./.WORLD TRADE
ORGANIZATIONG/SG/Q2/ECU/9
12 November 2003
(03-6075)
Committee on Safeguards Original:  English
NOTIFICATION UNDER ARTICLE 12.4 OF THE AGREEMENT ON
SAFEGUARDS BEFORE TAKING A PROVISIONAL SAFEGUARD
MEASURE REFERRED TO IN ARTICLE 6
Follow-Up Questions Posed by the EUROPEAN COMMUNITIES
Regarding the Notification from ECUADOR1
(Glazed Ceramic Flags and Paving, Hearth or Wall Tiles (Smooth Ceramics)
The following communication, dated 10 November 2003, has been received from the
Delegation of the European Commission.
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On 3 July 2003, the External Trade and Investments Committee of Ecuador (COMEXI)
decided to initiate a safeguard investigation on glazed ceramic flags and paving, hearth or wall tiles.
On 1 September 2003, a provisional measure was imposed for a 180-day period, consisting of an
extra-duty of 15 per cent ad-valorem.  This measure was notified to the WTO Committee on
Safeguards on 24 September 2003 (G/SG/N/7/ECU/2) .  The measure was adopted on the basis of
Ecuadorian safeguard legislation, Decree 3497/2003.
1. It appears that Ecuador has not yet notified to the WTO Committee on Safeguards Decree
3497/2003 (published in the Official Journal n° 744 of 14 January 2003).  Can Ecuador explain the
reasons why it has not made this notification promptly as mandated by Article 12.6 SA, and when it
intends to make the relevant notification?  Would Ecuador agree that a WTO Member should notapply measures based on safeguard legislation it has not yet notified to, and which has not yet been
reviewed by, the WTO Committee on Safeguards?
2. Ecuador notified the provisional measures to the WTO Committee on Safeguards 23 days
after their imposition.  Does Ecuador consider that it has complied with Article 12.4 SA, whichrequires that provisional measures are notified before they are taken?
3. Has Ecuador made any preliminary findings on unforeseen developments as mandated by
GATT Article XIX in the context of its decision on provisional measures?  Can Ecuador explain
where these findings can be found in its notifications and or decisions on provisional measures?
4. Ecuador’s notification of provisional measures under Article 12.4 contains some evidence on
evolution of domestic sales (stable over last three and half years), domestic production (declining
according to Ecuador, yet with no supporting evidence), capacity utilisation (declining from 56 per
cent to 52 per cent over the period), gross profit and operating profit (declining but still positive at the
                                                     
1 G/SG/N/7/ECU/2G/SG/Q2/ECU/9
Page 2
end of the period), employment (stable over th e period), and inventories (increasing by approx.
100 per cent).
(a) Can Ecuador explain how could inventories double when production was allegedly declining
and sales remained stable?
(b) Can Ecuador explain how can the above data constitute a preliminary determination that there
is “clear evidence” of an “overall impairment in the position of a domestic industry”
(Articles 6 and 4(1)(a) SA)?
(c) Can Ecuador explain how can the above data constitute a preliminary determination that there
is “clear evidence” that the alleged problems of the domestic industry are caused by importsand not by any other factors (Articles 6 and 4(2)(b) SA)?
(d) Can Ecuador explain how can the above data constitute “critical circumstances where delay
would cause damage which it would be difficult to repair” (Article 6 SA)?  Has Ecuador
evaluated the damage that would be caused by delayed action? Can details be provided?
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