject to reservations by individual delegations. The majority
of such reservations were concerned with matters forming part of
larger issues or related to problems still under discussion in other
sub-committees.
Article 40. - Emergency Action on Imports of Particular Products.
8. The Sub-Committee did not consider justified a proposal to
exclude quantitative restrictions on imports of agricultural and
fisheries products from the measures provided for in this Article.
The delegation of Peru reserved its position in this matter.
9. The Sub-Committee was unanimous in its understanding
of this Article that action taken by Members under paragraphs 1
(a), 1 (b) and 3 (b)--as distinct from paragraph 3 (a)--should not
involve any discrimination against the trade of any Member.
As the Geneva text might leave from for doubts on this point, it
was felt that this intention, as interpreted by the Sub-Committee,
should be expressly stated in the Charter. The Sub-Committee
decided therefore to recommend that this interpretation be embo-
died in a footnote attached to the Article and forming part of the
Charter. The delegation of Argentina reserved its position. - 83 -
10. The question was raised whether, in taking action under
paragraph 1 of Article 40, Members would be limited to the reim-
position of measures which had been in effect prior to the entry
into force of the Charter. It was agreed that the text as drafted
does not limit the measures which Members might take. For
example, it would be possible, under this paragraph, for a Member
to impose a quantitative restriction on imports of a particular
product, if such a restriction were in fact necessary to prevent or
remedy serious injury to domestic producers in the face of increased
imports, even though a quantitative restriction had not been
applied prior to the adoption of the Charter. There would,
however, have to be a relationship of cause and effect between (a)
the increase in imports resulting in injury, and (b) the obligations
assumed by Members under Chapter IV. Such a relationship
might exist in the following cases, among others:
(i) The granting of a tariff concession (either the reduction of a
duty or the binding of a duty against increase) might lead to
injurious imports;
(ii) The elimination of a quantitative restriction existing prior to
the adoption of the Charter might lead to injurious imports.
This might happen even though the restriction in question had
never been actually applied but had merely been provided for
under the laws or regulations of a Member.
In view of the broad scope of paragraph 1, as illustrated above,
the amendment proposed by the delegation of Cuba was withdrawn.
11. In sub-paragraph 1 (a) the word " relatively " was inserted
between " such " and " increased " so as to make it clear that
Article 40 could apply in cases where imports had increased rela-
tively to domestic production, even though there might not have
been an absolute increase in imports as compared with a previous
base period.
12. The Sub-Committee was unable to accept a proposal to
delete sub-paragraph 1 (b).
13. The Sub-Committee shared the doubts expressed by the
delegation of Argentina as to the exact meaning of the word
" critical " in paragraph 2 and recommended its substitution by
the words " of special urgency " to follow after " circumstances ".
14. The delegation of Argentina recorded a reservation in
respect of the words " the suspension of which the Organization
does not disapprove" at the end of sub-paragraph 3 (a).1
1 This reservation was not maintained in Committee III. - 84 -
Proposed New Article 40 A.
15. The Sub-Committee, having given full consideration to the
Colombian proposal for insertion of a new Article, decided that
internal price regulation and internal taxation were matters out-
side the scope of Section F and might properly be discussed in
relation to Article 18. The proposal of the Working Party com-
posed of the representatives of Colombia and the United States
to recommend that a provision dealing with certain aspects of
these matters be included in Article 18, was therefore referred to
the Sub-Committee dealing with that Article.
Article 41. - Consultation.
16. It was decided to add to the measures mentioned speci-
fically in this Article " internal price regulations " and " practices
and regulations affecting the freedom of transit ", the latter being
subject to examination by the Central Drafting Committee.
Article 43 [45]. -- General Exceptions to Chapter I V.
17. The numbering of paragraphs in this Article was changed
so as to bring it into line with all other provisions of the Charter
since there did not seem to be any reason for departing from the
general practice followed elsewhere.
18. Upon recommendation of Sub-Committee I of Com-
mittee VI an exception was added concerning " laws and regula-
tions relating to public safety ", the latter term, in the view of
the Sub-Committee, including the concept of " public order ".
19. In discussing an amendment to sub-paragraph (a) (v),
previously I (d), of the Geneva draft, designed to exempt measures
against so-called " social dumping " from the provisions of Chapter
IV, the Sub-Committee expressed the view that this objective was
covered for short-term purposes by paragraph 1 of Article 40 and
for long-term purposes by Article 4 [7] in combination with Articles
89 and 90 [93, 94 and 95].
20. The delegation of Australia maintained its reservation in
respect of sub-paragraph (a) (viii) of paragraph 1, formerly I (g)
of the Geneva draft, subject to the final wording of Article 94 [99].1
21. Upon recommendation of Committee V a further excep-
tion was inserted for measures taken under inter-governmental
agreements for the conservation of fisheries resources, migratory
1 This reservation was withdrawn in Committee III. - 85 -
birds and wild animals, as a corollary to a similar addition made to
paragraph 1 of Article 67 [70]. It was thought desirable, however,
that the Cntral Drafting Committee should examine the wording
of this provision as well as the question whether it should be
stated separately or might be incorporated in sub-paragraph 1(h)
of the Geneva draft.
22. In sub-paragraph (a) (x) [ix], previously I (h) of the Geneva
draft, the words " terms of " were substituted for " obligations
under " since it was felt that the word " obligation " was liable to
misinterpretation. It was agreed that this change should be
subject to further examination by the Central Drafting Committee.
23. The Committee was unable to accept a proposal for deletion
of the last part of sub-paragraph (a) (xi) of the Havana text begin-
ning with the words " during periods ". The delegation of Argen-
tina reserved its position on this point.1
24. The Sub-Committee expressed the view that governmental
measures relating to the orderly marketing of agricultural commo-
dities for which storage facilities in both the countries of origin
and destination were insufficient, were covered in paragraph 2 (b)
of Article 20. On this understanding the proposal by the dele-
gation of Afghanistan to add a new provision to paragraph 1 (a)
was withdrawn.
25. In sub-paragraph (b) (i), previously II (a) of the Geneva
draft, the words "general inter-governmental" were substituted
for the word " multilateral ". In the view of the Sub-Committee
the provision is intended to require Members to take guidance
not from any multilateral agreement as such, but from agreements
of a wide and general character, and the change was made so as
to express this intention more accurately. The delegate of Argen-
tina recorded a reservation 2
26. The Sub-Committee in considering sub-paragraphs (b)
(ii) and (iii), formerly II (b) and (c) of the Geneva draft, agreed
that the words " the war " were intended solely to refer to World
War II. In the course of the discussion it appeared, however,
that not only there might be room for a different interpretation,
but that the concept of World War II, as applied to different parts
of the world, is in itself not sufficiently precise. It was decided,
therefore, to recommend that the Central Drafting Committee
1 In Committee III reservations on this paragraph were recorded by the delega-
tions of Argentina, Ecuador and Uruguay.
2 This reservation was not maintained in Committee III. - 86 -
examine this provision with a view to removing any ambiguity
and vagueness.
27. A proposal to delete the proviso in sub-paragraph (b) (iii),
previously II (c) of the Geneva draft, was not accepted. The
delegation of Argentina recorded a reservation on this point.
28. The Sub-Committee decided to recommend that, instead
of including a definite date in the final paragraph, the Organization
should be authorized to specify when the measures permitted
under sub-paragraph 1 (b), previously II, should be discontinued.
It was felt that the conditions due to the war had not improved
at the rate and to the extent expected when the Charter was
first drafted and that even now it was not possible to foresee with
any accuracy when these conditions would be likely to cease
to exist. It appeared desirable therefore not to specify a date in
advance, but to empower the Organization to fix the time limit
for the termination of all or any measures in the light of future
developments.
29. The delegate of Belgium did not insist on a proposal to
leave the present text unchanged and to add a provision empower-
ing the Organization to authorize the application of particular
measures in respect of particular products if it considered such
measures warranted by circumstances then ruling. A proposal by
the delegation of Argentina to delete the last part of paragraph 2,
formerly part of I of the Geneva draft, beginning with the words
" and in any event " having found no support, the representative
of Argentina reserved his position.
REPORT OF SUB-COMMITTEE E OF THE
THIRD COMMITTEE ON ARTICLES 20 AND 221
1. Sub-Committee E was appointed on 30 December 1947 to
examine and submit recommendations to Committee III on all
proposed amendments to Articles 20 and 22 and was given authority
to consult, if necessary, with Sub-Committee C of Committee II
on Articles 13 and 14.
2. The Sub-Committee was composed of the delegations of
Ceylon, Chile, China, Colombia, Egypt, France, Ireland, Mexico,
1 E/CONF. 2/C.3/54. - 87 -
Netherlands, New Zealand, Peru, the Union of South Africa,
Sweden, the United Kingdom and the United States.
3. The Sub-Committee at its first meeting on 5 Januaty 1948,
unanimously elected Mr. J. E. HOLLOWAY (Union of South
Africa) as Chairman.
4. The Sub-Committee held eleven meetings and established
nine Working Parties to consider particular proposals in detail.
All the amendments listed in the Annotated Agenda were fully
studied, together with various proposals arising out of those
amendments.
5. The Sub-Committee and the Working Parties enjoyed the
benefit of consultation and co-operation with the delegations of
Argentina, Australia, Canada, Cuba, Czechoslovakia, Denmark,
Greece, India, Lebanon, Norway, Syria and Turkey.
Article 20. - General Elimination of Quantitative Restrictions.
6. The Sub-Committee was unable to recommend the deletion
of the Article proposed by the delegation of Ceylon. The represen-
tative of Ceylon reserved his position on the Article, pending a
final settlement on the provisions of Article 13. The representa-
tives of Colombia, Mexico and Peru reserved their positions on
Article 20 until final settlement had been reached on Article 13.
Paragraph 2. -- General.
7. A Working Party, set up to consider the amendments
proposed by Chile and Argentina, reported that its work had not
been completed as it depended on a proposed amendment1 to
Article 21 and a proposed interpretative statements by a delegate
on the text of that Article. The representative of Chile reserved
his position until the proposal mentioned above had been accepted
and pending the final text of Article 13. The representatives of
Argentina (who was not a member of the Sub-Committee) and
Ireland also reserved the positions of their delegations pending
the final text of Articles 13 and 21.3
8. The representative of China reserved his position until the
general situation became clearer. The representative of Lebanon
(who was not a member of the Sub-Committee) withdrew his
reservation, considering that the problem of the use of quantitative
1E/CONF.2/C.3/82.
2 E/CONF.2/C.3/SR.46: Annex 1.
3 See note to paragraph 13 below. - 88 -
restrictions by underdeveloped countries should be solved under
Article 13.1
9. There was no support for the amendments of Cuba. The
representative of Cuba (who was not a member of the Sub-Com-
mittee) reserved his position with regard to the second of his
amendments.2
Paragraph 2 (a).
10. The following text was recommended to meet the amend-
ment put forward by the delegation of Australia:
"(a) export prohibitions or restrictions [temporarily] applied for the
period necessary to prevent or relieve critical shortages of
foodstuffs or other products essential to the exporting Member
country."
11. The Sub-Committee considered the request of the dele-
gation of Australia that the reference to the term " critical " in the
minutes of the proceedings of Commission A in the Second Session
of the Preparatory Committee (document E/PC/T/A/PV/40 (1)
pages 4, 6, 8 and 9) be concurred in by Committee III and included
in its minutes. The Sub-Committee unanimously concured in the
conclusions of Commission A as set out in Geneva document and
recommended to the Committee that the Australian request be met.
12. In connection with the amendment submitted by the
delegation of Greece, the Sub-Committee felt that the position
could best be met by an interpretative footnote. It recommended
that this note should take the following form:
" In the case of products which are basic to diet in the exporting
country and which are subject to alternate annual shortages and
surpluses, the provisions of this sub-paragraph do not preclude such
export prohibitions or restrictions as are necessary to maintain
from year to year domestic stocks sufficient to avoid critical
shortages."
13. The delegation of China withdrew its amendment, while
reserving its position should certain other provisions in the Charter
be altered.3
14. The Sub-Committee was satisfied that the terms of
paragraph 2 (a) of Article 20 are adequate to allow a country to
impose temporary export restrictions to meet a considerable rise
in domestic prices of foodstuffs due to a rise in prices in other
1, 2 See note to paragraph 13 below.
3 The reservation of Colombia, Mexico, Peru, Chile, China, Ireland and Cuba,
mentioned in paragraphs 6, 7, 8, 9 and 13 were withdrawn in Committee III. - 89 -
countries. In view of this consideration the amendment of
Sweden was withdrawn.
15. The amendment of Mexico was withdrawn.
Paragraph 2 (C).
16. The Sub-Committee agreed that paragraph (2) (c) was
not intended to provide a means of protecting domestic producers
against foreign competition but simply to permit, in appropriate
cases the enforcement of domestic governmental measures neces-
sitated by the special problems relating to the production and
marketing of agricultural and fisheries products.
17. The Sub-Committee agreed that in interpreting the term
restrict " for the purposes of paragraph (2) (c) the essential
point was that the measures of domestic restriction must effectively
keep domestic output below the level which it would have attained
in the absence of restrictions.
Amendments Designed to Narrow the Scope of Paragraph (2) (c).
18. The Sub-Committee was unable to recommend the adop-
tion of the amendments proposed by Peru, Mexico and Norway.
19. The Sub-Committee discussed fully the proposals of
Egypt and Peru seeking to provide that paragraph (2) (c) should
apply only:
(a) where the restrictions on domestic output were temporary
(Egypt);
(b) to permit only temporary use of import restrictions (Peru);
(c) where there was a surplus of production (Egypt, supported by
Peru);
(d) where there was no subsidy to domestic production (Peru).
20. As regards (a) and (b) it was noted that the term " tempo-
rary" was difficult to define, and that the terms of paragraph (2)
(c), particularly with the additional provision of the proposed
new sub-paragraph 3 (a), would ensure that import restrictions
could be applied only for as long as they were necessary to the
enforcement of restrictions on domestic output. It was agreed
that governments would certainly not wish to restrict domestic
output of agricultural and fisheries products for any longer period
than was really necessary. The delegates of Egypt and Peru
withdrew these proposals.
21. As regards (c), the Sub-Committee agreed that no govern-
ment would wish to restrict domestic output except when obliged - 90 -
to do so by the existence of a surplus or by a persistent tendency
towards the production of a surplus; however, to write (c), or
indeed (a) or (b), into the text of the Charter would in practice
have the effect of giving the Organization the power to determine
whether and when Members could or could not institute or enforce
particular restrictions on domestic agricultural production, a
condition which governments could not reasonably be expected
to accept.
22. As regards (d) the Sub-Committee agreed that it was not
the case that subsidies were necessarily inconsistent with restrictions
of production and that in some cases they might be necessary fea-
tures of a governmental programme for restricting production.
It was recognized, on the other hand, that there might be cases in
which restrictions on domestic production were not effectively
enforced and that this, particularly in conjunctions with the appli-
cation of subsidies, might lead to misuse of the provisions of
paragraph (2) (c). The Sub-Committee agreed that Members
whose interests were seriously prejudiced by the operation of a
domestic subsidy should normally have recourse to the procedure
of Article 25 and that this procedure would be open to any Member
which considered that restrictions on domestic agricultural produc-
tion applied for the purposes of paragraph (2) (c) were being
rendered ineffective by the operation of a domestic subsidy. The
essential point was that the restrictions on domestic production
should be effectively enforced and the Sub-Committee recognized
that unless this condition were fulfilled, restrictions on imports
would not be warranted.
23. It was agreed (except by the representative of Peru who
reserved his position as regards the question of subsidies) that
points (c) and (d) might adequately be met by the insertion of
"effectively " after " operate " in the fourth line of paragraph (2)
(c) and by the provision of other suitable safeguards for the inter-
ests of exporting countries (see paragraphs 24 and 26 below).
Safeguards for Exporting Countries.
24. The Sub-Committee gave full consideration to the question
of safeguards to prevent prejudice to the interest of exporting
countries by import restrictions imposed in consequence of restric-
tions on domestic output under paragraph (2) (c). It was agreed
that the possibility that the provisions of the Article might be
misused by the imposition of restrictions on domestic output which - 91 -
were not effectively enforced should be dealt with by the amend-
ments suggested in paragraph 23 above.
25. The Sub-Committee further noted that the provisions of
Article 22, and in particular the consultation provisions of para-
graph 4 of Article 22 applied to import restrictions imposed under
paragraph (2) (c); further, that it would be open to a Member at
any time to make representations under Article 41 to a Member
applying import restrictions under paragraph (2) (c), or to raise
under Articles 89 and 90 [93, 94 and 95] the question whether the
governmental measure restricting domestic output were such as to
warrant the application of import restrictions under para-
graph (2) (c).
26. It was pointed out that the sudden imposition of import
restrictions under paragraph (2) (c) might have serious effects on
the interest of exporting countries, and that to avoid this there
should be provisions requiring Members intending to introduce
such import restrictions to give as much advance notice as possible
to exporting countries in order to afford adequate opportunity
for consultation before the import restrictions were put into effect.
It was suggested that this point might be met by the inclusion of
the provisions as to prior notice and consultations set out in the
proposed new sub-paragraph 3 (b).
27. It was agreed that provision should be made for the obser-
vance of secrecy with regard to prior notice of, and consultation
concerning, the proposed introduction of restrictions if the Member
proposing to introduce such restrictions should so request.
28. It was pointed out that it was possible that import
restrictions might in certain circumstances operate so as to give
undue advantage to particular exporting countries. For example,
global quotas not allocated among supplying countries might
sometimes operate in a manner unduly favorable to those countries
best able for any reason to take prompt advantage of the global
quota at the opening of the quotas period; and it was agreed that
Members, in administering import restrictions, should pay due
regard to the need for avoiding such a result. It was also agreed
that, in the case of perishable commodities, due regard should be had
for the special problems affecting the trade in these commodities.
Amendments Designed to Widen the Scope of Paragraph (2) (c).
29. A majority of the Sub-Committee felt that the amendment
of Ireland, and an amendment of Colombia introduced during the - 92 --
discussion providing for the use of import restrictions to stabilize
agricultural prices, provided for the use of import restrictions on
a much broader basis than that provided in the case of restrictions
under (i) of paragraph (2) (c), and if generally applied would widen
the scope of the Article in a way which would seriously endanger
the interest of agricultural exporting countries, and that the parti-
cular difficulties of Ireland should be met by other measures.
Accordingly the Sub-Committee was unable to recommend the
adoption of these amendments.
30. The Sub-Committee discussed the amendment of Sweden
providing for the use of import restrictions to mitigate seasonal and
short-term fluctuations in the supply of agricultural products.
After hearing a statement by the representative of Sweden as to
his Government's policy in regard to livestock production, the Sub-
Committee agreed that a number of measures that he had described
were certainly capable of being used for restricting domestic
production, and, to the extent that they were so used, would be
covered by the provisions of paragraph (2) (c) (i). On this under-
standing the representative of Sweden withdrew his amendment.
31. The Sub-Committee did not recommend the adoption of
the amendments of Uruguay and Ireland.
Other Amendments.
32. The Sub-Committee decided that the proposal by the
delegation of Norway to substitute the word "partly" for
" mainly " in paragraph (2) (c) (iii) was unnecessary. It was
agreed that, under the existing text, in a case for example in which
a Member wished to restrict the quantities permitted to be produced
of any animal product the production of which was dependent
wholly or mainly on two or more imported kinds of feeding stuffs
considered together but not necessarily on either kind considered
separately, it would be open to that Member to restrict the produc-
tion of animal products, provided that domestic production of the
imported kinds of feeding-stuffs were relatively negligible, by treat-
ing the imported kinds of feeding-stuffs as a single commodity
and applying import restrictions thereto.
33. It was further agreed that if the various imported feeding-
stuffs were in fact treated as a single commodity, import restrictions
thereon should be applied globally on the total combined imports
without allocating shares to the individual feeding-stuffs. It was
felt that, in cases where this procedure would not be practicable, - 93 -
the import restriction should take the form of an equal propor-
tionate reduction in the amount permitted to be imported of each
of the several feeding-stuffs. The representative of Norway
accordingly withdrew his amendment.
34. The Sub-Committee agreed that the provisions of para-
graph (2) (c) (ii) would cover arrangements under which the govern-
ment concerned made temporary surpluses of grain available as
animal feeding-stuffs to small holders and similar categories with
a low standard of living, free of charge or at prices below the current
market level. In the light of this the representative of Sweden
withdrew the amendment.
35. The amendment of Mexico did not find the support of the
Sub-Committee.
36. The amendment of the United Kingdom was withdrawn.
The Sub-Committee accepted a further United Kingdom suggestion
that in order to avoid ambiguity the words " agricultural or fish-
eries " should be inserted between " domestic " and " product ,
at the end of paragraph 2 (c) (i). A drafting amendment of the
United Kingdom was accepted.
37. The Sub-Committee agreed that a new paragraph (3 (a)
in the revised draft of the text) should be inserted to achieve the
objectives of the amendment of Chile.
Geneva Draft Notes.
38. With regard to the footnote in the Geneva text on the
term " in any form " the Sub-Committee accepted as valid the
criticism put forward by the representative of the United States
that the introduction of the term " perishable " which is inappli-
cable to many types of agricultural products had unduly narrowed
the scope of paragraph 2 (c). It considered, therefore, that some
clarification of the text was required and accordingly recommended
to the Committee the wording set forth in the revised text.
39. The Sub-Committee, however, wishes to make clear that the
omission of the phrase " when in an early stage of processing and
still perishable" is dictated solely by the need to permit greater
flexibility in taking into account the differing circumstances that
may relate to the trade in different types of agricultural products,
having in view only the necessity of not making ineffective the
restriction on the importation of the product in its original form
and is in no way intended to widen the field within which quanti- - 94 -
tative restrictions under paragraph 2 (c) may be applied. In
particular, it should not be construed as permitting the use of
quantitative restrictions as a method of protecting the industrial
processing of agricultural or fisheries products.
40. The word " utilization" refers to the ultimate use of the
products and is not used in a technical sense. For example,
wheat and flour are so closely related as regards utilization that
flour is to be regarded as a processed form of wheat such as is
referred to in the interpretative note.
41. The Sub-Committee took note that paragraph 3 (a) was
not intended to and did not establish any new exception permitting
the use of quantitative restrictions on imports. It is to be under-
stood that the basic requirement of the effective operation of res-
trictions on domestic production or marketing remains as a condi-
tion precedent for all cases in which import restrictions may be
imposed under paragraph 2 (c) (i).
42. With regard to the interpretative note on " special factors"
the Sub-Committee agreed that it was desirable to make clear
that changes in relative productive efficiency between the home
producers and foreign producers should be taken into consideration
in determining the size of import quotas under paragraph (2) (c) (i).
The Sub-Committee recommended that the note to paragraph (2)
(c) of the Geneva text on " special factors " should be retained as
an interpretative note to paragraph 3 (d) of the Havana Charter
in the form set out in the revised text.
43. The Sub-Committee, after consideration of the interpre-
tative notes on " special factors " to Articles 20 and 22 of the Geneva
text, agreed that, as stated in those notes, changes artificially
brought about since the representative period (assuming that
period to have preceded the coming into force of the Charter) by
means not permissible under the provisions of the Charter were
not to be regarded as " special factors " for the purposes of para-
graph (2) (c) and Article 22. The Sub-Committee agreed, however,
that it was unnecessary to state this specifically in the text of the
Articles or in the interpretative notes.
44. The Sub-Committee agreed that the use of the words
"inter alia " in the footnotes to Articles 20 and 22 on " special
factors" should be brought to the notice of the Central Drafting
Committee in order that the footnotes throughout the Charter
might be standardized as to their form. -- 95 -
other Points.
45. At the request of the representative of Mexico the Sub-
Committee agreed to have it recorded that in its view the freedom
given to a Member to apply restrictions under paragraph (2) (c)
did not free such Member from a prior obligation to any individual
Member.
46. The representatives of Colombia, Mexico and Peru reserved
their positions on Article 20 until final settlement was reached on
Article 13.1
47. The representative of Ireland maintained that the pro-
visions of Article 20 should be extended so as to enable countries
to use import restrictions at least to meet situations arising out of
unavoidable seasonal fluctuations in supply, and also to allow for
the maintenance of stable incomes in agriculture. He accordingly
reserved his position on these points.2
Article 22. - Non-Discriminatory Administration of
Quantitative Restrictions.
48. The amendment of the delegation of Argentina to delete
paragraphs 2, 3, 4 and 5 found no support in the Sub-Committee.
49. The amendments of Uruguay and Mexico were with-
drawn since the Sub-Committee considered that their objectives
were covered by the existing text of the Article; the amendments
of Mexico and Turkey were withdrawn in view of the revision of the
interpretative note on " special factors " (see paragraph 51 below).
50. The amendment of Syria and Lebanon was referred to
Sub-Committee F with the concurrence of those delegations and of
Sub-Committee F.
51. The Sub-Committee agreed to delete the footnote to
paragraph 2 (d) of the Geneva text.
52. The Sub-Committee agreed that the interpretative note
on " special factors " should be retained as a note but should be
made more explicit both by the deletion of the cross reference to
the note to Article 20 which appears in the Geneva text and by
the specific mention of certain additional factors which should be
taken into account in the allocation of quotas. The Sub-Committee
also agreed that it was desirable to make clear that, in cases where
1, 2 The reservations mentioned in paragraphs 46 and 47, were withdrawn in
Committee III, but the delegation of Bolivia entered a reservation on the whole
of Article 20. - 96 -
separate import quotas were allotted to the various foreign sup-
pliers, a country whose productive efficiency or ability to export
had increased relatively to other foreign suppliers since the repre-
sentative period on which import quotas were based should receive
a relatively larger import quota. The Sub-Committee accordingly
recommended the wording shown in the revised text (see also para-
graph 43 under Article 20).
53. The Sub-Committee agreed that the objectives of the
amendements of India could best be met by the insertion of a new
interpretative note to the text.
54. The Sub-Committee considered that some provision should
be made in the Charter for releasing a Member from its obligation
to give public notice under paragraphs 3 (b) and 3 (c) in the case
of a Member trading with a non-Member or non-Members. Accord-
ingly the Sub-Committee recommended that a new paragraph 3 (d)
be inserted in the text. The Sub-Committee expressed the view
that, to enable prompt consideration of applications under para-
graph 3 (d) it would be desirable for the Organization to delegate
its functions in respect of this sub-paragraph to the Executive
Board; and that, provided an application under this sub-paragraph
was made sufficiently early and accompanied by sufficiently full
information to enable adequate consideration by the Executive
Board before the commencement of the quota period the Executive
Board should temporarily release the applicant Member from the
requirement to give public notice for the period necessary for the
Executive Board to make a decision on the application.1
REPORT OF SUB-COMMITTEE F OF THE
THIRD COMMITTEE ON ARTICLES 21, 23 AND 24.2
1. Sub-Committee F was appointed on 5 January 1948 to
examine and submit recommendations on all proposed amendments
to Articles 21, 23 and 24.
2. The Sub-Committee was composed of representatives of
Argentina, Australia, Belgium, Brazil, Canada, Cuba, Czecho-
slovakia, France, Greece, India, Italy, Lebanon, Liberia, Norway,
the Philippines, the United Kingdom and the United States.
1 In Committee III the delegation of Switzerland reserved its position on the
whole of Section B of Chapter IV. The delegation of Bolivia reserved its position
on Article 22, and that of Argentina on paragraphs 2, 3 and 4 of Article 22.
2 E/CONF.2/C3/57 and E./CONF. 2/C3/91. - 97 -
3. Mr. J. MELANDER (Norway) was unanimously elected
Chairman.
4. The Sub-Committee held fourteen meetings.
5. A number of representatives of delegations who were not
members of the Sub-Committee attended as observers and also
took part in the discussion of amendments which they had sub-
mitted. The Sub-Committee also heard statements by the repre-
sentatives of the International Monetary Fund.
Article 21. -- Restrictions to Safeguard the
Balance of Payments.1
6. The main change in Article 21 recommended by the Sub-
Committee was the inclusion of a new paragraph 1. This change
was made in response to an amendment submitted by Belgium and
related to action which may be taken to correct maladjustments
in the balance of payments.
7. In response to an amendment of Australia certain changes
were made in paragraph 3 (b), formerly 2 (b) of the Geneva draft.
8. Paragraph 3 (c) (i), formerly 3 (c) (ii), was amended in
response to a proposal submitted by Argentina.
9. Paragraph 4 (b), formerly 3 (b) of the Geneva draft, was
amended in response to an amendment by Denmark.
10. The introductory phrase of paragraph 4 (b) (i), formerly
3 (b) (i) of the Geneva draft, was deleted and, paralleling this,
the Sub-Committee recommended the deletion of the interpretative
note relating to this phrase.
11. In response to a proposal by Brazil, sub-paragraphs (ii)
and (iii) of paragraphs 3 (c) of the Geneva text were transferred to
paragraph 3 (c) of the present text (paragraph 2 of the Geneva text)
on the ground that they constitute limitations on any kind of
quantitative restrictions irrespective of whether the restriction is
a consequence of the domestic policies referred to in paragraph 3 (c)
of the Geneva text or of other causes.
12. In response to a proposal by New Zealandan interpreta-
tive note appended to Article 31 of the Geneva text was trans-
ferred to Article 21.
13. The delegation of Chile reserved its position on para-
graph 3 (a), formerly 2 (a) of the Geneva draft.2
1 E/CONF.2/C.3/57.
2 This reservation was withdrawn in Committee III. - 98 -
14. The delegation of Argentina reserved its position on
Article 21 (paragraphs 4 (a) and 5).
Article 23. - Exceptions to the Rule of Non-discrimination.1
15. In addition to the amendments to Article 23 in the Anno-
tated Agenda, the Sub-Committee considered an amendment to
Article 22 proposed by Syria and Lebanon which was referred to
it by Sub-Committee E as falling more properly under Article 23.
16. After a thorough consideration of the amendments mentio-
ned above, the Sub-Committee concluded that a substantial redraft
of Article 23 was desirable.2 Since, however, certain Members
would have already accepted the principles of Article 23 of the Geneva
text and would have begun to apply them, the Sub-Committee con-
sidered that such Members should be allowed, if they so desired, to
continue to apply these principles during the transitional period
as defined below in paragraph 20. The Sub-Committee accord-
ingly submitted a revised text together with a proposed new Annex
which embodies these principles. Two interpretative notes were
attached to the text of the Article and one to the Annex.
17. The new text did not require the Interpretative Note to
paragraph 3 of Article 23 of the Geneva Draft and it was accord-
ingly been dropped.
18. The major changes from the Geneva text of Article 23 were
to be found in paragraphs 1, 2 and 4 of the revised Article.
19. In conjuction with the proposed revision of Article 23, it
was considered desirable that paragraph 9 of Article 24 of the
Geneva text (renumbered paragraph 8 in the text submitted by
the Sub-Committee) be amended by the deletion of the phrase
" Subject to paragraph 4 of this Article, " at the beginning of the
paragraph. As consequence of this change the Sub-Committee
recommended that the interpretative note now attached to para-
graph 4 of Article 24 of the Geneva text be attached to paragraph 8
of that Article, that the first sentence of the note be deleted, and
that certain consequential drafting changes be made as shown in the
recommended text.
20. Paragraph 1 of tile revised Article defines the exceptions
to the rule of non-discrimination permissible during the post-war
transitional period. This transitional period and its application in
1 E/CONF.2/C.3/91, and Corr.1.
2 Consequently, the references to the paragraphs of Article 23 relate to the
Havana Charter. - 99 -
respect of individual members are defined by reference to the provi-
sions of Article XIV of the Agreement of the International Monetary
Fund or by reference to an analogous provision of a special exchange
agreement entered into pursuant to paragraph 6 of Article 24. The
discriminatory measures, including adaptations thereof, permitted
under paragraph 1 may be applied by a Member during the transi-
tional period without the prior approval of the Organization.
21. Sub-paragraph 1 (d) of the new text provides that a
Member may under certain condition elect to operate during the
transitional period under the Annex rather than under sub-para-
graphs (b) or (c) of paragraph 1. The subject matter of the Annex
is dealt with in paragraph 26 below. Sub-paragraphs (g) and (h)
deal with the administrative control which is to be exercised by
the Organization over measures taken by a Member under this
Article. The attention of the Sub-Committee was particularly
directed to ensuring that Members operating under sub-para-
graphs (b) and (c) and Members operating under the Annex enjoyed
equality of treatment in this respect. As a consequence, the Sub-
Committee in drafting these sub-paragraphs took account of the
procedures laid down in Article XIV of the Articles of Agreement
of the International Monetary Fund.
22. After the termination of the transitional period for a
Member, paragraph 2 makes provision, subject to the prior approval
of the Organization, for limited departures from the rule of non-
discrimination.
23. Paragraph 4 permits a Member applying import restric-
tions in accordance with Article 21 to control its exports in such
a manner as to increase its earning of currencies which it can use
without deviation from the provisions of Article 22.
24. The effect of the amendment to paragraph 9 [8] of Article 24
is that the measures defined in that paragraph are not precluded
by the provisions of this Section of the Charter.
25. Paragraph 3 is identical with paragraph 4 of the Geneva
text and paragraph 5 is substantially the same as paragraph 5 of
the Geneva text. Paragraph 5 (b) of the revised article incorporates
an amendment which is a consequential change resulting from
certain amendments to Annex A of Article 16 which were
approved by Committee III with reservation by the delegations
of Brazil and Uruguay.
26. The Annex contains a substantial part of the provisions
of the Geneva text of Article 23. Certain sections of that text were, - 100 -
however, transferred to the new Article proper and the
declaration in sub-paragraph 1 (a) of the Geneva text was
omitted in view of sub-paragraphs 1(a) and 1 (f) of the new Article.
The procedures for administrative control in sub-paragraphs 3 (a)
and 3 (c) in the Geneva text were replaced by sub-paragraphs
1 (f), 1 (g) and 1(h) of the new Article. The criteria in sub-para-
graph 1 (b) of the Geneva text remain the same.
27. Certain delegations suggested that the provisions of para-
graph 4 of Annex K be transferred to the body of Article 23 so
that they would be applicable both to Members who elect Annex K
and those who do not so elect. The Sub-Committee felt that this
purpose was covered in part by the procedures available under
Article 21, and that the change need not therefore be made.
28. It was considered by the Sub-Committee that the above
changes met a large number of the objectives to which the amend-
ments submitted were directed. In view of the extensive revision
of Article 23 it was not practicable to indicate how particular
amendments were accommodated. However, the amendments
submitted by the following countries were considered by the
delegates of those countries to be covered by the new text:
(a) Belgium
(b) Czechoslovakia (amendments to paragraphs 1 (a), 1 (b), 2, 3 (a)
and 3 (c) are covered by Article 23 and the proposed amendment
to paragraph 5 is covered by the proposed revision of paragraph 8
of Article 24).
(c) Denmark
(d) France
(e) Lebanon
(f)Norway (amendment to paragraph 1 (b) (i))
(g) Syria.
29. The Norwegian delegate indicated that the new text of
Article 93 [98] on relations with non-Members which has been
approved by the Sixth Committee met the major part of the
problem to which his amendment on long-term agreements was
directed, and, accordingly, withdrew this amendment.
30. With respect to the amendment submitted by Italy the
Sub-Committee considered that paragraph 2 of the revised text
takes account of the concept of relative injury.
31. The delegate of Mexico stated that his delegation was
at that time reviewing the new text to see wether the purpose of
its amendment was met. - 101 -
32. The amendment submitted by Greece proposing a new
Article 23A was replaced by an amendment to paragraph 5 of
Article 23 submitted by that delegation. When the new text of
Article 23, together with the change proposed in Article 24,
were before the Working Party dealing with this matter, the
delegate of Greece agreed that these new texts went a long way to
meet the problem of his country. However, he did not feel that
his point was met entirely, particularly in the post-transitional
period. The Sub-Committee belived that further amendment in
this respect would provide too wide an exception, and therefore
recommended no further change in the text. The delegation of
Greece reserved its position.1
33. The delegation of Argentina reserved its position on
Article 23. The delegation of Brazil expressed no opinion on the
Article.
Article 24. - Relationship with the International
Monetary Fund and Exchange Arrangements.2
34. After consideration of paragraph 2 of Article 25 in the
light of the amendments proposed by Australia and New Zealand,
the Sub-Committee recommended an amendment.
35. The Sub-Committee gave consideration to an amendment
to paragraph 6 proposed by the delegate of Liberia referring to
the case of a country which does not use its own currency. The
Sub-Committee recommended that to meet this case the new sub-
paragraph 6 (d) should be included.
36. In this connection, two members of the Sub-Committee,
while having no objection in substance to the proposed text,
thought that the Committee should consider whether such a
provision should be included in the text of Article 24, or whether
the special situation of Liberia could be suitably dealt with under
Article 74 [77], which provides for the waiver of obligations under
the Charter.
37. The Sub-Committee also considered that paragraphs 6
and 7 of Article 24 could be combined with advantage, since they
dealt with the same subject. It also recommended that a conse-
quential amendment should be included in paragraph 8 (new para-
graph 7).
1 This reservation was withdrawn in Committee III.
2 E/CONF.2/C.3/91. - 102 -
38. The Sub-Committee, while aware of the desirability of
keeping interpretative notes to a minimum, considered that the
interpretaive footnote to paragraph 4 of Article 24 of the Geneva
text relating to " frustration " is both essential and too detailed
for inclusion in the text of Article 24. It therefore recommended
that this interpretative note, with the amendment thereto proposed
in paragraph 19 above, be appended to the text of Article 24.
39. The Sub-Committee took note of the amendment of
Mexico but felt that it would be desirable that a more specific
amendment be submitted by Mexico. Having heard a further
explanation by the delegation of Mexico, the Sub-Committee did
not consider that the text of Article 24 required any change in the
light of the proposed Mexican amendment. It took note that the
problem to which the delegation of Mexico had directed its amend-
ment was similar to that being considered by Sub-Committee G
of Committee III. In the light of the Sub-Committee's recommen-
dation the Mexican delegate stated that his delegation reserved its
position on Article 24. 1
40. The Sub-Committee considered that the title of Article 24
would more clearly its content if it were changed to read as follows:
" Relationship with the International Monetary Fund and Ex-
change Arrangements ".
41. It recommended also that the title of section B of Chapter
IV would more clearly indicate the content of the section if it
were to read: " Quantitative Restrictions and Related Exchange
Matters" instead of " Quantitative Restrictions and Exchange
Controls ".
REPORT OF SUB-COMMITTEE G OF THE
THIRD COMMITTEE ON THE SWISS PROPOSAL2
1. Sub-Committee G was appointed by Committee III on
5 January 1948 with the following terms of reference:
" To consider the proposal of the Swiss delegation (reference
E/CONF.2/C.3/II) that the following new paragraph be inserted in
Chapter IV:
" ' A Member, unable to invoke the provisions of Article 21 and finding
that its economic stability, particularly in the fields of agriculture and
employment, is being seriously impaired or gravely threatened, may take
such steps as are necessary for safeguarding its vital interests.'"
1 The reservation of Mexico was withdrawn in Committee III, but a reservation
was entered by the delegation of Argentina.
2 E/CONF.2/C.3/72. - 103 -
2. The following delegations were appointed to the Sub-
Committee: Belgium, China, France, Poland, Sweden, Switzerland,
the United Kingdom, the United States of America, Uruguay
and Venezuela. The Sub-Committee held ten meetings. Mr. L. P.
THOMPSON-MCCAUSLAND (United Kingdom) was unanimously
elected Chairman. Owing to the departure of Mr. L. P. THOMP-
SON-McCAUSLAND before the work of the Sub-Committee was
completed Mr. A. PHILIP (France) was unanimously elected Acting
Chairman at the tenth meeting.
3. Proceeding from the draft amendment contained in its
terms of reference, the Sub-Committee based its enquiries on the
assumption that the Member concerted was not eligible to impose
quantitative restrictions under Article 21 but was liable to suffer
damage from restrictions imposed by other Members under that
Article.
4. A variety of factors was put before the Sub-Committee
as justifying special measures. Several were regarded by the
Sub-Committee as irrelevant, others as doubtful, and no single
factor was judged to be sufficient by itself to justify special
treatment. The Sub-Committee, however, agreed that the follow-
ing factors advanced by the delegate of Switzerland represented,
when taken together, a combination of circumstances requiring
special consideration:
(a) that a relatively high proportion of the country's total produc-
tion depended upon export markets;
(b) that a relatively high proportion of these exports consisted of
goods and services considered as non-essential by many import-
ing countries and treated by them accordingly; and
(c) that the country's normal export markets were in countries which
were applying restrictions in accordance with the principles
of the Charter.
5. The Sub-Committee therefore recognized that a small
country, in which a relatively high proportion of workers depend
for their employment on the manufacture of non-essential goods
for export, may be liable to serious unemployment when the
countries to which it normally exports such goods can, under the
Charter, greatly restrict, or stop completely, their imports of them.
This risk is increased when the exporting country has a convertible
currency, since countries in balance-of-payments difficulties would
be anxious both to reduce their imports from it to save " hard
currency " and to increase their exports to it to earn " hard cur-
rency ". The country would, in fact, be an attractive export - 104 -
market for all other countries, and while in normal conditions
economic forces would operate to limit the impact of excessive
imports, there is in present conditions a threat of imports flooding
in at a rate which would endanger domestic production and em-
ployment. These pressures, in combination, might in the long
run undermine the convertibility of the currency. The Sub-
Committee agreed that it would not be in the interests of the
Members to expose such a country to such pressures.
6. The Sub-Committee considered whether the existing
provisions of the Charter would give the necessary safeguards to a
country in the situation described above and came to the conclusion
that with respect to both exports and imports a certain protection
exists in Articles 21 and 40. It was, however, recognized that
these provisions are insufficient to meet the exceptional needs of
Switzerland. It was accordingly agreed that if such a country
has to engage in bilateral negotiations with other countries which
are themselves applying restrictions to their imports, it will need
bargaining powers to safeguard its export interests by the use of
necessary measures. It may also need powers to defend itself
against the pressure of excessive imports.
7. The amendment presented by the Swiss delegation would
safeguard the country's freedom of action. The majority of the
Sub-Committee, however, was of the opinion that this proposal
was so far-reaching that its adoption by the Conference would
dangerously weaken the structure of the whole Charter. The
Sub-Committee was therefore unable to recommend the amendment
as a solution of the problem (4 delegates being against the amend-
ment, 3 for it, 2 abstaining and 1 absent).
8. In an effort to enable Switzerland to adhere to the Charter
the Sub-Committee examined other solutions, but regretted that
it had been unable to find one which could accommodate Switzer-
land without excessive weakening of the Charter. The Sub-
Committee, therefore, aimed a t keeping open a way by which
Switzerland might later enter into negotiations with the Organi-
zation regarding its adherence to the Charter. Before specific
proposals to this end could be submitted further and more detailed
examination of the problem was called for.
9. The Sub-Committee recommended, therefore, that the
Conference should direct the Interim Commission to invite the
Swiss Government to participate in a study of the problems facing
the Swiss economy with a view to submitting to the first Conference - 105 -
of the Organization a report as to the measures which could be
taken in accordance with the procedures established in the Charter
for dealing with the problem.
10. The Sub-Committee also examined the cases of Venezuela
and Uruguay which were presented to it and found that neither of
these countries had established any special problems connected
with transition from their present systems of trading to that
contemplated by the Charter.
11. It was the view of the Sub-Committee that the present text
of Article 21 made adequate provision for many of the considerations
put forward by the delegates of Venezuela and Uruguay. Thus,
it was pointed out that paragraph 2 (a) [3 (a)] requires that " due
regard " be paid in the monetary reserve questions there involved
" to any special factors which may be affecting the Member's. .
need for reserves . . ." It was pointed out that a country export-
ing principally a small number of products would, in like conditions,
probably be considered to have need for greater reserves than a
country exporting a large variety of products, particularly if the
exports were exhaustible or subject to considerable fluctuations
of supply or price. A country actively embarked on a programme of
economic development which is raising levels of production and
foreign trade would probably then be considered to have need for
greater reserves than when its economic activity was at a lower
level.
12. Beyond this the issues raised involved matters which
were then under active consideration in connection with Articles 13
and 14. The considerations put forward by Venezuela and
Uruguay in this connection were not dissimilar from those being
urged by a considerable number of other " underdeveloped "
countries in connection with the economic development chapter of
the Charter. This Sub-Committee felt it should not pursue this
matter any further since to do so would be to duplicate the work
of Committee II and its Sub-Committees.
13. The delegate of Venezuela had advised the Sub-Committee
that he was satisfied with the foregoing statements by this Sub-
Committee.
14. The delegate of the United States, while agreeing with the
final conclusion, stated that he was not in agreementwith certain
aspects of this Report.<R>1</R>
1 See E/CONF.2/C.3/73. - 106 -
REPORT OF
SUB-COMMITTEE H OF THE THIRD COMMITTEE
ON ARTICLES 25-29 [25-28] 1
1. The Sub-Committee was appointed at the twenty-seventh
meeting (7 January 1948) of the Third Committee. It was given the
following terms of reference:
" (a) To consider all proposed amendments to Section C of Chap-
ter IV of the Draft Charter as contained in document
E/CONF.2/C.3/8, together with all suggestions and proposals
made during discussion of those proposed amendments in
Committee III; and
" (b) to recommend texts to reconcile the various points of view
expressed."
2. The Sub-Committee consisted of representatives of the
following delegations:
Argentina, Australia, Brazil, Canada, Cuba, Denmark, France,
Netherlands, Peru, Philippines, Sweden, Turkey, United Kingdom,
United States of America and Venezuela.
3. Mr. E. MCCARTHY (Australia) was elected Chairman. At
the seventh meeting of the Sub-Committee Mr. G. WARWICK
SMITH (Australia) was elected in place of Mr. McCarthy who had to
leave Havana.
4. At the fifth meeting of the Sub-Committee it was decided
to set up a Working Party to examine proposed amendments to
Articles 26 to 29. The Working Party consisted of representatives
of Brazil, Canada, Peru, United Kingdom, United States of America
and Venezuela, together with the Chairman of the Sub-Committee.
It held ten meetings.
5. The Sub-Committee held eight meetings and reached general
agreement on a text to submit to the Committee.
General.
6. The delegation of Brazil provisionally reserved its position
on Section C of Chapter IV.2
7. The delegation of Peru wished its view recorded that there
was a difference of treatment as between subsidies which operate
directly or indirectly to maintain or increase the export of any
primary commodity, and subsidies which operate directly or indi-
1 This reservation was withdrawn in Committee III. - 107 -
rectly to reduce, or prevent an increase in, the imports of any
primary commodity. The former were subject to the provisions
of Article 28, while the latter were subject only to the much weaker
provisions of Article 25. In the view of that delegation the
latter type of subsidy ought to be subject also to provisions parallel
to those of Article 28, because the interests of exporting countries
were prejudiced just as much by a subsidy which decreases imports
in an importing country as by one which increases exports from
a competing exporting country. Consequently the delegation of
Peru reserved its position on Section C.
8. The Sub-Committee considered an inquiry from the Central
Drafting Committee as to whether it was desired that references
in Section C to primary commodities should be covered by the
definition of a " primary commodity " contained in Article 53 [56].
It was agreed that the definition contained in pargraph 1 of Article
53 [56] was applicable to all such references.
9. The Sub-Committee considered the suggestions of the
International Chamber of Commerce1 regarding the arrangement of
the Section, but thought that the present arrangement was appro-
priate.
Article 25. ? ?Subsidies in General.
10. The Sub-Committee was unable to agree to the inclusion
of the words " direct or indirect ", or of an alternative amendment
having a similar purpose, proposed by the delegation of Cuba.
11. The representative of Cuba explained to the Sub-Committee
that the amendment constituted a matter of immediate and prac-
tical importance to his country, which could not afford to promote
its economic development by the methods of direct subsidization.
It had therefore introduced a system by which certain domestic
industries were exempted from internal taxes payable on imported
goods. This was simpler in practice than, though no different in
principle from, the system of " payments to domestic producers
derived from the proceeds of internal taxes or charges" which
was permitted under paragraph 5 [8 (b)] of Article 18. The
system employed in Cuba had secured favourable results, parti-
cularly in encouraging capital investment, both domestic and
foreign.
12. The Sub-Committee was in general agreement that the
terms of Article 25 were sufficiently wide to cover a case such as
1 E/CONF.2/14. - 108 -
that described by the Cuban delegation. It was considered that
the proposals of Cuba in regard to Article 25 would not alter the
sense of the Article, nor would they have the effect of permitting
continuance of the Cuban system if it conflicted with other provi-
sions of the Charter such as those regarding non-discrimination.
The appropriate place to consider an amendment with this purpose
was under Article 18 concerning the non-discriminatory application
of internal taxation. The representative of Cuba maintained the
reservation of his delegation on Article 25.1
13. Arising from an amendment proposed by the United States
delegation, it was agreed to make the following changes in the
first sentence:
". . .which operates directly or indirectly to maintain or increase
exports of any product from, or to reduce, or prevent an increase in,
imports of any product into . . ."
It was felt that the Geneva text of the Article failed to cover
subsidies which, whilst not increasing a Member's exports nor reduc-
ing its imports, might nevertheless affect a Member's share of total
trade.
14. It was agreed to accept the proposal by the United States
delegation to introduce in the last sentence the phrase " a Member
considers " in place of determinations by the Organization. It
was thought that this change was consistent with similar changes
made in Chapter VI and would expedite procedure.
Article 26. ? Additional Provisions on Export Subsidies.
Paragraph 1.
15. The Sub-Committee was unable to accept the proposal of
the United States delegation to except subsidies on primary
commodities from the provisions of paragraph 1, and the conse-
quential changes proposed ih regard to other Article. The United
States delegation, however, submitted alternative suggestions to
which reference is made in the notes on Articles 27 and 28 below.
Paragraph 2.
16. Drafting changes proposed by the United States delegation
were accepted with slight modification.
17. The insertion of the words " in general of those products"
after " payments to domestic producers " was intended to make it
1 This reservation was withdrawn at the final Plenary Meeting. In Com-
mittee III a reservation was entered on Article 25 by the delegation of Bolivia. - 109 -
clear that the payments in question refer to general subsidization
of domestic producers of like products.
18. The delegation of Sweden withdrew its proposal to insert
the words " directly or indirectly" between the words " taxes "
and " imposed ". It was understood that the text?particularly
the phrase " remission of such duties or taxes . . . which
have accrued "? covers the case of remission of duties or taxes
imposed on raw materials and semi-manufactured products subse-
quently used in the production of exported manufactured goods.
19. It was understood that the term "like products" is
intended to mean closely similar products in the corresponding
stage of production, allowing for such differences as are necessary
for export purposes.
Paragraph 3.
20. The Sub-Committee was unable to accept the proposal of
the delegation of Argentina to delete the time-limit provisions in
this paragraph. The delegation of Argentina reserved its right to
reopen the question in Committee.
21. The introduction of the words " and if so on what terms"
in the last sentence of paragraph 3 was prompted by the decision
to exclude subsidies on non-primary commodities from the provi-
sions of Article 28. It was felt that the position of the Organization
in relation to such subsidies should be stated more explicitly.
22. The Sub-Committee agreed to certain drafting changes
proposed by the delegation of the Netherlands.
Proposed New Paragraph.
23. The Sub-Committee considered the proposal of the delega-
tion of Venezuela to insert a new paragraph designed to except
certain types of subsidies from the provisions of paragraph 1 of
Article 26. It was felt that the subsidies in question, i. e. those
whose effect on world trade in the community is of minor signifi-
cance, would be largely covered by the proposed new texts of
paragraphs 3 and 5 of Article 27, and of sub-paragraphs 4 (b) and
4 (c) of Article 28. In particular it was understood that the
phrase " if an agreement is inappropriate " in the proposed text
of paragraph 5 of Article 27 meant that if Chapter VI procedure
was inappropriate (including cases judged to be inappropriate by
the Organization under Article 55 [58], paragraph 2), a Member
could grant or maintain an export subsidy without being bound to -110 -
seek an inter-governmental agreement on the commodity in ques-
tion. Moreover, in cases where negotiation did take place toward
an intergovernmental agreement, a Member would be free
(under paragraph 3 of Article 27), pending the outcome of such
negotiations, to maintain export subsidies on the commodity in
question.
Article 27. ? Special Treatment of Primary Commodities
24. Specific references in Article 27 to the provisions of
Article 28 are not intended to be exclusive. They are included for
purposes of emphasis.
Paragraph 1.
25. It was agreed to insert in sub-paragraph (a) the words
"or is so designed as to result " after the words " has also resulted ".
It was felt that this covered the substance of a similar amendment
proposed by the delegation of Venezuela. A corresponding addi-
tion has been made in sub-paragraph (b).
Proposed New Paragraph 2.
26. The Sub-Committee considered the new paragraph proposed
by the delegation of the Netherlands relating to certain types of
price stabilization schemes. It was generally agreed that a system
for the stabilization of the domestic price or of the return to domes-
tic producers of a primary commodity, independently of the
movement of import prices, which results, or is so designed as to
result, in the sale of the commodity in the domestic market at a
price at times higher and at times lower than the comparable
landed cost for the imported product, should be treated as a case
under Article 25. On this understanding the delegation of the
Netherlands withdrew its proposal.
Paragraph 2.
27. Paragraph 2 is a new provision emphasizing the responsi-
bility of Members granting any form of subsidy on a primary
commodity to co-operate in negotiating inter-governmental agree-
ments under Chapter VI.
Paragraph 3.
28. This paragraph takes the place of paragraph 2 in the
Geneva text of Article 27. The Sub-Committee was unable to
accept the proposal by the delegations of Argentina and Peru to
delete the paragraph. - 111 -
29. The paragraph has been redrafted to make it clear that,
as regards serious prejudice caused by the granting of a subsidy,
the paragraph applies to all types of subsidization of primary
commodities.
30. A new provision has been added to permit a Member to
maintain a subsidy pending the outcome of negociations under
Chapter VI.
Paragraph 4.
31. Paragraph 4 is a new provision prohibiting a Member from
granting a new subsidy or increasing an existing subsidy, affecting
the export of a primary commodity, during a commodity conference
dealing with the commodity in question, unless the Organization
concurs. This provision serves to limit the above-mentioned new
provision contained in paragraph 3. The Sub-Committee was
unable to agree to a proposal by the delegation of Argentina to
delete the phrase " unless the Organization concurs ", and that
delegation reserved its right to reopen the question in Committee
Paragraph 5.
32. This paragraph takes the place of paragraph 3 in the
the Geneva text of Article 27. The Sub-Committee was unable to
accept the proposal by the delegations of Argentina and Peru to
delete the paragraph; the delegation of Argentina was satisfied,
however, that its point was covered by the new text. The delega-
tion of Peru reserved its position on the paragraph.
33. On the basis of a suggestion by the United States repre-
sentatives, the paragraph was redrafted in order to permit Members
who consider their interests seriously prejudiced to apply or
maintain export subsidies on primary commodities, without prior
approval or a determination by the Organization, where Chapter VI
procedure has failed or does not promise to succeed or where an
inter-governmental agreement is inappropriate. It was recognized
that any judgment by a Member that an agreement is " inappro-
priate" could subsequently be challenged by any other Member
through the procedure of Chapter VI.
Article 28. ? Undertaking regarding Stimulation of Exports of
Primary Commodities.
34. In the light of the relaxation of the provisions of Article 27
the safeguards contained in Article 28 were strengthened. In - 112 -
particular, provision was made, where consultation fails, for the
Organization to make determinations to which Members shall
conform. Other changes which were agreed are as follows:
(i) The new Article refers not only to export subsidies but to any
form of subsidy operating directly or indirectly to increase
or maintain exports; its application, however, is now limited
to primary commodities.
(ii) The concept of a " previous representative period " as the
basic criterion has been replaced by that of " an equitable share
of world trade ". This is intended to meet criticisms that the
Article, as in the Geneva text, would tend to stabilize an
existing trade situation to the detriment of under-developed
countries. It is thought that the new text will, in this respect
cover the case of these countries and go some way to meet the
position of the delegation of Argentina expressed in its proposal
to delete the Article.
(iii) Factors are specified which, amongst others, the Organization
shall take into consideration in making its determination of an
" equitable share ". In regard to sub-paragraph 4 (c) of
Article 28 it is understood that the terms " the economy " and
" the economies " mean national economy as a whole and would
include the balance-of-payments situation of the Members
concerned. The terms would naturally cover any special
aspect of the economic structure of a Member.
35. It was felt that the new text, by its application of safe-
guards to general subsidies affecting exports, partly met the point
raised in the amendment submitted by the delegation of Brazil
(paragraph 2 of proposed Article 27 A). Regarding the other
point raised by the delegation of Brazil (paragraph 1 of proposed
Article 27 A), which was referred to Sub-Committee A, the Sub-
Committee noted the latter's decision, namely, that a majority of
the Members of Sub-Committee A felt that it was unnecessary to
insert the amendment, whereas a minority supported the Brazilian
proposal, at least in principle.
36. The representative of Argentina proposed to amend
paragraph 3 so as to remove the provision that a Member should
conform to a determination by the Organization. The Sub-
Committee was unable to accept the proposal, and the represen..
tative of Argentina reserved his delegation's position on the para-
graph.
37. In regard to paragraph 4 (d), one delegation called atten-
tion to the fact that a major consideration in deciding what is an
" equitable share " is the extent to which a country may success-
fully have limited the supply of a surplus commodity. This is
recognized as concerns one kind of such limitation in the reference -113 -
to paragraph 1 of Article 27. However, there are other methods
of limiting supply which also deserve mention because of their
specific and important relevance.
38. The term " other measures " in paragraph 4 (e) refers
only to measures permitted under Section C.
Article 29 of the Geneva draft ? Procedure.
39. It was agreed to delete this Atricle and instead to make
appropriate reference to the Organization in paragraph 3 of Article
26 and in paragraph 1 of Article 27 in regard to the determina-
tions provided for in those paragraphs. The deletion of Artcle 29
had been proposed by the delegation of Argentina.
REPORT OF
SUB-COMMIITTEE J OF THE THIRD COMMITTEE
ON ARTICLES 30 AND 31 [29 TO 32]1
1. The Third Committee at its twenty-eight meeting on
7 January 1948 approved the formation of a Sub-Committee on
Section D?State Trading?of Chapter IV consisting of the repre-
sentatives of Czechoslovakia, Ecuador, Egypt, Mexico, the Nether-
lands, Pakistan, Sw itzerland, the United Kingdom and the United
States.
2. The terms of reference of the Sub-Committee were to con-
sider and make recommendations concerning the text of Articles 30
[29] and 31 and the notes attached and amendments submitted
to these Articles.
3. The Sub-Committee understood the proposal by the
delegation of Argentina to delete the entire Section D, which
had met with no support during the discussion in Committee, to
be outside its terms of reference and did not, therefore, include it
in its considerations.
4. The Sub-Committee held its first meeting on Monday,
12 January 1948 and unanimously elected the Right Honourable
Walter NASH (New Zealand) its Chairman.
5. The Sub-Committee held seven meetings. Representatives
of several counties not members of the Sub-Committee attended
the meetings as observers. Delegates of Belgium, Canada, Cuba
1 E/CONF.2/C.3/43.
8 - 114 -
and Denmark took an active part in the discussion on points of
special interest to them.
6. In the course of its work the Sub-Committee examined the
text of Articles 30 [29] and 31, the notes attached and all outstand-
ing amendments submitted to these Articles, as well as amend-
ments and observations subsequently submitted by members and
recommendations made by other Sub-Committees.
7. In order to facilitate the work of the Sub-Committee, several
Working Groups to consider particular items were establiched on
which the delegates of Czechoslovakia, Mexico, the Netherlands,
New Zealand, Switzerland, the United Kingdom and the United
States were represented.
8. The Sub-Committee was able to reach unanimous agree-
ment on most points, only a small number of decisions taken being
subject to reservations by individual delegations.
General.
9. In view of the additional provisions included in this Section.
it was considered necessary to make a change in the title of the
Section by adding the words " and Related Matters"
Article 30 [29]. ? Non-discriminatory Treatment.
10. In the opinion of the Sub-Committee, the term " state
enterprise" in the text did not require any special definition; it
was the general understanding that the term includes, inter alia,
any agency of government that engages in purchasing or selling.
11. A drafting amendment, replacing in sub-paragraph 1 (a)
the words " applied in this Charter to governmental measures" by
" prescribed in this Charter for governmental measures " was
adopted so as to express more correctly the purpose of the provision.
12. It was decided to embody the substance of the paragraphs.
in the footnotes to paragraph 1 relating to Marketing Boards in
a new Article.
13. In regard to the footnote to paragraph 1 concerning
different prices in different markets for sales of products by state
enterprises, it was decided to retain the interpretation contained
in the footnote. The Sub-Committee agreed, therefore, to amend
the text so as to include purchases as well as sales and to take
account also of relevant factors other than supply and demand.
The representative of Belgium stated that if the new text were - 115 -
approved his delegation would not maintain the reservation made
at Geneva..
14. The Sub-Committee felt that the Note appended to
sub-paragraph 1 (a) could not be dispensed with. It was unani-
mously agreed to recommend the retention of its text, with certain
alterations, as a footnote attached to that sub-paragraph and
forming a part of the Charter.
15. It was felt that the matter covered in the Note appended
to sub-paragraph 1 (b) did not require express statement. It
was therefore agreed to delete this Note.
16. An amendment by Mexico proposing to delete paragraph 2
was withdrawn.
17. It was considered necessary to retain the Note attached
to paragraph 2 in the Geneva draft.
New Article 30A [30]. ? Marketing Organizations.
18. Following the discussion on the footnotes relating to
marketing boards appended to paragraph 1 of Article 30 of the
Geneva draft and on the amendment by the New Zealand delegation
as to how the provisions of the Charter would apply to the activities
of marketing boards, commissions and similar bodies it was agreed
unanimously that a provision dealing with this question should
be included in the Charter. A suitably drafted text for a new
Article, headed " Marketing Organizations ", was accordingly
inserted.
Article 31. ? Expansion of Trade.
19. Arising from the amendment proposed by the United
States, the Sub-Committee agreed that the last phrase of sub-
paragraph 1 (b) as previously drafted did not accurately express
the intention of that provision. It was therefore decided to make
the drafting change indicated in the revised text.
20. The Cuban delegation explained the object of its amend-
ment and advised that the delegation would be satisfied if para-
graph 2 (b) was altered in any of the following ways:
(A) " . . . or would be not wholly effective for the achieve-
ment of . . ."
(B) " . . . or would not be satisfactorily effective for the
achievementof . . ."
Provided that a record should also be kept with the Committee with
an explanation of the interpretation to the effect, that if the negotia-
tion of the maximum import duty should not be entirely or - 116 -
partially effective in attaining the objects mentioned in sub-para-
graph 1 (b), any other agreement which is reached in accordance
with sub-paragraph 2 (b) does not exclude the agreement regarding
the maximum import duties mentioned in sub-paragraph (a)."
21. It was considered that the proposed change in the wording
would not add anything to the present scope of sub-paragraph (b).
The Sub-Committee expressed the view that the wording of sub-
paragraph (b) was not intended to preclude a negotiation by mutual
agreement under this sub-paragraph in conjunction with, or in
addition to, a negotiation under sub-paragraph (a).
22. The Sub-Committee expressed the view that the Note
appended to paragraph 3 of the Geneva draft which reads:
" If the maximum import duty is not bound by negotiations
according to sub-paragraph 2 (a) the Member is free to change at any
time the declared maximum import duty, provided that such change
is made public or notified to the Organization."
represents a correct interpretation of the provision. It was
considered, however, that the text as drafted was sufficiently
clear and that there was no need to retain the footnote.
23. In order to remove any possible misinterpretation of
paragraph 4 and to make its intention fully clear the words " exclu-
sive of " were substituted for " after due allowance for ".
24. In paragraph 4 as well as in the Note to paragraph 4
the words " primary product " were replaced by the words " pri-
mary commodity ". In using the expression " primary com-
modity" in Section D the Sub-Commiteee had in mind the defi-
nition contained in paragraph 1of Article 53 [56].
25. The Sub-Committee considered that it was desirable to
retain the Note appended to paragraph 4 of the Geneva draft as
a footnote.
26. The proposal by Denmark to add to paragraph 5 the
following proviso:
" Provided that such rationing does not aim at restrictions over
and above such restrictions that are otherwise justified according to
the Charter."
was not approved as it was felt that Chapter VIII gave adequate
safeguards in the event of abuse by any Member, and furthermore
that Article 41 provided specifically for consultation with regard
to all state-trading operations. The representative of Denmark
thereupon withdrew his amendment. - 117 -
27. An amendment to paragraph 6 submitted by the delegation
of Switzerland was fully considered in the Sub-Committee. It was
decided to retain the present text.
28. The delegate of Mexico, supported by the delegate of
Ecuador, made the following statement and then withdrew his
amendment:
"The delegation of Mexico has noted the views of the Sub-
Committee that it was not intended in the drafting of paragraph 6
of Article 31 to define in any narrow sense the term 'social purposes ',
and further that it would be unwise for the Sub-Committee itself
to decide that a particular interpretation should have greater force
than any other.
" The responsibility placed on the Members and the Organization
is simply that they should pay 'due regard' to the fact that some
monopolies may be established mainly for 'social purposes' and, to
that extent, general economic considerations would not be the sole
factor to be taken into account in any negotiations.
In these circumstances, the delegation of Mexico considers that
this term would appropriately include, amongst other aspects of
monopolies established and operated mainly for social purposes, such
state monopolies as are set up under specific legislation to supply
the necessary elements for the people's subsistence and to foster the
social development of the nation."
29. The representative of Ecuador provisionally reserved his
position in respect of all provisions relating to state monopolies
for fiscal purposes.1
30. It was decided to omit the Note attached to Article 31
of the Geneva draft, concerning the deletion of Article 33 as con-
tained in the London draft.
31. The following statement appears as a footnote under
Article 31 on page 29 of the Geneva draft:
" Arising out of a proposal by the New Zealand delegation to make
an addition to the previous text of Article 33, the Preparatory Com-
mittee considered the special problems that might be created for
Members which, as a result of their programmes of full employment,
maintenance of high and rising levels of demand and economic
development, find themselves faced with a high level of demand for
imports, and in consequence maintain quantitative regulations of
their foreign trade. In the opinion of the Preparatory Committee
the present text of Article 21, together with the provision for export
controls in certain parts of the Charter, e.g. in Article 43 [45], fully
meet the position of these economies."
" The delegation of New Zealand reserved the position of its
Government on this question."
1 This reservation was withdrawn in Committee III. - 118 -
The New Zealand delegation stated that until the final text of
the Charter had been determined it maintained its reservation on
this question.1
New Article 31 A [32]. ? Liquidation of Non-Commercial Stocks.
32. The Sub-Committee considered the following commu-
nication from the Chairman of Sub-Committee I of Committee VI:
" The Joint Sub-Committee of Committees V and VI has been
considering the substance and the location of an exception to be
made in respect of agreements made by or for military establishments
for the purpose of meeting essential requirements of national security.
The Sub-Committee had decided to recommend the inclusion of the
appropriate provision in Article 94 [99].
" However, in putting forward this recommendation, the Sub-
Committee is of the view that a related provision should be introduced
elsewhere in the Charter concerning the need for consultation on the
liquidation of any stock piles accumulated under such a provision in
Article 94 [99]. The Sub-Committee considers that the insertion of a
provision on liquidation might best be considered in Section D of
Chapter IV. Accordingly, the Joint Sub-Committee would be
grateful if Sub-Committee J of the Third Committee would give
consideration to this question. The Joint Sub-Committee has
instructed me to communicate this request to you, and at the same
time to transmit for possible consideration by Sub-Committee J
two alternative versions of such a provision which the Joint Sub-
Committee had before it:
(1) That following the word " sale" at the end of the first sentence in
paragraph 2 of Article 30 [29] a proviso might be added to the following
effect:
'Provided that, upon a complaint that substantial injury is
being caused or is anticipated, a Member shall accord sympathetic
consideration to, and shall afford adequate opportunity for,
consultation regarding such representations as may be made by
any other Member with respect to disposal of reserve stocks so
acquired.'
(2) That any provision to be made in Section D might be along the
following lines:
' Any Member accumulating non-commercial reserves of
primary commodities for military purposes under an inter-govern-
mental agreement . . . shall not make arrangements for the
commercial liquidation of such reserve stocks in such a way as to
injure the commercial interests of producers of the commodities in
question, and shall consult with the Organization as to the best
means to that end.'
"While the Joint Sub-Committee was agreed in recommending
that Sub-Committee J consider the inclusion of some provisions for
consultation on the liquidation of such stock piles, the joint Sub-
Committee has not examined the merits of either of the texts
reproduced above and is merely transmitting them for information
and to provide a possible basis for discussion."
1 This reservation was withdrawn in Committee III. -119 -
33. The Sub-Committee decided to recommend the insertion
of a new Article, to follow Article 31, dealing with the liquidation
of non-commercial government stocks of primary commodities.
The term " non-commercial purposes " was used to make clear
that the stocks held by governments for commercial purposes
e. g., those of state trading enterprises, are excluded from the
provisions of the proposed new Article. The main reason for the
inclusion of Article 31 A [32] was to provide machinery for prior
consultation in regard to the liquidation of stocks accumulated
for security reasons. It is implied in the text of the Article that
the Organization on receipt of notice as provided shall advise the
Member governments accordingly.
34. The Sub-Committee considered that Article 31A [32] did
not in any way affect the obligations of Members under Article 30
[29] as it relates solely to public or prior notification of an intention
to liquidate stocks.1
1 In Committee III the delegation of Chile recorded a reservation which was
subsequently withdrawn in the final Plenary Meeting. IV. REPORTS RELATING TO THE
FOURTH COMMITTEE
RESTRICTIVE BUSINESS PRACTICES
This section contains the Report of the Fourth Committee. The
Sub-Committee Report (E/CONF.2/C.4/5) has not been reproduced
since virtually all of its contents as modified by the full Committee
were incorporated in the Committee Report.
REPORT OF THE FOURTH COMMITTEE:
RESTRICTIVE BUSINESS PRACTICES1
1. The Fourth Committee, established by a decision of the
Third Plenary Meeting to examine Chapter V of the Geneva draft
(Restrictive Business Practices), considered all the amendments
proposed to that Chapter and, subject to the reservations mentioned
in Part I of this Report, agreed on the new text of Chapter V.
2. Dr. C. CHARLONE (Uruguay) was appointed Chairman, and
Mr. A. J. van VELDEN (Union of South Africa) Vice-Chairman; on
Mr. van Veldens' departure from Cuba on 16 January 1948, Mr. B. N.
BANERJI (India) was appointed as his successor. In the absence
of the Chairman and Vice-Chairman Mr. de BARROS (Brasil) pre-
sided at one meeting of the Committee.
3. After the first reading of the text, the Committee set up
a Sub-Committee to study all the amendments proposed in relation
to Chapter V. Mr. J. H. LOPEZ ALCAR (Mexico) was appointed
Chairman of the Sub-Committe, which was composed of repre-
sentatives of the following ten delegations: Argentina, Belgium,
Canada, Ecuador, India, Iraq, Mexico, Norway, the United Kingdom
and the United States of America. The Sub-Committee held
1 E/CONF.2/53 with Addendum 1. - 121 -
twenty-three meetings and submitted its final report to the Fourth
Committee on 10 January 1948.1
4. The Committee held fifteen meetings.
PART I
GENERAL COMMENTS.
5. The delegations of Ceylon, India, Pakistan and Venezuela
reserved their positions on Chapter V, and especially on Article 50
[53], pending the outcome of discussions on the new Article 18 A.2
The delegations of Denmark, France, Greece, Norway and Sweden
reserved their positions on Article 50 [53], pending the outcome of
discussions on the new Article 18 A .2 The delegation of Colombia
reserved its position with respect to the scope of Article 50 [53].3
6. The delegation of Argentina reserved its position in respect
of the inclusion of " public commercial enterprises " within the
scope of Chapter V and in respect to Article 50 [53].4 In this
connection the Committee made a clear distinction between the
State acting in a legislative or executive capacity and the State
pursuing the activities of a business enterprise. It was considered
important to point out that the inclusion of business practices of
public commercial enterprises in Chapter V does not infringe upon
the sovereignty of the State itself, but is designed to bring within
the framework of the Chapter the business practices of public
commercial enterprises in so far as they may harmfully affect
international trade.
7. As an aid to proper interpretation of the words " decide"
and " decision " a new sub-paragraph was added to Article 51 [54],
and it was decided to incorporate the following explanatory note
in the report of the Committee:
" The words' decide ' and' decision' ('constate ' and ' constata-
tion ' in the French text) as used in Articles 44 [46], 45 A [48]
1 E/CONF.2/C.4/5.
2 See pp. 68-69 for the Report of Sub-Committee B to the Third Committee
concerning the decision to omit the proposed Article 18 A.; see also pp. 41-42.
3 At the fifteenth meeting of the Committee the delegations of Denmark, Greece,
Norway, India, Pakistan and Sweden withdrew the reservations previously recorded.
The delegations of Chile, El Salvador, New Zealand and Venezuela reserved their
positions on Article 50 [53] in the light of the notes adopted at that meeting relating
to that Article. Certain of these reservations were indicated to be of a provisional
character pending further consideration. All of these reservations were withdrawn
during the final plenary meetings of the Conference.
4 Subsequently the delegation of Argentina entered a reservation to the entire
Chapter (E/CONF.2/74). -122 -
(except in paragraphs 3 and 4) and 47 [50] relate to conclusions by the
Organization whether or not particular practices have had, have or
are about to have the harmful effects described in paragraph 1 of
Article 44 [46], and do riot prescribe the obligations of Members.
Members' obligations regarding these ' decisions' are set out in the
relevant paragraphs of Article 47 [50]. Therefore, such ' decisions'
(or constations) are not to be construed as binding the legislative,
executive or judicial activities of Member States."
8. The Committee discussed at length the relation between
the procedures of Chapter V under Articles 45 [45] and 45 A [48],
and those of Chapter VIII In the course of its discussions, the
Committee had the benefit of a communication from Commit-
tee VI 1 setting forth the opinion of that Committee on the subject
of Chapter VIII in its general relation to other parts of the Charter.
Committee IV found that the question was full of complexities and
that it was difficult to foresee at this stage all implications of cases
that may in practice arise.
However, Committee IV calls attention to the fact that the
procedures under Chapter V apply to complaints directed against
harmful effects arising out of business practices of commercial
enterprises, while the procedures under Chapter VIII apply to
complaints against Members as such. Therefore, the procedures
set forth in Chapter V cannot preclude resort by a Member to the
procedures under Chapter VIII, whenever it considers that there
is nullification or impairment of the benefits under the Charter by
another Member.
PART II
SPECIAL COMMENTS
Article 44 [46]
9. In paragraph 1 of Article 44 [46] the words " and shall co-
operate with the Organization" were substituted for the words
" individually or through the Organization or in both ways " in
order to express the general principle of co-operation between
Members and the Organization.
10. In considering paragraph 2, sub-paragraph (c) of
Article 44 [46], the Committee was of the opinion that the expression
" effective control of trade between two or more countries " was
open to possible misinterpretation. The amendment was designed
to make it clear that the activities of an enterprise which has, been
granted sole rights of import or export of a particular product in a
1 See Attachment 2 to the Report of the Sixth Committee. - 123 -
particular country, and which might, therefore, be said to have de
jure control of trade between that country and any other, will not
be liable to complaint unless it also has de facto control of trade
and is in a position to exert monopolistic pressure on its suppliers
or customers to accept certain terms or conditions. It is clear that
if a Member's exports or imports of a product are a negligibly small
proportion of international trade in that product, business practices
of firms under that Member's jurisdiction in respect of this product
could not be subject to complaint. Generally speaking an enter-
prise situated in one county will not be in a position to exert such
de facto control of trade with any other single country unless it
also controls trade among several countries, and it is for this
reason that the Committee introduced the more general expression
" effective control of trade among a number of countries ". This
phrase is also intended to cover the less frequent case of an enter-
prise which exerts de facto control of trade between two countries
only.
11. In Article 44 [46], paragraph 3 (a) the term "third
parties " was changed to read " others " in order to maintain
uniformity with the French text of the Geneva draft and to
reflect the understanding of the representatives of some delegations
as to the meaning of this sub-paragraph. It was the Committee's
view that the language should be broad enough to allow the proce-
dures of Chapter V to be applied to (i) cases in which two or more
parties agree upon the terms of their behaviour towards other
parties, including prices or other conditions of doing business with,
such other parties; and (ii) cases in which one enterprise
including a complex of firms related by common ownership of some
or all of their respective capital, engages in the practice of monopo-
listic extortion towards other buyers or sellers.
The Committee emphasized that this sub-paragraph is not to be
construed as applying to simple price situations where, for example,
an enterprise during the period of a " sellers" market may be
charging prices higher than could normally be obtained. It was
not the Committee's intention that the Organization should
exercise functions similar to those of a national price control
agency. The Committee pointed out that sub-paragraph 3 (a), like
all other sections of paragraph 3, can be construed only together
with paragraphs 1 and 2.
12. In the French text of sub-paragraph (c), paragraph 3 of
this Article, the word " déterminées " was substituted for the - 124 -
word " particulières ", as the latter word could be misinterpreted
as meaning " private ".
Article 45A [48].
13. The Committee felt that paragraph 7 of Article 45 A [48]
was of considerable importance. This paragraph provides that if
the Organization decides that certain restrictive business practices
have harmful effects, it shall call upon the Members concerned
to take remedial action. The paragraph provides further that the
Organizations may make recommendations to the Members con-
cerned regarding remedial measures to be taken in the particular
case.
In view of its importancethe Committee called attention to this
distinction between a decision of the Organization and a recommen-
dation. The term decision relates to conclusions by the Organiza-
tion as to whether the practices in question have harmful effects.
The term recommendation relates to specific or general sugges-
tions formulated and advanced by the Organization which set
forth a course of action that might be followed to advantage by
the Members concerned in remedying the situation under complaint.
It is not contemplated in paragraph 7 that in every case such a
recommendation would be proper or necessary. In simple situa-
tions involving one or perhaps two countries, a recommendation
by the Organization might not be appropriate; however, in com-
plex cases involving a number of countries, it is frequently difficult,
if not impossible, for one country to act effectively and properly
in the absence of knowledge as to the lines of conduct which other
countries propose to follow. In the view of the Committee it
appeared inadvisable to require the Organization to make recom-
mendations in every case or to define the type of cases in which
recommendations would be appropriate. This matter should be
left to the discretion of the Organization.
Article 47 [50].
14. In Article 47 [50], the transposition of the words " in
accordance with the Member's system of law and economic organ-
ization " and the addition of the word " constitution " to para-
graph 1, were intended to make it clear that in implementing the
obligations undertaken by a Member in terms of this Article it
has to proceed in accordance with its own system of political
and economic organization. The nature of the exact legal or
administrative implementations of these obligations would accord- - 125 -
ingly vary from country to country, and no impairment of funda-
mental legislation or basic economic policy would be involved in
giving effect to a Member's obligations under this Article. In
other words the phrase " system of law " is complementary to the
words " constitution " or " basic legislation '. The words " cons-
titution " and " system of law " represent two different concepts
? one the actual existence of basic fundamental legislation, and the
other the general legal framework within which remedial action
was carried out by a Member of the Organization.
15. A small amendment in paragraph I of Article 47 [50]
makes it clear that the practices referred to in Article 47 [50]
in respect of which Members undertake obligations are those
which meet the conditions of paragraphs 1, 2 and 3 of Article 44 [46].
Article 48 [51].
16. It was the intention of the Committee that the co-operative
action permitted under Article 48 [51], paragraph 1, should be
entirely voluntary and that this Article should not be construed
as implying any obligation upon Members to participate in co-
operative action. The Committee was also of the opinion that the
parties to such co-operative action should be those Members directly
interested in any particular instance of restrictive business practices.
Article 50 [53].
17. The alteration of the word " banking " in the first sentence
of paragraph 1 of Article 50 [53] to the phrase " the commercial
services of banks ", is designed to make it perfectly clear that the
banking operations to which the paragraph refers are simple
financial services directly and intimately connected with inter-
national commercial transactions such as the provision of short-
term credit facilities to cover imports and exports of goods; and
the alteration of the phrase " in relation to them " to the phrase
" enterprises engaged in these activities in international trade "
is intended to show that the paragraph refers only to banking
institutions which are themselves directly engaged in international
commercial transactions.
The Committee agreed that the provisions of Article 50 [53]
do not refer to such activities as the regulation of internal credit
or of internal monetary circulation by a central bank or to longer
term international lending by a governmental agency.
The note to Article 50 [53] was added in order to avoid conflicts
of responsibility and jurisdiction between the International Trade -126 -
Organization and the proposed Inter-governmental Maritime Con-
sultative Organization.
18. Electricity as a service or as a product is covered by
Chapter V. On the question of whether electricity should be
considered as a product and its transmissions as a service, the
Committee felt that it should be left to the Organization itself to
come to a conclusion.
Article 51 [54].
19. The first sentence of paragraph 1 of the new Article 51 [54]
was intended to make it clear that action by commercial enterprises
necessary to implement, for instance, an inter-governmental
commodity control agreement which meets the requirements of
Section C of Chapter VI cannot be subject to challenge under
Chapter V, but that effects of such action which are restrictive
beyond the scope and purposes of the said agreement may be
subject to complaint.
20. The Committee agreed that the use of the words " may
have " in paragraph 1 of Article 51 [54] did not entail any extension
of the provisions of Chapter V.
21. Paragraph 2 (a) specifically lays down that single contracts
of purchase, sale or lease concluded between two commercial
enterprises whether public or private, shall not except in the
special circumstances set out in the proviso be considered as
falling within the meaning of the term " business practices " as
used in this Chapter. It was believed that this provision would
be a safeguard against certain types of complaints which did not
properly fall within the scope of Chapter V.
22. An alteration in the definition of public enterprises was
made in paragraph 2 (b) (i) in order to distinguish between the
actions of a State when acting in its sovereign legislative or admi-
nistrative capacity and when acting in a trading or commercial
capacity. In the former case the actions of a State are not subject
to investigation under Chapter V.
23. The delegation of India accepted paragraph 2 (d) of
Article 51 [54] provisionally and reserved its right to reconsider
its position in the plenary session. V. REPORTS RELATING TO THE
FIFTH COMMITTEE
INTER-GOVERNMENTAL COMMODITY AGREEMENTS
This section contains the following documents relating to the
work of the Fifth Committee:
(i) Report of the Fifth Committee.
(ii) Report of the Drafting Sub-Committee of the Fifth Committee.
(iii) Report of Sub-Committee A of the Fifth Committe.
(iv) Report of the Joint Sub-Committee of the Fifth and Sixth Commit-
tees.
(v) Note on a Resolution concerning the Interim Co-ordinating Comittee
for International Commodity Arrangements.
REPORT OF THE FIFTH COMMITTEE:
INTER-GOVERNMENTAL COMMODITY AGREEMENTS1
1. The Fifth Committee was charged with the examination of
the Geneva draft of Chapter VI ? Inter-goverrnmental Commodity
Agreements, together with the amendments to this Chapter pro-
posed by delegations.
2. Mr. George HAKIM (Lebanon) was elected Chairman and
Mr. Mauritz BONOW (Sweden) was elected Vice-Chairman.
3. The Committee was able to resolve all issues before it. To
facilitate its work the Committee established two Sub-Committees
and a Joint Sub-Committee with the Sixth Committee.
4. The Committee recommended adoption of a resolution
regarding the composition of the Interim Co-ordinating Committee
for International Commodity Arrangements.2
5. The next Section of this Report includes for each Article
of Chapter VI the action taken by the Committee on amendments
1 E/CONF.2/39 and 40.
2 The Resolution is contained in the Final Act and Related Documents
(ICITO. 1/4 or E/CONF.2/78). - 128 -
proposed by delegations. The delegations of Colombia, El Salvador1
and Guatemala2 reserved their position on the action by the
Committee rejecting the Colombian proposal for a new Article.
SECTION A. ? INTRODUCTORY CONSIDERATIONS
Articles 52 [55]. ? Difficulties Relating to Primary Commodities.
1. There were no amendments proposed to this Article.
2. The footnote to the Geneva text was withdrawn.
3. The Committee adopted the Geneva text.
Article 53 [56]. ? Primary and Related Commodities.
1. Amendments were proposed by the delegations of Chile,
Italy and Uruguay.
2. The Committee accepted the principle of the proposal by
the delegation of Chile that the definition should be uniform
throughout the Charter. The Central Drafting Committee made
the appropriate changes.3 The proposal of the delegation of Italy
was withdrawn. The Committee did not accept the proposal by
the delegation of Uruguay.
Article 54 [57]. ? Objectives of Inter-Governmental
Commodity A greements.
1. Amendments were proposed by the delegations of Ceylon,
Chile, Cuba, El Salvador, Mexico, Philippine Republic, Uruguay
and Venezuela.
(a) In consideration of the proposal by the delegation of Chile
the Committee revised the preamble of this Article.
The delegation of El Salvador withdrew its proposed amendment
to the preamble.
(b) Arising out of the proposal of the delegation of Mexico,
the Committee revised sub-paragraph (b) of this Article.
1 The reservation by the delegation of El Salvador was withdrawn during the
final plenary meetings of the Conference.
2 The reservation by the delegation of Guatemala was withdrawn prior to the
final plenary meetings of the Conference.
3 E/CONF.2/40. - 129 -
(c) In consideration of the proposals by the delegations of
Ceylon, Cuba, El Salvador, Mexico, Philippine Republic, Uruguay
and Venezuela to amend sub-paragraph (c) the Committee substi-
tuted the phrase " such prices as are fair to consumers and provide
a reasonable return to producers "for " fair to consumers and remu-
nerative to efficient producers" in the Geneva text. The Com-
mittee agreed, in view of the purpose of the Venezuelan proposal
to amend Article 59 [62], to insert the words " prevent or " between
"to " and " moderate " in the Geneva text.
(d) The proposal by the Cuban delegation to amend sub-
paragraph (e) was withdrawn. The Committee accepted an
addition to the text incorporating the sense of the footnote to the
Geneva text. (See Report of Drafting Sub-Committee.)1
(e) The proposals by the delegation of El Salvador to add two
new sub-paragraphs to this Article were withdrawn. The Com-
mittee decided against acceptance of the new sub-paragraph proposed
by the Uruguyan delegation.
Note: In connection with the amendments proposed to Article 54
[57] attention is drawn to the addition in Havana of present
sub-paragraph (d) of paragraph 1 of Article 69 [72] to cover
international agreements concerned with the relationship between
world prices of primary commodities and manufactured goods.
SECTION B. ? INTER-GOVERNMENTAL COMMODITY AGREEMENTS
IN GENERAL
Article 55 [58]. ? Commodity Studies.
1. Amendments were proposed by the delegations of Ceylon,
El Salvador, and Uruguay.
2. To meet the proposals of the delegations of El Salvador
and Uruguay the Committee substituted " considers itself " for
" is " in the first line of paragraph 1 and " itself " for " that it is "
in paragraph 2. The Committee agreed that the intentions of the
Ceylon proposals were in fact covered by the existing text.
Article 56 [59]. ? Commodity Conferences.
1. Amendments were proposed by the delegations of Ceylon,
Egypt, El Salvador, and Peru.
1 E/CONF.2/C.5/8. - 130 -
2. The proposals of the delegations of Peru and El Salvador
to add a new paragraph to this Article were withdrawn. The
Committee revised paragraph 1 and substituted " itself " for
" that it is " in paragraph 2 to meet the proposals of Ceylon,
Egypt and the balance of the El Salvador amendment.
Article 57 [60]. ? General Principles Governing Inter-
Governmental Commodity Agreements.
1. An amendment was proposed by the delegation of the Phi-
lippines but later withdrawn.
2. The Committee adopted the Geneva text.
Article 58 [61]. ? Types of Agreements.
1. Amendments were proposed by the delegations of Mexico
and India.
2. To provide for a smooth transition at the time when an
"expansion " agreement becomes a control agreement, paragraph 5
was redrafted. The Committee redrafted paragraph 6 to cover the
first part of the Mexican proposal, and the remaining two parts
of this amendment were withdrawn. As the amendment proposed
by the Indian delegation was consequential to their proposal to
Article 64 [67], it was dealt with during the consideration of that
Article.
SECTION C. ? INTER-GOVERNMENTAL COMMODITY
CONTROL AGREEMENTS.
Article 59 [62]. ? Circumstances governing the use
of Commodity Control Agreemensts.
1. Amendments were proposed by the delegations of Ceylon
and Venezuela.
2. Although the Committee did not accept the Ceylon proposal
to delete this Article, it endeavored to meet the points made in in the
discussion of this proposal by deleting paragraph 2 and inserting
a revised preamble to this Article. The Venezuelan proposal was
dealt with by amending paragraph (c) of Article 54 [57].
Article 60 [63]. ? Additional Principles Governing
Commodity Control Agreements.
1. There were no amendments proposed to this Article. - 131 -
2. In order to incorporate the sense of the explanatory footnote
to sub-paragraph (a) the Committee agreed that the words " rea-
sonable prices " in the Geneva text should be replaced by the words
" prices which are in keeping with the provisions of Article 54
[57] (c) ". The Committee agreed to delete the explanatory
footnote to sub-paragraph (b) of this Article.
Article 61 [64]. ? Administration of Commodity Control Agreements
There were no amendments proposed to this Article and the
Committee adopted the Geneva text.
Article 62 [65]. ? Initial Term, Review and Renewal of
Commodity Control A greements [Initial Term, Renewal
and Review of Commodity Control Agreements].
1. An amendment was proposed by the delegation of Costa
Rica.
2. The Committee did not accept this proposal and adopted
the Geneva text.
Article 63 [66]. ? Settlement of Disputes.
There were no amendments proposed to this Article and the
Committee adopted the Geneva text.
SECTION D. ? MISCELLANEOUS PROVISIONS.
Article 64 [67]. ?Relations with Inter- Governmental
Organizations.
1. Amendments were proposed by the delegation of India.
2. The Committee decided that this proposal together with a
consequential proposal to Article 58 [61] should not be accepted.
However, it was agreed to delete the words " on the basis thereof"
from sub-paragraph (c) of the Geneva text.
Article 65 [68]. - Obligations of Members Regarding Existing
and Proposed Commodity A greements.
1. Amendments were proposed by the delegation of Argentina.
2. The Committee revised the text to incorporate the intention
of these amendments. - 132 -
Article 66 [69]. ? Territorial Application.
There were no amendments proposed to this Article and the
Committee adopted the Geneva text.
Article 67 [70]. ? Exceptions to Provisions Relating to Inter-
Governmental Commodity Agreements [Exceptions to Chapter VI].
1. Amendments were proposed by the delegations of Norway
and the United States.
2. The Committee adopted a new sub-paragraph 1 (d) covering
the proposal by Norway and recommended to the Third Committee
that a comparable exemption be inserted in Chapter IV. This
exemption had been agreed to by the Third Committee. As regards
the United States proposal the Committee accepted the principle
involved; however, it referred the matter to the Joint Sub-Com-
mittee of the Fifth and Sixth Committees which recommended
that the proposal be met by amendments elsewhere in the Charter.
This recommendation was accepted (see page 145).
Proposed New Article.
1. The addition of a new Article to Chapter VI was proposed
by the delegation of Colombia.
2. The Committee did not accept this proposal. The dele-
gations of Colombia, El Salvador 1 and Guatemala 2 reserved
their position.
Note: The Committee agreed to recommend to the Third Com-
mittee that the word " terms " be substituted for the word
" obligations " in Article 43 [45] paragraph I (h) [1 (a) (ix)]. The
Third Committee approved a redraft of this provision deleting the
word " obligations ".
REPORT OF THE DRAFTING SUB-COMMITTEE OF
THE FIFTH COMMITTEE 3
1. The Drafting Sub-Committee was established to consider:
(a) the interpretative footnotes to the Articles, and
(b) the preamble to Article 54 [57].
1 The reservation by the delegation of El Salvador was withdrawn during the
final plenary meetings of the Conference.
2 The reservation by the delegation of Guatemala was withdrawn prior to the
final plenary meetings of the Conference.
3 E/CONF.2/C.5/8. - 133 -
The Sub-Committee was composed of the representatives of
Argentina, Australia, Colombia, France, India, the Netherlands,
the United Kingdom and the United States of America.
Mr. R. B. SCHWENGER (United States) was elected Chairman.
2. Explanatory Note to Article 54 [57] (e).
It was decided to submit to the Fifth Committee the following
draft of sub-paragraph (e), which would incorporate the sense of
the footnote in the text:
"(e) to provide for the expansion of the production of a primary
commodity where this can be accomplished with advantage to
consumers and producers, including in appropriate cases the
distribution of basic foods at special prices."
The representative of the Food and Agriculture Organization
participated in the discussion of the Sub-Committee and expressed
agreement with this draft.
3. Explanatory Note to Article 60 [63].
The delegate of Cuba participated in the discussion of the
action to be taken on this footnote.
The Sub-Committee considered it inadvisable to make a recom-
mendation regarding the status of this footnote, as the adoption
of a text for Article 54 [57] (e) would necessarily influence the
position of Article 60 [63] (a) in regard to the term " reasonable
price ".
4. Preamble to Article 54 [57].
The Sub-Committee submitted for consideration by the Com-
mittee the following text of the preamble:
" The Members recognize that inter-governmental commodity
agreements are appropriate for the achievement of the following
objectives: "
The delegate for Chile participated in the discussion of the item
and agreed that this text should be submitted to the Committee.
5. The explanatory footnotes to Articles 52 [55] and Article 60
[63], sub-paragraph (b) were deleted in Committee and were not,
therefore, before the Sub-Committee. -134 -
REPORT OF SUB-COMMITTEE A OF THE
FIFTH COMMITTEE1
PART I
1. The Sub-Committee was given the following terms of
reference:
"(1) to consider all proposed amendments to Chapter VI, together
with the suggestions made during the discussions in Com-
mittee V of these proposed amendments; and
"(2) to recommend texts which would reconcile the various points
of view expressed."
2. The Sub-Committee consisted of representatives of the
following delegations: Argentina, Australia, Colombia, Cuba,
Egypt, El Salvador, France, India, Italy, Netherlands, Pakistan,
Sweden, the United Kingdom and the United States of America.
3. Mr. R. B. SCHWENGER (United States) was elected Chairman.
4. A number of representatives of delegations not appointed
to the Sub-Committee attended as observers and, as far as possible,
such representatives participated in the discussion of particular
amendments for which they were primarily responsible. Obser-
vers from the Food and Agriculture Organization, International
Co-operative Alliance and International Federation of Agricultural
Producers also attended.
5. There follows in Part II a brief statement of the disposition
agreed on for each of the matters dealt with.
PART II
Article 42 [55]. ? Difficulties Relating to Primary Commodities.
The Sub-Committee noted the fact that the explanatory foot-
note to Article 52 [55] was withdrawn in Committee.
Article 53 [56]. ? Primary and Related Commodities.
1. The Sub-Committee discussed the proposals of the dele-
gation of Uruguay regarding p paragraph 1 of this Article. The
1 E/CONF.2/C.5/9. During the consideration of this Report by the Fifth
Committee it was pointed out that the explanatory text of the Report of Sub-Com-
mittee A was not subject to adoption by the Committee and that it was only a
statement of the considerations underlying the decisions of the Sub-Committee. - 135 -
proposed preamble, dealing with the extent of application of the
definitions, was considered to raise similar questions to those
contained in the Chilean amendment which the Committee had
decided to refer to the Central Drafting Committee.
2. The latter part of the Uruguayan amendment would include
processing equipment in the definition of a primary commodity,
and thus permit separate agreements for such equipment. It
was the general opinion of the Sub-Committee that this would be
undesirable, largely on the grounds that such equipment presented
different characteristics from primary commodities; that agree-
ments for such equipment would, in practice, tend to be of the
nature of cartels, with unfavourable results for the users of the
equipment; and that, because of lack of standardization of pro-
cessing equipment, multilateral inter-governmental agreements
were impracticable.
In this connection, concern was expressed about the equitable
distribution of non-primary products in short supply. The Sub-
Committee took note of the fact that agreements for the equitable
distribution of non-primary products in short supply are clearly
contemplated under Article 43, II (a) [45, I (b) (i)] as direct excep-
tions to Chapter IV. Moreover, it was agreed that the Charter
contemplated that members of a commodity conference (Article 56
[59]) or a Commodity Council under a. primary commodity control.
agreement (Article 61 [64]) might discuss and seek agreement
covering any or all phases of a commodity problem, including
those relating to production difficulties.
3. The delegation of Italy, in the light of the discussion in
Committee, withdrew its proposal to alter the word " exceptional"
in Article 53 [56], paragraph 3.
Article 54 [57]. ? Objetives of Inter- Governmental
Commodity A greements.
1. Preamble.
The proposal by El Salvador to replace the word " may " by
may only " was withdrawn in view of the new draft of the pre-
amble recommended by the Drafting Sub-Committee.
2. Sub-paragraph (b).
(i) The Sub-Committee discussed the proposed amendment
of the delegation of Mexico to include in this paragraph mention
of the promotion of the processing of primary commodities in - 136 -
the producing countries. It was agreed to recommend the addition
to sub-paragraph (b) of the words:
" including, as far as possible, in appropriate cases, the
development of secondary industries based upon domestic
production of primary commodities."
(ii) The Sub-Committee considered an amendment submitted
by the delegation of El Savador to the effect that a statement
should be added to Article 54 [57] (b) to make it clear that
the provisions of the sub-paragraph would be applicable to
uneconomic agricultural industries based on protection. The
delegation of El Salvador withdrew its amendment on the
understanding of the Sub-Committee that the matter was covered
adequately by the provisions of Article 60 [63] (c) and (d).
3. Sub-Paragraph (c).
The Sub-Committee considered amendments proposed by the
delegations of Ceylon, Cuba, El Salvador, Mexico, Philippines,
Uruguay and Venezuela, designed to clarify the term " fair to
consumers and remunerative to efficient producers " relating to
the prices which may be negotiated in an agreement designed to
moderate pronounced price fluctuations. The discussion resulted
in general agreement that the existing text was sufficiently flexible
to cover the substance of all the proposed amendments. In the
negotiation of a commodity agreement, countries would in fact be
able to put forward all of the considerations raised in the amend-
ments. These were of the nature of elaborations of the phrase
under discussion, particularly of the word " fair ". Complete
elaboration of the word " fair ", however, would involve mention
of a number of " fair " considerations besides those raised in the
amendments. The negotiation would take place in the light of
the objectives of the Charter as a whole, and it was unnecessary
to repeat at this point factors which were included more appro-
priately in other parts of the Charter.
For these reasons the Sub-Committee generally favoured
retention of the Geneva text.1 It was agreed, however, in connec-
tion with an amendment to Article 59 [62] proposed by the dele-
gation of Venezuela (see note on Article 59 [62],2 to add the
words " prevent or" in sub-paragraph (c) in order to streng-
1 The action of the Fifth Committee on this sub-paragraph is set out in the
Report of that Committee (see pages 128-129).
2 Page 141. - 137 -
then the text in regard to the use of commodity agreements to
deal with pronounced price fluctuations.
4. Sub-paragraph (e).
The Drafting Sub-Committee recommended a text which
included the sense of the footnote to the Geneva text.
5. Proposed New Sub-Paragraphs.
New sub-paragraphs were proposed by the delegations of El
Salvador and Uruguay:
(i) The proposal by El Salvador for a new sub-paragraph (h) was
withdrawn in the light of the new draft of the preamble to this
Article recommended by the Drafting Sub-Committee.
(ii) In the discussion of the El Salvador proposal for a sub-
paragraph (g) designed to give small countries access to inter-
governmental agreement procedure to deal with certain policies
of commercial enterprises purchasing their primary commodities,
attention was drawn to the provisions of Chapter V for inter-
governmental co-operation on the problems involved. The Sub-
Committee thought that, either through the procedures of that
Chapter or, insofar as a specific commodity problem was concerned,
through Article 55 [58], it would be possible to request the formation
of a study group to consider these problems. On this understanding,
the delegate of El Salvador withdrew the proposal.
(iii) The Sub-Committee agreed that the sub-paragraph pro-
posed by the delegation of Uruguay, concerning fair prices for
equipment and facilities required for industrialization, was dealt
with adequately in connection with its conclusions reported above
on Article 54 [57] (c) and on the latter part of the Uruguayen
amendment to Article 53 [56].
Article 55 [58]. - Commodity Studies.
1. Use of term " substantially interested ".
The Sub-Committee examined the use of the term " substan-
tially interested " in Articles 55 [58] and 56 [59] in the light of the
Committee's instruction that the term should be used consistently.
In the Geneva text t he term was used both subjectively and
objectively according to the particular context, In regard to
paragraph 1 of Article 55 [58], it had been the original intention
to limit the Members who might ask for a study group to those
" substantially interested " in an objective sense. It was now - 138 -
agreed, however, that any Member substantially interested from
its own (subjective) viewpoint should have the right to ask for a
study group.
It was therefore agreed to redraft the opening words of para-
graph 1 as follows:
" Any Member which considers itself substantially interested in
the production or
It was considered that this change would cover the intentions of
the amendments submitted by the delegations of Uruguay and
El Salvador. I
The Sub-Committee also agreed to a consequential drafting
change in paragraph 2: " if the Member considers itself substan-
tially interested ".
2. Powers of Study Groups.
(i) In regard to the proposed amendments of the delegation
of Ceylon the Sub-Committee agreed that the intentions of these
amendments were in fact covered by the existing text. In particular,
it was understood that the power of a study group to make
recommendations to its members and to the Organization as to
how best to deal with special difficulties includes the power to
recommend that the situation requires an agreement or a continuing
study group. Moreover, if the situation wa9rants, Article 56 [5g]
permits going straight to the conference stage without calling a
study group.
(ii) It was agreed to strengthen the text of paragraph 3 by
deleting the word " may " from the phrase " which may exist
in line 7 of the Geneva text.
Article 56 [59]. - Commodity Conferences.
i. The Sub-Committee arrived at general agreement that the
substance of the ame1d1ents to paragraph i submitted by Ceylon,
Egypt and El Salvador, and also of the suggestions made in Com-
mittee', would be covered by the new text.
1 The following suggestions had been made in Committee, and referred to the
Sub-Committee:
(a) in line 3, for " whose interest represents " to substitute " whose interests
represent ".
(b) if possible to redraft this paragraph as regards " substantial interest " so
as to introduce the subjective element contained in paragraph 2
(ie. " . . . which considers that it is substantially interested . . ").
(c) to state that, on the basis of a request by any Member particularly
affected the Organization should consult with other interested Members
regarding the need for a conference. - 139 -
In sub-paragraph (b) of this new text the word " significant "
was substituted for " substantial " because the Sub-Committee
thought that the latter might be open to a restrictive interpretation.
In using the term " significant ", the Sub-Committee intended that
account be taken of considerations additional to the proportion
of total world production, consumption or trade, which the term
"substantial " might be taken to imply. It is still the intention
in this sub-paragraph, however, that there should be a finding by
the Organization as to the extent of Members' interest.
The new sub-paragraph (c) agreed by the Sub-Committee was
designed to permit Members, whose economies are dependent to
an important extent on a primary commodity, to call on the Orga-
nization to convene a commodity conference. In this instance,
as distinct from sub-paragraph (b), judgment as to the extent of
Members' interest is left to the Members themselves, but the
Organization may reject their request for a conferece if, and
only if, it thinks that no useful purpose would be served.
2. In line 1 of paragraph 2 it was agreed to substitute the word
"itself " for the words " that it is ", in order to secure consistency
with the new text of Article 55 [58].
3. The delegation of El Salvador, in the light of the discussion
on Article 55 [58] regarding the powers of study groups, withdrew
its proposal for a new paragraph in Article 56 [59].
Article 57 [60]. - General Principles governing Inter-Governmental
Commodity A greements.
In the light of the Sub-Committee's discussion of the "due
consideration " clause at the end of paragraph 1 (c) of Article 57 [60],
the delegation of the Philippines withdrew its proposed amendment.
The Sub-Committee was of the opinion that the existing clauses
covered the situation envisaged in the Philippine amendment.
The Geneva text was necessary because other situations that might
arise in relation to non-participants in a commodity agreement
had also to be covered.
Article 58 [61]. ? Types of Agreements.
1. Paragraph 5.
The Sub-Committee gave consideration to the proposal made
in Committee that the last sentence of paragraph 5 of this Article
should be redrafted so as to provide for smooth transition at the -140 -
time when an " expansion " agreement becomes a commodity
control agreement through the entry into operation of its price
provisions. It was thought necessary to remove the implication,
contained in the present text, that the Organization must call
substantially interested Members together to make a finding
under Article 59 [62] at the time the price provisions of any such
agreement become operative. The Sub-Committee therefore agreed
to the new text.
2. Paragraph 6.
(a) (i) In regard to the proposals of the delegation of Mexico
on paragraph 6, it was agreed that the delegation's first point,
relating to the word " recommended ", was covered by the new
text agreed to in Committee for the first sentence of this para-
graph.1
(ii) Regarding the second part of the Mexican amendment,
designed to prevent delay between a study group and a confer-
ence, the delegate of Mexico agreed to withdrawal on the
understanding that the changes agreed to in Articles 55 [58]
and 56 [59] had reduced the danger of delay to a minimum. In
this connection, it wasagreed to extend the " unreasonable delay "
provisions by adding the words " in the convening or " before
"in the proceedings " in paragraph 6.
(iii) In explanation of the third part of the Mexican amend-
ment relating to the " provisional " nature of agreements reached
by direct emergency negotiation, it was pointed out that an
agreement reached by such action would be subject to revision
in the light of any conflicting decision which might subsequently
be reached by a properly constituted commodity conference. It was
also pointed out that agreements reached by direct negotiation
would have to conform to the other provisions of Chapter VI.
On this understanding the amendment was withdrawn.
(b) At the suggestion of the Cuban member the Sub-Committee
agreed that, for the purposes of clarification, paragraph 6 should
contain references to the provisions of Article 59 [62]. It was
1 The Committee had pointed out that the use of the term " recommended "
in this paragraph in a different sense from its use in regard to study groups in
Articles 55 [58] and 56 [59] might lead to misunderstanding. Substitution of the
term " decided " was suggested; an alternative suggestion was the use of the
following wording:
6. The Members shall enter into a new commodity control agreement
only through a conference called . . ." - 141 -
therefore agreed to make the following additions to the Geneva
text:
(i) in line 4, after " Article 56 [59] ", to add " and after an
appropriate finding has been made in accordance with
Article 59 [62] ".1
(ii) to insert at the end of the paragraph " provided that
the situation falls within the cases contemplated in
Articles 59 [62] (a) or (b) and. . . . .".1
Article 59 [62]. ? Circumstances governing the use of Commodity
Control Agreements.
1. In discussing in Committee his delegation's proposal to
delete this Article, the representative of Ceylon brought out the
point that the determinations required under the Article might be
interpreted to call for a procedural step additional to those provided
in Articles 55 [58] and 56 [59]. For this reason it was agreed to
eliminate paragraph 2 of Article 59 [62] and to redraft the preamble
of paragraph 1.
The new text is intended to make it clear that procedure addi-
tional to that set out in Articles 55 [58] and 56 [59] is not called
for. The Sub-Committee took the view thet the finding referred to
would in most cases be made by substantially interested Members
through a commodity conference.
2. Arising from discussion on a new sub-paragraph to Article 59
[62] proposed by the delegation of Venezuela in place of its earlier
proposal, it was agreed to amend Article 54 [57] (c) as noted earlier
in this Report. As concerns the text of Article 59 [62] itself,there
was general agreement that the Venezuelan delegation's concern
about the use of control agreements to deal with pronounced price
fluctuations was covered.
Article 60 [63]. ? Additional Principles governing Commodity
Control Agreements.
Sub-paragraph (a).
In order to incorporate in the text of the Charter the sense of
the explanatory footnote to sub-paragraph (a), it was agreed to
amend the text as follows:
"(a) . . . for world demand at prices agreed in the light of
Article 54 [57] (c), and . . . " 2
1This wording was subsequently redrafted by the Central Drafting Committee.
2 The Fifth Committee altered this wording. (See the records of the Twelfth
Meeting). - 142 -
Article 62 [65]. ? Initial Term, Review and Renewal
of commodity Control Agreements.
Paragraph 1.
The amendment proposed by the delegation of Costa Rica would
have removed the limit on the term of a commodity control agree-
ment. One delegation wished to fix a shorter maximum term.
There was general agreement in favour of retaining the existing
text.
Article 64 [67]. ? Relations with Inter- Governmental
Organizations.
Discussion of the amendment proposed by the delegation of
India resulted in a general agreement that the existing text should
be retained.1 It was felt that this text provided an appropriate
recognition of the special responsibilities of the FAO in the field of
food and agriculture. The FAO has continuing responsibility in this
field, and this was emphasized in Article 64 [67]. The ITO would
have the responsibility for inter-governmental commodity agree-
ments with respect to which Members of ITO were granted excep-
tions to the general commercial provisions of the Charter. There-
fore. The ITO should appropriately be the organization to convene
conferences to negotiate such agreements. Under the provisions
of Article 84 [87] a detailed working agreement would have to be
made between the two specialized agencies, to provide for effective
co-operation in their related fields of activity. The representative
of India indicated that his delegation reserved its position pending
discussion in Committee.
Article 65 [68]. ? Obligations of Members regarding Existing
and Proposed Commodity Agreements.
In order to give effect to the proposal by the delegation of
Argentina to amend paragraph 1, it was agreed that the last sen-
tence of paragraph 1 should read:
" If, after review, the Organization finds that any such agreement
is inconsistent with the provisions of this Chapter, it shall com-
municate such findings to the Members concerned in order to secure
promptly the adjustment of the agreement to bring it into conformity
with the provisions of this Chapter."
The Fifth Committee subsequently agreed to amend thin Article by deleting
on the basis thereof ". (See the records of the Twelfth Meeting). - 143 -
Similarly the amendment proposed by Argentina to the second
sentence of paragraph 2 was given effect by amending that sentence
to reads:
"If, after review, the Organization finds that any such negotia-
tions are inconsistent with the provisions of this Chapter, it shall
communicate such findings to the Members concerned in order to
secure prompt action with regard to their continued participation in
such negotiations."
Article 67 [70]. - Exceptions to Provisions Relating to Inter-
governmental Commodity Agreements. [Exceptions to Chapter VI.]
Paragraph 1.
(i) The Sub-Committee accepted the proposal of the dele-
gation of Norway to exclude, subject to safeguards, certain conser-
vation agreements from the provisions of the Chapter, and agreed
to the addition of a new sub-paragraph (d) to paragraph 1 of
Article 67 [70].
It was pointed out that a comparable exemption would be
needed in Chapter IV, and it was agreed to refer this matter to the
Third Committee.
(ii) Regarding the amendment proposed by the delegation of
the United States," the Sub-Committee reached agreement on the
following points:
(a) That the Charter should be amended to make clear that
it was intended to have an exception for action relating
to primary commodities as defined in Article 53 [56] taken
in concert as well as taken unilaterally, applying to the
requirements of national security ? in whatever way the
reference to national security should appropriately be
drafted.
(b) That it was desirable that the exceptions be drafted as
narrowly as possible consistently with achieving adequately
the purpose of the exceptions.
(c) That decision as to (i) the drafting of the exception, and
(ii) its location in the Charter, might best be taken in
connection with the discussion of the related portion 'of
Article 94 [99], though not necessarily by the Committee
responsible for that Article.
1 See also the Report of the Joint Sub-Committee of the Fifth and the Sixth
Committees. - 144 -
(d) That the Sub-Committee should report that the following
two texts had been before it for discussion:
Proposal 1 -- the addition of the following sub-paragraph:
"(e) to any inter-governmental commodity agree-
ment, or any provision in such an agreement,
made to meet the essential requirements of
national security."
Proposal 2
(i) The addition of the following sub-paragraph:
"(e) to any inter-governmental agreement con-
cluded solely for the purpose of the non-
commercial accumulation of reserves of
primary commodities for military purposes
or of the expansion of facilities for the pro-
duction of such primary commodities:
Provided that any Member, not being a
party to such agreement, may bring a com-
plaint that its commercial interests are
seriously prejudiced by the operation of the
agreement and the Organization, if it so
finds, shall request the participating Mem-
bers to consult with the complaining Mem-
ber in order to safeguard the latter's
commercial interests "; and
(ii) The addition of the following new paragraph 2:
" Any Member accumulating non-commer-
cial reserves of primary commodities for military
purposes under an inter-governmental agreement,
to which paragraph (1) (e) of this Article applies,
shall not make arrangements for the commercial
liquidation of such reserve stocks in such a way
as to injure the commercial interests of producers
of the commodities in question, and shall consult
with the Organization as to the best means to
that end."
Proposed New Article.
The Sub-Committee considered the proposal of the delegation
of Colombia to insert a new Article which would except from the
Chapter agreements concluded by countries whose economies
depend essentially on the export of certain primary commodities,
to defend the prices of these commodities against the effects of
pronounced short-term fluctuations in foreign markets. There
was general agreement that the proposed amendment would widen
the terms of Chapter VI by permitting producer countries to
conclude agreements not contemplated under the present text and
would not accomplish the intention of the proposal because:
(i) consumer countries would insist on equivalent rights which
might nullify its aims, and - 145 -
(ii) its purposes could not be achieved without adequate
participation by consuming countries.
It was generally felt that the purpose of the amendment could
be best achieved through inter-governmental agreements made in
accordance with the present provisions of the Chapter. The
representative of one delegation called attention to Article 27 as
presenting a possible solution to the problem raised by the proposal.
The representative of Columbia reserved his position.
Note on References in Chapter IV.
In considering the relation of Chapter VI to the Charter as a
whole, it was agreed to recommend to the Committee that is should
discuss the desirability of requesting Committee III to amend
paragraph I (h) of Article 43 [45] to read as follows:
"(h) undertaken in pursuance of the terms of inter-governmental
commodity agreements concluded in accordance with the
provisions of Chapter VI; or"
It was considered that the word " terms " conveys more appro-
priately the understanding of the Sub-Committee as to the desired
exception from Chapter IV. It was felt that the word " obliga-
tion" was subject to possible misinterpretation.
REPORT OF THE JOINT SUB-COMMITTEE OF THE
FIFTH AND SIXTH COMMITTEES 1
1. With the agreement of the Sixth Committee, the Fifth Com-
mittee at its thirteenth meeting approved the establishment of
a joint sub-committee, consisting of the members of Sub-
Committee I of the Sixth Committee, together with representatives
of the Fifth Committee, to
(a) draft an exception for national security in relation to inter-
governmental commodity agreements on the basis of the recom-
mendations contained in the Report of Sub-Committee A of the
Fifth Committee, and
(b) recommend regarding the location in the Charter of such an
exception.
2. The Joint Sub-Committee consisted of representatives of
the following delegations:
1 E/CONF.2/C.5/14.
10 - 146 -
Australia Iraq
Chile Netherlands
Costa Rica New Zealand
Czechoslovakia Pakistan
Denmark Philippines
Guaternala Union of South Africa
France United Kingdom
India United States of America
3. Mr. Luis TINOCO (Costa Rica) was elected chairman of the
Joint Sub-Committee.
4. The Sub-Committee reached agreement on the following
points:
(a) that the exception to be made regarding the requirements
of national security should appear in Article 94 [99].
(b) That the terms of this exception should be as follows:
" Nothing in this Charter shall be construed
" (c) to prevent any Member from entering into or carrying
out any inter-governmental agreement, or other agree-
ment on behalf of a government for the purpose specified
in this exception, made by or for a military establishment
for the purpose of meeting essential requirements of the
national security of one or more of the participating
countries." 1
(c) That the insertion of this provision in Article 94 [99] be
accompanied by the addition to Section D of Chapter IV of a
provision for consultation on the liquidation of any stock
piles accumulated pursuant to this paragraph of
Article 94 [99].
5. The Joint Sub-Committee communicated informally to the
Sub-Committee of the Third Committee dealing with Section D of
Chapter IV its views concerning the desirability of amending that
Section to cover consultation on the liquidation of stocks and also
transmitted to that Sub-Committee possible texts for such a
provision which might serve as a basis for discussion. The repre-
sentative of the United Kingdom indicated that acceptance by his
delegation of the proposed new paragraph in Article 94 [99] was
contingent upon the insertion elsewhere in the Charter of a satis-
factory provision relating to consultation on the liquidation of
stocks.2
1This sub-paragraph was subsequently redrafted by the Central Drafting
Committee.
2 This was dealt with by the Third Committee and a new Article 32 relating
to consultation on liquidation of stocks was included in Section D of Chapter IV. - 147 -
6. The Joint Sub-Committee considered the possible inclusion
of the word " solely " before " for the purpose of . . . " in the
text recommended for the new paragraph (c) of Article 94 [99] but
felt that the question of including or omitting this qualifying word
should be dealt with by Sub-Committee I of the Sixth Committee
in relation to Article 94 [99] as a whole.
7. It is suggested by the Joint Sub-Committee that the Central
Drafting Committee might be asked to consider whether at the end
of the proposed new paragraph of Article 94 [99], the word
"countries " or the word " states " should be used."
8. The representative of Iraq indicated that his delegation
could not agree to the inclusion of the proposed new paragraph in
Article 94 [99] pending determination of the final shape of the whole
of Article 94 [99] in the light of the amendment submitted by the
Iraqian delegation.2
NOTE CONCERNING A RESOLUTION ON THE INTERIM
CO-ORDINATING COMMITTEE FOR INTERNATIONAL
COMMODITY ARRANGEMENTS 3
During the first session of the Preparatory Committee a resolu-
tion was communicated to the Economic and Social Council
recommending the establishment of an Interim Co-ordinating
Committee for International Commodity Arrangements (see
Annexure 9 to the Report of the first session, document E/PC/T.33).
On the basis of this recommendation, which was endorsed in
principle by the Preparatory Commission on World Food Proposals
of the Food and Agriculture Organization, the Economic and Social
Council adopted a resolution on 28 March 1947 requesting the
Secretary-General of the United Nations to appoint such an interim
co-ordinating committee which would have the function of keeping
informed on, and facilitating by appropriate means, inter-govern-
mental consultation on action with respect to commodity problems.
The Resolution of the Economic and Social Council provided that
the Committee should consist of " a Chairman to represent the
Preparatory Committee of the United Nations Conference on Trade
1 The word " countries " was retained.
2 The representative of Iraq subsequently agreed to the revised Article, including
this provision.
3 See E/CONF.2/C.5/16 and E/CONF.2/42. - 148 -
and Employment, a person nominated by the Food and Agriculture
Organization of the United Nations to be concerned in particular
with agricultural primary commodities, and a person to be concerned
in particular with non-agricultural primary commodities."
In view of the fact that the Preparatory Committee had ceased
to exist, it was considered appropriate that the Conference propose
that the composition of the Interim Co-ordinating Committee be
revised to provide that the Interim Commission for the International
Trade Organization should assume in respect of this Co-ordinating
Committee the position previously filled by the Preparatory Com-
mittee.
The Fifth Committee recommended the text of a resolu-
tion to a Plenary Session of the Conference. The Conference
approved the resolution 1, and the recommendations contained
therein were accepted by the United Nations Economic and Social
Council during its sixth session.
1 The Resolution is contained in the Final Act and Related Documents (ICITO.1/4
or E/CONF.2/78). VI. REPORTS RELATING TO THE
SIXTH COMMITTEE
ORGANIZATION
This section contains the following documents relating to the
work of the Sixth Committee:
(i) Report of the Sixth Committee.
(ii) Attachment 1?Report of the Sixth Committee upon the question
of an Interim Commission for the International Trade Organization.
(iii) Attachment 2-Notification by the Sixth Committee to the other
Committees of the Conference concerning the Relationship between
Chapter VIII and other parts of the Charter.
The reports of the Sub-Committees have not been reproduced as
virtually all of their contents were incorporated in the Report of the
Committee.
REPORT OF THE SIXTH COMMITTEE: ORGANIZATION1
1. The Sixth Committee was charged with the consideration
of Chapters I (Purpose and Objectives), VII (The International
Trade Organization), VIII (Settlement of Differences - Interpre-
tation) and IX (General Provisions) of the Draft Charter prepared
by the Preparatory Committee. The Committee, under the
chairmanship of Mr. Erik COLBAN (Norway), held forty-one
meetings.
2. The Committee established seventeen sub-committees, the
principal ones being those set up to discuss Article 1 (Purpose and
Objectives), the proposal of the delegation of Mexico to establish
an Economic Development Committee and related matters (this
sub-committee worked jointly with a sub-committee of the Second
Committee), Article 75 [78] (Composition of the Executive Board),
Article 81 [no equivalent article in the Havana Charter] (The
Tariff Committee), Chapter VIII (Settlement of Differences -
Interpretation), Article 93 [98] (Relations with Non-Members),
1 E/CONF.2/68 with Addenda 1 and 2. - 150 -
Article 94 [99] (General Exceptions) and Articles 95, 96, 98, 99
and 100 [100, 101, 103, 104,106] (Amendments, Review of the
Charter, Entry into Force and Registration, Territorial Application
and Deposit of Texts respectively). The composition of these
sub-committees was as follows:
Sub-Committee on
Article 11
Argentina
Belgium (Chairman)
Ecuador
Egypt
France
Italy
Norway
United Kingdom
United States
Uruguay
Sub-Committee on.
Article 75 [78]2
Argentina
Australia
Belgium
Brazil
Canada
China
Cuba
El Salvador
France
Italy
Norway
Pakistan
Peru
Syria (Chairman)
Turkey
United Kingdom
United States
Sub-Committee on
Article 813
[No Corresponding Article.]
Brazil
Canada
China
Cuba (Chairman)
Czechoslovakia
Egypt
France
Italy
Mexico
Netherlands
Peru
Philippines
United Kingdom
United States
Joint Sub-Committee of the
Second and Sixth Committees 4
Australia (Chairman)
Belgium
Brazil
China
Colombia
France
Iraq
Mexico
Pakistan
South Africa
Turkey
United Kingdom
United States
Venezuela
1 Report in E/CONF.2/C.6/98.
2 Report in E/CONF.2/C.6/53 and Corr.1.
3 Covered in Co-ordination Committee Report
E/CONF.2/51).
4 Report in E/CONF.2/C.6/72.
6 Report in E/CONF.2/C.6/83 and Corr.1.
Sub-Committee on
Chapter VIII 5
Australia
Canada (Chairman)
Colombia
Denmark
France
India
Iraq
Italy
Mexico
Netherlands
Poland
South Africa
Switzerland
United Kingdom
United States
Uruguay
(E/CONF.2/45 Rev.1 and - 151 -
Sub-Committee on
Article 93 [98] 1
Argentina
Australia
Belgium (Chairman)
China
Cuba
Czechoslovakia
France
Greece
Iran
Italy
Lebanon
Sweden
United Kingdom
United States
Sub-Committee on A
Article 94 [99]2
Australia
Costa Rica(Chairman)
Czechoslovakia
Guatemala
Iraq
India
Pakistan
South Africa
United Kingdom
United States
Sub-Committee on
Articles 95, 96, 98, 99 and
106 3 [100,101,103, 104, 106]
Argentina
Belgium
Czechoslovakia
France
India
Italy
Mexico
United Kingdom
(Chairman)
United States
Uruguay
Australia, China, Den-
namk and Poland also
paicipated when Arti-
cle 99 [104] was consid-
ered)
3. In addition to the sub-committees already mentioned the
Sixth Committee established, a number of working parties, the
principal one being that set up to consider the question of the
establishment of an Interim Commission for the Organization. The
report of this Working Party is attached hereto.
4. The reports of all sub-committees were approved subject
only to drafting amendments. The Sixth Committee placed on
record the following comments, declarations and reservations:
CHAPTER VII
THE INTERNATIONAL TRADE ORGANIZATION
Article 68 [71]. ? Membership.
The Committee did not discuss the question of which were the
"competent authorities" for the purpose of paragraph 5 of Arti-
cle 68 [71] with respect to any particular territory. The delegation
of Czechoslovakia declared that in its viewpoint the competent
authority in respect of Germany is the Inter-Allied Control Com-
mission in Berlin. The delegation of Poland stated that in its
opinion the competent authorities in respect of Germany and Japan
are the Inter-Allied Control Commission in Berlin and the Far
Eastern Commission in Washington respectively. The delegations
1 Report in E/CONF.2/C.6/96.
2 Report in E/CONF.2/C.6/93.
3 Report in E/CONF.2/C.6/48/Rev. 1,80 and 82. - 152 -
of Czechoslovakia and Poland reserved their positions upon para-
graph 5 of Article 68 [71].
Article 69 [72].- Functions.1
(a) The Committee in discussing Article 69 [72] was of the
opinion that whenever the United Nations creates agencies for
certain specific purposes, such as, for example, the Fiscal Commis-
sion of the Economic and Social Council, the Organization shall
make its studies and recommendations in close collaboration with
these agencies.
(b) Regarding sub-paragraph (d) [(e)] the Committee agreed
that, although general recommendations are to be made to " the
Members ", meaning the Members as a whole, nevertheless there
are, through the Charter, provisions which envisage recommenda-
tions to one or more Members especially, for example as in Chap-
ter VIII. The Committee did not intend to change the effect of
such specific provisions.
Article 74 [77]. - Powers and Duties.
With regard to paragraph 6, the Committee agreed that if a
maximum limit upon contributions were established and if the
efficiency of the Organization would otherwise be seriously impaired
for lack of funds, a Member may agree, as a purely temporary
measure, to pay more than the maximum limit in any given year.
Article 75 [78] - Composition of the Executive Board.
(a) The Committee agreed that paragraph 3 of the Annex to
Article 75 [78] is intended to cover also the case of certain geogra-
phical groups, such as the Arab States, other Middle and Near
Eastern States and States in the north of Europe. It is anticipated
that any one of such groups may deem it convenient to present a
common candidate to represent the particular interest of all the
countries of the group.
(b) The Committee agreed that the text of Article 75 [78]
implies that each Member of the Executive Board should act for the
Organization as a whole and should bear in mind the interests of all
the Members.
(c) The delegation of Italy reserved its position on rticle75[78].2
1 The delegation of Argentina subsequently entered a reservation to the
Article (E/CONF.2/74).
2 The Delegation of Argentina subsequently entered a reservation to this
Article (E/CONF. 2/74). - 153 -
Article 80 [83]. - Composition and Procedure.
The delegation of Costa Rica proposed to add the following
words at the end of paragraph 1 of Article 80 [83]:
" Not more than one person of the same nationality shall form
part of any commission."
The Committee agreed that normally not more than one person
drawn from any one Member should form part of any commission.
It considered that it was not necessary to state this in the text.
Article 83 A [86] - Relations with the United Nations.
(a) On examining several of the proposals submitted by delega-
tions relating to action taken in connection with political matters
or with the essential interests of Members, the Committee concluded
that the provisions regarding such action should be made in con-
nection with an article on " Relations with the United Nations ",
since the question of the proper allocation of responsibility as be-
tween the Organization and the United Nations was involved.
Accordingly, the Committee adopted a new Article 83 A [86].
Paragraphs 1, 2 and 4 of the new text of this article replace para-
graphe 1 of the former text of Article 84 and sub-paragraph (c) of
the former text of Article 94.
(b) Paragraph 3 of Article 83 A [86] which, like paragraph 4,
is independent in its operation, is designed to deal with any measure
which is directly in connection with a political matter brought
before the United Nations in a manner which will avoid conflict of
responsibility between the United Nations and the Organization
with respect to political matters. The Committee agreed that this
provision would cover measures maintained by a Member even
though another Member has brought the particular matter before
the United Nations so long as the measure was taken directly in
connection with the matter. It was also agreed that such a
measure, as well as the political matter with which it was directly
connected, should remain within the jurisdiction of the United
Nations and not within that of the Organization. The Committee
was of the opinion that the important thing was to maintain the
jurisdiction of the United Nations over political matters and over
economic measures of this sort taken directly in connection with
such a political matter, and nothing in Article 83 A [86] could be
held to prejudice the freedom of action of the United Nations to
settle such matters and to take steps to deal with such economic
measures in accordance with the provisions of the Charter of the
United Nations if they see fit to do so. - 154 -
(c) It was the view of the Committee that the word " measure
in paragraph 3 of Article 83 A [86] and in the interpretative notes
to that paragraph refers only to a measure which is taken directly
in connection with a political matter brought before the United
Nations in accordance with Chapters IV and VI of the Charter of
the United Nations and does not refer to any other measure.
(d) The delegation of South Africa reserved its position upon
paragraph 3 of Article 83 A [86] and the interpretative notes to
that paragraph pending the receipt af instructions from its Govern-
ment.1
CHAPTER VIII
SETTLEMENT OF DIFFERENCES. - INTERPRETATION 2
Article 88 A [92]. - Reliance on the Procedure of the charter.
(a) The Committee examined the question of the relation
beweeen paragraph 1 of Article 88 A [92] and paragraph 2 of
Article 89 [93] in connection with procedures for arbitration as
agreed between Members under existing or future bilateral or multi-
lateral treaties. It decided that no clarification is necessary as to
whether the procedure established in the Charter or in other treaties
should have priority since procedures for arbitration under other
treaties would not be inconsistent with the procedures of the
Charter.
(b) Pending the result of the consultation which, by resolution
of the United Nations Conference on Trade and Employment, the
Interim Commission of the International Trade Organization is
instructed to carry out with appropriate officials of the Interna-
tional Court of Justice or with the Court itself, regarding possible
amendments to Chapter VIII designed to ensure recourse to the
International Court of Justice by Members of the Organization
which are parties to the Statute of the Court in respect of questions
arising from the Charter but not covered by Chapter VIII, the
delegation of Mexico maintained the view that paragraph 1 of
Article 88 A [92] does not impair the rights of Members under the
Statute of the International Court of Justice as regards questions
arising from the Charter but which are not covered by Chapter VIII
of the Charter.
1The delegation of South Africa formally maintained its reservation to this
Article during the final plenary meetings of the Conference.
2 See also attachment 2 accompanying the present edition of the Committee's
Report. - 155 -
Article 89 [93]. - Consultation between Members.
(a) The Committee was of the opinion that, in case of wide-
spread unemployment of a serious decline in demand in the territory
of another Member, a Member might properly have recourse to
Article 89 [93], if the measures adopted by the other Member
under the provisions of Article 3 had not produced the effects which
they were designed to achieve and thus did not result in such
benefits as might reasonably be anticipated.
(b) The Committee agreed that the word " matter" as used
in Article 89 [93] and in the rest of Chapter VIII refers to nulli-
fication or impairment of a benefit and not to the action, failure,
measure or situation referred to in sub-paragraphs 1 (a), (b) of (c)
of Article 89 [93].
(c) The delegation of Belgium reserved its position upon the
words " other than Article 1 " in paragraph 1 of Article 89 [93].
Article 90 [94 and 95]. - Reference to the Organization.
(a) The Committee drew attention to the fact that in both
Article 90 [94] and Article 90 A [95] tht text provides that the
nature of the relief to be granted is compensatory and not punitive.
The word " appropriate " in the texts should not be read to provide
for relief beyond compensation.
(b) It was agreed that sub-paragraph 2 (e) of Article 90 [94]
does not empower the Executive Board or the Conference to
require a Member to suspend or withdraw a measure not in conflict
with the Charter.
Articles 91 [96] and 92 [97]. - Reference to the Inter-
national Court of Justice and Miscellaneous Provisions,
respectively; - Annex to Article 95 [100]
and Draft Resolution.
(a) The Committee agreed to use the phrase " whose interests
are thereby prejudiced " in paragraph 2 of Article 91 [96] in order
to make it clear that a real interest of a Member must be adversely
affected before that Member can compel recourse of the Organi-
zation to the International Court of Justice. A remote, theoretical
or unsubstantial interest of a Member in the decision in question
would not be sufficient to give a Member rights under Article 91 [96].
(b) The view of certain delegations was expressed that the
provisions of Chapter VIII did not provide for recourse to the
International Court of Justice on all questions arising out of the - 156 -
Charter. Those delegations urged that the text be in particular
amended so as to provide that Members might refer such questions
as could not be decided by the Organization to the International
Court. It was made clear, however, that these delegations did
not urge that a Member should be allowed to attack the validity of
an advisory opinion of the Court obtained through the procedures
of Chapter VIII on the points covered by such opinions. The
views of other delegations were expressed that the procedures of
Chapter VIII were plenary and adequate.
In view of the limited time available for further discussion,
the Committee agreed that the Interim Commission should examine
the question, and the Committee proposed a resolution providing
for such examination. The Committee also agreed that amendment
to the provisions of the Charter in this respect should be relatively
easy in the light of the report to be presented by the Interim
Commission and therefore suggested an annex to Article 95 [100]
providing for amendments in this respect by a simple majority
vote of the Conference. It was agreed that the first proviso to
the proposed Annex to Article 95 [100] covers the questions dealt
with in sub-paragraph 2 (c) of Article 36 of the Statute of the Inter-
national Court of Justice.
(c) The delegations of Colombia, Iraq and Peru reserved their
positions upon the first proviso to the Annex to Article 95 [100].
CHAPTER IX
GENERAL PROVISIONS
Article 93 [98]. - Relations with Non-Members.
(a) In the course of the discussion of paragraph 1 and 2 of the
text, the Committee agreed that termination of any existing
obligations of Members towards non-Members should be in accord-
ance with the terms of the agreements embodying such obligations.
(b) The Committee understood that, in general, sub-para-
graph (a) of paragraph 2 applies to treaties or agreements which,
by their terms, preclude the extension to other Members of benefits
provided for in such treaties or agreements. This interpretation
does not rule out the possibility that, if a Member were wilfully to
accomplish the same result by other means, this sub-paragraph
should be held to apply. - 157 -
(c) The Committee further understood that action by a state
trading enterprise of a non-Member which would be non-discri-
minatory under the terms of Article 30 [29] would also be considered
non-discriminatory for the purpose of interpreting the provisions
of paragraph 2 (a) of Article 93 [98].
(d) The delegation of Iran suggested the following interpre-
tative note to paragraph 4 of the text:
" In making its recommendations the Executive Board shall have
due regard to special conditions and economic circumstances of those
Members which are creditor countries or have substantial long-
standing trade with such non-Members of which they are neighbours
and shall take appropriate account of the consequences of its recom-
mendations upon the interests of such Members."
The Committee agreed that the text suggested contained con-
siderations which would be among those in the mind of the Executive
Board when making its recommendations pursuant to paragraph 4.
It also considered that the text of Article 93 [98] as a whole was in
accordance with the considerations put forward by the delegation
of Iran, which therefore did not insist upon its proposal to have
an interpretative note.
(e) The delegations of Argentina, Bolivia, Chile, Peru and
Poland reserved their positions on Article 93 [98].
Article 94 [99]. - General Exceptions.
(a) The delegation of Italy reserved its position on sub-para-
graph 2 (a) of Article 94 [99].
(b) The delegation of Turkey reserved its position upon Arti-
cle 94 [99] pending the outcome of the discussions on Article 16
and pending the receipt of instructions from its Government.1
Article 95 [100]. - Amendments.
The Committee agreed that the phrase " a two-thirds majority
of the Members " as used in paragraph 1 of Article 95 [100] means
that in order to approve an amendment under that paragraph the
affirmative vote of two-thirds of the Members of the Organization
is required.2
Article 99 [104]. - Territorial Application.
(a) The Committee agreed that the provisions of paragraph 1
of Article 99 [104] cannot in any way affect rights and obligations
under or pursuant to the General Agreement on Tariffs and Trade.
1 This reservation was subsequently withdrawn (E/CONF.2/76).
2 This paragraph is contained in document E/CONF.2/68/Add.v. - 158 -
(b) The delegation of Egypt, desiring to avoid any misunder-
standing to which the interpretative note to Article 99 [104] might
give rise, desired to record the attitude of the Egyptian Govern-
ment as regards the Sudan. In view of the fact that there are no
customs boundaries between Egypt and the Sudan and in view
of the fact that Egypt and the Sudan are one and the same territory,
customs matters concerning the Sudan are the exclusive concern
of the Egyptian Government.
(c) The Committee agreed that no presumption should be
drawn from the text of paragraphs 1 and 2 of Article 99 [104]
that the dependent territories were autonomous or quasi-autono-
mous in the conduct of their external commercial relations and of
the other matters provided for by the Charter for the purposes of
paragraph 3 of Article 68 [71].
(d) The delegation of the United Kingdom said that the
Government of the United Kingdom of Great Britain and Northern
Ireland would not have thought that the general principle laid
down in the interpretative note to Article 99 [104] required any
qualification, since it in no way prejudices the question of what
is or is not a condominium. In view, however, of the declaration
by the delegation of Egypt, the Government of the United Kingdom
decided to place on record that, as is well known, it does not accept
the thesis of the Egyptian Government in regard to the Anglo-
Egyptian Condominium of the Sudan.
ATTACHMENT 1 TO THE REPORT OF THE SIXTH COMMITTEE
REPORT OF THE SIXTH COMMITTEE UPON THE QUESTION OF AN INTERIM
COMMISSION FOR THE INTERNATIONAL TRADE ORGANIZATION.1
1. The Working Party set up to consider the question of an Interim
Commission for the International Trade Organization was composed of
Canada, Colombia, El Salvador, France, Iraq, Mexico, Netherlands, New
Zealand, Norway (Chairman), Pakistan, Peru, Philippines, Turkey,
the United Kingdom and the United States.
2. The Committee agreed that the performance of the functions
specified in sub-paragraphs 2 (c), (d) and (e) of the annex to the Resolution2
could not result in the increase of the obligations or the decrease of the
rights of Members under the Charter.
3. It was agreed that under the second sentence of paragraph 3 of
the annex to the resolution the Executive Secretary of the Commission,
1 E/CONF.2/C.6/III.
2 The Resolution Establishing an Interim Commission is contained in the
Final Act and Related Documents (E/CONF.2/78 or ICITO/1/4). - 159 -
might, for example, be authorized to make available to the Contracting
Parties to the General Agreement on Tariffs and Trade acting jointly in
accordance with Article XXV thereof, at their request, the services of
the staff upon terms to be agreed.
4. The Committee considered that a function which the Executive
Committee might usefully perform under sub-paragraphs 2 (b) and 2 (i)
of the annex would be the publication of the important documents
issued at Havana. The Committee noted, however, that it had not been
possible at the Conference to establish texts of the reports of committees
and sub-committees properly revised by drafting sub-committees. The
attention of the Executive Committee of the Interim Commission was
drawn to this fact. The Committee assumed that, before the Executive
Committee published, whether for use at the first regular session of the
Conference of the Organization or otherwise, the texts of any of these
reports or of any other important document issued at Havana, the
Executive Committee will ensure that such texts are, as far as possible,
correctly drafted and that they correspond in each language that is
employed.
5. The delegation of Bolivia reserved its position upon the question
of establishing an Interim Commission.
ATTACHMENT 2 TO THE REPORT OF THE SIXTH COMMITTEE
NOTIFICATION BY THE SIXTH COMMITTEE TO OTHER COMMITTEES
OF THE CONFERENCE.1
The Sixth Committee has discussed the question of the relationship
between Chapter VIII and other parts of the Charter. In the light of its
discussion the Committee wishes to make known to other Committees of
the Conference that, in its opinion, where an article of the Charter other
than those contained in Chapter VIII establishes procedures for action by
a Member or by the Organization, action in accordance with that pro-
cedure should precede that provided for in Chapter VIII, but shall not,
unless it is so specified, impair the rights of Members under Chapter VIII.
However, it is the view of the Committee that if consultation or investiga-
tion has taken place under the provisions of another article, the Organ-
ization may regard such consultation or investigation as fulfilling, either
in whole or in part, any similar procedural requirement in Chapter VIII.
This will be made clear in the appropriate article of Chapter VIII.
1 E/CONF.2/C.6/63. VII. DOCUMENTS RELATING
TO THE CO-ORDINATING COMMITTEE
This section contains the following documents:
(i) Report of the Co-ordinating Committee to the Heads of
Delegations.
(ii) Recommendations by the Heads of Delegations regarding
the Report of the Co-ordinating Committee.
REPORT OF THE CO-ORDINATING COMMITTEE
TO THE HEADS OF DELEGATIONS 1
The Co-ordinating Committee, consisting of the following indi-
viduals acting in a personal capacity: Messrs. ABELLO 2, BETETA,
COOMBS, FERRERO, HAKIM, HOLMES, LLERAS RESTREPO, MALIK,
MULLER, PHILIP, Wunsz KING and WILCOX, under the chairmanship
of Mr. Max SUETENS, was established by the Heads of Delegations at
their meeting on 4 February 1948, in order to expedite the successful
termination of the Conference by recommending compromise
solutions for differences relating primarily to questions of economic
development.
The Committee therefore devoted its attention to establishing a
basis for agreement on Article 13, Article 15 and the Tariff Com-
mittee and the proposed Economic Development Committee and
included 3 in its Report annexes relating to Article 13, Article 15
1 E/CONF.2/45/Rev.1.
2 Mr. Abello was unable to attend the later meetings.
3 Annex 1 was a draft of Article 13 with footnotes; the text and the footnotes
were incorporated in substantially the same form either into the text of the Charter
including one interpretative note in Annex P or into the Report of Sub-Committee C
of Committee II. One change was made by the Heads of Delegations namely in
the footnote on " processing " which was incorporated into the interpretative note
in Annex P. Annex 1is not reproduced. Annex 2 was a draft of Article 15 with
footnotes; the text and the footnotes were incorporated in substantially the same
form into the text of the Charter including interpretative notes in Annex P.
Annex 2 is therefore not reproduced. Annex 3 consisted of a report on " proposals
dealing with the Tariff Committee, the Committee on Economic Development and
Reconstruction, etc.". This annex is reproduced with the exception of the recom-
mended texts substantially incorporated into the Charter. Annex 4 consisted of
a statement made by Mr. Lleras Restrepo (Colombia) at the meeting of the
Co-ordinating Committee held on 25 February 1948 and is not reproduced. - 161 -
and amendments concerning the Tariff Committee and the proposed
Economic Development Committee, which represented the result of
the Committee's consideration of these matters.
The Committee recommended that the Heads of Delegations
consider these drafts from the standpoint of obtaining an overall
solution to the problems involved and of reaching a decision on the
proposals as a whole. If an agreement on these lines was reached,
it was recommended that it should be accompanied by withdrawal
of a number of amendments and reservations entered pending the
settlement of the final drafts of the Articles involved in the overall
settlement. The Committee also considered that, as a decision on.
the Report of the Sub-Committee on Article 75 [78] 1 had been
postponed pending a settlement of the matters referred to above,
that Report should also be included as part of the overall settlement.
If this procedure was acceptable to the Heads of Delegations, and
it proved possible to reach agreement on the substance of the drafts
submitted, it was recommended that the drafts be referred to the
appropriate committees as the basis for the adoption of final texts.
ANNEX 3 TO THE REPORT
Proposal dealing with the Tariff Committee,
the Committee on Economic Development and Reconstruction, etc.
i. The Co-ordinating Committee considered three alternative pro-
posals submitted by the delegation of the United States, for dealing with
the problem of the Tariff Committee, the proposed Committee on
Economic Development and Reconstruction and a possible Commercial
Policy Committee.
2. It was agreed that the second proposal would be accepted as a
basis for the work of the Committee. Under this alternative:
(a) there would be no provisions in the Charter for a Tariff Com-
mittee, a Committee on Economic Development and Recons-
truction or a Commercial Policy Committee.
(b) [Members, not parties to the GATT would enjoy GATT conces-
sions for two years, but these concessions would thereafter be
withdrawn unless the Member concerned had become party to
the GATT.] <R>2</R>
1 E/CONF.2/C.6/53.
2 The Heads of Delegations approved the following text instead of the words
in square brackets:
" Any Member, not party to the GATT would enjoy GATT concessions
for two years, but these concessions would thereafter be withdrawn subject to
certain provisos by any other Member which has requested such Member to
negotiate with a view to becoming a contracting party to the GATT, without
concluding an agreement."
11 - 162 -
3. The Committee considered in addition amendments to this
proposal submitted by various members of the Committee.
4. The Committee agreed to submit texts of Articles 70 [73] and
74 [77] and also of paragraph 4 of Article 17 of the Havana Charter.
5. The Committee proposed the deletion of Article 81 of the Geneva
draft on the Tariff Committee and agreed that the fact that no provision
was made in the Charter for a Tariff Committee, a Committee for
Economic Development and Reconstruction or a Commercial Policy
Committee, would not preclude the establishment by the Organization
of [any of these]1 Committees in the future.
6. In relation to paragraph 4 (a) of Article 17 of the Havana
Charter, it was agreed that whereas this paragraph provides that Arti-
cle 16 does not require the continued application of the tariff concessions
embodied in the schedules of the GATT to the trade of a Member which
has failed to become a party of the GATT, it does not permit the with-
drawal of other forms of most-favoured nation treatment required by
the Charter, e.g. in relation to internal taxation, the administration. of
quantitative restrictions, etc.
7. It was also agreed that since Members would under the provisions
of Article 17 be required to become Contracting Parties to the GATT, it
was desirable that they should be aware of the obligations which would
be imposed upon them as contracting parties. In this connection
attention was drawn to the fact that:
(a) it had been proposed to amend the GATT to permit the admis-
sion of a country as a contracting party upon a vote of two-thirds
of the contracting parties instead as of a unanimous vote as at
present required;
(b) it was decided to suggest to the Heads of Delegations that they
should recommend to the Contracting Parties that they amend
the text of paragraph 5 of Article XXV of the GATT.<R>3</R>
RECOMMENDATIONS BY THE HEADS OF DELEGATIONS
REGARDING THE REPORT OF THE CO-ORDINATING
COMMITTEE 3
There are set out below, for the guidance of the Committees and
Sub-Committees concerned, recommendations approved at a
meeting of the Heads of Delegations held on Wednesday, 3 March
regarding the Report of the Co-ordinating Committee.4
1The Heads of Delegations agreed to substitute the words " either or both of
the two latter " for the words in square brackets.
2 The recommended text, with minor changes, is embodied in the Protocol
Modifying Certain Provisions of the General Agreement on Tarifis and Trade signed
at Havana on 24 March 1948. It now constitutes the whole paragraph 5 of
Article XXV of the GATT as amended by the Protocol, with the exception of
sub-paragraph (d), which was added by the Contracting Parties.
3 E/CONF.2/51.
4 E/CONF.2/45/Rev.1. -163 -
y. (a) the Heads of Delegations recommended 1 the contents of
the Report of the Co-ordinating Committee as an overall
settlement of the issues dealt with therein;
(b) this recommendation was subject to reservations by the
delegations of Afghanistan, Argentina, Poland, Turkey
and the United Kingdom 2;
(c) the delegations of Iraq, Ireland and the Philippines felt
unable to express an opinion in the absence of instruc-
tions from their Governments.
2. The Heads of Delegations therefore recommended that the
texts submitted by the Co-ordinating Committee be accepted as the
basis for the preparation of final texts by the Committees and
Sub-Committees of the Conference.
These recommendations were accompanied by a resolution
approved by a large majority of the Heads of Delegations, that the
proposals of the Co-ordinating Committee be adopted by the
Sub-Committees and Committees without major changes of
substance.
1 Subject to corrections indicated in the accompanying text of the Report of
the Co-ordinating Committee.
2 The Indian delegate stated that his adherence to the recommendations and the
resolution was subject to a satisfactory settlement of another Article of the draft
Charter. REFERENCE LIST OF THE PRINCIPAL DOCUMENTS
CONTAINING PROPOSALS MADE BY INDIVIDUAL
DELEGATIONS DURING THE HAVANA CONFERENCE 1,2
CHAPTER I
Ecuador .
El Salvador ......
Mexico .
Article 1.
. . . E/CONF.2/C.6/12/Add.2.
. . . ,, Add.11
,, Add.1 and Add. 12
CHAPTER II
Italy
Mexico
Peru
Italy
Mexico .
Norway
Philippines
Article 3.
E/CONF.2/II/Add.IS
,, Add.28
,, Add.4
Article 3.
. . . . . . .... E/CONF.2/I11/Add.18
. . . . . . ... .. ,, Add.28
........ ........ E/CONF.2/C.1/3/Add.7
,, Add.4
Argentina
Belgium
Burma
Ceylon
Colombia
Haiti
International Labour Organiza-
tion
.
.
.
.
.
. . .
Article 4 [7].
. . E/CONF.2/II/Add.3
. . E/CONF.2/C.I/15/Add.I
. . E/CONF.2/II/Add.23
. . ,, Add.33
. . E/CONF.2/C.I/3/Add.5
, Add.I
E/CONF.2/C.I/12
1 As indicated in the Introduction these documents are available for reference
at the Headquarters of the United Nations, Lake Success, New York, and at the
office of the Interim Commission for the International Trade Organization,
Geneva, Switzerland.
2 The article numbers of the Havana Charter are indicated in square brackets
following those of the Geneva draft when they differ. Mexico.
Peru
Philippines .
Union of South Africa
United States of America
Uruguay
Denmark.
Peru.
Italy
Mexico.
Norway
- 165 -
. . E/CONF.2/11/Add.28 and Add.31
. . ,, Add.4
. . E/CONF.2/C.1/3/Add.4
v ,, Add.3
. . E/CONF.2/C.I/7/Add.I
, . E/CONF.2/C.I/3/Add.2
Article 5 [4].
E/CONF. 2/C. 1/3/Add.6
. .E/CONF.2/II/Add.32 and
E/CONF.2/C.1/7/Corr. I
Article 6 [5].
E/CONF.2/C.I/13
. .E/CONF.2/II/Add.31
Article 7 [6].
. ... . . . .. E/CONF.2/C.1/7/Add.2 and
E/CONF.2/C. I/2I
CHAPTER III
Article 8.
No formal proposals.
Article 9.
Ceylon .......... . E/CONF.2/C.2/9
Mexico. . . . . . . . . . . . ..
Burma .
Mexico
Pakistan
Turkey
Afghanistan
Burma
Chile.
China.
Italy
Mexico .
Norway .
Peru .
Uruguay
Article 10
....... E/CONF.2/C.2/9
. . . . . . ..
. . . . . . ..
. . . . . . ..
Article II.
E/CONF.2/C.2/9
and Add.4/Corr 3.
..
,, and Add.4/Corr.3
. . . .
. . . .
. . . .
. . . .
. . . . -166 -
Afghanistan
Argentina.
Burma
Ceylon
Chile
Costa Rica.
Czechoslovakia
Denmark.
India
Mexico
New Zealand.
Norway
Pakistan
Peru
Sweden
United States of America
Uruguay
Venezuela
Argentina
Brazil
Burma
Ceylon
Chile
China
Colombia
Cuba
Ecuador.
India.
Iraq
Mexico.
New Zealand
Pakistan
Philippines .
United Kingdom
Uruguay
Argentina
Costa Rica .
Ecuador.
Italy
Philippines .
Turkey
Article 12.
. E/CONF.2/C.2/9
. . ..
. . ..
. . ..
. . . "
. .
.
. .
. .
, . . E/CON F. 2/C.2/9/Add. 5
and Add.5/Corr.1
and Corr.4
and Add.4/Corr.3
Add.5 and
Add.5/Corr.I
E/CONF.2/C.2/9
,, and Add.4/Corr.3
Article 13.
E/CONF.2/C.2/9
E/CONF.2/C.2/C/5 and
E/CONF.2/C.2/C/13
E/CONF.2/C.2/9
E/CONF.2/C.2/9/Add.I and
Add. I/Corr. I
E/CONF.2/C.2/9
and Add.3 and
Add.4/Corr.3
E/CONF.2/C.2/C/14
E/CONF.2/C.2/9
E/CONF.2/C.2/6/Add.23
Article 14.
... .... . E/CONF.2/C.2/9/Corr.5
. ...... E/CONF.2/C.2/9
. . . . . .
. . . .. . .
. . . . . ..
.... . . . .. E/CONF.2/C.2/C/5 and
'E/CONF.2/C.2/C/13
.... E/CONF.2/C.2/9
E/CONF.2/C.2/6/Add.23
. .
. . .
. .
. .
. .
.
United Kingdom . . .
Uruguay . . . . . . - 167 -
Argentina.
Chile.
Ecuador . . . . . .
El Salvador ....
Poland.
Venezuela.
Article 15.
E E/CONF.2/C.2/9
.
.
and Add.4/Corr.3
E/CONF.2/50
E/CONF.2/C.2/9 and Add.4/Corr.3
CHAPTER IV
Afghanistan
Argentina.
Bolivia.
Burma.
Chile.
Colombia.
Costa Rica
Cuba.
Czechoslovakia
Denmark
Dominican Republic
Ecuador
Egypt
El Salvador
France.
Greece
Guatemala .
Haiti.
Iran
Iraq
Italy
Lebanon .
Peru.
Philippines
Portugal . . . . .
Syria.
Transjordan
Turkey.
Venezuela
Article 16.
E/CONF.2/C.3/6
E/CONF.2/C.3/6/Add.I
E/CONF.2/C.3/6
E/CONF.2/C.3/6/Add.7
E/CONF.2/C.3/6
E/CONF.2/C.3/79
and Add.3
Add.I
Add.7
and Add.3
and Corr. I
and Corr.4
and Add.4 and
E/CONF.2/C.3/77/Rev.I
Argentina ......
Ceylon.
Chile
Colombia.
Cuba
El Salvador.
Haiti
Mexico . . . . .
Norway.
Peru.
Article 17.
... ... E/CONF.2/C.3/6
. . ..
. . . ..
. . ..
. . ..
. . . ..
. . ..
. .... , , and
E/CONF.2/C.3/A//W.13 - 168 -
Philippines
United States of America.
Uruguay
Venezuela.
E/CONF.2/C.3/6
. and.Corr.5
,, and Corr.2
Argentina . . . . . . .
Brazil .
Ceylon.
Chile.
China . . . . . . . . .
Colombia.
Costa Rica .......
Cuba.
Ireland.
Lebanon .
Mexico.
Norway.
Peru.
Sweden.
Syria .
United Kingdom .....
United States of America
Uruguay
Argentina
Czechoslovakia
United Kingdom
Argentina
Australia.
Ceylon
Chile
China
Cuba
Egypt.
Greece
Ireland
Lebanon.
Mexico
Norway.
Peru .
Article 18.
. E/CONF.2/C.3/6
..I
..I
..I
..,
..I
..I
..I
..I
..I
..I
..I
..I
..I
..I
..I
Article 19 .
E/CONF.2/C.3/6
Article 20.
. . . . . . . . E/CONF.2/C.3/7
. . . . .
. . . . .
. . . . .
. . . . .
. . . . .
Sweden
United Kingdom . .
Uruguay
and Corr.3
and Corr.6
and Add.5
and Add.2
and Corr.6
and
E/CONF.2/C.3/E/W.6
E/CONF.2/C.3/7 and
E/CONF.2/C.3/E/W.5
and
E/CONF.2/C.3/E/W.10
Argentina .
Australia .
Belgium.
Article 21.
. . . . . . E / C O N F .2 / C .3 / 7
. . . . ..
. ..... , , and
E/CONF.2/C.3/F/W.6
. .
. . . .
. . . .
. . . .
. . . . Brazil .
Ceylon
Chile
Denmark
Italy
New Zealand
Uruguay
Venezuela
Argentina
Czechoslovakia
India
Lebanon .
Mexico
Syria
Turkey
Uruguay
Argentina
Belgium.
Brazil
Czechoslovakia
Denmark
France.
Greece
Italy
Mexico
Norway
United Kingdom
Uruguay
Argentina
Australia .
Liberia
Mexico
New Zealand
- 169 -
. . E/CONF.2/C. /F/W.24
. . E/CONF.2/C.3/7
..1
E/CONF.2/C.3/F/W.23
. E/CONF.2/C.3/7
Article 22.
E/CONF.2/C.3/7
Article 23.
E/CONF.2/C.3/7
. . . E/CONF.2/C.3/F/W.6
E/CONF.2/C.3/7
E/CONF.2/C.3/F/W.14
E/CONF.2/C.3/7
and E/CONF-2/C.3/F/W.4
and W.5
. . ..
Article 24.
E/CONF.2/C.3/7
E/CONF.2/C.3/F/W.15
E/CONF.2/C.3/7
Cuba
United States of America
Argentina
Sweden.
United States of America
Venezuela
Argentina.
Netherlands
Peru
United States of America
Venezula
Article 25.
E/CONF.2/C.3/8
Article 26.
. E/CONF.2/C.3/8
Article 27.
. E/CONF.2/C.3/8
.
.
.
.
.
. - 170 -
Article 28.
Argentina.. .... E/CONF.2/C.3/8
Brazil.. ..... E/CONF.2/C.3/H/5
United States of America . . . E/CONF.2/C.3/8
Article 29 [deleted].
Argentina ..... . E/CONF.2/C.3/8
Ecuador . . . . . . . . . . .
United States of America .
Argentina.
Mexico.
New Zealand . . .
United Kingdom . .
Article 30 [29].
. . . . . E / C O N T . 2 / C . 3 / 9
. . ..~~~~1
. . ..~~~~1
and Add.I
Argentina
Denmark.
Mexico
Switzerland
United States
Afghanistan
Argentina
Chile
Costa Rica
France.
Argentina
China
Cuba
Denmark
Lebanon .
Mexico
Philippines
Syria...
Argentina
Chile
Uruguay
Afghanistan
Argentina
Brazil.
Haiti
Peru .
Turkey
Uruguay
Article 31.
. E/CONF.2/C.3/9
. ,, and Add.2
. ..
. ..
. ..
. ..
of
America
Article 32 [33].
..... ..........E/CONF.2/C.3/10
Article 33 [34].
. . . E/CONF.2/C.3/10
Article 34 [35].
E/CONF.2/C.3/10
Article 35 [36].
. . . . E/CONF./C.3/10
. . . . . . . . . E/CONF.2/C.3/10/Add.I
. . . . . . . . E/CONF.2/C.3/10/Add.2
. . . . . . . . E/CONF.2/C.3/10 Argentina .
Chile.
Argentina . . . .
New Zealand . .
United Kingdom .
Australia.
Czechoslov.
Norway
Iraq
Lebanon.
Mexico
Syria
Argentina
Colombia
Denmark
Peru
Afghanistan
Argentina
Ecuador .
Guatemala .
Uruguay
- 171 -
Article 36 [37].
.. . . . . . E /C O N F .2 /C .3 /10
,, and Corr.1
Article 37 [38].
. .... . E/CONF.2/C.3/10
. . .
. . . ..
Article 38 [39].
..... ' E/CONF.2/C.3/10/Add.4
vakia . . 1. . . . . E/CONF.2/C.3/10/Add.3/Rev.I
.. ........ . E/CONF.2/C.3/10 and Add.3
Article 39 [deleted].
. . . . . . . . . E/CONF.2/C.3/10
. . . ..1
. . . ..1
Article 40.
. . E/CONF.2/C.3/II
Article 41.
. . . . . . . . . E/CONF.2/C.3/II
. ....... . E/CONF.2/C.3/46/Rev.I
. . .. . . . I..
. . . . . . I..
. . . . . . I..
Argentina . .
Chile . . . . .
France. . . . .
Iraq.
Italy .
Lebanon .
Syria
United Kingdom .
Afghanistan
Australia..
Cuba
Norway
Switzerland
Uruguay
Article 42 [42, 43 and 44].
. .... . E/CONF.2/C.3/II
. . . . . E/CONF.2/C.3/1I/Add.I
... . E/CONF.2/C.3/II
. . . ..
. . . ..
. . . ..
. . . . ..
Article 43 [45].
.. ....... . E/CONF.2/C.3/II
. . . . . v
. . . . . 11
. . . . . s
. . . . . . 1
. . . . . . . - 172 -
CHAPTER V
Article 44 [46].
Afghanistan .E/CONF.2/C.4/4
Argentina . . . . . . . . . .
Ceylon . . . . . . . . . . . ..
Czechoslovakia . . . . . . . .
Greece
Italy.
Mexico . . . . . . . . . . .
Norway . . . . . . . . . . .
Article 45 [47 and 48].
Argentina .. ... E/CONF.2/C.4/4
Italy . . . . . . . . . . . .
Mexico . . . . . . . . . . .
Article 45A [48].
Norway .E/CONF.2/C.4/4/Add.2
Article 46 [49].
Argentina .E/CONF.2/C.4/4
Ceylon . . . . . . . . . . .
Italy . . . . . . . . . . . .
Mexico . . . . . . . . . . .
Argentina
Italy
Mexico
Mexico.
No formal proposals.
Argentina
Ceylon.
Ecuador . .
Norway . .
United States of
America
Ecuador . . . . . . .
Mexico.
Article 47 [50].
E/CONF.2/C.4/4
Article 48 [51].
E/CONF.2/C.4/4
Article 49 [52].
Article 50 [53].
E/CONF.2/C.4/4
E/CONF.2/C.4/21 and 24
Article 51 [54].
. E/CONF.2/C.4/4
CHAPTER VI
. Article 52 [55].
No formal proposals.
. . .
. . .
. . . - 173 -
Chile
Italy
Uruguay
Ceylon
Chile
Cuba
El Salvador
Mexico
Philippines
Uruguay
Vnezuela
Ceylon.
El Salvador
Uruguay
Ceylon.
Egypt .
El Salvador
Peru
Philippines
India
Mexico
Ceylon
Venezuela
No formal proposals.
No formal proposals.
Costa Rica
No formal proposals.
Article 53 [56].
. . . E/CONF/2/II/Add.30
. . . E/CONF.2/C.5/Add.2
. . . Add.12
Article 54 [57].
. . E/CONF.2/C.5/3/Add.6
. . . E/CONF.2/11/Add.30
. . . E/CONF.2/C.5/3/Add.3
. . . ,, Add.8
. . . ,, Add.9
. . . ,, Add.7
, . . Add.12
. . . ,, Add.II
Article 55 [58].
........ .........E/CONF.2/C.5/3/Add.6
. ....... . E/CONF.2/C.5/5/Add.3
. ....... . E/CONF.2/C.5/3/Add.12
Article 56 [59].
. . . . . . . . E/CONF.2/C.5/3/Add.6
, .. ...Add.13
........ .........E/CONF.2/C.5/5/Add.3
. ....... . E/CONF.2/C.5/3/Add.4
Article 57 [60].
. ....... . E/CONF.2/C.5/3/Add.7
Article 58 [61].
...... ....... .. E/CONF.2/II/Add.27
.... .. .. E/CONF.2/C.5/3/Add.9
Article 59 [62].
. . . . . . . . . E/CONF.2/C.5/3/Add.6
. . . . . . . . . E/CONF. 2/II/Add.II
Article 60 [63].
Article 61 [64].
Article 62 [65].
. . . . . . . . . E/CONF.2/II/Add.16
Article 63 [66].
Article 64 [67].
India . E/CONF.2/II/Add.27
Article 65 [68].
Argentina.
No formal proposals.
. . . . E/CONF.2/II/Add.3
Article 66 [69].
. . . . . . Norway . ..
United States
Colombia
New Zealand
Costa Rica
Czechoslovakia
No formal proposals.
No formal proposals.
No formal proposals.
No formal proposals.
Czechoslovakia
Australia.
China
Cuba
Czechoslovakia
Mexico
United States of America
No formal proposals.
No formal proposals.
No formal proposals.
No formal proposals.
Costa Rica
China.
- 174 -
Article 67 [70]
E/CONF.2/C.5/3/Add.10
Add.5
Proposed New Article.
. .... . . .. E/CONF.2/C.5/3/Add.I
CHAPTER VII
Article 68 [71].
.. . . . . . . . E /C O N F .2 /C .6 /W .8 8
Article 69 [72].
........ E/CONF.2/C.6/12/Add.17
. . . . Add.3
Article 70 [73].
Article 71 [74].
Article 72 [75].
Article 73 [76].
Article 74 [77].
.. . . . . . . E /C O N F .2/C .6/I 2/Add.5
Article 75 [78].
. . . .. . . E/CONF.2/C.6/W .II
....... .......E/CONF.2/C.6/W.5/Add.I
...... . . . . .... ,, Add.2, and
E./CONF.2/C.6/W.51 and
E/CONF.2/C.6/W. 72
.. . . . . . . . E /CONF.2/C .6/12/Add.3
....... ......E/CONF.2/C.6/W.17 and Corr.
. . . E/CONF.2/C.6/W.5
Article 76 [79].
Article 77 [80].
Article 78 [81].
Article 79 [82].
Article 8o [83].
.. . . . .. . E/CONF.2/C .6/I2/Add.16
Article 81 [deleted].
. . . . . . . E/CONF.2/C.6/12/Add.7 - 175 -
Article 82 [84].
No formal proposals.
Article 83 [85].
Chile .E/CONF.2/C.6/12/Add.14
Ireland ........... ,, Add.6
Article 83 A [86].
Australia .......... E/CONF.2/C.6/93/Add.3 and
E/CONF.2/C.5/99
India ....... . " Add.1
South Africa .......... . Add.2 and
E/CONF.2/C.6/100
United Kingdom .... . ,, Add.4
Article 84 [87].
No formal proposals.
Article 85 [88].
No formal proposals.
Article 86 [89]..
No formal proposals.
Article 87 [90].
No formal proposals.
Article 88 [91].
No formal proposals.
CHAPTER VIII
India.
Colombia.
Article 89 [92 and 93].
.. . . . . E /C O N F .2 /C .6 /12 /A d d .4
Article 90 [94 and 95].
. . . . . E/CONF.2/C.6/W.53
Article 91 [96].
France .. E/CONF.2/C.6/W.73 and Add.
United States of America . . . E/CONF.2/C.6/W.81
Colombia. .
Costa Rica . .
France .
Article 92 [92, 97 and 106].
..... . ... E/CONF.2/C.6/12/Add.23
. . . Add.15
... . ...... ,, Add.23
CHAPTER IX
Chile.
Czechoslovakia .
Peru . . ...
United Kingdom. .
Article 93 [98].
. . . E/CONF.2/C.6/106
. . . E/CONF.2/C.6/W.108
. . . E/CONF.2/C.6/106
. . . E/CONF.2/C.6/35 and
E/CONF.2/C.6/W.119. - 176 -
Article 94 [86 and 99].
Iraq .E/CONF.2/C.6/12/Add.9
United Kingdom. E/CONF.2/C.6/W.48
Article 95 [100].
Mexico. E/CONF.2/C.6/W.27
United Kingdom. ... . E/CONF.2/C.6/83/Add.1
United States of America . . . E/CONF.2/C.6/W.27
Article 96 [101].
No formal proposals.
Article 97 [102].
No formal proposals.
Article 98 [103].
Cuba .E/CONF.2/C.6/W.101
Czechoslovakia .E/CONF.2/C.6/12/Add.8
Article 99 [104].
Guatemala . E/CONF.2/C.6/12/Add.22 and
E/CONF.2/C.6/101
Mexico Add.18
United Kingdom Add.13
United States of America . . . Add. 10
Article 100 [106].
Cuba .E/CONF.2/C.6/44
Mexico .E/CONF.2/C.6/12/Add.21
Formal Proposal by Non-Governmental Organisations
International Chamber of Com-
merce. E/CONF.2/8 (General Commentary)
E/CONF.2/14 (Proposals regarding
Chapters II, III, IV, V, VI
and IX)
International Co-operative
Alliance. E/CONF.2/15 and. Add.1 (Proposals
regarding Chapters V and VI) INDICES
(A) PRINCIPAL REFERENCES RELATING TO THE CHAPTERS, SECTIONS
AND ARTICLES OF THE Geneva Draft.
CHAPTER I:
Article 1:
CHAPTER
Article
Article
Article
Article
Article
Article
II:
2:
3:
4:
5:
6:
7:
Page
149
150
7-18
8
8, 43
9-10, 10-13, 14, 84
9
9, 14, 16
9
CHAPTER III : 19-38
Article 8: 20, 37
Article 9: 20, 21, 22, 26, 43
Article 10: 20, 21, 22, 26, 37
Article II: 20, 21, 22-25, 26
Article 12: 20, 26, 27
Article 13: 20, 28-31, 58, 86-88,
95, I05, 160, 161
Article 14: 20, 28, 31, 56, 86,
105
Article 15: 20, 32, 33-36, 40, 46,
47, 48, 52, 54, 160
"Reconstruction " footnote: 37,
41
CHAPTER IV: 41-119,132, 143, 145
Section A:
Article 16: 20, 32, 40, 41, 46, 47,
48, 52-55, 60, 62, 77, 99, 162.
Article 17: 41, 52, 55-61, 62,
162
Article 18: 16, 40, 41,52,53,61-
67, 77, 83, 107
Article 18 A: (proposed but not
accepted): 41, 68, 69, 121
Article 19: 40, 52, 67, 68
Page
Section B: 52,102
Article 20: 16, 43, 85, 87-95
Article 21: 43, 44, 58, 87, 97, 98,
99, 100, 103, 104, 105, 117
Article 22: 43, 66, 87, 91, 94, 95,
96, 99
Article 23: 43, 44, 54, 58, 96, 98-
101
Article 23 A (proposed but not
accepted): 101
Article 21 : 43, 44, 58, 96, 98,
99, 100, 101, 102
Section C: 60, 66, 106, 107
Article 25: 16, 45, 90, 106, 107,
108, 110
Article 26: 16, 45, 106, 108,
109,110,113
Article 27: 16, 45, 60, 75, 106,
108, 109, 110, 111, 145
Article 27 A (proposed but not
accepted): 112
Article 28: 16, 45, 106, 108, 110,
111, 112, 113
Article 29: 16, 45, 106, 113
Section D . 113,
118, 119
Article 30: 45,
118, 119, 157
Article 31: 45,
114-117
Section E: 71
Article 32: 42,
Article 33: 42,
Article 34: 42,
Article 35: 41,
76-78
115, 116, 117,
67, 113, 114, 115,
66, 67, 98, 113,
70, 71-73
70, 73-75
70, 75, 76, 79
42, 54, 69, 70, 72, Article
Article
Article
Article
Page
36: 42, 69, 70, 78, 79
37: 42, 69, 70, 79, 80
38: 42, 69, 70, 80
39: 42, 69, 70, 81
Section F: 84
Article 40: .42, 43, 81, 82, 83,
104
Article 40 A: (proposed but not
accepted): 84
Article 41: 42, 43, 74, 81, 82, 84,
116
Article 42: 20, 32, 46, 46, 49, 50,
51, 52, 81, 82
Article 43: 16, 42, 43, 52, 81, 82,
84-86, 117, 132, 135, 145
The "Swiss Proposal": 44, 45,
102-105
CHAPTER V:
Article 44:
Article 45:
Article 47:
Article 48:
Article 50:
126
Article 51:
68, 120-126, 137
121, 122, 123, 124
122
122, 124,125
125
41, 42, 69, 121, 125,
121, 126
CHAPTER VI: 16, 45, 108, 111, 127-
148
Section A: 128,129
Article 52: 128, 133, 134
Article 53: 107, 116, 128, 134.
135, 137, 143
Article 54: 128, 129, 130, 132,
133, 135-137, 141
Section B: 129, 130
Article 55: 16, 109, 129, 137,
138, 139, 140, 141
Article 56: 129, 130, 135, 137,
138, 139, 140, 141
Article 57: 130, 139
Article 58: 130, 131, 138-140
Section C: 126, 130, 131
Article 59: 129, 130,
141
Article 60:
141
Article 61:
Article 62:
Article 63:
136, 140,
130, 131, 133, 136,
131, 135
131, 142
131
Page
Section D: 131, 132
Article 64: 130, 131, 142
Article 65: 131, 142, 143
Article 66: 132
Article 67: 85, 132, 143
CHAPTER VII: 149-154
Section A:
Article 68: 49, 151, 158
Article 69: 16, 22, 24, 73, 129,
152
Article 70:
Section B.:
Article 74: 23, 101, 152, 161
Section C:
Article 75: 149, 150, 152, 161
Section D:
Article 80: 153
Section E:
Article 81: 25, 26, 59, 60, 149,
150, 160, 161
Section G:
Article 84: 80, 142, 153
CHAPTER VIII: 25, 26, 27, 116,
122, 149, 150, 152, 154-156, 159
Article 89: 16, 74, 84, 91, 154,
155
Article 90: 16, 84, 91, 155
Article 91: 15, 156
Article 92:
155, 156
CHAPTER IX: 22, 24, 149, 156-158
Article 93: 34, 51, 100, 149, 151,
156, 157
Article 94: 84, 118, 143, 144,
146, 147, 150, 151, 153, 157
Article 95: 150, 151, 155, 156
Article 96: 150, 151
Article 97: 49
Article 98: 150, 151
Article 99: 49, 62, 150, 151,
157, 158
Article 100: 150, 151
- 178 -
161 - 179 -
(B) PRINCIPAL REFERENCES RELATING TO THE CHAPTERS,
SECTIONS AND ARTICLES OF THE Havana Charter
CHAPTER I:
Article 1:
Page
149
150
CHAPTER II: 7-18
Article 2: 8
Article 3: 8, 43
Article 4: 9
Article 5: 9, 14,
Article 6: 9
Article 7: 9-10,
16
10-13, 14, 84
CHAPTER III: 19-38
Article 8: 20, 37
Article 9: 20, 21, 22, 26, 43
Article 10: 20, 21, 22, 26, 37
Article 11: 20, 21, 22-25, 26
Article 12: 20, 26, 27
Article 13: 20, 28-31, 58, 86-88,
95, 105, 160, 161
Article 14: 20, 28, 31, 56, 86,
105
Article 15: 20, 32, 33-36, 40, 46,
47, 48, 52, 54, 160
Inclusion of " Reconstruction ":
37, 38, 41
CHAPTER IV: 41-119, 132, 143, 145
Section A:
Article 16: 20, 32, 40, 41, 46, 47,
48, 52-55, 60, 62, 77, 99, 162
Article 17: 41, 52, 55-61, 60, 62,
162
Article 18: 16, 40, 41, 52, 53, 61-
67, 77, 83, 107
Article 19: 40, 52, 67, 68
Section B: 52, 102
Article 20: 16, 43, 85, 87-95
Article 21: 43, 44, 58, 87, 97, 98,
99, 100, 103, 104, 105, 117
Article 22: 43, 66, 87, 91, 94, 95,
96, 99
Article 23: 43,44, 54, 58, 96, 98-
101
Article 24: 43, 44, 58, 96, 98, 99,
100, 101, 102
Page
Section C: 60, 66, 106, 107
Article 25: 16, 45, 90, 106, 107,
108, 110
Article 26: 16, 45, 106, 108, 109,
110, 113
Article 27: 16, 45, 60, 75, 106,
108, 109, 110, 111, 145
Article 28:16, 45, 106, 108, 110,
111 112, 113
Section D: 113, 115, 116, 117, 118,
119
Article 29: 45, 67, 113, 114, 115,
118, 119, 157
Article 30: 45, 66, 67, 98, 113,
114-117
Article 31: 45, 46, 67, 113, 114,
115-118
Article 32: 45, 46, 113, 114, 118,
119
Section E: 71
Article 33:
Article 34:
Article 35:
Article 36:
76-78
Article 37:.
Article 38:
Article 39:
42, 70, 71-73
42, 70, 73-75
42, 70, 75, 76, 79
41, 42, 54, 69, 70, 72,
42, 69, 70, 78, 79
42, 69, 70, 79, 80
42, 69, 70, 80
Section F: 84
Article 40: 42, 43, 81, 82, 83,
104.
Article 41: 42, 43, 74, 81, 82, 84,
116
Article 42: 20, 32, 40, 46, 49, 50,
51, 52, 81, 82
Article 43: 20, 32, 33, 40, 46, 49,
50, 81, 82
Article 44: 20, 32, 33, 40, 46, 49,
50-52, 81, 82
Article 45:16, 42, 43, 52, 81, 82,
84-86, 117, 132, 135, 145
CHAPTER V: 68, 120-126, 137
Article 46: 121, 122, 123, 124 - 180 -
Page
Article 47:
Article 48:
Article 50:
Article 51:
Article 53:
126
122
122, 124
122, 124, 125
125
41, 42, 69, 121, 125,
Article 54: 121, 126
CHAPTER VI:
148
16,45, 108, 111, 127-
Section A: 128, 129
Article 55: 128, 133, 134
Article 56: 107, 116, 128, 134,
135, 137, 143
Article 57: 128, 129, 130, 132,
133, 135-137, 141
Section B: 129, 130
Article 58: 16, 109, 129, 137,
138, 139, 140, 141
Article 59: 129, 130, 135, 137,
138, 139, 140, 141
Article 60: 130, 139
Article 61: 130, 131, 138-140
Section C: 126, 130, 131
Article 62: 129, 130, 136, 140,
141
Article 63: 130, 131, 133, 136,
141
Article 64: 131, 135
Article 65: 131, 142
Article 64: 131
Section D: 131, 132
Article 67: 130, 131, 142
Article 68: 131, 142, 143
Article 69: 132
Article 170: 85, 132, 143
Page
CHAPTER VII: 149-154
Section A:
Article 7I: 49, 151,158
Article 72: 16, 22, 24, 73, 129,
152
Article 73: 161
Section B:
Article 77: 23, 101, 152, 161
Section C:
Article 78: 149, 150, 152, 161
Section D:
Article 83:
Section G:
Article 86:
Article 87:
CHAPTER VIII
122, 149,
Article 92:
Article 93:
155
Article 94:
Article 95:
Article 96:
Article 97:
153
80, 153, 154
80, 142, 153
25, 26, 27, 116,
150, 152, 154-156, 159
154, 155
16, 74, 84, 91, 154,
16, 84, 91, 155
16, 84, 91, 155
155, 156
155, 156
CHAPTER IX: 22, 24, 149, 156-158
Article 98: 34, 51, 100, 149, 151,
156,157
Article 99: 84, 118, 143, 144,
146, 147, 150, 151, 153, 157
Article 100: 150, 151, 155, 156
Article 101:150, 151
Article 102: 49
Article 103: 150, 151
Article 104: 49, 62, 150, 151,
157, 158
Article 106: 150, 151 |
|
GATT Library | mz858nb6542 | Reports of Working Party 3 (Article 18) and Working Party 4 (Article 19) | United Nations Conference on Trade and Employment, February 6, 1948 | Third Committee: Commercial Policy and Third Committee: Commercial Policy Sub-Committee A (Articles 16, 17, 18, 19) | 06/02/1948 | official documents | E/CONF.2/C.3/A/W.47, E/CONF.2/C.3/A/W.40-55, and C.3/A/WHITE PAPERS | https://exhibits.stanford.edu/gatt/catalog/mz858nb6542 | mz858nb6542_90190477.xml | GATT_147 | 3,067 | 19,774 | United Nations Nations Unies RESRICTED
E/CONF. 2/C.3/A/W.47
CONFERENCE CONFERENCE 6 February 1948
ON DU ORIGINAL:ENGLISH
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI
THIRD COMMITTE: COMMERCIAL POLICY
SUB-COMMITTEE A (ARTICLES 16, 17, 18, 19)
REPORTS OF WORKING PARTY 3 (ARTICLE 18) AND WORKIG PARTY 4 (ARTICLE 19)
I. REPORT OF WORKING PARTY 3 (ARTICLE 18)
Working Party 3 (Article 18), consisting of the delegates of Colombia,
Cuba, France, Norway, the United Kingdom and the United States, having
consulted with a number of the other Members of the Sub-Committee, reports
as follows:
A. REVISED TEXT OF ARTICLE 18
National Treatment on internal Taxation and Regulation
1. The Members recognize that internal taxes and charges, and laws,
regulations-or requirements af'fecting the internal sale, offering f'or sale,
purchase, transportation, distribution, or use of products, and internal
quantitative regulations requiring the mixture, processing or use of products
in specified amounts or proportions, should not be applied to imported or
domestic products so as to afford protection to domestic production.
2. The products of any Nember country, imported into any Member
country shall [be exempt from not be subject, directly or indirectly,to
internal taxes [and] or other internal charges of any kind, in excess of
those applied, directly or indirectly, to like domestic products. [of
national origin. Moreover, in cases in which there is no substantial
domestic production of like products of national origin, no Member shall
apply new or increased internal taxes on the products of other Member
countries for the purpose of affording protection to the production of
directly competitive or substitutable products] Moreover, no Member shall
otherwise apply internal taxes or charges to imported or domestic products
in a manner contrary to the principles set forth in paragraph 1.
3. With respect to any existing internal tax which i?? inconsistent with
the provisions of paragraph 2 but which is specifically authorized under
a trade agreement, in force on 10 April 1947, in which the import tariff
on the taxed product is bond.against increase, the Member imposing the
tax shall be free to postpone the application of the provisions of paragraph 2
to such tax until such time as the Member can obtain release from its trade
agreement obligations in order to permit the increase of suchi tariff to the
extent necessary to compensate for the elimination of the protective element
of the tax. 4. The products E/CONF.2/C.3/A/W.47
Page 2
[2] 4. The products of any Member country imported into any other Member country
shall be accorded treatment no less favourable than that accorded to like
products of national origin in respect of all laws, regulations, and
requirements affecting their internal sale, offering for sale, purchase,
transportation, distribution, or use. This paragraph shall not prevent the
application of differential internal transportation charges which are based
exclusively on the economic operation of the means of transport and not on the
nationality of the product.
[3] 5. No Member shall establish or maintain any eternal quantitative regulation
relating to the mixture, processing or use of products in specified amounts or
proportions which requires, directly or indirectly, that any specified amount
or proportion of any product which is the subject of the regulation must be
supplied from domestic sources. Moreover, no Member shall otherwise apply
internal quantlitative regulations in a manner contrary to the principles set
forth in paragraph 1.
[4] 6. The provisions of paragraph [3] 5 shall not apply to [:
(a) any internal quantitative regulation relating to cinematograph
films and meeting the requirements of Article 19;
(b)] any [other measures of] internal quantitative [control] regulation
in force in any Member, country on 1 July 1939 [or] 10 April 1947 or on
the day on which the Final Act of the United Nations Conference on Trade
and Employment is signed,* at the option of that Member; Provided that any
such [measure] regulation which would.be in conflict with the provisions
of paragraph [3] 5 shall not be modified to the detriment of imports and
shall be subject to negotiation [s for its limitation, liberalization or
elimination in the manner provided for in respect of tariffs and
preferences under Article 17] and accordingly shall be treated as a
customs duty for the purposes of Article 17.
7. No internal quantitative regulation relating to the mixture, processing
or use of produce in specified amounts or proportions shall be applied in such
a manner as to allocate any such amount or proportion among external sources
* If the Conference agrees to delete from Article 100 the words DONE at....
this.....day of. ....One Thousand Nine-Hundred and Forty...." and to
substitute the words "the date of this Charter shall be the date upon
which the Final Act of the United Nations Conference on Trade and
Employment is signed", the words "or on the date of this Charter" should
be substituted for the words "or on the day on which the Final Act of the
United Nations Conference on Trade and Employment is signed".
** The Norwegian delegation reserved its position on paragraph 7 pending the
results of the discussion in Sub-Committee E of Committee III of
Sub-Committee A's recommendation to amend paragraph 5 of Article 22.
/[5] 8.(a) The E/CONF.2/C.3/A/W.47
Page 3
[5] 8. (a) The provisions of this Article shall not apply to laws,
regulations or requirements governing the procurement by
governmental agencies of products purchased for governmental
purposesa and not [ for] with a view to commercial resale or with
a view to use in the production of goods for commercial sale [,];
(b) [nor] The provisions of this Article shall [they] not prevent
the payment of subsidies exclusively to domestic producers [only
of subsidies provided for under Article 25] including payments
to domestic producers derived from the proceeds of internal taxes
or charges applied consistently with the provisions of this Article
and subsidies effected through government purchases of domestic
products.
2. The Members recognize that internal maximum price control measures,
even though conforming to the other provisions of this Article, can have
effects prejudicial to the interests of Member countries supplying
imported products. Accordingly, Members applying such measures shall take
account of the interests of exporting Member countries with a view to
avoidingr to the fullest practicable extent such prejudicial effects.*
B. RECOMMENDED CONSEQUENTIAL CHANGES
Article 16, Paragraph 1
The following changes are recomended to bring paragraph 1 of
Article 16 in line with the revised text of Article 18:
"..... .and with respect to all matters [referred to in] within the scope
of paragraphs [1 and.2] 2 and 4 of Article 18....."
Article 22, Paragraph 5
If the proposed new paragraph 7 of Article 18 is adopted, paragraph 5 of
Artiicle 22 would have to be amended as follows:
"5. The provisions of this Article shall apply to any tariff quota
instituted or maintained by any Member and, insofar as applicable,
the principles of this Article shalls also extend to export restrictions
[and to any internal regulation or requirements under paragraph 2 of
Article 18]."
Article 30, Paragrph 2
The Working Party recommends that Sub-Committee A recommend to
Committee III that paragraph 2 of Article 30 be amended (a) to bring the
wording of paragraph 2 of Article 30 and paragraph 8 (a) of Article 18 in line
* The Norwegian delegation reserved its position on paragraph 9 both with
respect to (a) its inclusion in Article 18 instead of as a separate
Article and (b) its -substance.
The United Kingdom delegation reserved its position on paragraph 9 for the
time being.
/so as to avoid E/CONF.2/C. 3/A/W.47
Page 4
so as to avoid difficulties of interpretation, and (b) to extend the "fair
and equitable treatment" rule established in paragraph 2 of Article 30 with
respect to imports for governmental purposes excepted from the provisions of
paragraph 1 of Article 30 to the laws, regulations and requirements relating
to procurement for goverrmental purposes referred to in paragraph 8 (a) of
Article 18, as follows:
"2. The provisions of paragraph 1 of this Article shall not apply to
imports of products [for immediate or ultimate consumption in
governmental use and not otherwise for resale or for] purchased for
governmental purposes and not with a view to commercial resale or with
a view to use in the production of goods for commercial sale. With
respect to such imports, and with respect to the laws relations and
requirements referred to in paragraph 8 (a) of Article 18, the Members
shall accord to the trade of the other Members fair and equitable
treatment."
C. INTERPRETATIVE NOTES
Article 17
It is understood that an internal tax (other than a general tax
uniformly applicable to a considerable number of products) which is applied
to a product not produced domestically in substantial quantities would be
treated as a customs duty under Article 17 in any case in which a tariff
concession on the product would not be of substantial value unless it is
accompanied by a binding or a reduction of the tax.*
Article 18
If any internal tax or other internal charge, or any law, regulation
or requirement of the kind referred to in paragraph 1, applying to an import
product and to the like domestic product, is collected or enforced in the case
of the imported product at the time or point of importation, it is nevertheless
to be regarded as an internal tax or other internal charge, or a law,
regulation or requirement of the kind referred to in paragraph 1 and is
accordingly subject to the provisions of Article 18.
Article 18, Paragraph 1
The application of paragraph 1 to internal taxes imposed local
governments within the territory of a Member is subject to the provisions
of paragraph 3 of Article 99. The term "reasonable measures" in the
last-mentioned paragraph would not require, for example, the repeal of
* The Norwegian delegation and the United Kingdom delegation each reserved
its position for the time being with respect to this interpretative note.
The Colombian delegate reserved the right to raise in the Sub-Committee
the question of whether this provision should be inserted in the text of
the Charter instead of as an Interpretative Note.
/existing national E/CONF.2//C .3/A/W.47
Page 5
existing national legislation authorizing local governments to impose internal
taxes which; although technically inconsistent with the letter of Article 18,
are not in fact inconsistent with its spirit, if such repeal would result in
a serious financial hardship for the local governments concerned. With regard
to taxation by local governments which is inconsistent with both the letter
and. spirit of Article 18, the term "reasonable measures" would permit a
Member to eliminate the inconsistent taxation gradually over a transition
period if abrupt action would create serious administrative and financial
diffiiculties.
Article 18. Paragraph 2
A tax conforming to the requirements of the first sentence of paragraph 2
would be considered to be inconsistent with the second sentence only in cases
where competition was involved between, on the one hand, the taxed product,
and on the other hand, a directly competitive or substitutable product which
was not similarly taxed.
Article 18, Paragraph 5
Regulations consistent with the first sentence of paragraph 5 shall not
be considered to be contrary to the second sentence in any case in which all of
the products subject to the regulation are produced domestically in substantial
quantities. A regulation cannot be justified as being consistent with the
second sentence on the ground that the proportion or amount allocated to each
of the products which are the subject of the regulation constitutes an
equitable relationship between imported and domestic products.
D. EXPLANATORY PAPAGRAPHS TO BE INCLUDED IN THE SUB-COMMITTEE'S REPORT
TO COMMITTEE
The delegations of Chile, Lebanon and Syria inquired whether certain
charges imposed by their countries on imported products would be considered
as internal taxes under Article 18. The Sub-Committee considered that the
charges referred to are import duties and not internal taxes because (a) they
are collected at the time of, and as a condition to, the entry of the goods
into the importing country, and (b) they apply exclusively to imported
products without being related in any way to similar charges collected
internally on like domestic products. The fact that these charges are
described as internal taxes in the laws of the importing country w-olu n-ot in
itself ahve the effect of giving them the status o f netparl taxes u nde rteh
haiter."0
"The Su-bCmmoittee considered that charges imposed in connection with
the international transfer of payments for imports or exports, particularly
ht echagres imposed by ocuntries emlpoying multiple currency practices, where
such chares ase irpmoesd not iconnsistentl ywith the Articles of gAreement
o/f the International E/ CONF.2/C.3/A/W.47
Pages 6
of the International Monetary Fund, would not be covered by Article 18. On
the other hand, in the unlikely case of a multiple currency practice which
takes the form of an internal tax or charge, such as an excise tax on an
imported product not applied on the like domestic product, that practice
would be precluded by Article 18. It may be pointed out that the possible
existence of charges on the transfer of payments insofar as these are
permitted by the International Monetary Fund is clearly recognized by
Article 16."
"The Norwegian delegation had proposed to insert a new paragraph 5 in
Article 18 to make sure that the provisions of this Article should not be
applied to laws, regulations and requirements which have the purpose of
standardizing domestic products in order to improve the quality or to reduce
costs of production, or have the purpose of facilitating an improved
organization of internal industry provided that they have no harmful effect
on the expansion of international trade. (See document E/CONF.2/C.3/1/Add.39).
The Sub-Committee was of the opinion that this amendment would not be
necessary because this Article as drafted would permit the use of internal
regulations required to enforce standards. In accordance with this opinion
the Norwegian delegation withdrew its amendment."
"The Sub-Committee was in agreement that under the provisions of
Article 18 regulations and taxes would be permitted which, while perhaps
having the effect of assisting the production of a particular domestic
product (say, butter), are directed as much against the domestic production
of another product (say, domestic oleomargarine) as they are against imports
(say, imported oleomargarine)."
"The exception permitting the continuance of existing mixing regulation
(paragraph 6) has been redrafted as suggested by the delegation of Sweden,
so as to bring out more clearly that Member would.be free to alter the
details of an existing regulation provided that such alterations do not
result in changing the overall effect of the regulation to the detriment of
imports."
"The delegate for Ireland-inquired whether the phrase `shall not be
modified to the detriment of imports' in paragraph 6 would permit the
maintenance of an existing regulation in Ireland providing for changes in
the amounts or proportions of a product required to be mixed which are the
result of changes in crops from year to year. The Sub-Committee considered
that since the regulation in question specifically provided for such changes
the changes would not be precluded by paragraph 6."
"Paragraph 8 (b) was redrafted in order to make it clear that nothing
in Article 18 could be construed to sanction the exemption of domestic
products from internal taxes imposed on like imported products or the
remission of such taxes."
/It was agreed E/CONF. 2 /C .3/A/W.47
Page 7
"It was agreed that a tax applying at a uniform rate to a considerable
number of products was to be regarded as a taxo f the kind referred to in the
parenthesis in the interpretative note to Article 17, notwithstanding the
fact that the legislation under which the tax was imposed also provided for
other rates of tax applying to other products."
II. REPORT OF WORKING PARTY 3 (ARTICLE 18)
AND WORKING PARTY 4 (ARTICLE 19)
Working Party 3 (Article 18) and Working Party 4 (Article 19),
consisting of the delegates of France, Norway, the United Kingdom and the
United States, after consulting with the Chairman of Sub-Committee A,
considered Article 19 jointly, in consultation with the delegate of
Czechoslovakia, and report as follows:
A. REVISED TEXT OF ARTICLE 19
Special Provisions Relating to Cinematograph Films
[If any Member establishes or maintains] The provisions of Article 18
shall not preveMent any Member from establishing or maintaining internal
quantitative regulations relating to exposed cinematography films [ , ] . Any
such regulations shall take the form of screen quotas which shall conform to
the following conditions and requirements:
(a) Screen quotas may require the exhibition of cinematograph films
of national origin during a specified minimum proportion of the total
screen time actually utilized over a specified period of not less than
one year in the commercial exhibition of all films of whatever origin,
and shall be computed on the basis of screen time per theatre per year
or the equivalent thereof.
(b) With the exception of screen time reserved for films of national
origin under a screen quota, [no] screen time, including screen time
released by administrative action from minimum time reserved for films
of national origin, shall [formally or in effect be allocated] not be
allocated formally or in effect among sources of supply.
(c) Notwithstanding the provisions of sub-paragraph (b)above, [Members]
any Member may maintain screen quotas conforming to the [conditions]
requirements of sub-paragraph (a) which reserve a minimum proportion
of screen time for films of a [national] specified origin other than
that of the Member imposing such screen quotas; Provided that no such
minimum proportion of screen time shall be increased above the level
in effect on 10 April 1947.
(d) Screen quotas shall be subject to negotiation [for their limitation,
liberalization or elimination in the manner provided for in respect of
tariffs and preferences under] and shall accordingly be treated as
customs duties for the purposes of Article 17.
/B. NOTE TO BE E/CONF.2/C.3/A/W .47
Page 8
B. NOTE TO BE INCLUDED IN THE SUB-COMMITTEE'S REPORT
TO COMMITTEE III
The delegate for Czechoslovakia reaffirmed the views expressed by the
head of his delegation in Committee III (E/CONF.2/C.3/SR.13) to the effect
that cinematograph films should be explicitly excluded from the competence
of the ITO on the grounds that films, being works of art, are not just simple
commercial comodities or industrial products. However, if the majority of
the Conference favoured the retention of Article 19 his delegation would no
longer press its objections. |
GATT Library | th518mj7319 | Representation of the Interim Commission on the Interim Co-Ordinating Committee for International commodity arrangements | Interim Commission for the International Trade Organization, July 21, 1948 | Interim Commission for the International Trade Organization (ICITO/GATT) and Executive Committee | 21/07/1948 | official documents | ICITO/EC.2/8 and ICITO/EC.2/7/N-ICITO/EC.2/11 | https://exhibits.stanford.edu/gatt/catalog/th518mj7319 | th518mj7319_90060201.xml | GATT_147 | 352 | 2,529 | INTERIM COMMISSION COMMISSION INTERMAIRE DE UNRESTRICTED
FOR THE INTERNATIONAL L'ORGANISATION INTERNATIONALE ICITO/EC.2/8
TRADE ORGANIZATION DU COMMERCE 21 July 1948
ORGINAL: ENGLISH
EXECUTIVE COMMITTEE
Second session
Item 8 of the Provisional Agenda.
REPRESENTATION OF THE INTERIM COMMISSION ON THE INTERIM
CO-ORDINATING COMMITTEE FOR INTERNATIONAL COMMODITY ARRANGEMENTS
1. On 28 March 1947, the Economic and Social Council requested the
Secretary-General of the United Nations
"to appoint an interim, co-ordinating committee for international
commodity arrangements to keep informed of and to facilitate by
appropriate means such inter-governmental consultation or action
with respect to commodity problems, the committee to consist of
chairman to represent the Preparatory Committee of the United
Nations Conference on Trade and Employment, a person nominated by
the Food and Agriculture Organization of the United Nations to be
concerned in particular with agricultural primary commodities, and
a person to be concerned in particular with non-agricultural primary
commodities. "
The Secretary-General, acting on the Resolution of the Council, appointed
the following individuals as members of the Committee:
Mr. J. R. C. Helmore - Chairman, representing the Preparatory Committee
of the United Nations Conference on Trade and
Employment
Mr. L. A. Wheeler - nominated by the Food End Agriculture Organization
Mr. Georges Peter - concerned in particular with non-agricultural
primary commodities.
2. The Preparatory Committee of the United Nations Conference on Trade
and Employment ceased to exist on the convening of the Conference on
21 November 1947. Accordingly, the Economic and Social Council, at the
suggestion of the Conference, requested the Secretary-General on
3 March 1948 to amend the composition of the Committee to provide that the
Chairman be nominated by the Interim Commission for the International Trade
Organization.
/3. The Executive ICITO/EC .2/8
Page 2
3. The Executive Committee of the Interim Commission, at its First Session
in Havana, decided on 24 March 1948 to request that Mr. Helmore should
continue to act as Chairman until the Executive Committee considered the
question at its next session. At the invitation of the Secretary-General
of the United Nations, Mr. Hemore agreed to continue.
4. The matter is now submitted for further consideration by the Executive
Committee. |
GATT Library | gz522kf7481 | Request by the government of Cuba to the Contracting Parties under Article XXIII of GATT for consideration of the situation facing Cuba in regard to certain items in schedule IX (Cuba) | General Agreement on Tariffs and Trade, September 8, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 08/09/1948 | official documents | GATT/CP.2/W.12 and GATT/CP.2/W.1-W.14 CP.2/W.1/Rev.1,CP.2/W.9/Corr.1,W.9/Add.1 | https://exhibits.stanford.edu/gatt/catalog/gz522kf7481 | gz522kf7481_91870465.xml | GATT_147 | 2,556 | 16,001 | RESTRICTED
LIMITED C
GATT/CP . 2/W. 12
8 September 1948
ENGLISH
Original: SPANISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
Contracting Parties
Second Session
REQUEST BY THE GOVERNMENT OF CUBA TO THE CONTRACTING
PARTIES UNDER ARTICLE XXIII OF GATT FOR CONSIDERATION
OF THE SITUATION FACING CUBA IN REGARD TO CERTAIN ITEMS
IN SCHEDULE IX (CUBA)
The Cuban Delegation to the Second Session of the
Contracting Parties to the General Agreement on Tariffs
and Trade, in accordance with the right conferred by Article
XXIII, paragraphs 1(c)&2of the General agreement, submits for
consideration by the Contracting Parties the situation facing
the Republic of Cuba in regard to its economic development
by reason of serious difficulties which have arisen regard-
ing the production and importation of cotton and rayon
braids, ribbons and balloons nylon stockings, and tyres
and inner tubes for motor vehicles and lorries; requesting
that the Contracting Parties authorise the Cuban Government,
to take such measures as are proposed in the present
memorandum.
The Government of Cuba has for some years been giving
consideration. to the necessity. of fostering the economic
development of the country with the object of obviating or
minimising the effects of the economic crises suffered by
Cuba simultaneously with the sugar crises; and numorous
measures have been adopted with this end in view. In 1940
this economic principle took the form of a constitutional
doctrine, which lays down the obligation that the bases of
agriculture and industry in Cuba should be broadened, and
that every effort be made to bring about a proper standard
of living for the Cuban people.
In accordance with this principle, the Cuban Govern-
ment has promoted the industrialization of the country, and
provided facilities for the establishment of any industry
corsidered as a source of employment worthy of encouragement.
The same principle was kept constantly in mind by the
Cuban delegation in the discussions on the drafting of GATT,
and. of the Havana Charter;. and generally speaking the
principle received proper consideration in the tariff
negotiations which took place in 1917 at Geneva, except in
regard to ribbons, nylon stockings, and tyres and inner-tubes
for motor vehicles and lorries, GATT/CP. 2/W. 12
page 2
The present situation is so acute that unless it is
remedied immediately, the industries in question will be
faced with unemployment, with a consequent lowering of the
standards of living of the Cuban people - a situation
absolutely contrary to the aims or GATT as expressly recog-
nized by the Contracting Parties in the Preamble to the
Agreement.
The situation is as follows:
BRIDS, GALLOONS AND RIBBONS
In 1939 an industry was established in Cuba for the
manufacture of braids, galloons and ribbons. The duties.
on these articles under items 127 - A & B, and 142 - A & B
of the Cuban Customs Tariff were very low; nevertheless, the
adv nt of the war enabled an industry of this kind to be
established.
Towards the end of the war, and with the resumption of
imports from all countries, it became clear that the protection
afforded by the Cuban Tariff was extremely slight. More-
over the increasing costs which began to be felt as a result
of the inflationary -movement brought about by the World War
diminished still further the relative value of what was a
specific duty tariff; hence the Government of Cuba on 21 July
1944 enacted Decree 2155, making the importation of the
articles covered by Items 127 A & B and 142 A & B subject to
a quota system. Had this not been done, imports would have
ousted the Cuban industry once for all and caused it to dis-
appear.
In order to give an idea of the Disproportionate
increase in costs, it is sufficient to point out that while
the average worker in this industry used to receive an average
wage of 6 pesos a week, the average weekly wage which is now
being paid, and which has boon paid since before 1944, is
30 pesos.
Half a million dollars were invested in the establishment
of the industry in question, while the annual wage bill is not
less than $250,000 and the industry provides a livelihood for
more than two hundred and fifty workers.
The Government of Cuba would have preferred not to
resort to the quota system when this regime was instituted;
it would have preferred to make a very substantial increase
in the duties concerned, bringing them into line with those
prevailing in almost every other country and especially in
*the United States of America.
The Cuban Government intended not to negotiate in
regard t! the products in question, but to omit them from
Schedule IX of GATT, since those items have never been
included in tariff negotiations conducted by Cuba; and on
the assumption that they were excluded from the negotiations,
the delegation of Cuba intimated to the future Contracting
Parties on 9 October 1947 its intention to maintain the quota
system as it stood at 1 Septmber 1947 (see Document
E/PC/T/190 - Restricted). GATT/CP . 2/W. 12
page 3
Unfortunately in a revision of Schedule IX (Cuba)
a few days before the signing of GATT on 30 October 1947,
the "error" occurred whereby Items 127A, 142-E and 142-F
of the Cuban Tariff, the first referring to cotton trimmings
and ribbons, the others to trimmings, ribbons, etc, of
rayon and other similar synthetic fibres, were included
in the said Schedule, and given tariff rates in no instance
higherr - taking into account the necessary adjustments -
than four per cent ad valorem.
With a view to rectifying this "error", the dele-
gation of Cuba submitted to the Contracting Parties , at
the First Session on 11 March 19148 (see Documents
GATT/l/19 and GATT/1/20) a corrigendum to Schedule IX
(Cuba), to delete the items in question, and to maintain the
quota on cotton and rayon ribbons, trimmings, etc.
The Contracting Parties decided to defer the decision
on these questions to the next session, as can be seen
from Docunent GATT/l/SR.14 of 23 March 1918, which also
contains the statement made on the subject by the Cuban
delegate.
In accordance with this decision, when the Agenda of
the Second Session was being prepared, the Government of
Cuba requested the inclusion in the Agenda of its request
for the rectification of the "error" in regard to the
items relating to trimmings, ribbons, galloons etc.
(127-A and 142-E & F), as well as for the maintenance of
the quota system at present in force for the products in
question.
The Contracting Parties at this Second Session,
after approving the inclusion of the Cuban request in the
Agenda, agreed to transmit the request for study and
consideration to Working Parties 2 and 5 which up to the
present have not submitted their final report and findings
on these points.
In the circumstances, the delegation of Cuba, having
since its arrival in Geneva negotiated without success with
the United States delegation, with a view to reaching a
mutually satisfactory agreement, and having received
yesterday from that delegation an opinion unfavourable to
the rectification of the "error" in question requests the
Contracting Parties for the necessary authorization to
withdraw from Schedule IX ( Cuba) the following tariff
items: 127-A, 142-E and 142-F, without prejudice to any
consultations and negotiations with the Contracting Parties
affected for determining whether compensation should be
offered, and if so, what form such compensation should
take.
NYLON STOCKINGS
The protection provided in the Cuban Tariff of 1927
to the stocking industry was so slight that it did not
prevent the increase in imports of stockings from other
countries into Cuba. Nevertheless, this slight protection
did permit the development of the Cuban stocking industry, GATT/CP. 2/W. 12
page 4
which was created chiefly on a basis of cheap labour.
Gradually the margin of protection has disappeared for
external and internal reasons. In regard to the external
aspect, bettor machinery and technical improvements in
large-scale production have been factors contributing to
increase output and to lower costs; from the internal
aspect, the extraordinary increase in wages, without an
individual output comparable to that developed by foreign
production began to constitute a serious danger for hone
production; this danger was particularly increased by
the attractiveness to. foreign manufacturers of the Cuban
market owing to the position of Cuban currency.
The need for modifying Item 137-F of the Cuban
Tariff was made clear to the United States Government in
a memorandum, dated 11 March 1948, submitted by the Cuban
Delegation at the First Session of the Contracting Parties
at Havana, but the idea was not favourably received.
At the moment Item 137-F figures in Schedule IX (Cuba)
as negotiated with the United States with a duty rate of
3.30 dollars per kg. which, in practice, is unduly low.
When the agenda for this Second Session was being
prepared the Cuban Government asked for the inclusion of
its request for a renegotiation of this Item, for the purpose
of making a suitable revision of the Cuban Schedule. The
Contracting Parties, after approving the inclusion of the
Cuban request in the Agenda, agreed to transmit it for study
and consideration to Working Party No. 2 which so far has
not taken any final decision.
Acting on the principle that these matters should be
clarified by preliminary discussions between those countries
which directly negotiated the tariff arrangements for a
given product, the Cuban Delegation, on arrival at Geneva,
has made repeated overtures to the United States Delegation
with a view to reaching a mutually satisfactory agreement.
However, as this has not been obtained, and since it was
informed yesterday that the United States is unwilling to
enter into negotiations on this subjects the Cuban Govern-
ment requests authorization from the Contracting Parties
to increase the Cuban tariff on nylon stockings to 50%
ad valorem. The urgent request for such an increase is
justified by the fact that for a long time Cuban tariffs
have for customs purposes assimilated nylon to natural
silk, which carries the above duty. The Cuban Government
offers adequate compensation to those parties who can show
they are adversely affected by this modification of Cuban
tariffs.
Should this measure be impossible the Cuban Govern-
ment requests from the Contracting Parties the necessary
authorization to withdraw Item 137-F from Schedule IX
(Cuba) without prejudice to such consultations and nego-
tations with adversely affected Contracting Parties as
may be necessary, in order to determine whether they should
be offered compensation and, if so, what form this should
take. GATT/CP. 2/W. 12
page 5
TYRES AND INNER TUB S FOR MOTOR VEHICLES AND LORRIES
Although a Cuban tyre factory had already been zstab-
lished before World War II at Pentes Grande in Havana, it
was not till 1941 that two such factories managed to get
firmly established and bean production.
These factories represent a total capital of some
3,500 ,000 dollars and provide work for some 500 workers,
During the war it was these factories that to all
intents and purposes supplied the Cuban demand for tyres
particularly lorry tyres. During 1946 imports of tyros from
the United States began to increase out of all measure. In
normal times Cuban national production satisfies approximately
75, of the demand, leaving some 30% to be satisfied by imports
from abroad, but in the first six months of 1948 imports
increased to 58% and Cuban sales decreased to 42%
To operate on an economic basis those two factories
require a minimum annual production of 105,000 units.
Therefore since Cuban requirerements amount to some 150,000
units per year and the capacity of its factories exceeds
130,000 it is clear that these unprecedented imports are forcing
down production below the essential minimum.
As a result of this excessive increase in imports,
the tyro Lactories have already shut down twice, and unless
the situation changes, will have to shut down permanently.
During last year's tariff negotiations at Geneva, this
matter was brought to the notice of the United States nego-
tiating "tcam" and a request made for increasing the duty on
tyres and inner tubes, to 40 cents per kilogramme, that is,
to the sane figure as in the 1927 tariff. This was an extremely
modest figure considering how this problem has been handled
by almost all other countries of Latin America,
When this matter was submitted by the Cuban delegation
to the notice of the United States delegation, it was not
given favourable consideration, so that the Cuban delegation
is now obliged to approach the Contracting Parties and
request authoriation to raise the tariffs as suggested, against
adequate compensation. Should this not be possible the Cuban
Government wishes to be authorized to withraw from Schedule
IX (Cuba) the items relating to rubber tyres and inner tubes
against appropriate compensation.
CONCLUSION
As may be seen from this statement, the Cuban Govern-
ment has to face an initial consequence of the application
of GATT to its.country, the closing of its factories producing
ribbons and trimmings, nylon stockings, rubber tyres and inner
tubes, with a resulting increase in the chronic unemployment
from which Cuba is suffering.
The Cuban Govornment feels that the principal ain
both of the General Agreement on Tariffs and Trade and of
the Havana Charter for an Internati:nal Trade Organization GATT/CP . 2/W. 12
page 6
is as stated in the Preamble of the former, that the ro-
lations of the Contracting Parties "in the field of trade
and oconomic endeavour should. be conducted with a view to
raising standards of livin-, ensuring full employment
and a large and steadily growing volume of real income and
effective demand ..."
To this and other ends, the Parties to the Havana
Charter pledged themselves, individually and collectively
to promoto national and international action designed "inter
alia" "to foster and. assist industrial and general economic
development, particularly of those countries which are still
in the early stages of industrial development ...."
Consequently it is not possible for the Cuban Govern-
ment to remain impassive before the closing of its factories
and a rise in unemployment, especially when means exist
for preventing, this serious situation. For this reason
under Prticle XXIII of GATT and in accordance with the
provisions of Articles XVIII, XIX and XXV the Cuban
delegation requests the Contracting Parties to. authorize
the Cuban Government to take the measures mentioned above,
of such measures as the Contracting Partics may deem most
appropriate in the light of the general principles of the
Havana Charter.
The Cuban. Government wishes to carry out the Geneva
Agreement and in due course the Havana Charter in their
entirety, but certain "errors" in Schedule IX (Cuba) require
to be rectified and certain tariff maladjustments corrected.
If any contracting party considers its interests prejudiced
and can provo that to the Contracting Parties our Govern-
ment will offer due compensation. What the Cuban Govern-
ment cannot do is to stand aloof in present circumstances.
Finally it must not be forgotten that the General
Agreement on Tariffs and Trade is is force in Cuba only
provisionally and has to be ratifiod, as has the Havana
Charter, by the Cuban Congress. Any inequitable treatment
of Cuba in this matter would without doubt seriously impede
ratification of both instruments by our Longross, not to
mention the repercussions such a precedent would have in all
countries whose economic development is in its early
stages. |
GATT Library | kq634tg0721 | Request of the Government of Chile Re Adherence to the Protocol of Provisional Application. Draft Resolution Submitted by the Representative of the United Kingdom | General Agreement on Tariffs and Trade, August 23, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 23/08/1948 | official documents | GATT/CP.2/W.8 and GATT/CP.2/W.1-W.14 CP.2/W.1/Rev.1,CP.2/W.9/Corr.1,W.9/Add.1 | https://exhibits.stanford.edu/gatt/catalog/kq634tg0721 | kq634tg0721_91870459.xml | GATT_147 | 174 | 1,151 | RESTRICTED
LIMITED C
GATT/CP. 2/W. 8
23 August 1948
ORIGINLL: ENGLISH
GENERAL AGREEMENT ON TARIFFS IND TRADE
Contracting Parties
Second Session
Request of the Government of Chile
Re Adherence to the Protocol of Provisional Application
Draft Resolution Submitted by the
Representative of the United Kingdom
THE CONTRACTING PARTIES, having considered the request
of the Government of Chile to. be granted an extension of time
to sign the Protocol of Provisional Alpplication of the
General Agreement on Tariffs and Trade,
DECIDE that in the event of the Government of' Chile
having, before the 16th February 1949, taken a decision to
accede to the Protocol of Provisional Application and having
completed by thet date the action necessary to enable its
accession to be implemented, and having notified the
Contracting Parties accordingly,
WILL CONSIDER the Government of Chile as having acceded,
with effect from. the date of such notification, to the
General Agreement in pursuance of' Article XXXIII of' that
Agreement, on the same terms as the Contracting Parties
which have signed the Protocol of Provisional' Application. |
GATT Library | kf360zq5241 | Request of the government of Cuba for Re-Negotiations, etc | General Agreement on Tariffs and Trade, July 19, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 19/07/1948 | official documents | GATT/CP.2/8 and GATT/CP.2/1-13,CP.2/2/Corr.1, CP.2/3/Rev.1,2,2/Corr.1,CP.4/Corr.1 4/Add.1,2,2/Corr.1,CP.6/Rev.1, CP.13/Corr.1,13/Add.1 | https://exhibits.stanford.edu/gatt/catalog/kf360zq5241 | kf360zq5241_90320017.xml | GATT_147 | 108 | 727 | RESTRICTED
GATT/CP.2/8
19 July 1948
ORIGINAL: ENGLISH
GENERAL AGREEMENT T ON TARIFFS AND TRADE
Contracting Parties
Second session
Item- 12 of the provisional agenda
REQUEST OF THE GOVERNMENT OF CUBA FOR RE-NEGOTIATIONS, ETC.
The following cable has been received from the Government of Cuba:
"Cuban Government wishes A have included in provisional
agenda second session Contracting Parties following points:
1. Negotiation part 802 list XX Annex to GATT regarding rum.
2. Negotiation parts 137-F 314-B 314-C list IX.
3. Reatification error parts 127-A 127-B 142-A 142-B list IX.
4. Maintanance for Cuba of quota regime on products protected
parts 127-A 127-B 142-A 142-B and 129-A Cuban customs tariff." |
GATT Library | xs139vt3344 | Request of the Netherlands Government regarding consular taxes imposed by the Cuban Government | General Agreement on Tariffs and Trade, December 1, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 01/12/1948 | official documents | GATT/CP/4 and GATT/CP/4 | https://exhibits.stanford.edu/gatt/catalog/xs139vt3344 | xs139vt3344_90070095.xml | GATT_147 | 216 | 1,449 | RESTRICTED
LIMITED B
GATT/CP/4
1 December 1948
ORIGINAL: ENGLISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
Contracting Parties
Request of the Netherlands Government
Regarding Consular Taxes Imposed by the Cuban Government
At the Second Session of the Contracting Parties the
representative of the Netherlands, referring to GATT/CP.2/9,
requested a ruling on the application of the provisions of
Article I to the consular taxes imposed by the Government of
Cuba. The Chairman stated (reference GATT/CP.2/SR.11) that,
in his opinion, the Cuban consular taxes would be governed
by the phrase "charges of any kind", and that the application
of the most-favoured-nation clause to such taxes would be
regulated by Article I. The Contracting Parties agreed with
this interpretation and the representative of the Netherlands
was asked to discuss the matter again with the representative
of Cuba.
The Chairman of the Contracting Parties has received a
communication from the Department of State, Havana, under date
of 10 November, l948, advising that the Government of Cuba by
Presidential Decree No. 3649 of 30 October, 19488 published
in the Official Gazette No. 261 of 8 November, 1948, has agreed
to extend most-favoured-nation treatment in respect of the
consular taxes to all the present contracting parties to the
General Agreement on Tariffs and Trade and to all countries
which subsequently become contracting parties. |
GATT Library | yh850xq1959 | Request of the United States for a Waiver Under Article XXV of the General Agreement on Tariffs and Trade in respect of Preferential Treatment for the Trust Territory of the Pacific | General Agreement on Tariffs and Trade, September 3, 1948 | General Agreement on Tariffs and Trade (Organization), Contracting Parties, and Working Party 3 on Modifications to the General Agreement | 03/09/1948 | official documents | GATT/CP.2/WP.3/6/Corr.1 and GATT/CP.2/WP.3/1-6 WP.3/6/Corr.1 | https://exhibits.stanford.edu/gatt/catalog/yh850xq1959 | yh850xq1959_91870485.xml | GATT_147 | 415 | 2,586 | RESTRICTED
LIMITED C
GATT/CP . 2/WP . 3/6/Corr. 1
3 September 1948
ORIGINAL: ENGLISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
Contracting Parties
Second Session
Working Party 3 on Modifications to the General Agreement
Request of the United States for a Waiver Under
Article XXV of the General Agreement on Tariffs and Trade
in respect of Preferential Treatment for the Trust
Territory of the Pacific
Delete paragraphs 4 to 5 on page 2: "of the foregoing
commiodities .more than 200,000 tons" and the
footnote on page 2, and insert the following text instead
of paragraphs 4 to 6:
"Of the foregoing conmiodities only copra and phosphate
are produced by the native population. The sugar, alcohol
and dried bonito industries employed practically all Japanese,
the first two having been subsidized by Japan for strategic
reasons. In view of the exodus of the 70.000 Japanese
there would appear to be no basis for the maintenance of these
industries in the future.
Phosphate exports, which are now going to Japan, are
expected to terminate by 1951 because of the depletion of
resources.
In addition to these main commodities there is a small
native production and export of trochus shells and of handi-
craft articles of wood, grass, leaves and porcelain. Handi-
craft exports amounted to about $26,000 in the first six
months of 1948. There were also 53,OO0 pounds of charcoal
exported during the latter period.
Copra. Copra exports from the islands during the 1930
ranged from 10 to 15 thousand tons, mostly to Japan. Exports
to the United States during the first hal. of 19+8 amounted
to a little over 5,000 tons, together with about 800 gallons
of coconut oil. Total United States imports of copra
average more than 200,000 tons.
Wartime destruction of coconut plantations together with
the limited area suited for the raising of coconuts, makes
unlikely annual production of more. than 10,000 tons.
It may be noted that the quantities of copra exported to
the United States from the N.E.I.in 1937 and 1939, amounting
to 5 500 and 12 000 tons respectively represented only 1%
and 2%, respectively, of total exports of copra from the N.E.I.
in those years. These exports took place in competition with
Philippine copra. Since production of Philippine copra is
more efficient than that of the Trust Territory there would
seem to be little reason to believe that the extension of the
preference to the latter would significantly alter the compe-
titive position of N.E.I. copra in the United States market." |
GATT Library | fc612rr1111 | Request of the United States. for aj Waivier under Article XXV of the General Agreement on Tariffs and Trade in Respect of Preferential Treatment for the Trist Territory of the Pacific | General Agreement on Tariffs and Trade, September 1, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 01/09/1948 | official documents | GATT/CP.2/WP3/6 and GATT/CP.2/WP.3/1-6 WP.3/6/Corr.1 | https://exhibits.stanford.edu/gatt/catalog/fc612rr1111 | fc612rr1111_91870484.xml | GATT_147 | 1,116 | 7,258 | RESTRICTED
LIMITED C.
GATT/CP. 2/WP3/6
1 September 1948
ORIGINAL: ENGLISH
GENERAL AGREEMENT ON TARIFFS-AND TRADE
Contracting Parties
Second Session
Request of the United States. for aj Waivier
under Article XXV of the General Agreement on
Tariffs and Trade in Respect of Preferential
Treatment for the Trist Territory of the Pacific.
The following statement is submitted to the CONTRACTING
PARTIES by. the United States delegation in lieu of that set forth
in document GATT/CP 2/W.6, which is hereby withdrawn.
Scope of request. The united States requests that the
CONTRACTING PARTIES, acting under Article XXV of the GATT,
waive the obligations of the United States under Article.I to
the extent necessary to permit:
a) the application of duty-free treatment to a l products
originating in the Trust Territory of the Pacific and
imported into the customs. territory,of the United States,
without obligation to extend the sane treatment to the
like products originating in the territories of the
contracting parties; and
b) the application to coconut oil. processed from copra
originating in the Trust Territory of the Pacific and
imported into the customs territory of the United States
of the lower rate of internal tax of 3 per pound presently
applicable to coconut oil processed.from copra originating
domestically and in the Phitippine Republics,without
obligation to extend the .same rate to coconut oil processed
from copra originating in the territories of the contracting
parties, which would remain taxable at 5 per pound.
Since the purpose of the r quest oulined above is to remove
a burden to the exports of the Trust Territory and not to divert or
add a burden to the trade of other countries, the United States
does not propose to make any preference effective by for example,
imposing or increasing duties on like products of other countri as.
The customs territory of the United States consists of the
United States and its possessions except the Virgin Islands,
American Samoa, the island of Guam, Wake Island, Midway Islands,
and Kingman Reef. GATT/CP. 2/WP3/6
page 2
Area and population of Trust Territory. The Trust
Territory of the Pacific consists of the Marshall, Caroline
and Mariana Islands formerly mandated to Japan under the
League of Nations. There are about 98 islands and island
clusters with a total land area of 846 square miles and a
total population of 48,000 native inhabitants.
Trusteeship agreement A Trusteeship Agreement
approved by the Security Council of the United Nations on
April 2 1947declares the islands concerned to be a
strategic area and designates the United States as the
administering authority. Under this Agreement (Article 6)
the United States is obligated to promote the best interests
of the inhabitants.
Production and Trade. The economic importance of the
islands is negligible. Before the war the exports of the
islands, which went almost entirely to Japan, ranged from.
$7,000,000 in 1932 to $13 000,000 in 1935. The five main
export commodities in 1936, and the export values for each,
were as follows:
Commodity Value
Sugar $ 6,497,000
Phosphate 1,428,000
Dried bonito 1,362,000
Copra 1,020,500
Alcohol 382,500
l10, 690 000
Of the foregoing commodities only copra and phosphate
are produced by the native population. The sugar, alcohol
and dried bonito industries employed practically all
Japanese. The future of these latter industries would
therefore appear to be in doubt.
In addition to these main commodities there is a
small native production and export of trochus shells and
of handicraft articles of wood,grass leaves and porcelain.
Handicraft exports are probably less than $7,500 annually.
Copra Copra exports from the islands during the
1930's ranged from 10 to 15 thousand tons, mostly to
Japan. Total United States. imports of copra average more
than 200,000 tons.
United States duties United States duties on
the various articles exported from the islands prewar are
2/Information is not presently available to the United
States delegation as to the status of the Japanese population
of some 50,000, i.e. whether they have returned or will
return to Japan. GATT/CP. 2/WP3/6
page 3
as follows:
Commoditv Rate of duty
Sugar 75 d per 100 lbs.
Phosphate Duty-free
Dried bonito If unsalted 5/8Ø per lb,
If salted and in containers
weighing more than 15 lbs. with
their contents lØ per lb.
If salted and in containers
weighing with their contents
less than 15 lbs. 15% ad valorem..
Copra Duty-free
Trochus shells Duty-free
Handicraft articles Varioius
Sugar imported into the United States is subject to an
import quota allocated by areas. The waiver requested by
the United States would not, therefore, affect imports of
sugar.
While imports of copra are duty-free, there is an
internal tax on the processing of coconut oil from copra of
a) 5Ø per pound in respect of copra imported from all
foreign sources except the Philippines and b) 3Ø per pound
in respect of copra processed from domestic and Phiilippine
sources.
Exceptional circumstatnces justifyin waiver. The
exceptional circumstances Justifying the requested waiver
are three:
1. The islands of the Trust Territory are geographi-
cally located in the midst of, and are to some extent
in economic competition with, a large number of
dependent territories of other powers (Australia,
France, the Netherlands and the United Kingdom ) all
of which are accorded preferential treatment for their
trade in the metropolitan territories of the powers
concerned.
2. The islands of the Trust Territory were accorded
preferential treatment in Japan prior to the war.
With the inauguration of United States administration
this preferential treatment will no longer exist.
What is being requested therefore is not the creation
of a new preferential system but the replacement of
one system by another. The Havana Charter does not
require that all preferences be terminated overnight
and it would not seen equitable to single out this
one small and economically weak area for more severe
treatment than has been accorded other larger and
economically stronger areas. To the extent that
any contracting party would be at a disadvantage
(which could only be slight) by reason of the creation GATT/CP. 2/WP3/6
Paeo 4
of a new preference in the United States, it would be
compensated by the withdrawal of a preference in the
Japanese market.
3. The preferences are "one-way" preferences, which
is in contrast to the situation which exists with
respect to many other dependent territories There
is no desire on the part of the United States to
obtain preferential treatment for its exports. It
should be noted in this connection that there is
nothing in the GATT which would prevent the establish-
ment of "two-way" free trade between the United
States and the Trust Territory and it is only because
a more limited arrangement is desired - one not
involving preferences for US exports - that a waiver
is needed. |
GATT Library | ww696zf8327 | Requête du Gouvernement des Pays-Bas au sujet des taxes consulaires imposées par le Gouvernement Cubain | Accord General sur les Tarifs Douaniers et le Commerce, December 1, 1948 | General Agreement on Tariffs and Trade (Organization), Parties Contractantes, and Contracting Parties | 01/12/1948 | official documents | GATT/CP/4 and GATT/CP/4 | https://exhibits.stanford.edu/gatt/catalog/ww696zf8327 | ww696zf8327_90070096.xml | GATT_147 | 241 | 1,620 | RESTRICTED
ACCORD GENERAL SUR LES TARIFS LIMITED B
GATT/CP/4
DOUANIERS ET LE COMMERCE ler décembre 1948
ORIGINAL: ENGLISH
ET LE COMMERCE
Parties contractantes
Reguête du Gouvernement des Pays-Bas
au sujet des taxes consulaires imposées par le Gouvernement
cuba in.
A la deuxième session des Parties contractantes, le re-
présentant des Pays-Bas, se référant au document GATT/CP.2/9
a demandé au Président de statuer sur application des dispo-
sitions de l'article I aux taxes consulaires imposées par le
government cube in.
Le President a déclaré (voir GATT/CP.2/SR.11) qu'à son
avis, lea taxes consulaires de Cuba font partie des droits
qualifiés d' "impositions de toute nature" et que l'applica-
tion à ces taxes de la clause de la nation la plus favorisée
serait régie par l'article I. Les Parties contractantes ont
approuvé cette interprétation et le représentant des Pays-Bas
a été pride d'examiner à nouveau la question avec le représen-
tant de Cuba.
Le Président des Parties contractantes a reçu du Départe-
ment d'Etat cubain une communication, datée du 10 novembre 1948,
l'informant que le gouvernement cubain, par décret présiden-
tiel No 3649, du 30 octobre 1948, public dans le Gazette Of-
ficielle No 261 du 8 novembre 1948, avait décidé d'aocorder le
traitement de la nation la plus favorisée, en ce qui concerne
les taxes consulaires, à touted les Parties contractantes ac-
tuelles de l'Accord général sur les terifs douaniers et le Com-
merce, ainsi qu'à tout pays qui deviendrait ultérieurement
Partie contractante. |
GATT Library | kh918hy4152 | Resolution | General Agreement on Tariffs and Trade, March 18, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 18/03/1948 | official documents | GATT/1/39 and GATT/1/29-46+38/Rev.1,40/Rev.1 | https://exhibits.stanford.edu/gatt/catalog/kh918hy4152 | kh918hy4152_90310315.xml | GATT_147 | 168 | 1,096 | RESTRICTED GATT/1/39
18 March 1948
GENERAL AGREEMENT ON TARIFFS AND TRADE
FIRST SESSION OF THE CONTRACTING PARITES
RESOLUTION
THE FIRST SESSION OF TO THE CONTRACTING PARTIES OF THE GENERAL AGREEMENT ON
TARIFFS AND TRADE
Considering the amendment suggested by the Brazilian representative in
Document GATT/1/29, intended, to permit an application to the Contracting Parties
for a variation in the dates specified in paragraph 6 of Article XVIII,
Considering the provisions of paragraph 5 of Article XXV of the
General Agreement on Tariffas and Trade,
Considering that the amendment of the Brazilian representative does not
requires adoption in that the cases it is intended to cover are governed by the
provisions of paragraph 5 of Article XXV, and
having taken note of the report of Committee II of the United Nations
Conference on Trade and Employment regarding Article 14 of the Havana Charter
for an International Trade Organization,
Resolves that decisions be given under paragraph 5 of Article XXV on such
applications as are submitted to the Contracting Parties. |
GATT Library | mb023jn4883 | Resolution concerning the formation of a customs union between France and Italy | General Agreement on Tariffs and Trade, March 18, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 18/03/1948 | official documents | GATT/1/38 and GATT/1/29-46+38/Rev.1,40/Rev.1 | https://exhibits.stanford.edu/gatt/catalog/mb023jn4883 | mb023jn4883_90310313.xml | GATT_147 | 125 | 797 | RESTRICTED GATT/1/38
GENERAL AGREEMENT ON TARIFFS AND TRADE
FIRST SESSION OF THE CONTRACTING PARTIES RESOLUTION CONCERNING THE FORMATION OF A CUSTOMS
The CONTRACTING PARTIES decide, in tems of paragraph 5 of Article XXV, that the limitations, to customs
unions, free trade areas and interim agreements between the territories
of contracting parties, of the exception for such arrangements provided
for in paragraph 5 of Article XXIV, as amendeed, of the General Agreement
on Tariffs and Trade, shall not apply to any customs union between France
and, Italy in the event that Italy has not become a contracting party by
the time such an arrangement is conclude, PROVIDED that any such
customs union or interim agreement ahall conform to all of the other
requirements of Article XXlV. |
GATT Library | fs795kk6922 | Resolution de la Conference au sujet de l'emploi : Note du Secrétaire de la Conférence | United Nations Conference on Trade and Employment, February 3, 1948 | 03/02/1948 | official documents | E/CONF.2/35 and E/CONF.2/14-15/REV.1 | https://exhibits.stanford.edu/gatt/catalog/fs795kk6922 | fs795kk6922_90040090.xml | GATT_147 | 133 | 1,001 | UNRISTRICTED
United Nations Nations Unies E/CONF .2/35
CONFERENCE CONFERENCE 3 février 1948
ON DU FRENCH
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI
RESOLUTION DE LA CONFERENCE AU SUJET DE L'EMPLOI
Note du Secrétaire de la Conférence
Le représentant de la Bolivie a soulevé une objection centre la procédure
propose dans le document E/CONF.2/34 et relative à la résolution de la
Conference au sujet de l'emplei. II sora en conséquence nécessaire que
cetto résolution soit examinée en séanco plénière, A cet effet, la Conférence
so réunira en séance pléniére le mercredi 4 février à 11 heures, dans la
salle B. Aprés examen de la résolution sur l'emploi, la Conférence so
séparera et lea chefs de délégation so réuniront en commission pour
examiner un rapport du Bureau relatif a la constitution d'une commission
de coordination. |
|
GATT Library | xd344zg5044 | Resolution establishing the Interim Commission : Note by the Executive Secretary | United Nations Conference on Trade and Employment, March 16, 1948 | 16/03/1948 | official documents | E/CONF.2/67 and E/CONF.2/59/CORR.4 - 69/CORR.1 | https://exhibits.stanford.edu/gatt/catalog/xd344zg5044 | xd344zg5044_90040137.xml | GATT_147 | 167 | 1,963 | United Nations Nations Unies
CONFERENCE CONFERENCE
ON DU UNRESTRICTED E/CONF.2/67
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI 16 March 1948
ORIGINAL: ENGLISH
RESOLUTION ESTABLISHING THE INTERIM COMMISSION
NOTE BY THE EXECUTIVE SECRETARY
1. The following delegations approved the resolution establishing the
Interim Commission (document E/CONF.2/C.6/111) at the plenary session
held on 16 March 1948:
Afghanistan Egypt Nicaragua
Argentina El Salvador Norway
Australia France Pakistan
Austria Greece Panama
Belgium Haitl Peru
Brazil India Philippines
Canada Republic of Indonesia Poland
Chile Iran Southern Rhodesia
China Iraq Sweden
Colombia Italy Syria
Costa Rica Lebanon Transjordan
Cuba Liberia South Africa
Czechoslovakia Luxembourg United Kingdom
Denmark Mexico United States
Dominican Republic Netherlands Uruguay
Ecuador New Zealand Venezuela
2. The following delegations abstained: Ireland, Portugal, Switzerland
and Turkey.
3. The delegation of Bolivia reserved its position. The delegatlons of
Burma, Ceylon, Guatemala and Honduras were absent.
4. Any other delegation which wishes to accept the resolution is requested
to inform the Secretariat accordingly in writing before 6.00 p.m. on Thursday,.
18 March 1948. |
|
GATT Library | sg067cd2892 | Resolution establishing the Interim Commission : Note by the Executive Secretary. Addendum | United Nations Conference on Trade and Employment, March 19, 1948 | 19/03/1948 | official documents | E/CONF.2/67/Add.1 and E/CONF.2/59/CORR.4 - 69/CORR.1 | https://exhibits.stanford.edu/gatt/catalog/sg067cd2892 | sg067cd2892_90040138.xml | GATT_147 | 124 | 899 | United Nations
CONFERENCE
ON
TRADE AND EMPLOYMENT
Nations Unies
CONFERENCE
DU
COMMERCE ET DE L'EPLOI
UNRESTRICTED
E/CONF. 2/67/Add. 1
19 March 1948
ENGLISH - FRENCH
ORIGINAL: ENGLISH
RESOLUTION ESTABLISHING THE INTERIM COMMISSION
NOTE BY THE EXECUTIVE SECRETARY
ADDENDUM
The following additional delegations have advised the Secretariat that
they wish to accept the resolution establishing the Interim Commission
(document E/CONF.2/C.6/111) which was approved at the plenary session
held on 16 March 1948:
Burma
Ceylon
RESOUITION INSTITUANT LA COMMISSION INTERIMAIRE
ADDITIF A LA NOTE DU SECETAIRE DE LA CONFERENCE
Lee délégationa ci-après ont fait savoir au Secrétariat qu'elIes accop-
tent la Résolution Instituant la Commission intérimairo (document E/CONF.2/C.
6/111) qui a été approuvée au cours de la session pléniòre tenuo lo 16
nars 1948:
Birmanie
Coylan |
|
GATT Library | mm147pn3942 | Resolution establishing the Interim Commission : Note by the Executive Secretary. Addendum | United Nations Conference on Trade and Employment, March 19, 1948 | 19/03/1948 | official documents | E/CONF.2/67/Add.2 and E/CONF.2/59/CORR.4 - 69/CORR.1 | https://exhibits.stanford.edu/gatt/catalog/mm147pn3942 | mm147pn3942_90040139.xml | GATT_147 | 100 | 761 | United Nations
CONFERENCE
ON
TRADE AND EMPLOYMENT
UNRESTRICTED
Nations Unies E/CONF. 2/67/Add.2
19 March 1948
CONFERENCE ENGLISH - FRENCH
DU ORIGINAL: ENGLISH
COMMERCE ET DE L'EMPLOI
RESOLUTION ESTABLISHING THE INTERIM COMMISSION
NOTE BY THE EXECUTIVE SECRETARY
ADDENDUM
Turkey has withdrawn its abstention and should be added to the
delegations listed which approved the resolution establishing the Interim
Commission.
RESOLUTION INSTITUANT LA COMMISSION INTERIMAIRE
ADDITIF A LA
NOTE DU SECRETAIRE LA CONFERENCE
La Turquie est revenue sur sa décision de s'abstenir et il y a lieu
d'ajouter son nom parmi les délégations qui ont approuvé la résolution
isntituant la Commssion lntérimaire. |
|
GATT Library | kp287wg1669 | Resolution of gratitude to the Cuban Government and people | United Nations Conference on Trade and Employment, March 22, 1948 | 22/03/1948 | official documents | E/CONF.2/71 and E/CONF.2/70-77 | https://exhibits.stanford.edu/gatt/catalog/kp287wg1669 | kp287wg1669_90040146_0002 | GATT_147 | 0 | 0 | ||
GATT Library | dz603fk1851 | Resolution on employment : Information note from the Secretariat | United Nations Conference on Trade and Employment, March 15, 1948 | 15/03/1948 | official documents | E/CONF.2/66 and E/CONF.2/59/CORR.4 - 69/CORR.1 | https://exhibits.stanford.edu/gatt/catalog/dz603fk1851 | dz603fk1851_90040136.xml | GATT_147 | 492 | 3,359 | United Nations Nations Unies
CONFERENCE CONFERENCE E/CONF.2/66
ON DU 15 March 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI
ORIGINAL: ENGLISH
RESOLUTION ON EMPLOYMENT
INFORMATION NOTE FROM THE SECRETARIAT
For the information of delegations there is reproduced below the text
of the resolution which was adopted by the Eocnomic and Social Council at
Its present session in response to the Reoslutoin on Employment transmitted
by this Conference (E/C0NF.2/27, as amended in E/CONF.2/SR.13).
THE ECONOMIC AND SOCIAL COUNCIL
TAKING NOTE the resolution unanimously adopted by the United Nations
Conference on Trade and Employment on 4 February 1948;
ENDORSES the opinion of the Conference to the effect that the studies
which have been initiated dealing with the achievement and maintenance of
full and productive employment should be advanced as rapidly as possible,
and that attention should be given now methods of ensuring that high
levels of employment and economic activity shall be maintained even when
special factors of temporary duration now prevailing in many countries have
ceased to operate;
BEARING IN MIND, that by virtue of it terms of reference and of the
Council's resolution 26 (IV) of 28 March 1947, the Economic and Employment
Commision ie empowered to study problems relating to full employment,
REQUESTS the Economic and Employment Commission to expedite the studies
provided for in paragraph (o) of resolution 26 - (IV) of 28 March 1947,
taking into acicount the passage In the Conferece's resolution dealing with
these problems;
REQUESTS the Seretary-General (a) to arrange with members of the
United Nations and, where practicable with non-members, for the submission
of information concerning action they are now taking to achieve or maintain
full employment and economic stability and concerning any publicly
available plans to prevent a future decline, (b) to arrange with the
appropriate specialized agencies for reports on plane which they have
prepared and resources they will have available to assist members of the
agency to prevent a decline n employment and economic activity and
(c) to prepare as soon as practicable an analytical report based on the
information received.
/BEARING IN MIND, ID/CONF . 2/66
Page 2
BEARING IN MIND, that by its resolution 42 (IV) of 29 March 1947
it instructed the Population and Social Commissions to prepare a practical
plan for allocation of functions without duplication of work among the
various organs concerned in the field of migration, and that by its
resolution 85 (v) of 13 August 1947 it transmitted for study to the
International Labour Organization a memorandum relating to the protection
of migrant and immigrant labour and called the attention of the Social and
Population Commissons to this memorandum;
TRANSMTTS, to the International Labour Organization, the Social
Commission and the Population Commission, Sections 3 and 4, in the Havana
Conference's resolution dealing with population and migration problems, and
invites them to take these sections into account in the action they are
taking on those aspects of population and migration which fall in their
respective field, |
|
GATT Library | zg888js0887 | Resolution on Employment Reported by Sub-Committee (C) of the First Committee (Document E/CONF.2/C.1/17 - last paragraph) Afghanistan: proposed Amendment | United Nations Conference on Trade and Employment, January 9, 1948 | First Committee: Employment and Economic Activity | 09/01/1948 | official documents | E/CONF.2/C.1/20 and E/CONF.2/C.1/1-26 | https://exhibits.stanford.edu/gatt/catalog/zg888js0887 | zg888js0887_90180257.xml | GATT_147 | 190 | 1,496 | United Nations Nations Unies UNRESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.1/20
ON DU ENILISH - FRENCH
TRADE AND EMPLOYMENT COMMERCE ET DEL'EMPLOI ORIGINAL: ENGLISH
FIRST COMMITIEE EMPLOYMENT AND ECONOMIC ACTIVITY
RESOLUTION ON EMPLOYMENT REPORTED
BY SUB-COMMITTEE (C) OF THE FIRST COMMITTEE
(DOCUMENT E/C0NF.2/C.1/17 - LAST PARAGRAPH)
AFGHANISTAN.: PROPOSED AMENDMENT
The delegation of Afghanisten proposes that the following words be
inserted after the word: "workers" in the fourth line of the last paragraph:
including existing treaties end long established
customs and usages pertaining thereto,
end that after the word "formulating" In the same line, the following
words be inserted:
in consultation with Members directly affected;
PREMIERE COMMISSION EMPLOI ET ACTIVITE ECONOMIQUE
RESOLUTION AU SUJET DE L'EMPLOI
(RAPPORT DE IA SOUS-COMMISSION (C) DE LA PREMIERE COMMISSION)
(DOCUMENT E/CONF.2/C.1/17 - DERNIER ALINEA)
AFGHANISTAN : PROPOSITION D'AMENDEMENT
Ia dTlTgation de l'Afghanistan propose d'insTrer l'expression suivante
a la suite du moT "travailleurs" a la quatriFme ligne du dernier alinTa :
"ainsi que les traitTs en vigueur et les usages retus qui se rapportent aa
cette questio"n
Et d'inTsrera la ligne suivante apFrs le mot "fomuMler" l'expression
c-idessou:s
"apFrsO tre entTr en consultation avec les Etats membres directement
inTtresTss," |
GATT Library | nt174cn6766 | Resolution regarding the Time-Table for future Meetings El Salvador: proposed Amendment | United Nations Conference on Trade and Employment, January 6, 1948 | General Committee | 06/01/1948 | official documents | E/CONF.2/BUR/20, E/CONF.2/W/1-15, E/CONF.2/BUR.1-39, and E/CONF.2/BUR/W.1 | https://exhibits.stanford.edu/gatt/catalog/nt174cn6766 | nt174cn6766_90180186.xml | GATT_147 | 877 | 5,530 | United Nations
ON
TRADE AND EMPLOYMENT
Nations Unies
CONFERENCE
DU
COMMERCE ET DE L'EMPLOI
RESTRICTED
E/CONF. 2/BU0
6 January 1
NGLISH
ORIGINAL:NGLISH
R/20
948
SPANISH
GMMERMI COMIvTTEE
RESOLUEION INMGTRD:G EHE TIME-TABLE FOR FMEETING ID!DGS
EL SALVADOR: PROPOSED AMENDMENT
The delegation of El Salvador proposes:
(a) a return to the previous system of two working periods
daily, one in the morning and one in the afternoon:
(b) the appointment of an Ad Hmc Comnittee to seek formulas for
a compromise on the five or six points of disagreement which have
arisen in going throu h theADraft Charter. The Committee would
be formed from the countries which best repres nt the various trends
of opinion, and would be authorized to discuss the points of
disagreement from an overall standpoint.
COPIOTS:
Durin g thecourse of the discussions it has become apparent that
in general the position of the United States, the United Kingdom and
the European countries is the same and in oppositi n to' that of the
Laten Am-rican and other undeveloped countries. A number of countries,
such as. Australia, occupy a position between these two extremes.
The Committee would be made up of the countries best representing the
points.of view noted.
Taking this faca as e starting point, the circumstances underlying
our. proposal are as follows:
The progress of the Conference has been rather slow as regards
the adoption of agreements, due not to lack of time or effort but to
the existence of a number of points in the Draft Charter (5 or 6) on
which there are apparently irreconcilable differences of opinion, and
which will continue to be an insuperable obstacle to the conclusion
of the, work of the Conference, if they are dealt with separately.
The General Committee s decision to increaee tha number of
ses-ions eeld Qach day does not solve the problem. It can only postpone
the conflict. In fact, for lack of time the small delegations will
not take part in a series of committee and sub-committee meetings,
:nd the opinion of thm comiittees, will be taken without them. In
orddr to defend their points of view they will resort to raising them'
/again and with
1
:?
.... E/CONF. 2/BUR/20 .
Page 2
* * ; - , t8* ;
agaiy . and wit greater vigour in the plener-meetings.`The United
States delegation (large-scale and efficient like everything produced
by that great people) will be present at every meeting. The same
will be true of the United Kingdom delegation which, although not
very large, is made up of members who, through having attended all the
Preparatory meetings, have the Draft Charter at their fingertips. As
a result they have more time at their disposal, since it is not necessary
for themhto spend more time studying the Draft CLarter in connection with
the problems which have been raised. The same will be true of France and
other delegations, Therefore, the opinions taken by, the chairmen of
the committees and sub-comnittoes will be those of the countries
mentioned, worthy of respect but not the same as those of the other
countries (including ny own) whose position is summed up. in the
expression "We will be at the Plenary"
On the other hand, if and Ad Hoc Conmittee is formed. representing
the varioes points of view, it will be able to seck formulas for
compromise more easily-wnthout involving any cessation of work or the
part of the committees and sub-committees--because it will be doing
so from -an. over-all standpoint. Let us take an example. In the case
of quantitative restrictions, the view of the under-developed countries
is that quantitative restrictions may be established without obtaining
the previous opinion of the Organization when they are intended. to
protect newly est ablished industries, or rather when they're called
for to promote or facilitate a plan of industrial development. In a
committee or sub-conmittee the attitude of the delegations concerned
will be inflexible because the subject will be dealt with in isolation. x
Nevertheless, it is closely connected (I am referring to the example)
with thecprinciples underlying the composition of the Exeoutive Board
of the Orgaeizatien. A Committee authorized to deal with those viows
from an overall standpoint will be able to find conciliatory formulas
which would. make hessible the solution of thi various aspects of tho
problem, solving the problem itself, which is in fact the opposition
between the trendpof opinion which seeks to stress economic devolooment
as a means of attaining the objectives of the Charter, and the trend of
oeinion which seeks to lay greater strees on the mure stimulation of
trate by the elimination of everything which may in its opinion prove.
to be a barrier to trade.
My delegation wishes to take this opportunity of stating its approval
of the.dissatisfac ihel expressed in- Committee V at the fact that .tiQ question
/of schedules
~~~~~~~ . , E/CONF. 2/BUR/20
Page 3
of schedules was settled in the Genral Committee and not at a Plenary
meeting, although one was hold two or three days prior to the General
Committee and not at a Plenary meeting, although one was held two or
three days prior to the General Committee's decision.
On behalf of the delegation of ElSalvador
/s/ Dr. Ricardo Jimenez CASTILLO
Head of the Delegation |
GATT Library | qm709sd9919 | Resolution to the Economic and Social Council concerning the Interim Co-ordinating Committee for International Commodity Arrangements | United Nations Conference on Trade and Employment, February 23, 1948 | 23/02/1948 | official documents | E/CONF.2/42 and E/CONF.2/14-15/REV.1 | https://exhibits.stanford.edu/gatt/catalog/qm709sd9919 | qm709sd9919_90040099.xml | GATT_147 | 547 | 3,824 | United Nations Nations Unies UNRESTRICTED
CONFERENCE CONFERENCE E/CONF. 2/42
ON DU 23 February 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI
RESOLUTION TO THE ECONOMIC AND SOCIAL COUNCIL CONCERNING
THE INTERIM CO-ORDINATING COMMITTEE FOR
INTERNATIONAL COMMODITY ARRANGEMENTS
Some time ago the Secretariat circulated a draft resolution on this
subject (E/CONF.2/C.5/16 and E/CONF.2/C.6/47) with the suggestion that it
be considered by either the Fifth Committee or the Sixth Committee for
recommendation to a Plenary Session of the Conference. Subsequently the
Fifth Committee discussed and adopted unanimously the proposed text of
the resolution (E/CONF.2/C.5/SR.15).
Inputting forward this suggestion earlier the Secretariat had expressed
the view that "formal approval by a Plenary Session of the Conference
would be deferred until the question of establishing an Interim Commission
had been settled". At that time it had appeared reasonable to suppose that
the Conference would have completed its work before the end of the current
session of the Economic and Social Council at which action on this subject
would be required if the activities of the Interim Co-ordinating Committee
were not to be-interrupted. It is now apparent that if the transmittal
of a resolution on this matter is deferred until the Conference has taken
final action on the question of establishing an Interim Commission it will
be received too late for this session of the Council to take the necessary
action. Accordingly, the Secretariat now suggests that consideration be
given to the adoption of the necessary resolution at a Plenary Session of
the Conference which is expected to be held later this week. Since it
would seem undesirable at this stage to prejudge what, if any, interim
body will be established eventually by the Conference, the Secretariat
would propose that if a Plenary session is to consider the draft resolution
already approved by the Fifth Committee, that resolution might be modified
in the manner indicated in the attached text in order to allow for all
possibilities. In the attached text the words suggested for deletion are
enclosed in square brackets and the suggested additions are identified
by underlining.
/DRAFT Page 2
DRAFT RESOLUTION CONCERNING THE INTERIM CO-ORDINATING COMMITTEE
FOR INTERNATIONAL COMMODITY ARRANGEMENTS
THE UNITED NATIONS CONFERNCE ON TRADE AND EMPLOYMENT
TAKING note of the Resolution adopted by the Economic and Social Council
on 28 March 1947 establishing an Interim Co-ordinating Committee for
International Commodity Arrangements with a chairman representing the
Preparatory Committee of the United Nations Conference on Trade and
Employment;
NOTING that, with the commencement of the United Nations Conference on
Trade and Employment on 21 November 1947 the Preparatory Committee ceased to
exist, and that [at the conclusion of the Conference an Interim Commission
for the International Trade Organization was established] an Interim
Commission is expected to be established at the conclusion of the Conference;
and
RECOGNIZING that it is desirable to avoid any interruption of the
interim arrangements for co-ordinating action in this field; accordingly
RECOMMENDS that the Economic and Social Council amend the composition
of the Interim Co-ordinating Committee for International Commodity
Arrangements to provide that the Chairman of that Committee be nominated
by the Interim Commission for the International Trade Organization or, in the
event that an Interim Commission is not established by such other body as
the United Nations Conference on Trade and Employment may designate. |
|
GATT Library | hc971nm1844 | Resolution to the Economic and Social Council relating to employment | United Nations Conference on Trade and Employment, January 9, 1948 | 09/01/1948 | official documents | E/CONF.2/27 and E/CONF.2/14-15/REV.1 | https://exhibits.stanford.edu/gatt/catalog/hc971nm1844 | hc971nm1844_90040082.xml | GATT_147 | 642 | 4,665 | United Nations Nations Unies UNRESTRICTED
CONFERENCE CONFERENCE E/CONF.2/27
CONFERENCE CONFERENCE 9 January 1948
ON DU ORIGINAL: ENGLISH
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI
RESOLUTION TO THE ECONOMIC AND SOCIAL COUNCIL
RELATING TO EMPLOYMENT
At its tenth meeting, 9 January 1948, the First Committee approved the
following resolution:
"THE UNITED NATIONS CONFERENCE ON TRADE AND EMPLOYMENT
"Having recognized in drawing up the Charter for an International
Trade Organization that future prosperity and peace must be founded on
full and productive employment and large and steadily growing effective
demand which, although primarily dependent upon internal measures taken
by individual countries, also require consultation and concerted action
as well as assistance from inter-governmental agencies;
"Recognizing that different measures may be appropriate for
different countries, according, for example, to the stage of economic
development or reconstruction and the availability of the various factors
of production
"Recognizing that inflationary as well as deflationary tendencies
need to be combatted;
"Taking note of the resolution adopted by the Second Session of the
General Assembly which approved the initiation of surveys of economic
conditions and trends and requested recommendations by the Economic and
Social Council on appropriate measures relating thereto;
"1. Notes that the Economic and Employment Commission and its
Sub-Commission on Employment and Economic Stability have been
instructed to consider the draft resolution on international
action relating to employment prepared by the First Session of
the Preparatory Committee; and
"AFFIRMS its interest in the four measures specifically
recommended for study in that draft resolution.
"2. Considers that the studies which have been initiated dealing
with the achievement and maintenance of full and productive
employment should be advanced as rapidly as possible and that
attention should be given now to method of ensuring that high
levels of employment and economic activity shall be maintained even
when special factors of temporary duration now prevailing in many
countries have ceased to operate, and accordingly
/"SUGGESTS E/CONF.2/27
Page 2
"SUGGESTS THAT, with a view to making appropriate
recommendations, the Economic and Social Council, in addition to
the investigations which it has already undertaken,
(a) Request the submission at an early date, by members of
the United Nations and by non-members represented at the preser
Conference, of information concerning action which they are now
taking to achieve or maintain full employment and economic
stability and the nature of any prepared plans to prevent a
future decline, and
(b) Request the various Specialized Agencies to indicate the
nature and extent of the assistance they are preparing to
provide if a decline in employment and economic activity
threatens.
"3. Considers that, in many countries, the problems of persistent
surplus or shortage of manpower are linked with the attainment of
full and productive employment and that their solution would advance
the aims of the International Trade Organization; and accordingly
"SUGGESTS THAT the Economic and Social Council initiate or
encourage studies and recommend appropriate action in connection
with international aspects of population problems as these relate
to employment, production and demand.
"4. Considers that, in relation to the maintenance of full
employment, it is advantageous to countries which require or
receive and to countries which supply workers on a seasonal or
temporary basis to adopt regulations which will mutually safeguard
their interests and also protect both the migrants and the domestic
workers against unfair competition or treatment; and accordingly
"SUGGESTS THAT the Economic and Social Council, in conjunction
with appropriate agencies such as the International Labour
Organization and its Permanent Migration Committee, consider the
problems of temporary or seasonal migration of workers, taking
into account existing treaties and long established customs and
usages pertaining thereto, for the purpose of formulating, in
consultation with Members directly affected, conventions and
model bilateral agreements on the basis of which individual
governments may concert their actions to ensure mutually
advantageous arrangements for their countries and fair conditions
for the workers concerned," |
|
GATT Library | xp078nc0114 | Resolution to the Economic and Social Council relating to employment : Note by the Executive Secretary | United Nations Conference on Trade and Employment, February 2, 1948 | 02/02/1948 | official documents | E/CONF.2/34 and E/CONF.2/14-15/REV.1 | https://exhibits.stanford.edu/gatt/catalog/xp078nc0114 | xp078nc0114_90040089.xml | GATT_147 | 247 | 1,705 | United Nations Nations Unies RESTRICTED
CONFERENCE CONFERENCE E/CONF.2/34
ON DU 2 February 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
RESOLUTION TO THE ECONOMIC AND SOCIAL COUNCIL
RELATING TO EMPLOYMENT
Note by the Executive Secretary
I am advised informally that the general economic debate during the
forthcoming session of the Economic and Social Council is likely to commence
around 9 February and that if a Resolution on Employment from this
Conference is to be taken into account in that debate it will have to be
available for circulation In New York within the next few days.
As the text of a resolution has already been approved without dissent
by a meeting of the First Committee at which all Delegations were
represented (E/CONF.2/C.1/SR.10 and E/CONF.2/27), and as presumably it is
desirable not to delay consideration of this Resolution until the
mid-summer session of the Economic and Social Council, It might be
suggested that the text given in E/CONF.2/27 be regarded as having been
approved by a Planary Session of the Conference in order that it might be
transmitted to Lake Success in time for discussion at the current session
of the Council. Accordingly, unless advice Is received from Delegations
by 6.00 p.m. Thursday 5 February that this procedure is not agreeable,
I propose that the text of the Resolution in E/CONF.2/27 be communicated
formally to the Economic and Social Council immediately thereafter as a
resolution of the Conference for consideration by the Economic and Social
Council. |
|
GATT Library | dy778fw3998 | Resolutions of the Maritime Conference | United Nations Conference on Trade and Employment, March 1, 1948 | Third Committee: Commercial Policy and Sub-Committee B (proposed new Article 18A) | 01/03/1948 | official documents | E/CONF.2/C.3/B/W.6 and E/CONF.2/C.3/A/WHITE PAPERS/C.3/B/W.1-7/C.3/C/W.1-16 | https://exhibits.stanford.edu/gatt/catalog/dy778fw3998 | dy778fw3998_90190495.xml | GATT_147 | 1,284 | 8,834 | United Nations Nations Unies
RESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.3/B/W.6
ON DU 1 March 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
THIRD COMITTEE: COMMERCIAL POLICY
SUB-COMMITTEE B (PROPOSED NEW ARTICLE 18A)
RESOLUTIONS OF THE MARITIME CONFERENCE
The Maritime Conference at present in session in Geneva which is drafting
a Convention for an Inter-governmental Maritime Consultative Organization,
has so far agreed on Articles I, II, III and part of Article VI of that
Convention. The texts have been received by cable and have been adopted
subject to drafting changes:
Article I - Scope and Purposes of the Organization
1. To provide machinery for co-operation on among governments in the
field of governmental regulation and practices relating to all kind
of technical matters affecting shipping engaged in international
trade and to encourage general adoption of the highest practicable
standarda in matters concerning maritime safety and- navigation
efficiency;
2. To encourage removal of discriminatory action and unnecessary
governmental restrictions affecting shipping engaged in international
trade so as to promote the availability of shipping services to
world commerce without discrimination; assistance and encouragement
given by a government for developing its national shipping and for
security purposes in itself does not constitute discrimination
provided such assistance is not based on measures designed to
restrict the shipping freedom of all flags taking part in international
3. To provide for consideration by the Organization of matters
concerning unfair restrictive practices by shipping concerns
according to Article II of the convention;
4. To provide for consideration of any matters concerning shippfng
that may be refrred to the Organization by any organs of the
United Nations (including its specialized agencies);
5. To provide for the exchange of information among governments
on matters under consideration by the Organization.
Article II - Functions
1. The functions of the Organization shall be consultative and
/advisory E/CONF.2/C.3/B/W.6
Page 2
advisory.
2. In order to achieve the objectives set out in Article I, the
functions of the Organization relating to matters within its scope
shall be:
(A) To consider and make recommendations upon matters arising
under Article I, sub-paragraphs 1, 2 and 3 that may be remitted
to it by Member governments, United Nations or other inter-
governmental organizations or upon matters referred to it under
Article I, sub-paragraph 4.
(B) To draft conventions, agreements, or other suitable
instruments, and to recommend these to governments and inter-
governmental organizations and to convene such conferences as
may be necessary;
(C) To provide machinery for consultation and exchange of
information among member governments.
3. In these matters which appear to the Organization as capable of
settlement through the normal process of the international shipping
business the Organization shall so recommend. When any matter
concerning unfair restrictive practices is considered by the
Organization as incapable of such settlement, the Organization shall
consider it according to the applicable principles and precedents
established by any organ of the United Nations having responsibilities
in the general field of restrictive business practices.
Article III - Membership
1. Membership of the Organization shall be open to all states,
subject to the following provisions:
2. Members of the United Nations may become members of the
Organizaticn by signing or otherwise accepting the present convention
in accordance with the provisions of Article (XV).
3. States not Members of the United Nations which have been invited
to send representatives to the International Maritime Conference held
at Geneva in February/March 1948, may become Members by signing or
otherwise accepting the present convention in accordance with the
provisions of Article (XV).
4. Any state which does not become a member in accordance with
paragraphs 2 and 3 may apply through the Secretary-General of the
Organization to become a Member and shall be admitted as a Member
upon its acceptance of the present convention in accordance with
the provisions of Article (XV) provided that, upon the recommendation
/of the Council, E/CONF. 2/C. 3/B/W. 6
Page 3
of the Council, its application has been accepted by two-thirds of
the Members of the Organization.
5. Any territory or group of territories to which the present
convention has been made applicable under the article dealing
with declarations by Members in respect of territories for whose
international relations they are responsible, by the Member having
responsibility for its international relations or by the United
Nations, may become an Associate Member of the Organization by
notification in writing given by such Member or by the United
Nations as the case may be to the Secretary-General of the
Organization.
6. Associate Members shall have the rights and obligations of a
Member of the Organization under the present conversion to the
extent which shall be determined by the Assembly and subject to
this the word "Member" in the convention shall be deemed to include
Associate Member unless the context otherwise required.
7. No state or territory may become or remain a Member or
Associate Member of the Organization contrary to a resolution of
the General Assembly of the United Nations.
Article VI - The Council
1. The Council shall consist of sixteen Member governments:
(A) Six of these shall be governments of the nations with
the largest interest in providing international shipping
services.
(B) Six shall be governments of other nations with the
largest interest in international seaborne trade.
(C) Of the four remaining Members two shall be elected by
the assembly from among the governments of nations having a
substantial interest in providing international shipping
services, and
(D) Two shall be elected by the Assembly from among the
governments of nations having a substantial interest in
international seaborne trade.
2. In accordance with principles set forth in paragraph 1 of this
Article the first Council shall be constituted as follows:
(A) The six Member governments with the largest interest in
providing international shipping services being: Greece,
Netherlands, Norway, Sweden, United Kingdom, United States.
(B) The six Member governments with the largest interest in
international seaborne trade being: Argentina, Australia,
/Belgium E/CONF.2/C.3/B/W.6
Page 4
Belgium, Canada, France, India.
(C) Two Member governments to be elected by the Assembly under
paragraph 1, sub-paragraph (C) of this Article from a panel
nominated by the six Member governments in paragraph 2,
sub-paragraph (A) of this Article.
(D) Two Member governments elected by the Assembly under
paragraph 1, sub-paragraph (D) of this Article from the Member
governments having a substantial interest in international
seaborne trade.
3. Except as provided in Annex, the Council shall determine for the
purpose of paragraph 1 (A) of this Article, the Member governments
with the largest interest in providing international shipping services
and shall also determine, for the purpose of paragraph 1 (C) of this
Article, the Member governments having a substantial interest in
providing such services. Such determinations shall be made by a
majority vote of the Council including the concurring votes of a
majority of the Member governments represented on the council under
paragraphs 1 (A) and (C). The Council shall further determine for
the purpose of paragraph 1 (B) of this Article, the Member governments
with the largest interest in international seaborne trade. Each
council shall make these determinations at a reasonable time before
the end of its period of office.
Article II was accepted against the votes of Finland and Sweden. In
opposing the text the Scandinavian countries maintained that the shipping
organization should only consider unfair, restrictive practices by a
shipping concern if the question was referred to it by the International
Trade Organization.
The following governments are represented at the International Shipping
Conference: Argentina, Australia, Belgium, Brazil, Canada, Chile, China,
Colombia, Czechoslovakia, Denmark, Dominican Republic, Ecuador, Egypt,
Finland, France, Greece, India, Iran, Ireland, Italy, Lebanon, Netherlands,
New Zealand, Norway, Pakistan, Panama, Peru, Poland, Portugal, Sweden,
Switzerland, Turkey, United Kingdom, United States. |
GATT Library | wm920xw5430 | Revised annotated Agenda for chapter IV Norway: proposed amendment | United Nations Conference on Trade and Employment, January 9, 1948 | Third Committee: Commercial Policy and Sub-Committee A (Articles 16, 17, 18, 19) | 09/01/1948 | official documents | E/CONF.2/C.3/6/Add.5 and E/CONF.2/C.3/1-/ADD.45-C.3/9/ADD.1 | https://exhibits.stanford.edu/gatt/catalog/wm920xw5430 | wm920xw5430_90190079.xml | GATT_147 | 871 | 5,776 | United Nations Nations Unies UNRESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.3/6/ Add. 5
ON DU 9 January 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
THIRD COMMITTEE: COMMERCIAL POLICY
SUB-COMMITTEE A (ARTICLE 16, 17, 18 AND 19)
REVISED ANNOTATED AGENDA FOR CHAPTER IV
NORWAY: PROPOSED AMENDMENT
Article 18 .
A new paragraph 4 to be inserted in Artei cle 18 af r,paragraph 3
reading as follows:
"The provisions of this Article shall not preclude domestic
ce priibiarranlizatarrgements involving subsidies on imported
products for the purpose of preventing or modifying inflationary
pressure and the imposition on imported prodchucgts of ares to
be pidinto a stabil izat onfound fourpiso ofr the ou oreventing
or mofying deflationary pressure; Provided that the charges must
not be imposed in a higher degree thhanw wat ould correspond to
othe tmaunluoaom f the subsidies for the same product paid during'
the preceding period of rising prices, and Provided, fu,rther that
the e schemfor such arrangements shall be reported to the
zaOrgio within three months after it has been put int~o
operation, or for existing arrangentems within rtheeo mns thafter
coming into force of the Charter." : ..
Thegra hoold parap f Article 18 to be renumbered 5.
CORO= .
The Charters f nrecognizes uras it udamental -ppose to promote full
and producve empeoment and large and stemad.lygroweming. effective daand
Among the different measures which hav e to be put intooperation to achieve
thns at ed are aiBoto contreo iinaeltitionanyary and. flaf--
tendencies. See Draft Resolution on Emplo yment, proposedby the Sub-
Commitmmittee C of Cotee I (document 2/C.1/17)
cveThe hara Tn on pflcwttdd m rkit cao knly betnl..aenoe
succetsbyslly m e co-ordinatesd batiob oaak e nmyrl lgmrereaternub
of the countries which rtanaren itant id trathe worlde. Actcordisng o thi
/view the E/CONF.2/C.3/6/Add. 5 Page 2
view the Norwegian gation is of the opinion that it would be appropriate
to insert in the Charter specific obligations for the Members to take
steps to prevent too wise fluctuations of prices. The Norwegian
delegation refers to the amendments which it has proposed to Article 3,
paragraph 1, and to Article 7 document 2/C.1/3/Add.7 and document
2/c.1/7/Add. 8).
However, as there are rather differing opinions among the delegations
in regard to these questions, it is not likely that we, for the time being,
should reach an agreement in regard to such co-ordinated actions. On the
other hand, the Charter should not bar the members from putting into
operation domestic price stabilisation arrangements if they themselves
deem it necessary to safeguard as far as possible their internal economy
against inflationary or deflationary pressure from other countries. The
amendment to Article 18 now proposed aims at making this clear. It is at
the same time formulate in such a way as to prevent any contradiction
with the general principles of this Article.
As many other countries Norway has fought inflationary tendencies
during and after the war by very comprehensive and detailed price
regulation, applying also subsidies to reduce the internal sales prices
both of imported and domestic products. This policy has been rather
effective. Since the liberation the increase of the cost of living has
been insignificant. The index has gone up only two or three per cent.
Nor do we in Norway have any blackmarket worth mentioning. As a consequence
we have been able to regulate the wages without any strikes. Norway wants,
and surely other countries also want to have the opportunity to conduct
to a certain extent a corresponding policy to meet future eflationary
pressure from other countries. The undesirable consequences of a sudden
and too far-going decline in the prices on the world market can not, of
course, be counteracted only through domestic price stabilization
arrangements. Norway, in particular, which is in a high degree dependent
upon international trade, will necessarily have to adjust its level of
production costs to the prices on the world market. It is important,
however, that one should have sufficient tine for such adjustments in
order to avoid difficulties with respect to regulation of wages and to
prevent a breakdown of the production and of the general demand. In
consequence a country should have the possibility of modifying a
deflationary pressure caused by a general fall of the prices of imported
products by imposing on such products stabilization charges corresponding
to the subsidies paid on the same product during the preceding period of
/rising E/CONF.2/C .3/6/Add.5
Page 3
rising prices. This point should be stressed. It makes it quite clear
that there is no question of protection, but only of fixing average prices
over a period of time according to the principle adopted in Article 31,
paragraph 4. To safeguard against abuse of the provisions for protective
purposes, it is also proposed that the schemes for the price stabilization
arrangements should be reported to the Organization within three months
after the arrangements have been put into operation and for existing
arrangements within three months after coming into force of the Charter.
Possible complaints should be dealt with according to Article 89 and
Article 90.
The proposal aims at inserting in Article 18 permanent provisions
in regard to price stabilization arrangements. Consequently, they fall
outside the scope of the provisional measures of Article 43, paragraph 2 (b). |
GATT Library | cy799qf6174 | Revised annotated Agenda for chapter IV section A - tariffs, preferences and internal taxation and regulation | United Nations Conference on Trade and Employment, January 6, 1948 | Third Committee: Commercial Policy | 06/01/1948 | official documents | E/CONF.2/C.3/6/Add.4 and E/CONF.2/C.3/1-/ADD.45-C.3/9/ADD.1 | https://exhibits.stanford.edu/gatt/catalog/cy799qf6174 | cy799qf6174_90190078.xml | GATT_147 | 333 | 2,092 | United Nations
CONFERENCE
ON
TRADE AND EMPLOYMENT
Nations Unies
CONFERENCE
DU
COMMERCE ET DE L'EMPLOI
E/CONF. 2/C. 3/6/
Add. 4
6 January 1948
ENGLISH
* ORIGINAL: FRENCH
;THIRD COMMITTE: COMMERCIAL POLICY
REVISED ANNA FOR CHAP? IV
SECTION A - TARIFFS, PREFERENCES AND INTERNAL TAXATION
AND REGULATION
Item 18 (page 5) of the annotated agenda:
The delegation of Turkey communicates the following list of all
commercial treaties concluded by Turkey to date which are still in force.
All the agreements include a clause providing for reciprocal
preferences for the countries which were part of the former Ottoman Empire
and were detached from it on 24 July 1923.
All. the treaties are in force for an indefinite period and, in common
with all instruments of this kind, contain provision for their denunciation.
Treaties concluded between Turkey and
Bulgaria
Denmark
Finland
Greece
Hungary
Iraq.
Italy
Norway
Poland
Roumania
Sweden
Switzerland
United Kingdom
United States of
America
Union of Soviet
Socialist
Republics
27 Mar 1930,
31 May 1930,
12 August 1929,
30 October 1930,
21 May 1930,
14 March 1937,
10 January 1932,
29 December 1936,
16 March 1931,
29 August 1931
11 June 1929,
29 September 1929,
13 December 1930,
1 March 1930,
1 October 1929,
8 October 1937,
entered
entered
into
if
II
It
to
II
to
71
force
It
ft
it
II
if
II
if
II
II
nU
nf
if
1 January 1931
2 July 1931
8 August 1932
5 November 1931
13 October 1930
6 October 1937
23 May 1934
1 January 1937
1 May 1933
28 May 1933
15 January 1931
29 June 1931
1 July 1932
3 September 1930
22 April 1930
8 October 1937
/Modus vivendi E/CONF.2/C.3/6/Add.4
Page 2
Modus vivendi concluded between Turkey and
Belgium 12 March 1947, entered into force 26 March 1947
Brazil 2 July 1933,
Egypt 2 July 1930,
France 31 August 1946,
Netherlands 21 November 1929,
Yugoslavia 18 September 1947,
2 July 1933
2 July 1930
21 September 1946
30 November 1929
20 October 1947 |
GATT Library | mr624pj7644 | Revised annotated Agenda for chapter IV section A - tariffs, preferences, and internal taxation and regulation | United Nations Conference on Trade and Employment, January 3, 1948 | Third Committee: Commercial Policy | 03/01/1948 | official documents | E/CONF.2/C.3/6/Corr/1 and E/CONF.2/C.3/1-/ADD.45-C.3/9/ADD.1 | https://exhibits.stanford.edu/gatt/catalog/mr624pj7644 | mr624pj7644_90190074.xml | GATT_147 | 149 | 1,111 | United Nations Nations Unies
CONFERENCE CONFERENCE UNRESTRICTED
E/CONF. 2/C. 3/6/
ON DU Corr. 5
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI 3 January 1948
ORIGINAL: ENGLISH
THIRD COMMITTEE: COMMERCIAL POLICY
REVISED ANNOTATED AGENDA FOR CHAPTER IV
SECTION A - TARIFFS, PREFERENCES, AND INTERNAL TAXATION AND REGULATION
Article 17 - Reduction of Tariffs and Elimination of Preferences
Page 7, paragraph 1, Item 26, should read as follows:
The delegation of Uruguay proposes the following amendments:
The first sentence to read:
"Each Member may, on its own initiative, or shall, upon the
request of the Organization, enter into and carry out with
such [other] Member or Members as it may determine or as the
Organization may specify, negotiations directed .............."
The second sentence to read:
"These negotiations shall proceed in accordance with the
[following rules] provisions of Chapter VIII of this Charter."
Sub-paragraphs (a), (b), (c) and (d) to be deleted. |
GATT Library | jg652dd1360 | Revised draft of Article 93 (Relations with non-members) prepared by the delegation of the United Kingdom | United Nations Conference on Trade and Employment, January 2, 1948 | Sixth Committee: Organization | 02/01/1948 | official documents | E/CONF.2/C.6/35 and E/CONF.2/C.6/12/ADD.4-44 | https://exhibits.stanford.edu/gatt/catalog/jg652dd1360 | jg652dd1360_90170088.xml | GATT_147 | 424 | 2,755 | United Nations Nations Unies UNRESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.6/35
ON DU 2 January 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
SIXTH COMMITTEE: ORGANIZATION
REVISED DRAFT OF ARTICLE 93 (RELATIONS WITH NON-MEMBERS)
PREPARED BY THE DELEGATION OF THE UNITED KINGDOM
Article 93
Relations with Non-Members
1. No Member shall seek preferential advantages from any non-Member
which result, directly or indirectly, in the application by the non-Member
to any other Member of measures which would if applied by a Member be
inconsistent with any provisions of this Charter.
2. A Member may
(a) continue to grant to a non-Member any advantage which it is so
Granting at the date on which this Charter becomes effective for the
Member;
(b) grant to a non-Member advantages including any of the advantages
or tariff concessions accorded by the Member respectively under
Chapter IV of the General Agreement on Tariffs and Trade or in
consequence of negotiations carried out under Article 17;
Provided that a Member shall notify the Organization of any advantages
Granted or to be granted in accordance with this paragraph and the
Organization shall inform the other Members thereof.
3. If any Member considers that its interests are injured, or that the
purpose set forth in Article 1 are being impeded, by any such grant or
proposed grant, it may request the Organization for a decision upon the
matter.
4. The Organization, having due regard to the purpose and objectives set
forth in Article 1 and to the legitimate interests of all interested Members,
shall thereupon decide whether or not -
(i) in the case of an advantage granted or to be granted under an
agreement with the non-Member, that agreement shall be denounced
by the Member in whole or in part;
(ii) in the case of an advantage granted or to be granted otherwise, it
shall be withdrawn or not granted
and shall notify the Members of its decision.
5. Within sixty days of the receipt of such notification the Member
/granting the E/CONF.2/C.6/35
Page 2
.
granting the advantage shall either (i) take steps to give affect to the
decision of the Organization; or (ii) give notice in writing to the
Director-General of its withdrawal from the Organization, which shall take
effect on the sixtieth day from the receipt of such notice.
6. Nothing in this Article shall be construed as overriding or modifying
any of the economic provisions which confer benefits on Members in the
Treaties of Peace concluded or to be concluded following the Second World
War, set out in Annex..... |
GATT Library | ph773rj7413 | Revised draft of provisional working arrangements between the International Trade Organization and the International Monetary Fund. (Item 4(b) of the Provisional Agenda) | Interim Commission for the International Trade Organization, August 14, 1948 | Interim Commission for the International Trade Organization (ICITO/GATT) and Executive Committee | 14/08/1948 | official documents | ICITO/EC.2/2/Add.2,Rev.1 and ICITO/EC.2/INF.1-3 ICITO/EC.2/1-2/ADD.4 | https://exhibits.stanford.edu/gatt/catalog/ph773rj7413 | ph773rj7413_90060178.xml | GATT_147 | 1,607 | 10,840 | RESTRICTED
LIMITED A
INTERIM COMMISSION COMMISSION INTERIMAIRE DE ICITO/EC .2/2/Add. 2,Rev.1
OR THE INTERNATIONAL L'ORGANISATION INTERNATIONALE 14 August 1948
RADE ORGANIZATION DU COMMERCE ORIGlNAL: ENGLISH
EXECUTIVE COMMITTEE
Second Session
Revised Draft of Provisional Working Arrangements
between the International Trade Organization and
the International Monetary Fund
(Item 4(b) of the Provisional Agenda)
Since the draft of provisional working arrangements
with the Fund was issued (document ICITO/EC/2/2/Add.2),
the Executive Secretary has held further consultations
with officials of the Fund and consequently wishes to
suggest the modifications indicated in the following revised
draft. This draft not, of Course, involve any
commitment on the part of the Fund or of the Executive
Committee.
1. The International Monetary Fund accepts the objective
of paragraph 1 of Article 24 of the Havana Charter that the
International Trade Organization and the Fund shall pursue
a co-ordinated policy with regard to exchange questions
within the jurisdiction of the Fund and questions of
quantitative restrictions and other trade measures within
the jurisdiction of the Organization. [, and agrees to
cooperate with the Organization to this end.]
[II. The Fund and the Organization therefore agree to
bring into effect the following working arrangements as soon
as the Organization is established and commences operations.]
In order to give effect to such coordinated policy the Fund
and the Organization agree to cooperate in accordance with
the following working arrangements. ICITO/EC.2/2/Add.2, Rev.1.
Page 2.
1. [The two organizations will afford to each other
every facility for reciprocal representation at the con-
ferences of the Organization and the meetings of the
Board of Governors of the Fund and at any other inter-
national meeting called or sponsored by either body.]
The Organization will invite the Fund to send represent-
atives to attend the meetings of the Conference of the
Organization as observers, The Executive Directors of
the Fund will recommend to the Chairman of the Board of
Governors that representatives of the Organization be
invited to attend the meetings of the Board of Governors
as observers.
2. The Excecutive Board of the Organization may at its
discretion invite a representative of the Fund to attend
meetings of the Board at which questions of particular
interest to the Fund are to be discussed; and
similarly, the Executive Directors of the Fund may at
their discretion invite a representative of the Organi-
zation to attend meetings of the Executive Directors at
which questions of particular interest to the Organi
zation are to be discussed.
3. The Director-General of the Organization and the
Managing Director of the Fund shall make administrative
arrangements to ensure [the] close[st possible] colla-
boration and liaison between the staffs of the two
organizations.*
* Depending upon the decision of the Organization as to the site of
its headquarters, it may be desirable to provide that the Director-
General and the Managing Director should consider the desirability
of appointing a permanent representative of each organization at
the headquarters of the other, and if, in their judgment, such
appointments would facilitate collaboration and liaison between
the staffs of the two organizations, they should proceed to appoint
such representatives. ICITO/EC.2/2/Add .2, Rev. 1
Page 3.
4. [subject to the need for the preservation of
secrecy in special circumstances, there shall be the
fullest possible exchange of information between the
Organization and the Fund relating to foreign exchange,
quantitative restrictions, monetary reserves and balance
of payments.
The Organization shall furnish as required to the
Fund trade statistics collected by the Organization in
accordance with Article 39 of the Havana Charter. The
Orgranization shall determine how much of, and when, this
information shall be published, but if the Fund so
requests any part of this information shall be supplied
to the Fund confidentially prior to publication.
The Fund shall furnish as required to the ITO
statistics collected by the Fund within its special
sphere. The Fund shall determine how much of, and when,
this information shall be published, but if the Organi-
zation so requests any part of this information shall be
supplied to the Organization confidentially prior to
publication.]
In order to facilitate the cooperation between the Fund
and the Organization in accordance with the provisions of
the Havana Charter and of this Arrangement the Fund and
the Organization shall, to the extent necessary for this
however, that any such limitation shall not be such as
would frustrate or impair theeffective cooperation ICITO/EC.2/2/Add. 2, Rev.1.
Page 4.
Article 24 and these Working Arrangements.
The Fund and the Organization agree to strive, con-
sistently within their respective agreements with the
United Nations, for maximum cooperation with a view to
the most efficient use of their technical personnel in
their respective collection, analysis, publication,
standardization, improvement and dissemination of
statistical information. They recognize the desir-
ability of avoiding duplication in the collection of
statistical information whenever it is practicable for
either of them to utilize information or materials which
the other may have available or may be specially quali-
fied and prepared to collect, and agree to combine their
efforts to secure the greatest Possible usefulness and
utilization of statistical information and to minimize
the burdens placed upon national governments and other
collected.*
5. The Organization and the Fund shall cooperate in
the preparation of a report, not later than 1 March
1950, and in each year thereafter, on action still being
taken by Members of the Organization under sub-para-
graphs (b) and (c) of paragraph 1 of Article 23 and
under Annex K of the Havana Charter. [This cooperation
shall be intended to ensure that the preparation of
*The provisions of paragraph 4 have been drafted in general terms
since the determination of the statistical responsibilities of
the Organization under Article 39 is a matter which requires
separate consideration and consultation with a number of
specialized agencies and the United Nations. Similarly, the
statistical responsibilities of the Fund depend upon general
arrangements regarding the international collection of statistics
to which in due course the Organization will be a party. ICITO/EC.2/2/Add. 2, Rev.1.
Page 5.
the above-mentioned reports, under paragraph 1(g) of
Article 23 of the Havana Charter, and of the reports
required under Artice XIV, Section 4, of the Articles
of Agreement of the Fund shall be coordinated.]
So far as possible these reports shall be coordinated
with the reports required under Article XIV, Section 4,
of the Articles ot Agreement of the Fund.
6. In respect of any Member of the Organization which
is not a member of the Fund, the Organization shall
consult the Fund on the preparation and conclusion of
a special exchange agreement between that Member and
the Organization, in pursuance of Article 24 of the
Havana Charter.
7. [In the event that a Member of the Organization
maintains multiple rates of exchange in respect of its
currency, consistently with the Articles of Agreement
of the Fund,] The Fund shall cooperate with the
Organization, under Article 35 of the Havana Charter,
in the formulation of rules [to] governing the con-
version of [the currency of that Member] currencies of
countries which maintain multiple rates of exchange
consistently with the Articles of Agreement of the Fund
or with special exchange agreements , by [other] Members
of the Organization in determining the value of products
subject to customs duties or other charges or
restrictions based upon or regulated in any manner by
value; and such rules shall be subject to revision at
the suggestion of either Organization.
8. [The Director-General of] The Organization and
[the Managing Director of] the Fund shall as soon as
possible consult for the purpose of formulating ICITO/EC.2/2/Add.2, Rev.1.
Page 6.
recommendations for an agreement between the two organi-
zations regarding procedures for consultation under
paragraph 2 of Article 24 of the Havana Charter.
Such recommendations shall be submitted for [approval
by the Executive Board] confirmation by the Conference
of the Organization and the [Executive Directors]
Board of Governors of the Fund. [As regards the
Organization, the recommendations shall subsequently
be submitted to the Conference for confirmation as
required by paragraph 3 of Article 24.] Pending the
conclusion of a formal agreement on procedures, [the
Director-General and the Managing Director shall make]
such informal administrative arrangements shall be
concluded by the Organization and the Fund as may be
required for such consultations.*
9.The Organization and the Fund shall each give
sympathetic consideration to representations received
from the other Organization on all matters of interest
to it.
10. This Agreement shall enter into force on the day
on which it has been accepted by the competent
authorities of the two Organizations, and shall be
*This wording leaves entirely to the discretion of the Director-
General and the Managing Director the informal arrangements pending
an agreement although they would no doubt seek guidance from their
Executive Board and Executive Directors respectively. The Executive
Committee may, however, wish to consider whether it would be desir-
able to give some guidance in this paragraph as to the type of
arrangement which should be considered; for example,the paragraph
might ask the Director General and the Mnaging Director 't consider
as part of these arrangements the establishnmet of a Joint Commi-
ttee consisting of three members appointde by the Organization and
threeremmbers appointed by the Fund,to which owuld be rfeerred all
vqustions concreinng monetary rseerves, balaenc of payments and
foreign excahgne arrangements which the ITO is called upon to con-
Sider; any such Joint Co
te ard o report within a specified period;abl thne d meanwhile
b ng required to communicate to the Joint Comemitteeand to the
Organization its findings on all matters in respect of which the
determination of the Fund ha to be accepted in accordance with
paragraph 2 of Article 24. |
GATT Library | hs718cr6462 | Revised Draft Report of Joint Sub-Committee of Committees II and VI on Articles 9, 10 and 11 | United Nations Conference on Trade and Employment, February 7, 1948 | Joint Sub-Committee of Committees II and VI | 07/02/1948 | official documents | E/CONF.2/C.26/A/W.29/Rev.1 and E/CONF.2/C.26/A/W.29-33 | https://exhibits.stanford.edu/gatt/catalog/hs718cr6462 | hs718cr6462_90180386.xml | GATT_147 | 3,115 | 21,189 | United Nations Nations Unies-
CONFERENCE CONFERENCE RESTRICTED
ON DU E/CONF.2//C.2&6/A/
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI 7 February 1948
ORIGINAL: ENGLISH
JOINT SUB-COMMITTEE OF COMMITTEES II AND VI
REVISED DRAFT REPORT OF JOINT SUB-COMMITTEE OF COMMITTEES II AND VI
ON ARTICLES 9, 10 AND 11
1. The Joint Sub-Committee was appointed at the sixth meeting of Committee II
and the fifth and seventh meetings of Committee VI with terms of reference:
"1. To examine Articles 9, 10 and 11 of Chapter III, proposed amendments
thereto and any proposed new articles relating to the positive functions
of the Organization in promoting economic development in the light of the
discussion in Committee II with a view to making recommendations as to the
texts of these articles and any organizations provisions which may be
required as a consequence thereof.
2. To examine the proposal of the Mexican delegation for the
establishment of an Economic Development Committee of the Organization
taking into account any conclusions reached under paragraph 1and any
other relevant considerations. -
3. In making recommendations under paragraphs 1 and 2 to take into
account the functions of other organs of the Organization and of the
United Nations and Specialized Agencies in general in the field of
economic development and any financial implications.
4. r To repot both CIommitteeI and Committee VI."
2. The Joint Sub-Committee was composed of representatives of:
Australia France Turkey
Belgium Iraq United Kingdom
Brazil Mexico United States
China Pakistan Venezuela
Colombia South Africa
Dr. H sC. Coomb (Australia) was elected Chairman of the Sub-Committee.
3. A numbper of reresentatives of delegations who were not membersof the
Sub-Committee attendedas observers and in many cases took part in the
discussion on particular amendents for wh ich theywere primarily responsible
or in which they had special interest. Representative s of theInternational
BReank for construction and Det velopmenand of thed Food anAgricultural
rganizlation,l as wel as ths Direccol ofs tlhe Fica Divition ocf the Eonomic
A hn ehpnr me pht ofteUited Nations gave their views to the Sub-Committee.
/4. The -SubCommittee E/CONF.2/C.2&6/A/W.29/Rev.1
Page 2
4. The Sub-Committee had held twenty-seven meetings at the date of approval
of this report. It examined Articles 9, 10 and 11 and all the amendments and
proposals submitted to it in connection with these articles as listed in
Annex A in accordance with paragraphs 1 and 3 of its terms of reference.
As a result of its examination the Sub-Committee decided to recommend:
(i) revised texts of Articles 9, 10 and 11 as set out in Annex B;
(ii) a resolution to be adopted by the Conference as set out in
Annex C;
(iii) changes in Article 69 as set out in Annex D; and
(iv) inclusion in Chapter IX of the text set out in Annex E.
It was agreed that the aforementioned recommendations disposed of all the
amendments and proposals listed in Annex A.
5. In accordance with the decision of Committee II at its sixteenth meeting
to establish Sub-Committee D to examine and submit recommendations concerning
the footnote to Chapter III on "Reconstruction" the Joint Sub-Committee did
not consider the question of the inclusion of any reference to reconstruction
with respect to any of the changes recommended in Articles 9, 10 or 11.
6. The representatives of Belgium and the United States expressed the view
that Article 11 did not prevent any government from taking such action as
might be reasonable or Justifiable to protect the savings of its nationals,
such action being subject to review by the Organization. However, the
Sub-Committee considered the text of the article to be clear and., therefore,
agreed unanimously that it was not necessary to include any explanation in
the report.
7. With respect to paragraph 1 (b) of Article 11 the Sub-Committee took
the view that "national treatment" would be taken as evidence that the
treatment did not constitute "unreasonable or unjustifiable' action. However,
it was agreed that cases could arise where national treatment could not
properly be considered to be reasonable or justifiable. The Sub-Committee
took the view that in interpreting the words "unreasonable or unjustifiable
impediments" in paragraph 1 (a) and the words "unreasonable or unjustifiable
action within its territories injurious to the rights or interests of nationals
of other Members" in paragraph 1 (b), it would be necessary to consider other
relevant provisions of the Charter, such as Article 12, and these words would
not be taken to prohibit any action permitted by other Charter provisions.
8. With respect of paragraph 2 of Article 11 the Sub-Committee took the
view that agreements promoted or recommended for adoption under paragraph 2
of Article 11 would not fall within paragraph 4 of Article 74.
9. With respect to paragraph 2 (b) of Article 11 the Sub-Committee took
the view that, while it was difficult to be precise at this stage as to the
nature of appropriate measures, more equitable and widely spread use of the
means to economic development could be achieved by joint action by Members.
/It seemed E/CONF. 2/C . 2&6/A/W. 29/Rev .1
Page 3
It seemed desirable, therefore, that it should bo made clear that the
Organization had the necessary authority, with due respect to the functions
and activities of other inter-governmental organizations, to make
recommendations for and promote agreements whether bilateral or multilateral
to provide for such joint action, if study of the circumstances suggested
that such a course were desirable. The Sub-Committee drew attention to the
fact that whether any agreements would in fact be concluded was dependent
upon the willingness of governments to enter into them and that the scope
of such agreements would be dependent upon the discretion of the governments
concerned. The Sub-Committee felt that the proposed paragraph 2 (b) would
enable the Organization to make recommendations and promote agreements to
assist countries encountering difficulties as a result of actual or
prospective shortages. The Sub-Committee considored that:
(a) the promotion of an agreement to facilitate an equitable
distribution of skills, arts, technology, materials and equipment,
was not restricted by the use to which these facilities were put,
i.e. if these facilities were essential to established industries
as well as to economic development, the Organization could recommend
an agreement in appropriate circumstances;
(b) without presuming to judge whether such action would in fact be
desirable, the text approved would permit the Organization, if it
believed that speculation was affecting the equitable distribution of
the facilities referred to in paragraph 1 and it judged that such
action was relevant and appropriate, could recommend and promote
agreements between governments providing for measures against
speculation;
(c) the authority granted to the Organization to make recommendations
and promote agreements designed to facilitate an equitable distribution
of skills, arts, technology, materials and equipment would enlarge
the scope of the co-operation and the assistance which the Organization
could give to Members in accordance with Article 10 and would be of
assistance to countries which were having difficulties in obtaining
the capital goods, equipment and materials which they required.
(d) "industrial patents" were included in the term "technology".
10. With reference to the text recommended to be included in Chapter IX
and set out in Annex E, the Sub-Committee noted that this text would be
/acceptable E/CONF .2/C .2&6/A/W.29/Rev.1
Page 4
acceptable to the Italian delegation in disposing of the new article proposed
by them to be inserted between Articles 69 and 70 (E/CONF.2/C.6/12, page 4)
and the amendment submitted by them to Article 81 (E/CONF.2/C.6/12, page 13).
The Sub-Committee agreed that this text would require the Organization in
cases where the economic circumstances of Members were relevant, to give
consideration to all of the factors affecting those economic circumstances.
Among such factors might be the degree of assistance extended to a Member by
other Members or by existing inter-governmental organizations.
11. It was agreed that the words "within the limits of their power" in
paragraph 1 (a) of Article 11 were clearly expressed by the words in the
French text "dans la mésure ou ils le pouront" and that the Central Drafting
Committee should be asked to consider what were the most appropriate English
words. It was agreed that the English word "enterprise" in paragraph 1 (b)
of Article 11 had the technical meaning used by economists, i.e. the
activities of an entrepreneur. It was agreed that the Central Drafting
Committee should be asked to consider the most appropriate word or words to
express this idea in French.
/ANNEX A E/CONF. 2/C. 2&6/A/W. 29/Rev. 1
Page 5
ANNEX A
AMENDMENTS AND PROPOSALS SUBMITTED TO JOINT SUB-COMMITTEE
IN CONNECTION WITH ARTICLES 9, 10 AND 11
Pages of Revised
Item Article Paragraph Name of Annotated Agenda
No. Country (E/CONF.2/C.2/9)
where not otherwise
stated.
2
2
2
Additional
Additional
1
1
1
1
1
2
2
2
3
Additional
4
Additional
Additional
Ceylon
Mexico
Pakistan
Turkey
Mexico
Mexico
Italy
Chile
Uruguay
Mexico
China
Mexico
Burma
Norway
Chile
Afghanistan
Peru
Mexico
Chile
Chile
Costa Rica
Colombia
2
3
3
3
4
4
5
5
5
5 and 6
6 and 7*
8
8
8
9*
Afghanistan 10
10 and 11*
11
12 and 13*
20 and 21
Costa Rica 21
25, 26, 27 and 28
* Also E/CONF. 2/C. 2/9/Add. 4/Corr.3
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
9
9.
10
10
10
10
10
11
11
11
11
11
11
11
11
11
11
11
New 11A
12
12
New 12A E/CONF.2/C. 2&6/A/W. 29/Rev. 1
Page 6
ANNEX B
TEXT OF ARTICLES 9, 10 AND 11 RECOMMENDED
(Additions to and deletions from the text of the Geneva Draft are
shown by underlining and square brackets respectively)
Article 9
Development of Domestic Resources and Productivity
Members shall within their respective territories take action designed
progressively to develop, and where necessary to reconstruct, industrial and
other economic resources and to raise standards of productivity through
measures [consistent] not inconsistent with the other provisions of this
Charter.
Article 10
Co-operation for Economic Development
1. Members shall co-operate with one another, with the Economic and Social
Council of the United Nations, with the Organization and with other appropriate
inter-governmental organizations in facilitating and promoting industrial and
general economic development. .
2. With a view to facilitating and promoting industrial and general economic
development and consequently higher standards of living, especially of those
countries which are still relatively undeveloped, and subject to any arrangements
entered into between the Organization and the Economic and Social Council
and appropriate inter-governmental organizations, the Organization shall;
within its powers and resources, at the request of any Member:
(a) (1) stud its natural resources and.its potentialities for
industrial and general economic development and assist
in the formulation of plans for such development;
(ii) furnish any Member which so requests7 t with appropriate
advice concerning its plans [and7for economic development
and the financing and carrying out of its programmes for
economic development [
or(b) [.]fi l7 asist it to procure such advice 7 ostudy.
such advic]e or assistance shall be furnished upon These services are to be
provided on terms to be agreed and in such collaboration with appropriate
regional or other inter-governmental organizations as will use fully the
Competence of each of tahem. The Organization shall, upon the sme conditions,
likewise aid members in pro.curing appropriate technical assistance
/3. With a view E/CONF. 2/C.2&6/A/W. 29/Rev. 1
Page 7
3. With a view to facilitating and promoting industrial and general economic
development especially of those countries which are still relatively undeveloped
the Organization shall co-operate fully with the Economic and Social Council
of the United Nations and appropriate inter-governmental Organizations on
all phases of economic development within their special competence and
in particular in respect of finance, equipment, technical assistance and
managerial skills.
Article 11
Means of Promoting Economic Development
1. Progressive industrial and general economic development requires among
other things adequate supplies of capital funds, materials, modern equipment
and technology, and technical and managerial skills. Accordingly, in order
to stimulate and assist in the provision and exchange of these facilities,
(a) Members shall co-operate in accordance with Article 10 in
providing or arranging for the provision of such facilities within
the limits of their power, and [no Member shall] Members shall not
impose unreasonable or unjustifiable impediments that would prevent
other Members from obtaining on equitable terms any such facilities
for their economic development [.] ;*
(b) no Member shall take unreasonable or unjustifiable action within
its territories injurious to the rights or interests of nationals of
other Members in the enterprise, skills, capital, arts or technology
which they have supplied.
/3 2. The Organization may in such collaboration with other
Inter-governmental organizations as may be appropriate
(a) make recommendation for and promote [international] bilateral
or multilateral agreements on measures designed
(i) to assure just and equitable treatment for the enterprise,
skills, capital, arts and technology brought from one Member
country to another;
(ii) to avoid international double taxation in order to stimulate
the flow of foreign private investments;
(iii) to enlarge to the greatest possible extent the benefits to
Members from the fulfilment of the obligations under this
Article.
(b) make recommendations and promote agreements designed to facilitate
an equitable distribution of skills, arts, technology, materials and
* In addition to the changes indicated what was the first part of the second
sentence in the Geneva Draft has become the second part of subparagraph (a)
and what was the second part of the second sentence in the Geneva Draft
has become the first part of sub-paragraph (a).
/equipment E/CONF.2/C.2&6/A/W.29/Rev.1
Page 8
equipment with due regard to the needs of all Members;
(c) [including the elaboration and] formulate and promote the
adoption of a general agreement or statement of principles as to the
conduct, practices and treatment of foreign investment.
[4.] 3. The term "nationals" as used in Articles 11 and 12 comprises natural
and legal persons.
/ANNEX C E/CONF. 2/C .2&6/A/W.29/Rev.1
Page 9
ANNEX C
PROPOSED RESOLUTION TO BE ADOPTED BY THE CONFERENCE
The United Nations Conference on Trade and Employment, having considered
the problem of the industrial and general economic development and
reconstruction of the Members of the International Trade Organization; and
Having noted the related activities of other inter-governmental
organizations and specialized agencies; and
Having determined that positive measures for the promotion of the
economic development and reconstruction of Members are an essential condition
for the realization of the purpose stated in Article 1 of the Charter of the
International Trade Organization and to the accomplishment of the objectives
therein set forth; and
Having regard to the provisions of Articles 10, 69 and 84 of the Charter,
Therefore resolves:
1. That the Interim Commission of the International Trade
Organization* is hereby directed to examine
(i) the powers, responsibilities and activities in the field
of industrial and general economic development and
reconstruction of the United Nations, of the specialized
agencies and of other inter-governmental organizations,
including regional organizations;
(ii) the availability of facilities for technical surveys
or studies of: the natural resources of underdeveloped
countries; or the possibilities of their industrial
development, whether general or in relation to the
processing of locally produced raw materials or other
particular industries; or for the improvement of their
systems of transportation and communications; or with
respect to the manner in which investment of foreign
capital may contribute to their economic development;
and in the light of this examination to report to the Organization
upon
(a) the structure and administrative methods,
(b) the working relations with the United Nations, the
specialized agencies and other inter-governmental
* If no such Commission is formed, a special committee shall be named.
/organizations including E/CONF.2/C.2&6/A/W.29/Rev.1
Page 10
organizations including regional organizations
which will enable the International Trade Organization most
effectively to carry out its positive functions for the promotion
of the economic development and reconstruction of Members.
2. That the report and recommendations of the Interim Commission*
shall be submitted in such a manner and at such a time as will
enable the Conference of the International Trade Organization to
take appropriate action at its first session.
* If no such Commission is formed, a special committee shall be named.
/ANNEX D E/CONF. 2/C.2&6/A/W.29/Rev.1
Page 11
ANNEX D
RECOMMENDED CHANGES IN ARTICLE 69
(Text of Geneva Draft with recommended additions and deletions
indicated, by underlining and square brackets respectively)
Article 69
Functions
The Organization shall perform the functions provided for elsewhere in
this Charter. In addition the Organization shall have the following functions:
(a) to collect, analyse and publish information relating to international
trade, including information relating to commercial policy, business
practices, commodity problems and industrial and general economic
development;
(b) to encourage and facilitate consultation among Members on all
questions relating to the provisions of this Charter;
(c) to undertake studies on, make recommendations for, and promote
international bilateral or multilateral agreements on, measures desired
(i) to assure just and equitable treatment for foreign nationals
and enterprises;
(ii) to expand the volume and to improve the bases of international
trade, including measures designed to facilitate commercial
arbitration and the avo dance of double taxation; [and]
(iii) to carry out on a regional or other basis, having due regard to
the activities of existing regional or other organizations, the
functions specified in paragraph 2 of Article 10;
(iv) to promote and encourage establishments for the technical
training that is necessary for progressive industrial and
general economic development; and
(v) generally to achieve any of the objectives set forth in
Article 1,
(d) generally to consult with and rake recommendations and, as necessary,
furnish advice and assistance to Members regarding any matter relating to
the operation of this Charter, and to take any other action necessary and
proper to carry out the provisions of this Charter;
(e) to co-operate with the United Nations and inter-governmental
organizations in furthering the achievement of the economic and social
objectives of the United Nation and the restoration and maintenance
of international peace and security;
/(f) in such E/CONF.2/C.2&6/A/W.29/Rev.1
Page 12
(f) in such collaboration with the Economic and Social Council of the
United Nations and with other inter-governmental organizations as may be
appropriate to undertake studies on the relationship between world prices
of primary commodities and manufactured products, to consider and, where
appropriate, to recommend international agreement on, measures designed
to reduce progressively any unwarranted disparity in those prices. E/CONF. 2/C. 2&6/A/W. 29/Rev.1
Page 13
ANNEX E
ADDITIONAL TEXT RECOMMENDED TO BE INCLUDED IN CHAPTER IX
In the exercise of its functions the Organization shall have due regard
to the economic circumstances of Members, to the factors affecting those
circumstances and to the consequences of its determinations upon the interests
of the Member or Members concerned. |
GATT Library | pv896pt3442 | Revised draft report of Sub-Committee C of Committee II on Articles 13 and 14 | United Nations Conference on Trade and Employment, March 9, 1948 | Second Committee: Economic Development and Sub-Committee C on Articles 13 and 14 | 09/03/1948 | official documents | E/CONF.2/C.2/C/W.15/Rev.1 and E/CONF.2/C.2/C/W.14-16 | https://exhibits.stanford.edu/gatt/catalog/pv896pt3442 | pv896pt3442_90180333.xml | GATT_147 | 4,255 | 27,920 | United Nations Nations Unies RESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.2/C/
ON DU W. 15/Rev. 1 9 March 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
SECOND COMMITTEE: ECONOMIC DEVELOPMENT
SUB-COMMITTEE C ON ARTICLES 13 AND 14
REVISED DRAFT REPORT OF SUB-COMMITTEE C OF COMMITTEE II ON
ARTICLES 13 AND 14
1. Sub-Committee C was appointed at the sixteenth meeting of Committee II
with terms of reference as follows:
"To examine and submit recommendations to Committee II
concerning the proposals on Articles 13 and 14 with authority
to consult, if considered necessary, with the Sub-Committee
of Committee III on Articles 20 and 22."
2. The Sub-Committee was composed of representatives of:
Argentina Iraq
Australia Mexico
Brazil Netherlands
Canada Norway
China Philippines
Colombia United Kingdom
Cuba United States
India Uruguay
Dr. Gustavo Gutierrez (Cuba) was elected Chairman of the Sub-Committee.
3. A number of representatives of delegations who were not Members of the
Sub-Committee attended as observers and in many cases took part in the
discussion on particular amendments for which they were primarily responsible.
or in which they had a special interest.
4.. The Sub-Committee held fourteen meetings. It examined Articles 13 and
14 and, the amendments submitted thereto as listed in Annex A. After the
Sub-Committee had almost completed its work on Article 13 and the amendments.
submitted thereto, the Article was also examined by the Co-ordinating
Committee. The Sub-Committee took into account the text submitted by the
Co-ordinating Committee (E/CONF. 2/45/Rev. 1) in accordance with the
recommendations of the Heads of Delegations (E/CONF.2/51). As a result the
Sub-Committee decided to recommend texts of Articles 13 and 14 as set out in
Annex B, of which paragraph 2 of Article 13 is based largely on proposals
/made by E/CONF. 2/C. 2/C/W. 15/Rev.1
Page 2
made by the representative of Brazil amended by the representative of Mexico
to cover anti-forestalling measures and paragraph 4 (c) on proposals of the
representative of Brazil in the light of a statement by the representative
of Colombia. It was agreed that this recommendation disposed of all the
amendments listed in Annex A.
5. The Sub-Committee considered the amendment of Cuba to insert the word
"maintenance" and the amendment of New Zealand to insert the word "maintain"
in paragraph 1 of Article 13 and the amendments arising as a consequence
thereof and expressed the view that the amendments were already covered in
the text set out in Annex B. It was agreed that the word "development", as
used in Article 13, might cover cases in which the branch of industry or
agriculture to be developed had been established for some time before the
date of the Member's application to the Organization.
6. The Sub-Committee considered it desirable to record that paragraph 4 (b)
(ii) as originally submitted to the Co-ordinating Committee ended with the
words "reduced as a result of new or increased restrictions imposed by some
other government or governments".
7. With regard to the meaning of the word "processing" appearing in
paragraphs 4 (b) (ii) and 4 (b) (iii) of Article 13 it was agreed that
processing meant the transformation of a primary commodity into semifinished
or finished goods but did not refer to highly developed industrial processes
such as the manufacture of precision instruments.
8. With regard to the reference to international trade at the end of
paragraph 4 (b) (iii) of Article 13 it was agreed that this was a reference
to international trade in general and not to trade in the specific product
to which the measure in question related.
9. With regard to the interpretation of the words "materially affecte"' in
paragraphs 3 and 4 (d) of Article 13 it was agreed that this term was not
restricted to those countries whic hin the past were the principal suppliers
and that it would be proper for the Organization to have regard, for instance,
to the interests of those Members which supplied a large proportion of the
imports of the applicant Member in the product concerned, those Members which
were substantially interested in exporting the product to world markets, and
those Members whose economies were materially dependent on exports of the
product.
10. With regard to paragraph 4 (e) of Article 13 it was agreed that the
phrase "pending a decision by the Organization" referred to the final
decision, which would be taken by the Conference in the event of previous
adverse decision sbeing followed by an appeal to the Conference by the
/applicant Member E/CONF. 2/C. 2/C/W.15/Rev.1
Page 3
applicant Member.
11. With regard to the proviso at the end of paragraph 4 (e) of Article 13
it was agreed that this proviso would permit a Member to prohibit entirely
or reduce the imports of a product. to the extent needed to ensure that, over
the whole period following the date of notification of the Member's
application,* that product was not imported at a rate greater than in the
most recent representative period preceding the date of notification.
12. With regard. to paragraph 4 (f) of Article 13 it was agreed that the
date cited therein by which the applicant Member would be notified whether
or not it would be released from its obligations was the date on which the
Executive Board would give its ruling. It was also noted that paragraph 2 of
Article 73 permitted the Conference to establish rules of procedure
appropriate for the carrying out of its functions during the intervals between
its sessions, e.g. voting by cable or air mail.
13. In connection with Article 14 the attention of the Sub-Committee was
invited to the possibility that in certain special circumstances beyond their
control some signatories to the Final Act of the Second Session of the
Preparatory Committee of the United Nations Conference on Trade and Employment
may find themselves unable for some time to apply the provisions of the
General Agreement on Tariffs and Trade. The Sub-Committee considered that
an application should be made to the Contracting Parties for an amendment to
that Agreement to meet these cases. If the amendment were accepted, it
would then be possible for the Contracting Parties to consider an application
for new dates to be established and to replace those of 1 September 1947 and
10 October 1947 at present specified in paragraph 6 of Article XVIII of the
Agreement. In order to prevent any decision under the provisions of such
an amendment, if it were accepted by the Contracting Parties, from becoming
ineffective on the date of entry into force of the Charter the Sub-Committee
agreed to insert the proviso appearing at the end of paragraph 1 (a) of
Article 14. The representative of Brazil reserved his position pending a
decision by the Contracting Parties with regard to such an amendment to the
agreement.
14. The Sub-Committee agreed that the provisions of paragraph 2 of Article 14
as set out in Annex B were intended to qualify the statement in paragraph 1
that certain measures might be maintained and in an earlier draft considered
by it had been contained in a proviso to paragraph 1. It was agreed that
* Proposal of representative of Australia is to substitute the words
"increase in the imports" for "date of notification of the Member's
application".
/the Central E/CONF. 2/ . 2/C/W.15/Rev. 1
Page 4
the Central Drafting Committee should be asked to consider whether the
conversion of the proviso to paragraph 1 into a separate paragraph would have
the effect of obseuring the quality and, if so, to make any consequential
changes necessary in paragraph 1, such as, for example, the addition of the
words "Until the organization gives a decision under paragraph 2 of this
Article" at the beginning of the paragraph before the words "any Member may
maintain''. . .'
15. The representative of Argentina reserved the position of his country
with respect to ArtIles 13 and 14.
/ANNEX A E/ CONF.2/C.2/C/W.15/Rev.1
Page 5
ANNEX A
AMIj=238O SUBMITTED TO ARTICLES 13 AND 14 Item no.
Paragraph(s) Name of Country
Symbol of
Document
Originally
Submitted (a)
Pages of Revised
Annotated Agenda
(E/CONF. 2/C. 2/9
ARTICLE 13
1.Whole Article Argentina
2.Whole Article Burma
3. Article Turkey
Article ceylon
Turkey
Colon
Ecuador
Article China
Article India
Article Mexico
Article Uruguay
United Kingdom
Cuba
Philippines
New Zealand
Cuba
Philippines
Chile
United Kingdom
Colombia
Cuba
Philippines
Naw Zealand
Iraq
Chile
11/Add. 3
I/Add.23
11/Add .26
11/Add. 33
C. 2/6/Add. 6
C.2/9/Add-
C. 2/6/Add. 8
C.2/6/Add.11
C. 2/6/Add.14
C. 2/6/Add. 23
11/Add.8
C. 2/6/Add. 10
C.2/6/Add. 12
C.2/6/Add. 22
C. 2/6/Add. 10
C. 2/6/Add.12
C.2/9/Add.1
11/Add.8
C.2/6/Add.3
C.2/6/Add. 10
C. 2/6/Add. 12
C.2/6/Add. 22
C. 2/6/Add. 20
C.2/9/Add.1
& Add.1/Corr.1
39,40,41&42
48 to 54
inclusive
29 (b)
43,44&45 '
29 (b)
35&36
45, 46&47
37,38&39
(c)
29
32
34
34
33
30&34
(d)
31
30
31&33
31&34
34
32
(e)
(a.) Initial symbol E/CONF. 2 omitted
(b) See also E/CONF.2/C.2/9/Add.4/Corr.3
(c) See E/CONF.2/C.2/6/Add.23
(d) See E/CONF.2/C.2/9/Add.1
(e) 1See E/CONF.2/C.2/9/Add. and E/CONF.2/C.2/9/Add.1/Corr. 1
(f) See E/CONF,/C.2/9/Corr.5
/ARTICLE 14
Item No.
1.
2.
4.
5.
6.
8.
9.
10.
11.
12
13.
4,
15.
1.
17.
18.
19.
20.
2]
22.
23.
Whole Artic
Whole Artic
Whole Arti(
ehole r
Whollee Artic
Whollee Artic
Whollee Artic
1
1
I
2
2
2
3
4
4
4
4
4
Additional
Additional E/CONF . 2/C. 2/C/W.15/Rev .1
Page 6
Item No. Paragraph(s) Name of Country Symbol of Pages of Revised
Document Annotated Agenda
Originally (E/CONF. 2/C . 2/9)
Submitted (a)
ARTICLE 14
1 1
2.
3. 1
4. 1
5. 1
6. 1
7. 1
8. 2
9. 2
10. Two additional
11. Additional
Argentina
United Kingdom
Costa Rica
Turkey
Italy
Ecuador
Uruguay
Argentina
Uruguay
Philippines
Turkey
11/Add . 3
11/Add. 8
11/Add. 16
11/Add. 26
C.2/6/Add. 1
C.2/6/Add. 6
C. 2/6/Add. 23
11/Add. 3
C. 2/6/Add. 23
C. 2/6/Add. 12
11/Add. 26
(a) Initial Symbol E/CONF.2/ omitted
(b) See also E /CONF.2/c.2/9/Add.4/Corr.3
(c) See E/CONF. 2/C. 2/6/Add. 23
(d) See E/CONF. 2/C.2/9/Add. 1
(e) See E/CONF. 2/C .2/9/Add. 1 and E/CONF. 2/C . 2/9/Add. 1/Corr. 1
(f) See E/CONF.2/C.2/9/Corr.5
/ANNEX B
56,57,58&59
56
57&59
59
58
57
(c)
(f)
(c)
55&56
63 (b) E/CONF. 2/C 2/C/W.15/Rev.1
Page 7
ANNEX B
Article 13
Governmental Assistance to
Economic Development
1. The Members recognize that special governmental assistance may
be required to promote the establishment, development or reconstruction
of particular industries, or particular branches of agriculture, and
that in appropriate circumstances the grant of such assistance in the
form of protective measures is justified. At the same time they
recognize that an unwise use of such measures would impose undue
burdens on their own economies, unwarranted restrictions on
international trade and might increase unnecessarily the difficulties
of adjustment for the economies of other countries.
2. (a) If a member in the interest of its economic development
or reconstruction or for the purpose of increasing a most
favoured nation rate of duty in connection with the establishment
of a new preferential agreement in accordance with Article 15
consiers it desirable to adopt any non-discriminatory measure
affecting imports which would apply to any product in respect
of which the Member has assumed an obligation through
negotiations with any other Member or Members pursuant to
Chapter IV, but which would not conflict with the provisions
of that Chapter, such Member
(i) shall enter into direct negotiations with all
the other Members which have contractual rights
with a view to obtaining agreement. The Members
shall be free to proceed in accordance with the
terms of any such agreement, provided that the
Organization is informed of the results of the
negotiations; or
(ii) shall initially or may in the event of failure
to reach agreement under sub-paragraph (i)
above apply to the Organization. The Organization
shall determine, from among Members which have
contractual rights, the Member or Members materially
affected by the proposed measure and shall sponsor
/negotiations E/CONF. 2,/C .2/C/W.15/Rev.1
Page 8
negotiations between the applicant Member and these Members
with a view to obtaining expeditious and substantial agreement.
The Organization shall establish and communicate to the
Members concerned a time schedule for such negotiations,
following as far as practicable any time schedule which may
have been proposed by the applicant Member. The Members shall
commence and proceed continuously with such negotiations in
accordance with the time schedule laid down by the
Organization. At the request of a Member the Organization
may, where it concurs in principle with the proposed measure,
assist in the negotiations. Upon substantial agreement being
reached, the applicant Member may be released by the
Organization from the obligation referred to in this
paragraph, subject to such limitations as may have been agreed
upon in the negotiations between the Members concerned.
(b) If as a result of action initiated under this paragraph, there
should be an increase in the importations of the product or products
concerned, including products which can be directly substituted therefor,
which if continued would be so great as to jeopardize substantially
the establishment, development or reconstruction of the industry,
industrial or branches of agriculture concerned, and if no preventive
measures consistent with this Charter can be found which seem likely
to prove effective, the applicant Member may, after informing, and when
practicile consulting with the Organization, adopt such other measures
as the Aituation may require; Provided that such measures do not restrict-
imports more than necessary to offset the increase in imports referred
in this sub-paragraph. Except in unusual circumstances, such measures
shall not reduce imports below the level obtaining in the most recent
representative period preceding the date on which the Member initiated
action under sub-paragraph (a) of this paragraph. The Organization
shall determine, as soon as practicable, whether such measures should
be continued, discontinued or modified. Such measures shall in any case
be terminated as soon as the Organization determines that the
negotiations are completed or discontinued. It is recognized that the
contractual relationships referred to in sub-paragraph (a) of this
paragraph involve reciprocal advantages, and therefore any other Member
which has a contractual right in respect of the product to which such
action relates, and whose trade is materially affected by the action,
/may suspend E/CONF .2/C.2/C/W.15/Rev.1
Page 9
may suspend the application to the trade of the applicant Member
of such substantially equivalent obligations or concosions under
Chapter IV, the suspensions of which the Organization does not
disappovol Any Member intonding to suspend such application
shall consult the Organization before doing so.
3. In the case of any non-discriminatory measure affecting imports
which would conflict with the provisions of Chapter IV, and which would
apply to any product in respect of which the Member has assumed an
obligation through negotiations with any other Member or Members
pursuant to Chapter IV, the provisions of paragraph 2 (a) (ii) shall
apply; Provided that before granting a release the Organization
shall afford adequate opportunity for all Members which it determines
to be materially affected to express their views. The provisions of
paragraph 2 (b) shall also be applicable in this case.
4. (a) If a Member in the interest of its economic development or
reconstruction considers it desirable to adopt any non-discriminatory
measure affecting imports which would conflict with any provision of
Chapter IV, but which would not apply to any product in respect of
which the Member has assumed an obligation through negotiations with
any other Member or Members pursuant to Chapter IV, such applicant
Member shall so notify the Organization and shall transmit to the
Organization a written statement of the considerations in support of
the adoption, for a specified period, of the proposed measure.
(b) After application by a Member the Organization shall concur in
the proposed measure and grant release from such provision for a
specified period if, having particular regard to the applicant Member's
need for economic development or reconstruction, it is established that
the measure
(i) is designed to protect a branch of industry, established
between 1 January 1939 and the date of sigature of the
Final Act of the United Nations Conference on Trade and
Employment, which was protected during that period of its
development by abnormal conditions arising out of the war; or
(ii) is desligned to promote the establishment or development of a
branch of industry for the processing of an indigenous
primary commodity, when the external sales of such commodity
have been materially reduced as a result of new or increased
/restrictions E/CONF.2/C.2/C/W.15/Rev.1
Page 10
restrictions imposed abroad; or
(iii) is necessary in view of the possibilities and resources of
the applicant Member to promote the establishment or
development of a branch of industry for the processing of an
Indigenous primary commodity, or for the processing of a
by-product of such a branch of industry which would otherwise
be wasted, in order to achieve a fuller and more economic
utilization of the applicant Member's natural resources and
manpower and, in the long run, to raise the standard of Iiving
within the territory of the applicant Member and is unlikely to
have a harmful effect in the long run, on international trade; or
(iv) is unlikely to be more restrictive of international trade than
any other practicable and reasonable measure permitted under
this Charter which could be imposed. without undue difficulty
and is the one most suitable for the purpose having regard
to the economics of the branch of industry or agriculture
concerned and to the applicant Member's need for economic
development or reconstruction;
Provided that
I. any proposal by the applicant Member to apply any such measure,
with or without modification after the end of the initial
priod, shall not be subject to the provisions of this sub-
paragraph; and'
II. the Organiztaino shall not concur in any measure under the
provisions fo usb-paragrap hb( i), b (ii) or b (iii) above
whics si likely t ocause serious prejudice to exports of a
primayr omcmoidtyo nw ihc hht ecneomy of another Memebr is
argely dapendent.d
(c) The applicant Member shall apply all measures under rsubr-paagraph (b)
a bove 'uch aas was eto avoid.unnecessary damage to the commercial or
economic interests any other Member including interests under
Arti asd 9.cle n -
(d)I edemeas perdoopos M.e sopot fall within the provisions of sub-
paragraph (b), the Member -
( M m ntr in oidirecoor nsuletsations with the Memberr P'Mebs
which, il-e :n, will oobe materially affected 'y the
asure,e,ith a view .to obtaining aigreement, At the sameitm,
the Membr: shall inftoerm the Organization o ho consultations
relative thereto in order to afford the Organization an
/opportunity to E/CONF. 2 /C .2/C /W. 15 /Rev.1
Page 11
opportunity to determine whether all materially affected Members
are included within such consultations. Upon complete or
substantial agreement being reached, the Member interested, in
taking the measure shall apply to the Organization for release.
The Organization shall promptly examine the application to
ascertain whether the interests of all the materially affected
Members were duly taken into account. If the Organization
reaches this conclusion, with or without further consultations
between the Members concerned, lt shall release the applicant
Member from its obligations under the relevant provision of
Chapter IV, subject to such limitations as it may impose; or
(ii) may initially or in the event of failure to reach complete or
substantial agreement under sub-paragraph (i) above apply to the
Organization. The Organization shall-promptly transmit the
statement submitted under sub-paragraph (a) above by the
applicant Member to the Member or Members which are determined by
the Organization to be Materially affected by the proposed
measure. Such Member or Members shall, within the time limits
prescribed by the Organization, inform the Organization whether,
in the light of the anticipated effects of the proposed measure
on the economy of such Member or Members, tere -is any objetion
to the prop.sed measure,The Organization shall,
I. if there be no objection to the proposed measure on the part
of the affected Member or Members, immediately release the
applicant Member from its obligations under the relevant
provisions of Chapter IV; or
II. if there be any objection, promptly examine the preposed
measure, having regaed to the prqvisions of the Charter, to
the considerations presented by the applicant Member and its
need for economic development or reconstruction, to the view
of the Member or Member t determinedto be materially,
ffected, and to the effectp which mthe-roposed"asure, with
or wihout modifis cations, iaikely to have, aimediately-d.
in the long run, on international trade and in the long run,
on the standard of living within the territory of the
appli.cant Member If, as a result of such examination, the
Organization concurs in the proposed measure, with or
without modification, it shall release the applicant Member
from its obligations under the relevant provision of
Chapter IV subject to such limitations as it may impose.
/(e) If in E/CONF. 2/C .2/C/W. 15/.Rev. 1
Page 12
(e) If in anticipation of the concurrence of the Organization in the
adoption of a measure, referred to in this paragraph there should be an
increase or threatened increase in the importations of the product or
products concerned, including products which can be directly substituted
therefor, so substantial as to jeopardize the establishment, development
or reconstruction of the industry, industries or branches of agriculture
concerned, and if no preventive measures consistent with this Charter can
be found which seem likely to prove effective, the applicant Member may,
after informing, and when practicable consulting with, the Organization,
adopt such other measures as the situation may require pending a decision
by the Organization on the Member's application; Provided that such
measures do not reduce imports below the level obtaining in the most
recent representative period preceding the date on which the Member's
original notification was made.
(f) In the case of measures referred to in this paragraph, the
Organization shall, at the earliest opportunity but ordinarily within
fifteen days after receipt of an application under the provisions of
sub-paragraph (b) or (d) (i) or (d) (ii) above advise the applicant Member
of the date by which it will be notified whether or not it is released
from such obligation or obligations as may be relevant. This date shall
be the earliest practicable but shall not be more than ninety days
subsequent to the receipt of such statement or application; Provided that,
if before the date set, unforeseen difficulties arise, the period may be
extended after consultation with the applicant Member. If the applicant
Member does not receive such decision by the date set, it may after
informing the Organization, institute the proposed measure.
5. The Organization and the Members concerned shall preserve the utmost
secrecy in respect of matters arising under this Article.
Interpretative Note
Paragraph )(4 ( (ii) and 4 ((b) iii)
The woprd "rocessing" as used in thesse ub-paragraphs means the
transformation of a primcary dommoity into semi-finished or finished goods
but does not refer to highly developed industrial processes.
Article 14
Transitional Measures
1, Any Member may maintain any non-discriminatory protective measure affecting
imports which has been imposed far the establishm,ent development or
/reconstruction of E/CONF. 2/C .2/C/W.15/Rev.1
Page 13
reconstruction of particular industries, or particular branches of agriculture,
and which is not otherwise permitted by this Charter; Provided that
notification was given of such measure and of each product to which it relates:
(a) in the case of a Member signatory to the Final Act of the Second
Session of the Preparatory Committee of the United Nations Conference on
Trade and Employment, in respect of measures in force on 1 September 1947
to the signatories of that Act not later than 10 October 1947, subject to
the provisions of paragraph 6 of Article XVII of the General Agreement
on Tariffs and Trade; Provided that, if in special circumstances the
Contracting Parties to that Agreement agree to dates other than those
specified in this sub-paragraph, such other dates shall apply;
(b) in the case of any other Member, in respect of measures in force on
the date of deposit of its instrument of acceptance of the Charter or on
the date of entry into force of the Charter, whichever is the earlier,
in the former case to the signatories of the Final Act of he
United Nations Conference on Trade and Employment and in the latter case
to the Organization;
2. Any Member other than a Contracting Party to the General
Agreement on Tariffs and Trade maintaining any such measure shall within one
month of assuming Membership in the Organization notify it of the
considerations in support of the maintenance of the measure and the period for
which it wishes to maintain it, and the Organization shall, as soon as possible,
but in any case within twelve months of such Member assuming Membership in the
Organization, examine and give a decision concerning the measure as if it had
been submitted to the Organization for its concurrence under Article 13.
3. Any measure approved in accordance with the provisions of Article XVIII
of the General Agreement on Tariffs and Trade in effect at the time the Charter
enters into force may remain in effect thereafter, subject to the possibility
of review by the Organization.
4. This Article shall not be construed to apply to any measure relating to a
Product in respect of which the Memberhas assumed an obligation through
negotiations.
5. The Organization, in making a decision under this Article specifying a
date by which any modification in or withdrawal of the measure is to be made,
shall have regard to the possible need of a Member or a suitable period of
time in which to make such modification or withdrawal. |
GATT Library | tq392nm8620 | Revised Draft Report of Sub-Committee G to Committee III | United Nations Conference on Trade and Employment, February 26, 1948 | Third Committee: Commercial Policy and Sub-Committee G (Swiss Proposal) | 26/02/1948 | official documents | E/CONF.2/C.3/G/W.11 and E/CONF.2/C.3/F/W.31/REV.2-32/G/W.1-13/H/W.1-9 | https://exhibits.stanford.edu/gatt/catalog/tq392nm8620 | tq392nm8620_90190614.xml | GATT_147 | 1,230 | 8,138 | United Nations
CONFERENCE
ON
TRADE AND EMPLOYMENT
Nations Unies
CONFERENCE
DU
COMERCE ET DE L'EMPLOI
RESTRICTED
E/CONF. 2/C .3/G/W. 11
26 February 1948
ORIGINAL:ENGLISH
COMMETRCIAL POLICY
SUB-COMMITTEE G (SWiSS PROPOSAL)
REVISED DRAFT REPORT OF SUB-COMMITTEE G TO COMMITTEE III
Chairman: Mr.L.P. THOMPSON-McCAUSLAND (United Kingdom)
1. Sub-Committee G was appointed by Committee III on 5 January 1948 with
the following terms of reference:
To consider the proposal of the Swiss delegation (reference
E/CONF.2/C.3/11) that the following new paragraph be inserted in
Chapter IV:
"A Member, unable to invoke the provisions of Article 21
and finding that its economic stability, particularly in the
fields of agriculture and employment, is being seriously
impaired or gravely threatened, may take such steps as are
necessary for safeguarding its vital interests."
2. The following delegations were appointed to the Sub-Committee:
Belgium, Chira, France, Polend, Sveden, Switzerland, the United Kingdom,
the United States of America, Uruguay and Venezuela. The Sub-Committee held
[ten] meetings.
3. Proceeding from the draft amendment contained in its terms of reference,
the Sub-Committee based its enquiries on the assumption that the Member
concerned was not eligible to impose quantitative restrictions under
Article 21 but was liable to suffer damage from restrictions imposed by other
Members under that Article.
4. A variety of factors was put before the Sub-Committee as justifying
special measures. Several were regarded by the Sub-Committee as irrelevant,
others as doubtful, and no single factor was judged to be sufficient by
itself to justify special treatment. The Sub-Coimittee, however, agreed that
the following factors advanced by the delegate for Switzerland represented,
when taken together, a combination of circumstances requiring special
consideration:
(a) that a relatively high proportion of the country's total
production depended upon export markets;
(b) that a relatively high proportion of these exports consisted of
goods and services considered as inessential by many importing countries
and treated by them accordingly;
/(c) that the
THIRD COMMITTEE: E/CONF.2/C. 3/G/W. 11
Page 2
(c) that the country's normal export markets were in countries
Which were applying restrictions in accordance with the principles
of the Charter.
5. The Sub-Committee therefore recognized that a small country, in which
a relatively high proportion of workers depend for their employment on the
manufacture of inessential goods for export, may be liable to serious
unemployment when the countries to which it normally exports such goods
can, under the Charter, greatly restrict, or stop completely, their
imports of them. This risk is increased when the exporting country has
a convertible currency, since countries in balance of payments difficulties
would be anxious both to reduce their imports from it to save "hard
currency" and to increase their exports to it to earn "hard currency".
The country would, in fact, be an attractive export market for all other
countries, and, while in normal conditions economic forces would operate
to limit the impact of excessive imports, there is in present conditions
a threat of imports flooding in at a rate which would endanger domestic
production and employment. These pressures, in combination, might in the
long run undermine the convertibility of the currency. The Sub-Committee
agreed that it would not be in the interests of the members to expose
such country to such pressures.
6. The Sub-Committee considered whether the existing provisions of the
Charter would give the necessary safeguards to a country in the situation
described above and came to the conclusion that with respect to both
exports and imports a certain protection exists in Articles 21 and 40. It
was, however, recognized that these provisions are insufficient to meet
the exceptional needs of Switzerland. It was accordingly agreed that if
such a country has to engage in bilateral negotiations with other countries
which are themselves applying restrictions to their imports, it will need
bargaining powers to safeguard its export interests by the threat and, if
necessary, the imposition of quantitative restrictions. It may also need
powers to defend itself against the pressure of excessive imports.
7. The amendment presented by the Swiss delegation would safeguard the
country's freedom of action. The majority of the Sub-Committee, however,
held that this proposal was so far-reaching that its adoption by the
Conference would dangerously weaken the structure of the whole Charter.
The Sub-Committee was therefore unable to recommend the amendment as a
solution of the problem (4 delegates being against the amendment, 3 for it,
2 abstaining an 1 absent). - . -
8. In an effor t to enableSwitzerland to adhere.o the Charter the Sub-
Comittee exaned other, slutions, but regrets that it has been unable
ofindewhich.coud ccommodate Switzerland without excessive
/weakening of
.. . .- , .; E/CONF . 2 /C . 3/G/W. 11
Page 3
weakening of the Charter. The Sub Committee, therefore, has aimed
at keeping open a way by which Switzerland might later enter into
negotiations with the Organization regarding its adherence to the
Charter. Before specific proposals to this and could be submitted,
further and more detailed examination of the problem is called for.
9. The Sub-Committee recommends, therefore, that the Conference
should direct the Interim Commission to invite the Swiss Government
to participate in a study of the problems facing the Swiss economy
with a view to submitting to the first Conference of the Organization
a report as to the measures which could be taken in accordance with
the procedures established in the Charter for dealing with the
problem.
10. The Sub-Committee also examined the cases of Venezuela and
Uruguay which were presented to it and finds that neither of these
countries has established any special problems connected with
transition from their present systems of trading to that contemplated
by the Charter.
It was the view of the Sub-Committee that the present text
of Article 21 made adequate provision for many of the considerations
put forward by the delegates of Venezuela and Uruguay. Thus, it was
Pointed out that paragraph 3 (a) (2 (a) of the Geneva text) requires
that "due regard" be paid in the monetary reserve questions there
involved "to any special factors which may be affecting the Meamber's...
need for reserves..." It was pointed out that a country exporting
principally one product would, in like conditions, probably be
considered to have need for greater reserves than a country exporting
a variety of products, particularly if the single expert was
exhaustible or subject to considerable fluctuations of supply or price.
A country actively embarked on a program of economic development
which is raising levels of production and foreign trade would probably
then be considered to have need for greater reserves than when its
economic activity was at a lower level.
11. Beyond this the issues raised involve matters now under active
consideration in connection with Articles 13 and 14. The considerations
put forward by Venezuela and Uruguay in this connection are not
dissimilar from those being urged by a considerable number of other
"underdeveloped" countries in connection with the economic development
chapter of the Charter. This Sub-Committee felt it should not pursue
this matter any further since to do so would be to duplicate the work
of Committee II and its Sub-Committees.
/12. The delegate E/CONF.2/C.3/G/W.11
Page 4
12. The delegate of Venezuela has advised the Sub-Committee that they
are satisfied with the foregoing statements by this Sub-Committee,
13. The delegate of the United States, while agreeing with the final
Conclusion, stated that he is not in agreement with certain aspects
of this report. |
GATT Library | wb357sq7363 | Revised Draft Report of Sub-Committee G to Committee III Observations by the Delegation of the United States | United Nations Conference on Trade and Employment, February 27, 1948 | Third Committee: Commercial Policy and Sub-Committee G (Swiss Proposal) | 27/02/1948 | official documents | E/CONF.2/C.3/G/W.12 and E/CONF.2/C.3/F/W.31/REV.2-32/G/W.1-13/H/W.1-9 | https://exhibits.stanford.edu/gatt/catalog/wb357sq7363 | wb357sq7363_90190615.xml | GATT_147 | 562 | 3,707 | United Nations Nations Unies
CONFERENCE CONFERENCE RESTRICTED
ON DU E/CONF.2/C.3/G/W.12
TRADE AND EMPLOYMENT COMMRCE ET DE L'EMPLOI 27 Febarury 1948
ORIGINAL: ENGLISH
THIRD COMMITTEE: COMMERCIAI POLICY
SUB-COMMITTEE G (SWISS PROPOSAL)
REVISED DRAFT REPORT OF SUB-COMMITTEE G TO COMMITTEE III
OBSERVATIONS BY THE DELEGATION OF THE UNITED STATES
1. The revised draft report circulated as E/CONF.2/C.3/G/W.11 was
prepared in a Working Party for submission to Sub-Committee G. This
report containsthe following paragraph:
"13. The delegate of the United States, while agreeing with
the final conclusion, stated that he is not in agreement
with certain aspects of this report."
2. The delegation of the United States here sets forth its objections
to certain aspects of the revised draft report.
3. The delegation of the United States is in agreement that various
factors in the Swiss economy constitute a combination of circumstances
requiring special consideration (paragraph 4 of the revised draft report).
It also agrees that the proposal put forward by the delegation of
Switzerland to meet this problem "would dangerously weaken the structure
of the whole Charter" (paragraph 7 of the revised draft report). It
further agrees that the Sub-Committee has been unable to devise a solution
which would accommodate Switzerland without excessive weakening of the
Charter (paragraph 8 of the revised draft report). It also agrees with
the final conclusion of the Working Party that the Interim Comnission
should invite the Swiss government to participate in a study of the
problem facing the Swiss economy with a view to devising a solution
(paragraph 9 of the revised draft reports.
4. However, the delegation of the United States cannot accept some of
the statements contained in paragraphs 5 and 6 of the revised draft report.
In our view these paragraphs go so far in accepting the arguments and
proposed solutions put forward here by the delegation of Switzerland. as in
effect to limit the freedom of the Interim Commission in exploring this
question. Thus, to say that "there is in present conditions a threat of
/imports E/CONF. 2/C.3/G/W.12
Page 2
imports flooding in at a rate which would endanger domestic production and
employment" and to say that "it was. . . recognized that these provisions
(Articles 21 and 40) are insufficient to meet the exceptional needs of
Switzerland" and to say that "it was accordingly agreed that if such a
country has to engage in bilateral negotiations with other countries which
are themselves applying restrictions to their imports, It will need
bargaining powers to safeguard its export interests by the threat and, if
necessary, the imposition of quantitative restrictions" is to concede most
of the arguments put forward by Switzerland and the basic solution proposed
by Switzerland and thus efftectively, to limit the scope of the inquiry of
the Interim Commission.
5. The delegation of the United. States is prepared to agree that
Switzerland would face certain special problems as a Member of the ITO
and is prepared. to give its full co-operation in seeking a reconciliation
of the Swiss problems with the general structure of the Charter. But it
is not prepared to enter upon such an inquiry under an advance commitment
which would. male it extremely difficult to come to any other conclusion
than that here sought by the delegation of Switzerland.
6. The delegation of the United States proposes therefore that
paragraphs 5 and 6 be deleted from the draft report. |
GATT Library | vq197dc8282 | Revised Draft Report to the Conference | United Nations Conference on Trade and Employment, March 2, 1948 | First Committee: Employment and Economic Activity | 02/03/1948 | official documents | E/CONF.2/C.1/23/Rev.1 and E/CONF.2/C.1/1-26 | https://exhibits.stanford.edu/gatt/catalog/vq197dc8282 | vq197dc8282_90180262.xml | GATT_147 | 2,118 | 15,011 | United Nations Nations Unies
CONFERENCE . E/CONF.2/C.1/23/
CONFERENCE CONFERENCE Rev.I
ON DU 2 March 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMLOI ORIGINAL: ENGLISH
FIRST COMMITTEE: EMPLOYMENT AND ECONOMIC ACTIVITY
REVISED DRAFT REPORT TO THE CONFERENCE.
1. The First Committee was responsible for the examination of the.Geneva
draft text of Chapter II on "'Employment and Economic Activity", together with
proposals submitted by delegations relating to the subject matter of the,
Chapter.
2. Mr. J. J. DEDMAN (Australia) was elected Chairman. Mr. E. WAERUM
(Denmark) was elected Vice-Chairman.
3. The Committee held thirteen meetings and succeeded in resolving all1
issues before it (E/CONF.2/C.l/SR.1/13). Mr. DEDMAN presided. at.the first
ten meetings and Mr. WAERUM at the last three meetings.
4. To facilitate its work the Committee established three sub-committees.
5. The First Sub-Committee was appointed to consider proposals relating to
the article on "Fair Labour Standards" and consisted of the representatives
of Argentina, Ceylon, China, Colombia, Cuba, Czechoslovakia, Denmark, Mexico,
thae Netherlands, New Zealand, Turkey, Union of South Africa, United Statees
of America and Uruguay. Dr. D. K. LIEU (China) was chairman of this sub-
committee. The Sub-Committee's report is contained in E/CONF.2/C.l/9.
6. The Second Sub-Committee was appointed to examine proposals relating.
to the other articles of the Chapter and consisted of the representatives of
Australia, Canada, France, India, Italy, Lebanon, Norway, Peru, Philippines,
United Kingdom and the United States of America. M. Jean BYER (France)
served as chairman of the sub-committee. The report of the Sub-Committe is
contained in E/CONF.2/C.l/10.
7 The Third Sub-Committee was set up to consider the draft resolution on-
employment which had been prepared by the First Session of the Preparatory
Committee, together with any new proposals which might be submitted. relating
to this subject. This Sub-Committee consisted of the representatives of
Australia, Belgium, Brazil, France, Italy, Lebanon, Mexico, Pakistan, Poland,
El Salvador, Sweden, the United Kingdom and the United States of America.
NOTE: The change agreed to by the Central Drafting Committee in respect of
the French text of Article 7 appears in the French edition of the
present document.
/.Mr. J. E G. PIERSON E/CONF. 2/C.1/23/Rev.1
Page 2,
Mr. J. H. G.. IERPSON (United States) served as Chairman. The report of this
Sub-Committee is given in E/CONF. 2/C. 11/7.
8. In the preparation of the text of the Chapter assigned to it, the First
Committee has taken account of the suggestions put forward by the Central
Drafting Committee in documents E/CONF.2/C.8/1/Rev.1and E/CON .2/C.8/7.
9. A summray list of the documents containing the proposals which were
considered by the Committee in preparing the text of the Chapter is set
forth in an attachment to this roport as Annex 1. The reportso f the Sub-
Committees which examined these proposals were accepted. Certain-questions
which the Sub-Committees were not able to resolve have now been reslved as
indicated in Annex 2. The text of Chapter II, as recommended unainmoulsy
by the First Committee for approval by the Conference, is attached to the
present. report. as Annex 3.
10. The First Committee has already transmitted to the Conference, and
Plenary Session of the Conference has already acted upon, the text of
resolution to the Economic and Social Council relating to employmen ( see
E/CONF.2/27 and E/CONF. 2/SR.13).
/ANNEX 1 E/CONF. 2/C.1/23/Rev. 1
Page 3
ANNEX 1
IDENTIFYING DOCUMENT - NUMBERS OF PROPOLSALS SUBMITTED RELATING
TO CHAPTER II EMPLOYMENT AND ECONOMIC ACTIVITY
Article 2
E/CONF.2/11/Add.4
E/CONF . 2/11/Add. 18.
E/CONF. 2/11/Add 28
Article 3
E/CONF.2/11/Add. 18
E/CONF.2/11/Add. 28
E/CONF. 2/C .1/3/Add, 7
Article 4 (Formerly Article 5)
E/C0NF.2/11/Add, 32 and
EC/ONF. 2/C .1/7/Coor.1
E/CONF. 2/C .1/3/Add. 6
Article 5 (Formerly Article 6)
E/CONF/. 2/11/Add.3 1
E/CONF. 2/C. 1/13
Article 6 (Formerly Article 7)
E//CONF. 2/C. 1/7/Add. 2
E/CONF.C 2/C 1/21
Article 7 (Formerly Article 4)
E/CONF. 2/11/Add. 3
E/CONF. 2/11/Add. 4
E/CONF.11 2//Add. 23
E/CONF. 2/11/Add. 28
E/CONF. 2/11/Add. 31
E/CONF. 2/11/Add. 33
E/CONF 2/1C ./3/Add.1
E/CONF.C 2/.1/3/Add. 2
E/CONF.2/C. 1/3/Add.3
E/CONF. 2/C.1/3/Add. 4
E/CONF. 2/C .1/3/Add. 5
E/CONF.2/C/1/7/Add.l
E/CONF. 2/C.1/15/Add. 1
(Peru)
(Italy)
(Mexico)
(Italy)
(Mexico)
(Philipepins)
(Norway)
(Peru)
(Denmark)
(Mexico)
(Italy)
(Norway)
(Norway)
(Argentina)
(Peru)
(Burma)
(Mexico)
(Mexico)
(Ceylon)
(Haiti)
(Uruguay)
(Union .of South Africa)
(Philippines)
(Colombia) ;
(Consequential Amendment by the
united States of Ameria).
(International Labour .Organization)
(Belgium)
/ANNEX 2 E/CONF. 2/C.1/23/Rev.1
Page 4
ANNEX 2
DISPOSITION OF PROPOSALS REMAINING AFTER THE SUBMISSION-
OF THE SUB-COMMITTEE REPORTS
The following statement indicates, with reference to each the
action taken on proposals which had not been satisfied y theb sum-Comittee
texts or which arose after the submission of the Sub-Committee reports,
Article 2
All proposals were dealt with imn the Sub-Comittee' sreport.
Article 3
The proposal of the delegation of Norway concerning fltucuatoins In;
demand and prices (E/CON/F.1/Add.7 and E/CFON.2/.1/2)dwhichja dnot
been covered in theudsb-Cotmmiete's report, was dealt. wiht. ni ao md dfed..
form through the amendment of new Article 6 at the eleventh. meetin goff th
Committee (E/C ON ./sC.1RS..11) T hequestion raised-by this propoas:
alsom entioned ni the preamble of the resolution on employment (E/2CON/.2//27
and E/CfONF.2/SR.13) .
The proposal by the delegation of Italy concerning the inter
mobility of labour (E/COI/1/Add.NF18 and E/COF.,C.l/N3) 2was, with
in a modified form by introducing present paragraph 1 (b) in new:jtl,4
(E/C/c.1S.9) and by SectioONFon C3 /of the Resolution on .Eoyme'
(E/CONF/27).
The proposal by the delegation of Mexico concerning migratr7iXir'
(E/CO.2/11/Add,2) was dealt witNFh in a mod.ified form in Section
Resolution on Emplo an/CONF. 2/27).
Article (Formerly Article 5)
The proposal of the delegation of Peru regarding the diposal
surpluses during period of widespread balance-of-payments dfiouies`-
(E/Ci-l/orl) was witrawn at the ninth meeting iONFn .2vicC.1/ewC of the
fact that the Sub-Committee had not been prepared to recommeie nlusion
of a provision on this subject in Chapter II (E/CONF.2/C.1/SI)-
Article 5 (Formerly Article 6) .
As ndicated above in connection with Article 3, sub-paragraiph (b
added to paragraph - of this Article as a result oQ heWwa prpppaly
the delegation of Italy in CONF.2/C.l/13.
Article 6 (Formerly Article 7)
As in the case of the proposal relating to paragraph 3, mentioned.
the proposal by the delegation of 1rway relating to pesenee -.
concerning the stabilization of prides (E/C. 2/C. l//Ada sn
//CONF. 2/01/21) E/CONF. 2/C. l/23/Rev. 1
Page 5
ECONF.2/C.1/21), was dealt with in a modified form through the amendment
of new Article 6 (E/CONF. 2/C. l/SR. 11). and through the preamble of the
Resolution on Employment (E/CONF. 2/27 and E/CONF. 2/SR .13).
Article 7 (Formerly Article 4) ;
The provisional reservation by the delegation of Mexico mentioned in
paragraph 8 of the Report of the Sub-Committee on this Article (E/CONF.2/C.1/9)
was with drawn at the eighth meeting (E/CONF.2/C.1/SR.8).
In the first sentence of paragrap1 the word "international", referring
to declarations conventions,ons and agreements, was changes to "inter-
governmental" at the ninth. meeting (E/CONF. 2/C.1/SR.9).1 Other changes in
this sentences suggested by theDrafting Committee (E/CONF. 2/CN 8/1/Rev.l1
were not accepted accepted(E/CONF2/C.1/SR.12).
The problem raised by' the delegation of Belgium. (E/CONF.2/C.l/SR.8 and
E/COIF.2/C.iN15/Add1l) . conceranng a pnisible misinterpretation of the labt
part of the second sentence in paragraph 1 of this Article was initially
discussed at third tenth meeeting (E/CONF.2/C.1/SR.10). Subsequently a
suggestion was put forward by the Central Drafting committee
(E/CONP. 2/C.8/1/ Rev.1) which was Considered by the First Committee at its
eleventh and twelfth meetings. At the twelfth meeeting it was decided that
the English text should read '....the improvement of wages and working
conditions as productivity may permit". At the thirteenth meeting, after.
receiving further- advice from the -Central Drafting Committee, the First
Committee decided that the corresponding French text should read ".
The words "within its territory" were added after "'conditions" in the
third sentence of paragragraph at the eighth meeting (E/CONF.2/C.1//SR.8).
At the eighth meeting the representative of the International Labour
Organization proposed a change in the third paragraph (E/CONF.2/C.1/12).
This proposal was discussed at the -ninth-meeting and was adopted in a
modified form (E/CONF.2/C.1/SR.9). E/CONF. 2/C.1 /23/Rev ,1
Page 6
ANNEX 3
CHAPTER II
EMPLOYMENT AND ECONOMIC ACTIVITY
Article 2
Importance of Employment, Production and Demand
in relation the Purpose of this Charter
1. The Member recognize that the employment avoidance of unemployment or under
employment, through the achievement and maintenance in each country of
useful employment opportunities for those able and willing to work and of
a large and steadily.. growing volume of production and effective demand for
goods and services is not of domestic concern alone, but is also a
necessary condition for the achievement of the general purpose and the
*-e . *- - q;,
objectives set forth in Article 1, including the expansion
trade, and thus for the. well-being of all other .countries.
2. The Member recognize that, while the avoidance of unemployment
under-employment must depend primarily on interpal measures. taken. by
individual countries, such measures should be supplemented by concerted
action under the sponsorship of the Economic and Social Council of the
United Nations in collaboration with the appropriate inter-governmental
organization, each of these bodies acting within its.respective
and consistently with the terms and purposes of its basic .instruments
3. The Members recognize that the regular exchange of information and view
among Members is indispeneble for successful co-operation in thefield
of employment economic activity and should be facilitated by the
Organization
Article 3
Maintenance of Domestic Employment
1, Each Member shall take action designed to achieve and maintain full
and productive employment and large and steadily growing demand within its
own territory through measures appropriate to its political, economic and
social institutions.
2. Measures to sustain employment, production and demand shall be
consistent with the other objectives and provisions of this Charter, Members
shall seek to avoid. measures which would have the effect of creating balance-
of-payments difficulties for other countries.
/Article 4 E/CONF..2/C.1/ o3/Rev.1
Page 7
Article 4
Removal of Malad justments within the Balance-of-Payments-
1. In the event that a persistent malad justmen within a Member's balance;
of-payments ia major factor in a situation in which other Members are
involved in balance-of-pafyments difficulties which handicap them in carrying
out the provisions of Article 3 without resort to trade restrictions, the
Member shall make its full contribution, while appropriate action shall be
taken by the other Members concerned, towards correcting the situation.
2. Action in accordance with. this Article shall be taken with due regard'
to the desirability of employing methods which expand. rather than contract
international trade
Article 5
Exchange of Information and Consultation
i.The Member and the Organization shall participate in arrangements
made bor sponsored by the economic and Social Council of the United Nations,
including arragements with appropriate inter-governmental organization:
(a) for the systematic collection, analysis and exchange of
in formation on domestic employment problems, trends and policies,
including as far possible information relating to national
income demand and the balance-of -payments;
(b) For studies, relevant to the purpose and objectives set-forth
in Article 1, concerning international aspects of population and
employment problems;
(c) for consultation with a view to concerted action on the part of
governments and inter-governmental organizations in order to promote
employment and economic activity,
2. The Organization shall, if it considers that the urgency of the
situation so requires, initiate consultations among Members with a view
to their taking appropriate measures against the international spread of
a decline in employment, production or demand.
Article 6
Safeguards for Members subject to External
Inflationary or Deflationary Pressure
The Organization shall have regard, in the exercise of its function
under other Articles this Charter, to the need of Members to take action
/within the E/CONF. 2/C. 1/23/Rev.1
Page 8
within the provisions of this Charter to safeguard their economies against
inflationary or deflationary pressure from abroad. In case of deflationary
pressure special consideration shall be given to the conisequences for any
Member of a serious or abrupt decline in the effective demand of other
countries.
Article 7
Fair Labour Standards
1. The Members recognize that measures relating to employment must take
fully into account the rights of workers under inter-governmental
declarations, conventions and agreements. They recognize that all countries
have a common interest in the achievement and maintenance of fair labour
Standards related to productivity, and thus in the improvement of wages
and working conditions as productivity may permit. The Members recognize
that unfair labour conditions, particularly in production for export, create
difficulties in international trade, and, accordingly, each Member shall
take whatever action may be appropriate and feasible to eliminate such
conditions within its territory.
2. Members which are also members of the International Labour Organization
shall co-operate with that organization in giving effect to this undertaking.
3. In all matters relating to labour standards that may be referred to the
Organization in accordance with the provisions of Article 90; it shall"
consult and co-operate with the International Labour Organization. |
GATT Library | bt049ks7260 | Revised list of products subject, in Syria and Lebanon, to non-discriminatory measures in virtue of Article XVIII, paragraph 6 | September 1, 1948 | 01/09/1948 | official documents | GATT/CP.2/WP.5/5/Add.1 and GATT/CP.2/WP.5/1-6 WP.5/5/Add.1 | https://exhibits.stanford.edu/gatt/catalog/bt049ks7260 | bt049ks7260_91870493.xml | GATT_147 | 434 | 2,713 | RESTRICTED
LIMITED C
GATT/CP. 2/WP. 5/5/Add .1
1 September 1948
ENGLISH
ORIGINAL: FRENCH
.REVISED LIST OF PRODUCTS SUBJECT,
IN SYRIA AND LEBANON,
TO NON-DISCRIMINATORY MEASURES IN
VIRTUE OF ARTICLE XVIII, PARAGRAPH 6.
The following list replaces that included in
Document GATT/CP.2/4/Add.2 of 14 August 1948 and should be
regarded as an annex to Document GATT/CP.2/WP.5/5 of'
31 August 1948.
Tariff Item No.
55 to 62
(except 62b )
68 to 74
Description of Products
)
75 to 82
122
Edible fruit
Cereals
Milling products:
and fecula
malts starch
Sugar
Chocolate and articles made of
chocolate
133 to 136
137 to 144
152 to. 161
(except 151b, 155,
157a-2 and 3,
157b-2.)
)
171 and 172
178
192
(except 192b and c)
319
(except 31 d , e-l
and e-2)
Preparations with basis of flou-r
or fecula
Preparations of vegetables or
fruits
Beverages, alcoholic liquids
and vinegars
Tobacco
Salt
Cerient
Perfumery articles
132 GATT/CP .2/WP. 5/5/Add .1
Page 2.
Tariff Item No.
Description of Products
Soap
Candles and tapers
Glues of animal, origin
Matches
3140
351 to 357
(except 353)
358 to 365
(except 362 and
363)
Ex 379
393
Ex 398a
401 to 1+05
L1+7 and l+18
1+28
LF30
)43 to L4i6
L+49 to t61
470 to 4+92
(except 477 and
486a)
507
518
522 to 525
(except 522b-'+ )
527 to 540
566
580 to 583
(except 580A-a
and b
and 581A-a)
)
)
I)
Tanned leather
Manufactures of leather
Rubber soles
Plywood
Doors and windows
Articles made of wood
Cardboard
Envelopes
Boxes cases for Jewellerys,
spectacles, etc. of cardboard
or paper
Natural silk thread
Fabrics of natural silk, pure
or mixed
Fabrics of artificial silk, of
artificial silk waste., and of
textile fibres, pure or mixed
Woollen fabrics
Cotton
Cotton thread
Cotton fabrics, pure. or mixed
Cabling, cordage and twine of
hemp
Hosiery
320
(except
325
(except
320d)
325b)
329 GATT/CP. 2/WP. 5/5/Add .1
Page 3.
Tarif Item No.
600 to 606
(except 604b)
639
663 to 681
Ex 755
Description of Products
Footwear
Manufactures of cement and
concrete
Glass and glassware
Metal bedsteads
768 and 769
839
Ex 841a
81+5
Ex 855b
Ex 855c
86o
975 and 976
Copper articles
Machines for the production of
cold
Machinery for manufacturing
footwear
Hosiery loons and knitting
machines
Machines for the manufacture
of beer
Machinery and apparatus f or the
manufacture of matches
Electric batteries
Games and toys for children
N.B. Bracketed items are those forming the subject of
tariff negotiations concluded in 1917.
Geneva, 1 September 1948,
M, MOBARAK
Chairman of the Delegation
of Lebanon
H. DJEBBARA
Chairman of. the Delegatiai
of Syria |
|
GATT Library | pw015vp1403 | Revised rules of procedure | Interim Commission for the International Trade Organization, August 26, 1948 | Interim Commission for the International Trade Organization (ICITO/GATT), Interim Commission for the International Trade Organization (ICITO/GATT), and Executive Committee | 26/08/1948 | official documents | ICITO/EC.2/6/Rev.1 and ICITO/EC.2/2/ADD.5 ICITO/EC.2/6/REV.1 | https://exhibits.stanford.edu/gatt/catalog/pw015vp1403 | pw015vp1403_90060189.xml | GATT_147 | 1,734 | 11,010 | INTERIM COMMISSION COMMISSION INTERIMAIRE DE UNRESTRICTED
FOR THE INTERNATIONAL L'ORGANISATION INTERNATIONALE ICITO/EC.2/6/Rev.1
TRADE ORGANIZATION DU COMMERCE 26 August 1948
ORIGINAL: ENGLISH
INTERIM COMMISSION OF THE INTERNATIONAL TRADE ORGANIZATION
EXECUTIVE COMMITTEE
REVISED RULES OF PROCEDURE
CHAPTER I. AGENDA
Rule 1 The provisional agenda for each session shall be drawn
up by the Executive Secretary in consultation With the
Chairman and shall be communicated to the members as soon as
possible after its preparation.
Rule 2.
The first item upon the provisional agenda of any
session shall be the adoption of the agenda.
Rule 3
The Executive Committee may decide to revise, add to or
delete from the agenda.
CHAPTER II. REPRESENTATION AND CREDENTIALS
Rule 4
Each member of the Executive Committee shall be
represented by an accredited representative.
Rule 5 Each representative may, be accompanied by such alternate
representatives and advisers as he may require.
Rule 6 The credentials of representatives shall be submitted to
the Executive Seretary before the opening of a session.
They shall take the form of a communication from or on behalf
of the Minister of Foreign Affairs. The Chairman, after
consulting with the Executive Secretary, shall draw attention
to any case where a representative has omitted to present his
credentials in due time and form.
CHAPTER III PARTICIPATTON OF OTHER ORGANIZATIONS AND OF
NON-MEMBERS OF THE EXECUTIVE COMMITTEE
Rule 7
Representatives of the United Nations and the specialized
agencies and such other inter-governmental organizations as
the Executive Committee may invite may attend meetings of the
Executive Committee and of its committees and may participate
without vote in their deliberations With respect to items on
their. agenda relating to matters within the scope of their
respective activities. IC ITO/EC . 2/6/Rev. 1
page 2
Rule 8 The Executive Committee may consult with the
representatives of non-governmental organizations granted
consultative status by the Economic and Social Council upon
questions in which such organizations have special competence
or knowledge. Such consultations, which may be direct or
through a committee established for that purpose may be
arranged on the invitation of the Executive Committee or on
the request of the Organization.
Rule 9 The representatives of governments invited to the
United Nations Conference on Trade and Employment which are
not members of the Executive Committee may take part as
observers at all meetings of the Committee and such
committees and sub-committees as the Executive Committee may
decide. Such representatives may also present items for
inclusion upon the provisional agenda of any session and may,
upon the invitation of the Chairman, address a meeting upon
any question under discussion,
CHAPTER IV. OFFICERS
Rule 10
The Executive Committee shall elect from the repre-
sentatives a Chairman and three Vice-Chairmen. They shall
each hold office for a period of one calendar year or should
the Committee not be meeting at the expiry of such period,
until their successors are elected at the next session.
Rule 11
If the Chairman is absent from any meeting or part
thereof a Vice-Chairman nominated by him shall preside.
Rule 12
If the Chairman ceases to represent a member of the
Executive Committee or is incapacitated from holding office,
a new Chairman shall be elected for the remaining part of
the term office of the former Chairman.
Rule 13 A Vice-Chairman acting as Chairman shall have the
same powers and duties as the Chairman.
Rule 14 The Chairman or a Vice-Chairman acting as Chairman
shall normally participate in the proceedings as such and
not as the representative of the member by which he was
accredited. He may, however at any time request that he
be permitted to act in the capacity of a representative. ICITO/EC .2/6/Rev.1
page 3
CHAPTER V. SECRETARIAT
Rule 15 The executive Secretary shall act in that capacity at
all meetings. He may appoint another member of the staff
to take his place at any meeting.
Rule 16 The Executive Secretary shall direct such staff as is
required by the Executive Committee and shall make all
necessary arrangements for meetings.
Rule17
The Executive Secretary may at any time, upon the
invitation of the chairman of any meeting, make oral or
written statements concerning any question under
consideration.
CHAPTER VI. CONDUCT OF BUSINESS
Rule 18
A simple majority of the members of the Executive
Committee shall constitute a quorum.
Rule 19 In addition to exercising the powers conferred upon
him elsewhere by these rules, the Chairman shall declare the
opening and closing of each meeting, shall direct the
discussion, accord the right to speak, put questions to the
vote, announce decisions rule on points of order and,
subject to these rules, have complete control of the
proceedings. The Chairman may also call a speaker to order
if his remarks are not relevant.
Rule 20 During the discussion of any matter a representative
may raise a point of order. In this case the Chairman shall
immediately state his ruling. If his ruling is challenged
the Chairman shall immediately submit it for decision and it
shall stand unless overruled.
Rule 21 During the discussion of any matter a representative
may move the adjournment of the debate. Any such motion
shall have priority. In addition to the proposer of the
motion, one representative may be allowed to speak in
favour of, and two representatives against, the motion.
Rule 22 A representative may at any time move the closure of
the debate. In addition to the mover of the motion not more
than two representatives. may be granted permission to speak
against the motion, after which the motion shall be put to
the vote immediately. ICITO/EC . 2/6/ReV.1
page 4
Rule 23
During the course of a debate the Chairman may announce
the list of speakers and, with the consent of the meeting,
declare the list closed. He may however accord a right
of reply. to any representative if a speech delivered after
he has declared the list closed makes this desirable.
Rule 24 The Chairman with the consent of the Executive
Committee, may limit the time allowed to each speaker.
Rule 25 Proposals and amendments shall normally be introduced
in writing and circulated to all representatives not later
than twelve hours before the commencement of the meeting
at which they are to be discussed.
Rule 26
If two or more proposals are moved relating to the
same question, the meeting shall first vote on the most far-
reaching proposal and then on the next most far-reaching
proposal and so on.
Rule 27
When an amendment is moved to a proposal the
amendment shall be put to the vote first, and if it is
adopted, the amended proposal shall then be put to the vote.
Rule 28
When two or more amendments are moved to a proposals
the meeting shall vote first on the amendment farthest
removed in substance from the original proposal, then, if
necessary, on the amendment next farthest removed, and so on
until all the amendments have been put to the vote.
CHAPTER VII. VOTING
Rule 29 Each member of the Executive Committee shall have one
vote.
Rule 30
Decisions of the Executive Committee shall be made by
a majority of the members present and voting. The phrase
"members present and voting" means members casting an
affirmative or negative vote; Members which abstain from
voting shall be considered as not voting.
Rule 31 The Executive Committee shall normally vote by show of
hands except when any representative requests a roll call
which shall then be taken in the English alphabetical order
of the names of the members. ICITO/EC 2/6/Rev.1
page 5
CHAPTER VIII. LANGUAGES
Chinese, English, French Russian and Spanish shall be
the official languages of the Executive Committee, and
English and French the working languages,
Rule 33
Speeches made in either of the working languages shalI
be Interpreted into the other working language
Rule 34 Speeches made in any of the other three official
languages shall be interpreted into both working laguages.
Rule 35 Any representative may make a speech in a language
other than an official language. In this case he himself
must provide for interpretation into one of the working
languages. Interpretation into the other working language
by an interpreter of the Secretariat may be based on the
interpretation given in the first working language.
Rule 36 Summary records shall be drawn up in the working
languages. A translation of the whole or any part of any
summary record into any of the other official languages
shall be furnished if requested by any representative.
Rule 37 All resolutions, recommendations and other formal
decisions of the Executive Committee shall be made available
in the official languages; Upon the request of any repre-
sentative, any other document of the Executive Committee shall
be made available in any or all of the official languages.
CHAPTER IX: RECORDS
Rule 38
Summary records of the meetings of the Executive
Committee shall be kept by the Secretariat. They shall be
sent as soon as possible to all representatives who shall
inform the Secretariat not later than twenty-four hours
after the circulation of the summary record of any changes
they wish to have made.
CHAPTER X. PUBLICITY OF MEETINGS
Rule 39
The meetings of the Executive Committee shall be held
in public unless the Executive Committee decides that a
meeting shall be held in private. ICITO/EC.2/6/Rev.1
page 6
The meetings of the committees of the Executive
Committee shall ordinarily be held in private. Each
committee may decide that a particular meeting or meetings
shall be held in public.
CHAPTER XI. COMMITTEES
Rule 41 The Executive Committee may set up such committees
and sub-committees as it deems necessary for the performance
of its functions.
Rule 42
The officers of each committee and sub-committee shall
be elected by the Executive Committee on the nomination of
the Chairman.
Rule 43 The provisions of Rules 19 to 35 inclusive shall be
applied in the proceedings of committees and sub-committees.
Rule 44
A simple majority of the members of a committee or
sub-committee shall constitute a quorum.
Rule 45
Committees and sub-committees may, by unanimous agree-
ment, decide to adopt rules of procedure regarding
interpretations or translations of a more simple character
than those laid down in these rules.
Rule 46
Sub-committees shall decide in consultation with the
Secretariat, upon the form of their records and the
procedure to be followed with them.
CHAPTER XII. AMENDMENTS
Rule 47 The Executive Committee may at any time amend any of
these Rules. |
GATT Library | kc849yr6184 | Revised text of Article 42 : (As approved by Committee III, 17 March) | United Nations Conference on Trade and Employment, March 17, 1948 | Third Committee: Commercial Policy | 17/03/1948 | official documents | E/CONF.2/C.3/85/Corr.1 and E/CONF.2/C.3/78-89/ADD.3 | https://exhibits.stanford.edu/gatt/catalog/kc849yr6184 | kc849yr6184_90190193.xml | GATT_147 | 182 | 1,312 | UNRESTRICTED
United Nations Nations Unies E/CONF.2/C.3/85/
CONFERCE CONFERCE Corr.1
ON DU ORIGINAL :ENGLISH
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI
THIRD COMMITTEE: COMMERCIAL POLICY
REVISED TEXT OF ARTICLE 42
(As Approved by Comittee III, 17 March)
Article 42
Territorial Application of Chapter IV
1. The provisions of Chapter IV shall apply to the metropolitan customs
territories of the Members and to any other customs territories in respect
of which this Charter has been accepted pursuant to Article 99. Each such
customs territory shall be treated as though it were a Member exclusively
for the purposes of the territorial application of Chapter IV; Provided
that the provisions of this paragraph shall not be construed to create any
rights or obligations as between two or more customs territories in respect
of which this Charter has been accepted by a single Member.
2. For the purposes of this Chapter a customs territory shall be understood
to mean any territory with respect to which separate tariffs or other
regulations of commerce art maintained for a substantial part of the trade of
such territory with other territories. |
GATT Library | gv495ys3197 | Revision of annexure 2 of GATT/1/1. Agenda for the first session of the contracting parties | General Agreement on Tariffs and Trade, March 4, 1948 | General Agreement on Tariffs and Trade (Organization) | 04/03/1948 | official documents | GATT/1/8 and GATT/1/2-8 | https://exhibits.stanford.edu/gatt/catalog/gv495ys3197 | gv495ys3197_90310275.xml | GATT_147 | 295 | 1,955 | RESTRICTED
GATT/1/8
4 March 1948
ORIGINAL: ENGLISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
REVISION OF ANNEXURE 2 OF GATT/1/1
AGENDA FOR THE FIRST SESSION OF THE CONTRACTING PARTIES
1.Adoption of a Provisional Rules of Procedure :
2. Election of Chairman and Vice-Chairman
3. Adoption of Provisional Agenda
4. Arrangements regarding the secretarial services of the Contracting
Parties
5. Signature of Protocol incorporating typographical corrections to
the text of the Schedules of the General Agreement on Tariffs and
Trade as signed at Geneva
6. Notification of measures by contracting parties under paragraph. 6
of Article XVIII
7. Any questions that may be raised concerning commitments made under
the Agreement and regarding its operation:
(a) Reconsideration of certain customs duties set
forth in Schedule XV
(b) Others
8. Relation of the General Agreement to the Charter for an International
Tradd Organization (Article XXIX)
9. Amendments and proposals relating to Articles of the General Agreement
not covered by Article XXIX:
(a) Amendment to Article XXIV: substitution of this Article by
the corresponding provisions of the Charter for an International
Trade Organization
(b) Recommendations of the Co-ordinating Committee of the Havana
Conference:
(i) Amendment of the General Agreement to permit
the admission of a country as a contracting
/party upon
5681 AsX r\;.r , 1 - 2-
party upon a vote of two-thirds of the contracting
parties instead of upon a unanimous vote as
at present required.
(ii) Amendment of paragraph 5 of Article XXV as let
out in paged 14 and 15 of document E/CONF.2/45/Rev.1
of the United Nations Conference on Trade and
10. Accession to the General Agreement on Tariffs and Trade of governments
not parties to the Agreement (Article XXXIII)
11. Determination of the date of the Second Session of the contracting
parties
12. Other business |
GATT Library | yc885fn4164 | Revision of draft protocal contained in document GATT/1/28 modifying certain general provisions of the General Agreement on Tariffs and Trade : (As Agreed on 19 March 1948) | General Agreement on Tariffs and Trade, March 19, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 19/03/1948 | official documents | GATT/1/47 and GATT/1/47-57+47/Rev.1 53/Add.1,2 | https://exhibits.stanford.edu/gatt/catalog/yc885fn4164 | yc885fn4164_90310324.xml | GATT_147 | 1,147 | 7,432 | RESTRICTED GATT/1/47
19 March 1948
ORIGINAL: ENGLISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
FIRST SESSION OF THE CONTRACTING PARTIES
REVISION OF DRAFT PROTOCAL CONTAINED IN DOCUMENT GATT/1/28
MODIFYING CERTAIN GENERAL PROVISIONS OF THE
GENERAL AGREEMENT ON TARIFFS AND TRADE
(As Agreed on 19 March 1948)
The Governments of the Commonwealth of Australia, the Kingdom of Belgium,
Canada, the Republic of Cuba, the French Republic, the Grand-Duchy of
Luxembourg, the Kingdom of the Netherlands, the United Kingdom of Great
Britain and Northern Ireland and the United States of America, acting in
their capacity of contracting parties to the General Agreement on Tariffs
and Trade, and
The Governments of the United States of Brazil, Burma, Ceylon, the
Republic of Chile, the Republic of China, the, Czechoslovak Republic, India,
Lebanon, New Zealand, the kingdom of Norway, Pakistan, Southern Rhodesia,
Syria, and the Union of South Africa, acting in their capacity of signatories
of the Final Act adopted at the conclusion of the Second Session of the
Preparatory Committee of the United Nations Conference on Trade and
Employment which authenticated the text of the General Agreement on Tariffs
and Trade
Being desirous of modifying the text of the general provisions of the
General Agreement on Tariffs and Trade, in the light of the text of the Havana
Charter for an International Trade Organization, which was authenticated by
the Final Act of the United Nations Conference on Trade and Employment
Hereby agree as follows:
I. Paragraph 5 of Article XXV of the General Agreement on Tariffs and Trade
shall read as follows:
"5. (a) In exceptional circumstances not elsewhere provided for
in this Agreementt, the CONTRACTING PARTIES may waive an
obligation imposed upon a contracting party by this Agreement;
Provided that any such decision shall be approved by a
two-thirds majority of the votes cast and that such majority
shall comprise more than half of the contracting parties. The
/CONTRACTING PARTIES GATT/1/47 Page2
CONTRACTING PARTIES may also by such a vote
(i) define certain categories of exceptional circumstances
to which other voting requirements shall apply for the
waiver of obligations, and
(ii) prescribe such criteria as may be necessary for the
application of this sub-paragraph.
(b) If any contracting party has failed without sufficient
Justification to carry out with another contracting party
negotiations of the kind described in paragraph 1 of Article 17
of the Havana Charter, the CONTRACTING PARTIES may, upon complaint
and after investigation, authorize the complaining contracting
party to withhold from the other- the concessions incorporated in
the relevant Schedule to this Agreement. In any Judgment as to
whether a contracting party has so failed, the. CONTRACTING. PARTIES
shalI have regard to all relevant circumstances, including the
developmental, reconstruction and other needs and the general
fiscal structures of the contracting parties. concerned and to the
provisions of the. Havana Charter as a whole. If in fact the
concessions referred to are so withheld, so as to result in the
application to the. trade of the. other contracting party of tariffs
higher than would otherwise have been applicable, such other
contracting party shall them be free, within sixty days after such
action becomes effective, to give written notice of withdrawal
from the Agreement. The withdrawal shall take effect upon the
expirations of sixty days from the day on which such notice is
received by the CONTRACTING PARTIES.
(c) The provisions of sub-paragraph (b) shall not apply as between
any two contracting parties the Schedules of which contain
concessions initially negotiated between such contracting parties.
(d) The provisions of sub-paragraphs (b) and (c) shall not apply
until 1 January 1949."
II. Paragraph 1 of Article XXXII shall read as follows:
"The contracting parties to this Agreement shall be understood to
mean those governments which are applying the provisions of this
Agreement under Article XXVI, Article XXXIII or pursuant to the
Protocol of Provisional Application."
III. Article XXXIII of the General Agreement on Tariffs and Trade shall road
as follows:
"A Government not party to this Agreement, or a Government acting
on behalf of a separate customs territory possessing full autonomy in
/the conduct GATT/1/47
Page 3
the conduct of its external commercial relations and of the other matters
provided for in this Agreement, may accede to this Agreement, on its own
behalf or on behalf of that territory, on terms to be agreed between
such Government and the CONTRACTING PARTIES. Decisions of the
CONTRACTING PARTIES under this paragraph shall be taken by a two-thirds
majority."
VII. The following Article shall be inserted in the General Agreement on
Tariffs and Trade after Article XXXIV:
Article XXXV
"1. Without prejudice to the provisions of paragraph 5 (b) of
Article XXV or to the obligations of a contracting party pursuant
to paragraph 1 of Article XXIX, this Agreement, or alternatively
Article II of this Agreement, shall not apply as between any contracting
party and any other contracting party if:
(a) the two contracting parties have not entered into tariff
negotiations with each other, and
(b) either of the contracting parties, at the time either becomes
a contracting party, does not consent to such application.
2. The CONTRACTING PARTIES may, at any time before the Havana Charter
enters into force, review the operation of this Article in particular
cases at the request of any contracting party and make appropriate
recommendations."
VIII. Notwithstanding the provisions of Article XXX of the General Agreement
on Tariffs and Trade, the modifications of the General Agreement on Tariffs
and Trade provided for in Items I to VII, inclusive, of this Protocol shall
become an integral part of the Agreement, on this ______day of March 1948.
Signature of this protocol by any government which at the time is
applying the General Agreement on Tariffs and Trade under the Protocol of
Provisional Application, shall serve to commit that Government to apply
provisionally the Agreement as modified by this Protocol.
Signature of this Protocol by any government which is not at the time
a contracting party to the General Agreement on Tariffs and Trade shall serve
to authenticate the texts of the modifications of the General Agreement
provided for in this Protocol and such governments shall not be required to
apply such modifications until they become contracting parties to the General
Agreement on Tariffs and Trade as defined in Article XXXII of the General
Agreement on Tariffs and Trade. This Protocol shall remain omen for signature
by any such government, named in the second paragraph of the preamble to this
Protocol, until May 1, 1948.
/The original GATT/1/47
Page 4
The original texts of this Protocol shall be deposited with tho
Secretary-General of tho United Nations, who is authorized to effect
registration thereof.
In witness whereof the respective representatives have signed the present
Protocol.
Done at Havana, in a single copy, in tho English and French languages,
both texts authentic, this ______________________ of March,
onc thousand nino hundred and forty-eight.
.
.
. |
GATT Library | mz338yd6711 | Revision of draft protocol contained in document GATT/1/21 modifying certain general provisons of the General Agreement on Tariffs and Trade : (As Agreed on 13 March 1948) | General Agreement of Tariffs and Trade, March 13, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 13/03/1948 | official documents | GATT/1/28 and GATT/1/9-28+21/Add.1 | https://exhibits.stanford.edu/gatt/catalog/mz338yd6711 | mz338yd6711_90310303.xml | GATT_147 | 2,593 | 17,145 | GATT/1/28
13 Marc 1948
GENERAL AGREEMENT OF TARRIFS AND TRADE
FIRST SESSION OF THE CONTRACTING PARTIES
REVISION OF DRAF PROTOCOL CONTAINED IN DOCUMENT GATT/1/21
MODIFYING CERTAIN GENERAL PROVISONS OF THE
GENERAL AGREEMENT ON TARIFFS AND TRADE
(AS Agreed on 13 march 1948)
The Governents of the Comonwealth of Australia the Kingdom of bellgium
Canada. the.-Republlc of cuba) the French Republic, the Giani-Duchy or Luxembourg,
Kingdome of netherlands the UnitedKingdom of Great Britain and Northern
Irelandl. and the united States of America, acting in their- capacity of
contracting parties-to.-the General Agreement on Tariffs and. Trade, and.
The Governments of the united. States of Brazil, Burma Ceylon, 'the Republic
of Chile, the republic of China, the Czechoelovak Republic;, ihdia, Lebanon,
NowZealand,, the Kingdom, of Norway-, Pakistan, Southern Rhodesia, Syria, .and
the. Unions - of South-Africa,. acting-in, their capacity- of signatories of, the Final'
Act adopted at ; conIusion of the Second Session of' the Preparatory Committee
of' the united nation Conference on Trade and' Employmnt which authetiicated.-
the test of the-General Agreement on- Tariffs and Trade - ;
Being' desirous of modifYing the text of the general provisions of the
General Agreement Tariffs and Trade, in the light of the text of the Havana
Charter for an-international Trade Organization, which was- authenticated by
.the Final- Act of the -United: Nations conference on Trade and. Employment
Hereby agreo as folows:-
.2. Article XXXIV of the- General Agreement on Tariffs and Trade shall read as
follows: - .
TERRITORAIL APPLICATION - FRONTIER TRAFFIC- CUSTOMS
UNIONS AND FREE TRADE AREAS
l. The riGhts and obligations arising under this Agreement shALL
be deemed to be In force- between each end OVERY CUstoms territory in
respect of wich the - Agreement is being applied under Article; XXVI
- ' - '- - - for pursuant GATT/1/28
Page2
or pursuant to the Protocol of provisional Application.
"2. for the purposes of- this agreement customs territory shall
be understood to mean any territory with repeat to -which separate
tariffs or other regulations of commerce are maintained for
substantially al the trade of such territory with other territories.
"3. The provisions of this Agreement 'shall-not be construed to
prevent:
(a) advantages accorded-by any contracting party to -adjacent
countries in order' to facilitate frontier traffic; or
(b) advantages accorded to the trade with the free Territory
of Trieste by.countries contiguous to that territory, provided
that such advantages are not in conflict with the Treaties of
'4. -The contracting parties -recognize the desirability of increasing
freedom of trade by the development,- through voluntary -agrements, of.
-closer integration between the- economies of participants. .-'Thet also...
recogize that the purpose .of a-customs Uni.on-or ofa &free-trade -area.:
should be to facilitate trade -between the -partes -to it - and mot .to
raise obstacles to the trade .of-other contracting parties 'with rs.
parties. - -. . -A'- -
"5.. The provisions of this.Agremnt ahall not therefore be comstrued-
to prevent as between the territories of parties the formation
of a .custom union or the -establishmnet of a free-trade area. -othe .
adoption of -an -interim agreement necesary for the -formation of a-:
customs union or a free-trade -area; Povided., that: - . -
(a) with respect to a customs union or -an interim t
leading to the establishment of -a -customs union, the duties- and..
other regulations-of commerce imposed at the institution of any
such union interim agreement in respect of trade with: -
contracting parties shall -not on- the whole be higher or more
restrictive than the general incidence of the duties and :
regulations of commerce applilcablle in' the constituent territorie
prior to the formattion of such union the adoption of such
interim agreement, as the case may be; -
(b) with respect to a free-trade area, or an Interim agreement
leading to the establish mnt of a free-trade area, the duties
a other regulations of c rce maintainedd in each of the
costituent territories and applicable at the es -of
such free-trade area, or the adoption of such interim agreement,
/to the trade GATT/I/2
Page 3
to the trade of contacting. parties not participating in the
arrangement shall. not be higher or move restrictive than the
corresponding tariffs. and other regulations. of commerce existing
in the: same; contituent terrotory- prior, to the establishment of
the freertrade area., or- interim agreement, as the case my be;-
(a) an interim agreement referred: to. in sub-partgraphs(a) `and
(b i. above sha.l Include- a. plsn and. schedule. for the. attainment
of such. a. custom unnion or the establishment of: such a free-trade
area- with n reasonable. length ot time.
(a) Any contractimg party- deciding to enter into customs union-
or a free-trade. area, .. an interim, 'agreemen't. leading to the-.
formation of such-a- union or- free-trade. area, shal promptly
notify the, Contracting parties and - shall;.make available- to, then
such information regarding the proposed union or free-trade area
as will enable them .to make such reporter and. recomedations to
contracting, partiee as. they may deem. appropriate.
(b) If, after having studied the plans. an schedules provide& for-
i an interim agreement under pararaph. 5, in consultation with
the- parties to, that agreement taking due account of the
information.. made availble in accordance with the terms of sub..
Paragrap (. the contracting parties find: that such agreement
is not- likely, to result. in. a customs. uniom or in: the: establisment
of a free-trade area writhhin the. period. contemplated by the parties
toa the agreement or that such period. is not: a reasonable one '
COTRACTING PaRTIES SHALL make- recommendations to, the, parties to'-
the agreement- - If the parties are. not prepared. to modify the-.
ageement in accordance- with such recommendation they shall not
maintain it in. force r institute. such- agreement if it has not yet
been concluded. . .
(c) Any substantial change in. the plan or schedule' shall be
notifIed to the COTRCTING PARTIES which may request the
contracting partles concerned to consult with them if the change
seems likely to- Jeopardize or delay' unduly the achievement of the
.customs. union or - the free-trde .:area.
'7. ror the purposes of this. Agreement:
(a) A customs- union. shall be understood to mean the substitution
of a single customs territory for two or more customs territories,'
so that (i) -tariff - and other restrictive -regulatons of comarce
(except, where necessary, those -permitted under -
Articles XI, .V,.XIX , , XX w XXI) are
aliminated on subsanitelly all -the trade between the
constituent territories of the union or at least -on
substantially all the trade in products originatirg
i such -territorie -and.
(ii') substantially the same tariffs and other regulations
of commerece are applied by each of -the ers of the
union to the trade of territories not included in the
union, subject to the provisions paragraph B;-
(b).:. A free-trade . shall be-understood to mean a --group, of two
or. zore custom territories in which the tarrif and other
restrictive regulations -for commerce '(except -where neceEsary
-those. permitted under ; Articl'es XI, .I XI=. W, X7, and
XXI) between such territories are eliminated on substantially
the trade In products originating In ;constitudt territories
the free-trade area.-' - - ;.~ - - -
8. ".e .preferences referred to In paragraph 2 -of -Article 'I shall not
be affected by the constitution off a customs union .or a free-trade area
but may be eliminated or adjusted by means of-negotiations with -
contracting parties affected. of procedure of negotiations'w ith
affected contracting parties- shall -in particular apply to the elimination
of preferaces, required to conform with the provisions of -sub-
paragraphs .(a)(i) and (b) of pagraph . -.- 7
9 The Contracting parties may be a two third majority approve
proposals which do not 'fully comply with the requirements of-
paragraphhs 4 to 8 inclusive Provided that they lead to the establishment
of a customs union or a free-trade area in the -sense of this Article.
"10. Taking into account the exceptional -circumstances arising- out of
the establishment of Inia andPakistan as independent states end
recogonizing the fact that they have long constituted 'an economic lmit,
the contracting- parties agree that the -provisions of this Agreement
shall not prevent the two countries from enteriing into. special-
arrangments with respect to the trade between them, pending the
establishment of their mutual trade relations-cn a definite basis.
"1l. Each contracting party hall take.such reasonable measures as
may be available to it to assure observance -of the provisions of this
Agreement by the regional and- local governments and authorities within
its territory."
/II Paragraph 5 GATT/1/28
Page 5
paragraph 5 of atricle XXV of the general agreement on Tarriffs and. Trade
read. as follows
"5 (a)t' in exceptonal cirumtances not elsewhere piovided for
in this: Agrement, the C Contracting parties may waive an
obligation imposed upon. a contracting party by this Agremennt;
Provideed that any such decision shall be approved. by a
two -third majority.of the votes cast and, that such mjority
shall.. comprise more than half of the contracting parties. The
contracting parties may also such a vote
define certain categories of, exceptional circumstances
:....to which other voing requirements shall apply for-the
waiver- of obligions;and
(Ui). . proscribe such. criteria as may be necessary for the
applicatiom of this ub-paragraph.:
(bi if any contractin party has faield without sufficient
justification to carry out with another contracting party
negotiations of the kind decribed. in paragraph J of'Articlo 1T
of, the Mavama Charter,. the COntracting parites may upon-complaint
-n. after, investigating,. authorize the complaining contracting
party to withhold from the other the concessions incorporated in
thai relavant Schedule. to this Agreement. in any Judgment, as to
Whether contracting party has. so faileds the CONtracting parties
shll have regard toz:aLL relevant, circumstances includingthe
developmentaL,. reconasruction and other needs and. the- general
fiscal strutures of the contacting parties concerd. and. t the
provisions of there of havana charter whole.: If in fact the
-conncessions referre&. to- are-, so withheld., so as to result in the
application. to the trade of the. other contractng party: of tiffs
higher than- would. others have been applicble., such other
contracting party shall then. be free, within sixty days. after such
actio-. becomes effective.- to give Written notice of withdrawal
from .. The, agree,ment shall take effect upon the
expration of' sixty' dgay from the day on which so'ch notice is-
recelved. by tho Contracting parties
(c)- the provisions of sub-parag'aph' (b) shall not applty- as between
any two contracting parties the Schedules of which contain
concessions initially negotiated between such contracting parties.
* (the provisional of subparagraph (b) and (a) shell not apply
.untill l january 1949.
/III paragraph 5 paragragph of article IXXVi of the general agreement on tariffs and trade
shall. as follws:
"5. ThisAgrementt shallL enter into for-as, among the.. ngovernments
Which bave. accepted it,, -o=.the thirtieth day following the day on which
instruements of acceptance have been dposited with the Secretary
of the United Rations on behalf of Govrnment signatory to the final
Act the -teritoriet of which account for eightyfive - per cntum -of the
total external trade of the territories of the signatories to the Final
Act adopted at the coclusian of the Second Session of the Prparatory
Comittee of the United Nations Conference on trade and. employment.
Such percentage shall be determined in acoordance with the table set
forth in. Annx H.The instrmnut of acceptance of each other Government
signatory to the final Act shall take effect on the thirtisthday following
day on which such intstrument is depsited.. - ;- - -
V. Article XXIX of the General Ageerement on Tariffrs and trade shall read. as
'I. -The contracting parties undertke to observe to the fulest -xtent
of their executive authority the genral principle of thq havaam Charter
penadig their. acceptance of it in aoccrdnce with their constitutional
'Proocedures
"2. Paragraphs 1: and 2 of Article I and Part II of this Agreement shall
be suspended and paragraph 3 of Article shall be, subject to f
consetquentinal amendments on the day on which the havaa Charter enters.
into force and. the oontracting pattie shall met. as Soon as .-posble
threafter.-end agree concerning thetrasfer to'the internaltional trade
Organization -of their factions under Article *. -
"3. If any contract party has not accepted the Chdrter when it has
entered Into force, the ontracting parties shall confer to agree whether,
and if so in what way, this Agreement, Insofar -as -it affects relations
betweenthe contracting. -partywhich has not the havan charter
and other -contracting parteis; -shall be supplemented or amended :
"14 During the mon of September 1949 should the havanas Charter.not
have.. entared into force or -at such earlier time agree--if- it
Is known that the will not enter into -force; or -at such- later.
time as ay -be agreed if the Havaa C casess to be, in force the
contracting parties shall net to agree whether this agreement shall be
amamded supplemented or maintained
"5. The signatoreis of : the final act which are not at the time contracting
Parties shall be linformed of any agrement which may be reached between
the contracting parties under paragraph 3 or 4 of this article.
, V.paragraph 1 Gattt/1/28
Page 7
V. Paragraph I of article XXXII Shall read as follows:
"The contracting parties to this shall be underrstood to
mean those goverments which are applying the povisioni of this
Agreement inder Article XXVI Article or -pursuant to the
Protocol of Provisional Applicatopn."
VI. Article- XXXIII of the General Agreement on Tariffs and Trade shal I read.
as follows
"A Government not party to this Agreement, or Governnent acting
on behalf of a separate customs territory possessing full, autonomy in
the conduct of its eternal comecial l relations and of the other matters
provide for In t.hiS Agreement, may accede to this Agreement, on its own
behalf or on behalf of that territory, on term to be agreed. between.
such. Goverent and the contracting parties decisions of the
COntrcting parties under this- paragraph shall be taken by a. two-thIrd
VIt. 'The following Article shall be inserted in the General Agreement on
Tariffs and. Tade after Article XXXV
Article 3MVr
"Without prejudice to the provisions of paragraph 5 (b) of'
Article XXV or to the obligations of a contracting party pursuant to
paragraph I. of Article this Agreement shell not apply as between
any contracting party and any other government becoming & contracting
party pruant to Article XIII if .
(a) the two contracting parties have not entered. into tariff
negotiations with each other and,
(b) either of, the contracting parties the timo either becomes
a cntracing party does not consent .to such application
VIII. Notwithstanding the provisions of Article of the General Agreement
on. Tariffs and. Trade, the modifications of the General Agreement on Tariffs
and Trade provided for in Item I to VII, inclusive, of this Protoco shall
become effective, 'as among contrang parties to the Agreemnt, on this
________day of March 1948.
"Signatateof this Protocol by amy government which is not at the
tim a contracting party to the'General Agreement Tariffs and Trade
shall. serve to authenticate the texts of the modifications of the
General Agreement provided for in this Protocol. This Protocol shall
remain open for signature by any such govermant named the second
paragrph of the preamble to- this Protocol, until 1 may 1948."
/in witness Page 8
In witness where of the respected rpresentstitves have signed the present
Protocol.
Done at Havana in a single copy English and French Languages.,
both text authentic, this of march,
one thousand nine hundred and forty -eight. |
GATT Library | gg108zb8638 | Revision of draft protocol contained in document GATT/1/28 modifying certain general provisions of General Agreement on Tariffs and Trade : (As Agreed at Meeting Held at 9.30 p.m. on 19 March 1948) | General Agreement on Tariffs and Trade, March 19, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 19/03/1948 | official documents | GATT/1/47/Rev.1 and GATT/1/47-57+47/Rev.1 53/Add.1,2 | https://exhibits.stanford.edu/gatt/catalog/gg108zb8638 | gg108zb8638_90310325.xml | GATT_147 | 1,070 | 6,943 | RESTRICTED GATT/1/47/Rev.1
19 March 1948
ORIGINAL: ENGLISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
FIRST SESSION OF THE CONTRACTING PARTIES
REVISION OF DRAFT PROTOCAL CONTAINED IN DOCUMENT GATT/1/28
MODIFYING CERTAIN GENERAL PROVISIONS OF
GENERAL AGREEMENT ON TARIFFS AND TRADE
(As Agreed at Meeting Held at 9.30 p.m. on 19 March 1948)
The Governments of the Commonwealth of Australia, the Kingdom of Belgium,
Canada, the Republic of Cuba, the French Republic, the Grand-Duchy of
Luxembourg, the Kingdom of the Netherlands, the United Kingdom of Great
Britain and Northern Ireland and the United States of America, acting in
their capacity of contracting parties to the General Agreement on Tariffs
and Trade, and
The Governments of the United States of Brazil, Burma, Ceylon, the
Republic of Chile, the Republic of China, the Czechoslovak Republic, India,
Lebanon, New Zealand, the Kingdom of Norway, Pakistan, Southern Rhodesia,
Syria, and the Union of South Africa, acting in their capacity of signatories
of the Final Act adopted at the conclusion of the Second Session of the
Preparatory Committee of the United Nations Conference on Trade and
Employment which authenticated the text of the General Agreement on Tariffs
and Trade
Being desirous of modifying the text of the general provisions of the
General Agreement on Tariffs and Trade, in the light of the text of the. Havana
Charter for an International Trade Organization, which was authenticated by
the Final Act of the United Nations Conference on Trade and Eployment
Hereby agree as follows:
I. Paragraph 5 of Article XXV of the General Agreement on Tariffs and Trade
shall read as follows:
"5. (a) In exceptional circumstances not elsewhere provided for
in this Agreement, the CONTRACTING PARTIES may waive an
obligation imposed upon a contracting party by this Agreement;
Provided that any such decision shall be approved by a
two-thirds majority of the votes cast and that such majority
shall comprise more than half of the contracting parties. The
/CONTRACTING PARTIES GATT/1/47/Rev.1 Page 2
CONTRACTING PARTIES may also by such a vote
(i) define certain categories of exceptional circumstances
to which other voting requirements shall apply for the
waiver of obligations, and
(ii) prescribe such criteria as may be necessary for the
application of this sub-paragraph.
(b) If any contracting party has failed without sufficient
justification to carry out with another contracting party
negotiations of the kind described in paragraph 1 of Article 17
of the Havana Charter, the CONTRACTING PARTIES may, upon complaint
and after investigation, authorize the complaining contracting
party to withhold from the other the concessions incorporated in
the relevant Schedule to this Agreement. In any judgment as to
whether a contracting party has so failed. the CONTRACTING PARTIES
shall have regard to all relevant circumstances, including the
developmental, reconstruction and other needs and the general
fiscal structures of the contracting parties concerned and to the
provisions of the Havana Charter as a whole. If in fact the
concessions referred to are so withheld, so as to result in the
application to the trade of the other contracting party of tariffs
higher than would otherwise have been applicable, such other
contracting party shall then be free, within sixty days after such
action becomes effective, to give written notice of withdrawal
from the Agreement. The withdrawal shall take effect upon the
expiration of sixty days from the day on which such notice. is
received by the CONTRACTING PARTIES.
(c) The provisions of sub-paragraph (b) shall not apply as between
any two contracting parties the Schedules of which contain
concessions initially negotiated between such contracting parties.
(d) The provisions of sub-paragraphs (b) and (c) shall not apply
until 1 January 1949."
II. Paragraph 1 of Article XXXII shall read as follows:
"The contracting parties to this Agreement shall be understood to
mean those governments which are applying the provisions of this
Agreement under Article XXVI, Article XXXIII or pursuant to the
Protocol of Provisional Application."
III. Article XXXIII of the General Agreement on Tariffs and Trade shall rcad
as follows:
"A Government not party to this Agreement, or a Government acting
on behalf of a separate customs territory possessing full autonomy in
/the conduct GATT/1/47/Rev.1 Page 3
the conduct of its external commercial relations and of the other matters
provided for in this Agreement, may accede to this Agreement, on its own
behalf or on behalf of that territory, on terms to be agreed between
such Government and the CONTRACTING PARTIES. Decisions of the
CONTRACTING PARTIES under this paragraph shall be taken by a two-thirds
majority."
IV. There following Article shall be inserted in the General Agreement on
Tariffs and Trade after Article XXXIV:
Article XXXV
"1. Without prejudice to the provisions of paragraph 5 (b) of
Article XXV or to the obligations of a contracting party pursuant
to paragraph 1 of Article XXIX this Agreement, or alterntively
Article II of this Agreement, shall not apply as between any
contracting party and any other contracting party if:
(a) the two contracting parties have not entered into tariff
negotiations with each other, and
(b) either of the contracting parties, at the time either
becomes a contracting party, does not consent to such
application.
2. The CONTRACTING PARTIES may, at any time before the Havana Charter
enters into force, review the operation of this Article in particular
cases at the request of any contracting party and make appropriate
recommendations."
V. Notwithstanding the provisions of Article XXX of the [General] Agreement
Tariffs and Trade, the modifications of the General Agreement onTariffs
and Trade provided for in Items I to IV, inclusive, of this Protocol shall
become an integral part of the Agreement, on this _____day of March 1948.
Signature of this Protocol by any government which is not at the time
a contracting party to the General Agreement on Tariffs and Trade shall serve
to authenticate the texts of the modifications of the General Ageement provided
for in this Protocol. This Protocol shall remain open for signature by any
such government , named in the second paragraph of the preamble to this
Protocol, until May 1, 1948.
The original texts of this Protocol shall be deposited with the Secretary-
General of the United Nations, who is authorized to effect registration thereof
In witness whereof the respective representatives have signed the present
Protocol.
Done at Havana, in a single copy, in the English and French languages,
/both texts GATT/1/47/Rev.1 Page 4
both texts authentic, this _______________________of March,
one thousand nine hundred and forty-eight. |
GATT Library | sy531bb1085 | Revision of draft special protocol contained in document GATT/l/21 modyfying Article XIV of the General Agrement on Tariffs and Trade : (As Agreed on 13 March 1948) | General Agreement on Tariffs and Trade, March 13, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 13/03/1948 | official documents | GATT/1/27 and GATT/1/9-28+21/Add.1 | https://exhibits.stanford.edu/gatt/catalog/sy531bb1085 | sy531bb1085_90310302.xml | GATT_147 | 435 | 2,760 | GATT/l/ 27
13 March 1948
GENERAL AGREEMENT ON TARFFS AND TRADE
FIRST SECTION ON CORIESPS T S PARTIES
RVISION OF DRAFT SPECIAL PROTOCOL CONTAINED IN DOCUMENT GATT/l/21
modyfying ARTICLE XIV OF THE GENERAL
AGREMENT ON TARRIFFS AND TRAD
(As Agreed on 13 March1948) -
The Government8 of the Commnvealth of Australia, the Kingdom of Belgium,.
Canada,. the. Republic of Cuba, the French Republic, the Grand-Duchy of
Luxembourg, the Kingdom of the retherlands, the United Kingdom of Great Britain
and Northern Ireland end the Unitad States of America, acting in their capacity
of contracting parties to the General Agreement on Tariffs and Trade, and
The governments of the United States of Brazil , Burma, Ceylon , the
Republic of Chfle, the Republic of China, the Czechoslovak, Republic, India,
Lebanon, New Zealand, the Kingdom of Norway, Pakistan, Southern Rhodesia,
Syria, and the Ubion of South Africa, acting in- their capacity of sigatories
of the FinaL Act adopted. at the conclusion of the Second. Session of the.
Preparatory Comittee of the United Nations Conference on Trade and Eployment
which authenticated the text of the General Agreement on Tariffs and Trade
Being desirous of modifying the text of Article XIV of the General.
Agreement on Tariffs and Trade, in the light of the text of the Havana Charter
for an International Trade Organization, which was authenticated by the
final, Act of the United Nations Conference on Trade and Employment
Hereby agree as follows:
I. Article XIV of the General Agreement on Tariffs and Trade hall read as
follow.:
[Insert final taxt of Article 23 of the Havana Charter and. any
accompanying anexees, etcj7
II. This Protocol shall. remain open .for' signature at the Headquarters of the
United Nations util 1 June 1948 on behalf of any government named in the
preamble of this Protocol Which have not signed it on this day.
Not outstanding the provision of Article XXX of the. General Agreement
on Tariffs ans Trade, the: modifications of theGeneral Agreement on
/Tariffe pages 2-
.
tariffs and Trade provised for in this Protocol shall become effective,
as among Contractlng Parties to the Agreement, on 1 January-1949.
sigature of this Protocol ;by any Governent which Is Not at the time
a Contracting Party to the Generel Agreement an Tariffs and rale shal
serve to authenticate the text of the modifications of the General.
Agreement provided for in this Protoool. -
In witness whereof the repective representatives have signed the present
Protocol.
Done at Havana, in a single copy, in the english and frech Languages,
both texts authentic thi.... .day of March, one thousand nine hundred and
forty -eight. |
GATT Library | jx461fy9675 | Revision of rules of procedure : Note by the Executive Secretary | Interim Commission for the International Trade Organization, August 2, 1948 | Interim Commission for the International Trade Organization (ICITO/GATT) and Executive Committee | 02/08/1948 | official documents | ICITO/EC.2/6 and ICITO/EC.2/2/ADD.5 ICITO/EC.2/6/REV.1 | https://exhibits.stanford.edu/gatt/catalog/jx461fy9675 | jx461fy9675_90060188.xml | GATT_147 | 260 | 1,984 | FOR THE INTERNATIONAL L'ORGANISATION INTERNATIONALE
TRADE ORGANIZATION DU COMMERCE
UNRESTRICTED
ICITO/EC. 2/6
EXECUTIVE COMMITTEE 2 August, 1948
Second session ORIGINAL: ENGLISH
Item 2 of the provisional agenda
REVISION OF RULES OF PROCEDURE
Note by the Executive Secretary
The following minor amendments to the Rules of Procedure
adopted at the first meeting of the Executive Committee at
Havana (document ICITO/EC.1/3) are suggested by the Executive
Secretary:-
"Representatives of the United Nations and the specialized
agencies and other inter-govermental organization may attend
meetings of the Executive Committee................. activities."
Rule 8
"The Executive Committee [shall accord to] may
with the representatives of non-governmental organizations
[approved by the Economic and Social Council for the purpose
of consultation] granted consultative by the Economic
and Social Council [the same rights and privileges as are
accorded by the commissions of the Council] upon questions in
which such organizations have special competence knowledge
either directly or through a committee established for that
purpose. Such consulations may be arranged on the invitation
of the Executive Committee or on the request of the Organization."
Rule 10
"The Executive Committee shall elect from the representa-
tives a Chairman and three Vice-Chairmen. They shall each
hold office for a period of one calendar year or should the
Committee not be meeting at the expiry such period.
"Decisions of the Executive Committee shall be made by a
majority of the members present and voting. The phrase "members
present and voting" means members casting an affirmative or
negative vote. Members which abstain from Voting shall be
sidered not voting."
INTERIM COMMISSION
COMMISSION INTERIMAIRE DE |
GATT Library | gn207bg2932 | Rules of procedure | General Agreement on Tariffs and Trade, March 9, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 09/03/1948 | official documents | GATT/1/16 and GATT/1/9-28+21/Add.1 | https://exhibits.stanford.edu/gatt/catalog/gn207bg2932 | gn207bg2932_90310290.xml | GATT_147 | 1,264 | 7,699 | RESTRICTED
GATT/1/16
9 March 1948
ORIGINAL: ENGLISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
FIRST SESSION OF THE CONTRACTING PARTIES
RULES OF PROCEDURE
CHAPTER I AGENADA
Rule 1.
The provisional. agenda for each session shall be drawn up by tho Secritary
in consultation with the Chairman and shall be communicated to the contracting
parties at least three weeks before the data of meeting. It shall be open to
any contracting party to propose items for inclusion in this provisional. agenda
up to one month from the date of meeting.
The first item of business at each session shall be the consideration
and approval of an agenda.
The agenda may be amended, at any time or priority given to certain items.
CHAPTER II - CREDENTIALS
Each contracting party as defined in Article XXXII of the General. Agreement
on Tariffs and Trade shall be represented by an accredited. representative.
Rule 5
Each representative may be accompanied by such alternate representatives
and. advisers as he may require.
Rule 6
The credentials of representatives shall be submitted to the secretary
at last one week before the opening of a meeting. They shall take the form
of a communication from or on behalf of the Minister of Foreign Affairs
authorizing the representative to perform on behalf of the contracting party
the functions indicated in Article XXV of the General Agreement on Tariffs and
/Trade.
5896 GATT/1/16
Page 2
Trade. The Chairman after consulting with the Secretary shall draw attention
to any case where a representative has omitted to present his credentials in
due time and form.
CHAPTER III - OBSERVERS
Rule 7-.
The representatives of countries signatories at Geneva of the Final Act
adopted at the conclusion of the Second. Session of the Preparatory Committee
of the United Nations Conference on Trade and Employment which have not become
contracting parties may attend meetings in the capacity of observers
participating in the discussions.
Rule 8
representatives of specialized agencies may participate in the meetings
without vote on the invitation of the contracting parties.
CHAPTER IV OFFICERS
A Chairman and a Vice-Chairman shall be elected from among the
represenatives. They shall each hold office for a period of one year.
Rule 10
If the Chairman is absent from any meeting or part thereof, the Vice-
Chairman shall preside.
Rule 11
If the Chairman ceases to represent a contracting party or is so
incapacitated that he can no longer hold office, the Vice-Chairman shall
become Chairman.
Rule 12
The Vice-Chairman acting as Chairman shall have the same powers and
duties as the Chairman.
Rule 13
The Chairman or the Vice-Chairman acting as Chairman shall normally
participate in the proceedings as such and not as the representatives of a
contracting party. He may, however, at any time request that he be permitted
to act in either capacity.
Rule 14
During the First Session of the Contracting Parties, the Executive
Secretary of the United Nations Conference on Trade and Employment and his
staff shall perform the usual duties of a Secretariat.
/CHAPTER V - CONDUCT GATT/1/16
Page 3
CHAPTER V- CONDUCT OF BUSINESS
A simple majority of the contracting parties shall constitute a quorum.
Rule 16
in addition to exercising the powers conferred upon him elsewhere by these
rules, the Chaiarman shall declare the opening and closing of each meoting., shall
direct the discussion, accord. the right to, speak, put questions to the vote,
announce decisions, rule on points of order and, subject to these rules, have
complete control of the proceedigs. The Chairman may also call a speaker to
order if his remarks are not relevant.
Rule 17
During the discussion of any matter a representative may raise a point
of order. In this case the Chairman shall immediately state his ruling. If
his ruling; is challenged, the Chairman shall immediately submit it for
decision and it shall stand. unless overruled.
Rule 18
During the discussion of any matter a representative may move the
adjournment of the debate. Any such motion shall have priority. In addition
to the proposer of the motion, one representative may be allowed to speak in
favour of, and two representatives against, the motion.
Rule 19
.A representative may at any time move the closure of the debate. in
addition to the mover of the motion, not more than one representative may be
granted permission to speak in favour of the motion and not more than two
representatives may be granted permission to speak against the. motion, after
which the motion shall be put to the vote immediately.
Rule 20
During the course of a debate the Chairman may announce the list; of
speakers and., with the consent of the meeting, declare the list close. . He
may, however, accord a right of reply to representative if a speech
delivered after he has declared the list closed makes this desirable.
Rule 21
The Chairman, with the consent of the contracting parties, may limit the
time allowed to each speaker.
Rule 22
Proposals and amendments shall normally be introduced in writing and
circulated to all representatives not later than twelve hours before the
commencement of the meeting at which they are to be discussed. Rule 23 GATT/1/16
Page 4
Rule 23
If two or more proposals are moved relating to the same questions, the
meeting shall first vote on the most far-reaching proposal and then on the
next most .ar-reaching proposal and so on.
Rule 24
When an amendment is moved to a proposal, the amendment shall be put to
the vote first, and if it is adopted, the amended proposal shall then be put
to the vote.
Rule 25
When two or more amendments are moved to a proposal, the meeting shall
vote first on the amendments farthest removed in substance from the original
proposal, then, if necessary, on the amendment next farthest removed, and so--
an until all the amendments have been put to the vote.
CHAPTER VI - VOTING
Rule 26
Except as otherwise specified in the General Agreement on Tariffs and
Trade, decisions shall be taken by a mojority of the votes cast.
Rule 27
Each contracting party shall be entitled to one vote.
CHAPTER VII- COMMITTEES
Rule 28
Such committees and sub-committees as may be necessary may be established.
Rule 29
A simple majority of the members of a committee shall constitute a quorum.
Rule. 30
The provisions of Rules 15 to 27 shall be applied in the proceeding of
committees.
CHAPTER VIII - LANGUAGES
Rule. 31
Subject to the provisions of Rule 32, Eglish and French shall be the
working languages.
Rule 32
A decision, by unanimouss agreement, may be taken at any meeting, to adopt
a rule of procedure regarding interpretations of a more simple character than
Rule 31.
/CHAPTER IX- RECORDS GATT/1/16 Page 5
CHAPTER IX - RECORDS
Rule 33
Summary records of the meetings of the contracting parties shall be kept
by the Secretariat. They shall be sent as soon as possible to all
representatives who shall inform the Secretariat not later than twenty-four
haours after the circulation of the summary record. of any changes they wish
to have made
Rule 34
Committees may decide to adopt records of a more simple form. than those
mentioned in Rule 33.
CHAPTER X - PUBLICITY OF MEETINGS
Rule 35
The meetings of the contracting parties and of committee shall ordinarily
be held in private. It may be decided that a particular meeting or meetings
should be held in public.
Rule 36
After a private meeting had boon held, the Secretary, with the approval
of the body concerned, may issue a communique to the press. |
GATT Library | gk779th7422 | Rules of procedure. El Salvador: Proposed amendment | United Nations Conference on Trade and Employment, January 3, 1948 | 03/01/1948 | official documents | E/CONF.2/2/Rev.4/Add.1 and E/CONF.2/1-8 | https://exhibits.stanford.edu/gatt/catalog/gk779th7422 | gk779th7422_90040010.xml | GATT_147 | 50 | 356 | United Nations
CONFERENCE
ON
TRADE AND EMPLOYMENT
Nations Unies
CONFERENCE
DU
COMMERCE ET DE L'EMPLOI
UNRESTRICTED
E/CONF.2/2/Rev.4/
Add. 1
3 January 1948
ENGLISH
ORIGINAL: SPANISH
RULES OF PROCEDURE
EL SALVADOR: PROPOSED AMENDMENT
Rule 38
Add. the following: "But in the Sub-Committees Spanish shall also
be used as a working language". |
|
GATT Library | fx071wz9786 | Rules of Procedure for the Commission : Note by the Executive Secretary | Interim Commission for the International Trade Organization, March 19, 1948 | Interim Commission for the International Trade Organization (ICITO/GATT) | 19/03/1948 | official documents | ICITO/1/2, ICITO/INF/1-8, and ICITO/1/1-16 | https://exhibits.stanford.edu/gatt/catalog/fx071wz9786 | fx071wz9786_90180011.xml | GATT_147 | 147 | 910 | UNRESTRICTED
ICITO/1/2
19 March 1948
INTERIM COMMISSION FOR THE INTERNATIONAL TRADE ORGANIZATION
RULES OF PROCEDURE FOR THE COMMISSION
NOTE BY THE EXECUTIVE SECRETARY
1. With reference to Item 1 of the Provisional Agenda for the first meeting
of the Commission, it is suggested that the Commission should adopt the Rules
of Procedure of the Havana Conference as contained in document E/CONF.2/2/Rev.4
of 26 November 1947, subject to the following modifications:
(a) in place of "the Conference" wherever it appears,
read "the Commission";
(b) delete Rules 3-6 Inclusive;
(c) amend Rule 7 to read "The Commission shall elect a
President";
(d) delete Rules 8, 9 and 10. In Rule 11, delete the words
" or a Vice-President";
(e) amend Rule 30 to read: "Decisions of the Commission
shall be made by a majority of the members present and voting";
(f) omit the first sentence of Rule 54.
6438 |
GATT Library | cx395fc1360 | Rules of procedure. Revised Czechoslovak proposal. Chapter III - observers | August 18, 1948 | 18/08/1948 | official documents | GATT/CP.2/W.1/Rev.1 and GATT/CP.2/W.1-W.14 CP.2/W.1/Rev.1,CP.2/W.9/Corr.1,W.9/Add.1 | https://exhibits.stanford.edu/gatt/catalog/cx395fc1360 | cx395fc1360_91870452.xml | GATT_147 | 104 | 728 | RESTRICTED
GATT/CP.2/W.1/Rev.1
18 August 1948
Original: ENGLISH.
RULES OF PROCEDURE
REVISED CZECHOSLOVAK PROPOSAL
CHAPTER III - OBSERVERS
Rule 7.
The Representatives of Governments invited to the
International Conference on Trade and Employment at Havana
may take part as observers at all meetings of the Contracting
Parties. Such representatives may, upon the invitation of
the Chairman, address a meeting on matters of direct concern
to then.
Rule 8.
The Representatives of Specialized Agencies in
relationship with the United Nations and of non-governmental
Organizations approved by the Economic and Social Council
shall have the same rights and privileges as are accorded
by Commissions of the Council. |
|
GATT Library | pw739gm8188 | Schedule XV. Pakistan - Negotiation with Ckechoslovakia | General Agreement on Tariffs and Trade, October 11, 1948 | General Agreement on Tariffs and Trade (Organization) | 11/10/1948 | official documents | GATT/CP.2/39/Add.1 and GATT/CP.2/38/Rev.1 CP.2/39+Add.1 CP.2/40-45 CP.2/44/Add.1 | https://exhibits.stanford.edu/gatt/catalog/pw739gm8188 | pw739gm8188_90320060.xml | GATT_147 | 134 | 898 | RESTRICTED
LIMITED B
GATT/CP.2/39/Add.1
11 October, 1948
ORIGINAL: ENGLISH
FRENCH
GENERAL AGREEMENT ON TARIFFS AND TRADE
Schedule XV. Pakistan - Negotiation with C,'echoslovakia.
Pursuant to GATT/CP.2/39, the Contracting Parties are
hereby advised that no objection has been lodged with the
Chairman of the Contracting Parties concerning the deletion
Item 60 (3), Glass Beads and False Pearls, from Schedule XV
of the General Agreement on Tariffs and Trade.
ACCORD GENERAL SUR LES TARIFS DOUANUERS ET LE COMMERCE
Liste XV - Negociation avec Ia Tchecoslovaquie
En conformite du document GATT/CP.2/39, les Parties
contractantes sont avisees que le President des Parties
contractantes n'a ete informe d'aueune objection a la
suppression de la position 60 (3) : Grains en verre et
Perles fausses, de la Liste XV, annexee a l'Accord general
sur les Tarifs douaniers et le Commerce. |
GATT Library | pm100jt3241 | Schedule XV - Pakistan. Negotiation with Czechoslovakia | General Agreement on Tariffs and Trade, September 9, 1948 | General Agreement on Tariffs and Trade (Organization) and Contracting Parties | 09/09/1948 | official documents | GATT/CP.2/39 and GATT/CP.2/38/Rev.1 CP.2/39+Add.1 CP.2/40-45 CP.2/44/Add.1 | https://exhibits.stanford.edu/gatt/catalog/pm100jt3241 | pm100jt3241_90320059.xml | GATT_147 | 169 | 1,149 | RESTRICTED
LIMITED B
GATT/CP. 2/39
9 September 1948
ORIGINAL : ENGLISH
GENERAL AGREEMENT ON TARIFFS AND TRADE
Contracting Parties
Second Session
Schedule XV Pakistan
Negotiation with Czechoslovakia.
The Delegation of Czechoslovakia has informed the
Chairman of the Contracting Parties that the Czechoslovakian
Government agrees to the deletion of Item 60 (3), Glass
beads and false pearls, from Schedule XV of the General
agreement on Tariffs and Trade. Since this amendment
of the Schedule can become effective, under the provisions
of Article XXX, only upon acceptance by all the Contracting
Parties, and since the Government of Southern Rhodesia is
not represented at the Second Session, the Chairman of
the Contracting Parties hereby gives notice, in accordance
with the recommendation contained in document GATT/CP.2/25
as approved by the Contracting Parties at the Second Session,
of the result of the negotiations between Pakistan and
Czechoslovakia.
If no objection is.lodged with the Chairman within
thirty days the Government of Pakistan will be free to
withdraw the concession on the item referred to above, |
GATT Library | xm190sr0364 | Scheduling of future Meetings | United Nations Conference on Trade and Employment, January 3, 1948 | 03/01/1948 | official documents | E/CONF.2/24 and E/CONF.2/14-15/REV.1 | https://exhibits.stanford.edu/gatt/catalog/xm190sr0364 | xm190sr0364_90040079.xml | GATT_147 | 393 | 2,621 | United Nations Nations Unies UNRESTRICTED
CONFERENCE CONFERENCE E/CONF.2/24
ON DU 3 January 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
SCHEDULING OF FUTURE MEETINGS
During the past few days, with the increase in the number of
sub-committees in operation, it has become increasingly difficult to
schedule meetings in a manner which would avoid serious conflicts for any
delegation represented by the same person on several committees or sub-
committees, and particularly for the smaller delegations which might be
members of, or substantially interested in, a number of committees and
sub-committees. Within the next few days the problem will become even
more difficult to deal with since it will be necessary from the beginning
of next week to find meeting times for some twenty sub-committees as well
as for occasional meetings of the committees of the Conference.
If even the present frequency of meetings is to be maintained it would
appear possible to accommodate the greatly increased number of sub-committees
with a minimum of conflicts in meeting times only by either scheduling
night meetings as a normal course and not merely in exceptional circumstances,
or by arranging two meeting periods in the afternoon. At the present
stage of the Conference the General Committee hesitates to suggest the
former course. Accordingly, as what would appear to be the only practicable
alternative, the following general plan of meeting times should go into
effect from the morning of Monday, 5 January:
10.30 a.m. to 1.00 p.m.
3.00 p.m. to 5.30 p.m.
5.45 p.m. to 8.00 p.m.
In this manner it would be possible to maintain at least the present
number of meetings per day while keeping the maximum number of formal
meetings taking place at any one time to four. At the present time the
normal number of meetings taking place simultaneously is five. It will
be seen that the new arrangement which is proposed, by reducing the number
of meetings taking place at one time, would decrease the number of conflicts
to the minimum consistent with the present frequency of meeting.
Informal meetings not requiring interpretation could take place as
needed and as convenient.
For this plan to work it would be necessary for the duration of each
meeting to be kept within the indicated limits in order to prevent meetings
from overlapping, and thus delaying the subsequent meeting scheduled for
the same room. |
|
GATT Library | nn487fp9047 | Second Committe: Economic Development : Corrigendum to report to Conference. Annex VII - page 29. Article 14. Transitional measures | United Nations Conference on Trade and Employment, March 22, 1948 | 22/03/1948 | official documents | E/CONF.2/69/Corr.1 and E/CONF.2/59/CORR.4 - 69/CORR.1 | https://exhibits.stanford.edu/gatt/catalog/nn487fp9047 | nn487fp9047_90040144.xml | GATT_147 | 88 | 655 | United Nations
CONFERENCE
ON
TRADE AND EMPLOYMENT
Nations unies
CONFERENCE
DU
COMMERCE ET DE L'EMPLOI
UNRESTRICTED
E/CONF.2/69/Corr.1
22 March 1948
ENGLISH ONLY
SECOND COMMITTE : ECONOMIC DEVELOPMENT
CORRIGENDUM TO REPORT TO CONFERENCE
ANNEX VII - PAGE 29
ARTICLE 14
TRANSITIONAL MEASURES
Paragraph 1 (a), the third line should read as follows:
"Conference on Trade and Employment, not later than October 10, 1947,
In respect of measures in"
Paragraph 1 (b) insert a comma after 'Member" in the first line and after
"charter" in the second line.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~1
F~~~~~~~~~~~~~~~~ |
|
GATT Library | rs824db5633 | Second Committee: Economic Developmemt : Article 14. Transitional Measures | United Nations Conference on Trade and Employment, March 18, 1948 | 18/03/1948 | official documents | E/CONF.2/C.2/49 and E/CONF.2/C.2/29-49/CORR.1 | https://exhibits.stanford.edu/gatt/catalog/rs824db5633 | rs824db5633_90040248.xml | GATT_147 | 544 | 3,478 | United Nations Nations Unies
CONFERENCE CONFERENCE UNRESTRICTED
ON DU E/CONF.2/C.2/49
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI 18 March 1948
ORIGINAL: ENGLISH
SECOND COMMITTEE: ECONOMIC DEVELOPMEMT
Article 14*
Transitional Measures
1. Any Member may maintain any non-discriminatory protective measure
affecting imports which has been imposed for the establishment, development
or reconstruction of a particular industry or branch of agriculture and
which is not otherwise permitted by this Charter, provided that notification
has been given of such measure and of each product to which it relates:
(a) in the case of a Member signatory to the Final Act of the Second
Session of the Preparatory Committee of the United Nations
Conference on Trade and Employment in respect of measures in
force on September 1, 1947, subject to decisions made under
paragraph 6 of Article XVIII of the General Agreement on
Tariffs and Trade; except that if in special circumstances the
CONTRACTING PARTIES to that Agreement agree to dates other than
those specified in this sub-paragraph, such other dates shall apply;
(b) in the case of any other Member not later than the day on which
it deposits its instrument of acceptance of this Charter in
respect of measures in force on that day or on the day of the
entry into force of the Charter, whichever is the earlier;
and provided further that notification has been given under sub-paragraph (a)
to the other signatories to the Final Act of the Second Session of the
Preparatory Committee of the United Nations Conference on Trade and Employment
and under sub-paragraph (b) to the Organization, or, if the Charter has not
entered into force on the day of such notification, to the signatories to
the Final Act of the United Nations Conference on Trade and Employment.
2. Any Member maintaining any such measure, other than a measure approved
by the CONTRACTING PARTIES to the General Agreement under paragraph 6 of
Article XVIII of that Agreement, shall, within one month of becoming a
Member of the Organization, submit to it a statement of the considerations
in support of the maintenance of the measure and the period for which it
wishes to maintain it. The Organization shall, as soon as possible, but in
* As approved by Committee II at its Twenty-sixth Meeting /any case E/CONF.2/C.2/49
Page 2
any case within twelve months of such Member becoming a Member of the
Organization, examine and give a decision concerning the measure as if it
had been submitted to the Organization for its concurrence under Article 13.
3. Any measure, approved in accordance with the provisions of Article XVIII
of the General Agreement, and which is in effect at the time this Charter
enters into force, may remain in effect thereafter, subject to the conditions
of any such approval and, if the Organization so decides, to review by the
Organization.
4. This Article shall not apply to any measure relating to a product in
respect of which the Member has assumed an obligation through negotiations
pursuant to Chapter IV.
5. In cases where the Organization decides that a measure should be modified
or withdrawn by a specified date, it shall have regard to the possible need of
a Member for a period of time in which to make such modification or withdrawal. |
|
GATT Library | gn214fs1469 | Second Committee: Economic Development | United Nations Conference on Trade and Employment, February 20, 1948 | 20/02/1948 | official documents | E/CONF.2/C.2/39 and E/CONF.2/C.2/29-49/CORR.1 | https://exhibits.stanford.edu/gatt/catalog/gn214fs1469 | gn214fs1469_90040235.xml | GATT_147 | 624 | 4,172 | United Nations Nations Unies UNRESTRICTED
CONFERENCE CONFERENCE E/CONF.2/C.2/39
ON DU 20 February 1948
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI ORIGINAL: ENGLISH
SECOND COMMITTEE: ECONOMIC DEVELOPMENT
I. PROPOSAL IN RELATION TO REPORT OF JOINT SUB-COMMITTEE OF
COMMITTEES II AND VI ON ARTICLES 9, 10 AND 11 (E/CONF.2/C.2/36)
II. PROPOSAL IN RELATION TO REPORT OF SUB-COMMITTEE D ON FOOTNOTE
TO CHAPTER III ON "RECONTRUCTION" (E/CONF.2/C.2/35)
I
1. In order to meet the point raised by the representative of Uruguay
at the twenty-first meeting of Committee II on 20 February 1948 the
representative of Australia proposed that Committee II endorse the View
expressed in paragraph 6 of the Report of the Joint Sub-Committee of
Committees II and VI on Articles 9, 10 and 11 (E/CONF.2/C.2/36) with
the deletion of the second sentence, namely
"These provide that all controversies which may arise out
of contracts in which the State or one of its sub-divisions are
parties are to be resolved by national tribunals."
and the substitution of the following two sentences:
"These provide that certain controversies, which [may erise
within their Jurisdiction], are to be resolved by national
tribunals. In some cases such controversies may arise in
connection with matters dealt with in Article 11."
The representative of the United Kingdom suggested further that
the words placed in square brackets in the draft suggested by the
representative of Australia be replaced by the words "are within the
domestic jurisdiction of such States".
2. At its twenty-first meeting Committee II had before it the view
set out below with regard to the deletion of paragraph 4 of Article 11
of the Geneva Draft Charter, which the Members of the Working Party
established at the twentieth meeting of Committee II (E/C0NF.2/C.2/SR.20),
proposed be endorsed by Committee II. The words in square brackets and
the words underlined are words which the representative of the
United Kingdom proposed be deleted and added respectively.
/In connection E/CONF. 2/C .2/39
Page 2
In connection with the deletion of paragraph 4 of' Article 11
of the Geneva Draft Charter it was pointed out that the paragraph
merely stated that the term "nationals" as used in that Article
and in Article 12 comprised natural and legal persons. However,
certain delegations called the attention of the Committee to
Provisions in their Constitutions requiring certain types of
activities to be carried on by legal entities incorporated under
their domestic laws and also affecting the rights of persons
holding shares of such entities. It was further [pointed out]
suggested by certain delegations that the problem of the
determination of the nationality of legal entities was very
complicated and raised many questions of international law. [it
was therefore agreed that the toxt should be deleted.]
The deletion is to be taken as reflecting only the [desire]
view of the Committee [to make cloar] that the constitutional
provisions referred to are not prejudiced and are outside the
scope of the Charter, [without on the other hand affooting]
though In their ipinion this does not affect the construction of
the torm nationals as used in Articles 11 and I2, without
prejudice to such provisions, as including both legal and natural
persons. The Committee also considered that the problem of the
nationality of legal entities was not raised by the paragraph or
by its deletion.
II
3. The representative of Australia proposed that the changes in Article 8
and paragraphs 2 and 3 of Article 10 recommended in the Report of
Sub-Committee D on the Footnote to Chapter III on "Reconstruction"
(E/CONF.2/C.2/35) be amended so that the words
"together with the reconstruction of those countries whose
economies have been devastated by war"
be replaced by the words
"together-with the reconstruction of the economies of those
countries which have been dovastated by war". |
|
GATT Library | zk866zp9138 | Second Committee: Economic Development. Agenda for Nineteenth Meeting : To be held Friday, 30 January 1948 at 10.30 a.m | United Nations Conference on Trade and Employment, January 29, 1948 | 29/01/1948 | official documents | E/CONF.2/C.2/34 and E/CONF.2/C.2/29-49/CORR.1 | https://exhibits.stanford.edu/gatt/catalog/zk866zp9138 | zk866zp9138_90040228.xml | GATT_147 | 0 | 0 | ||
GATT Library | pm796vh7898 | Second Committee: Economic Development. Agenda for Nineteenth Meeting : To be held Friday, 30 January 1948 at 10.30 a.m | United Nations Conference on Trade and Employment, January 29, 1948 | 29/01/1948 | official documents | E/CONF.2/C.2/34 and E/CONF.2/C.2/29-49/CORR.1 | https://exhibits.stanford.edu/gatt/catalog/pm796vh7898 | pm796vh7898_90040228.xml | GATT_147 | 166 | 1,255 | United Nations Nations Unies
CONFERENCE CONFERENCE UNRESTRICTED
ON DU E/CONF. 2/C. 2/34
TRADE AND EMPLOYMENT COMMERCE ET DE L'EMPLOI 29 January 1948
ORIGINAL: ENGLISH
SECOND COMMITTEE: ECONOMIC DEVELOPMENT
AGENDA FOR NINETEENTH MEETING
To be Held Friday, 30 January 1948 at 10.30 a.m.
1. Amendments Proposed to the Text of Article 12
(a) Proposal of Belgium to delete paragraph 3 of Article 12.
(b) Drafting amendment of China that paragraph 2, sub-paragraph (b)
of Article 12 should read:
"Upon the request of any Member and without prejudice to
existing international agreements to which Members are
parties to enter....." etc.
2. Amendments Proposed to Interpretation of Article 12 in Sub-Committees
Report
(a) The delegate for Venezuela proposed the deletion of paragraph 3,
sub-paragraph (a).
(b) The delegate for Poland proposed that paragraph 3, sub-paragraph (c)
of the report should read as follows:
"The Articles of Agreement of the International Monetary Fund
are included among the International agreements referred to in
paragraph 1 (c) and paragraph 2, sub-paragraph (b)." |
|
GATT Library | bz858zg8520 | Second Committee: Economic Development. Agenda for Seventeenth Meeting : To be held Monday, 26 January 1948 at 6.00 p.m | United Nations Conference on Trade and Employment, January 2, 1948 | 02/01/1948 | official documents | E/CONF.2/C.2/30 and E/CONF.2/C.2/29-49/CORR.1 | https://exhibits.stanford.edu/gatt/catalog/bz858zg8520 | bz858zg8520_90040223.xml | GATT_147 | 100 | 732 | United Nations
CONFERENCE
ON
TRADE AND EMPLOYMENT
Nations Unies
CONFERENCE
DU
COMMERCE ET DE L'EMPLOI
UNRESTRICTED
E/CONF. 2/C.2/30
2 January 1948
ENGLISH - FRENCH
ORIGINAL: ENGLISH
SECOND COMMITTEE: ECONOMIC DEVELOPMENT
AGENDA FOR SEVENTEENTH MEETING
To be Held Monday, 26 January 1948 at 6.00 p.m.
Discussion of Report of Sub-Committee B on Article 12 -
International Investment for Economic Development - (E/CONF.2/C.2/29)
DEUXIEME COMMISSION: DEVELOPPEMENT ECONOMIQUE
ORDRE DU JOUR DE LA DIX-SEPTIEME SEANCE
qui se tiendra le lm 26 janvier 1948, à 18 heures
Examen du rapport de la Sous-Commission B sur l'article 12.
Investiseements internationaux destinés au développement économique
(E/CONF.2/C.2/29). |
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