WTA /WTO and GATT Uruguay 1994
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World Trade Agreement 1994 (establishing the WTO and including GATT Uruguay 1994)
Annex 3: Trade Policy Review Mechanism
Annex 3: Trade Policy Review Mechanism
(i) The purpose of the Trade Policy Review Mechanism is to contribute to improved adherence by all Members to rules, disciplines and commitments made under the Multilateral Trade Agreements and, where applicable, the Plurilateral Trade Agreements, and hence to the smoother functioning of the multilateral trading system, by achieving greater transparency in, and understanding of, the trade policies and practices of Members. Accordingly, the review mechanism will enable the regular collective appreciation and evaluation by the Ministerial Conference of the full range of individual Members' trade policies and practices and their impact on the functioning of the multilateral trading system. It is not, however, intended to serve as a basis for the enforcement of specific obligations under the Agreements or for dispute settlement procedures, or to impose new policy commitments on Members.
(ii) The assessment to be carried out under the review mechanism will, to the extent relevant, take place against the background of the wider economic and developmental needs, policies and objectives of the Member concerned, as well as of its external environment. However, the function of the review mechanism is to examine the impact of a Member's trade policies and practices on the multilateral trading system.
Members recognize the inherent value of domestic transparency of government decision-making on trade policy matters for both Members' economies and the multilateral trading system, and agree to encourage and promote greater transparency within their own systems, acknowledging that the implementation of domestic transparency must be on a voluntary basis and take account of each Member's legal and political systems.
(i) Trade policy reviews will be carried out by the Trade Policy Review Body (TPRB).
(ii) The trade policies and practices of all Members will be subject to periodic review. The impact of individual Members on the functioning of the multilateral trading system, defined in terms of their share of world trade in a recent representative period, will be the determining factor in deciding on the frequency of reviews. The first four trading entities so identified (counting the European Communities as one) will be subject to review every two years. The next sixteen will be reviewed every four years. Other Members will be reviewed every six years, except that a longer period may be fixed for least-developed country Members. It is understood that the review of entities having a common external policy covering more than one Member shall cover all components of policy affecting trade including relevant policies and practices of the individual Members. Exceptionally, in the event of changes in a Member's trade policies or practices which may have a significant impact on its trading partners, the Member concerned may be requested by the TPRB, after consultation, to bring forward its next review.
(iii) In the light of the objectives set out in A above, discussions in the meeting of the TPRB will, to the extent relevant, take place against the background of the wider economic and developmental needs, policies and objectives of the Member concerned, as well as of its external environment. The focus of these discussions will be on the Member's trade policies and practices which are the subject of the assessment under the review mechanism.
(iv) The TPRB will establish a basic plan for the conduct of the reviews. It may also discuss and take note of update reports from Members. The TPRB will establish a programme of reviews for each year in consultation with the Members directly concerned. In consultation with the Member or Members under review, the Chairman may choose discussants who, in their personal capacity, will introduce the discussions in the TPRB.
(v) The TPRB will base its work on the following documentation:
(a) A full report, referred to in paragraph D(i) below, supplied by the Member or Members under review.
(b) A report, to be drawn up by the Secretariat on its own responsibility, based on the information available to it and that provided by the Member or Members concerned. The Secretariat should seek clarification from the Member or Members concerned of their trade policies and practices.
(vi) The reports by the Member under review and by the Secretariat, together with the minutes of the respective meeting of the TPRB, will be published promptly after the review.
(vii) These documents will be forwarded to the Ministerial Conference, which will take note of them.
(i) In order to achieve the fullest possible degree of transparency, each Member shall report regularly to the TPRB. Full reports will describe the trade policies and practices pursued by the Member or Members concerned, based on an agreed format to be decided upon by the TPRB. This format initially shall be based on the Outline Format for Country Reports established by the Decision of the GATT 1947 CONTRACTING PARTIES of 19 July 1989, amended as necessary to extend the coverage of reports to all aspects of trade policies covered by the Multilateral Trade Agreements in Annex 1 and, where applicable, the Plurilateral Trade Agreements. This format may be revised by the TPRB in the light of experience. Between reviews, Members will provide brief reports when there are any significant changes in their trade policies; an annual update of statistical information will be provided according to the agreed format. Particular account will be taken of difficulties presented to least-developed country Members in compiling their reports. The Secretariat shall make available technical assistance on request to developing country Members, and in particular to the least-developed country Members. Information contained in reports should to the greatest extent possible be coordinated with notifications made under provisions of the Multilateral Trade Agreements and, where applicable, the Plurilateral Trade Agreements.
Members recognize the need to minimize the burden for governments also subject to full consultations under the balance-of-payments provisions of the GATT 1994 or the GATS. To this end, the Chairman of the TPRB shall, in consultation with the Member or Members concerned, and with the Chairman of the Committee on Balance-of-Payments Restrictions, devise administrative arrangements which would harmonize the normal rhythm of the trade policy reviews with the time-table for balance-of-payments consultations but would not postpone the trade policy review by more than twelve months.
The TPRB will undertake an appraisal of the operation of the TPRM not more than five years after the entry into force of the Agreement Establishing the WTO. The results of the appraisal will be presented to the Ministerial Conference. It may subsequently undertake appraisals of the TPRM at intervals to be determined by it or as requested by the Ministerial Conference.
An annual overview of developments in the international trading environment which are having an impact on the multilateral trading system will also be undertaken by the TPRB. It will be assisted by an annual report by the Director-General setting out major activities of the WTO and highlighting significant policy issues affecting the trading system.