WORLD TRADE G/RO/13
6March 1997
ORGANIZATION(97-0911)
Committee onRules ofOrigin
HARMONIZATION OFRULES OFORIGIN
Thefollowing communication wassentbytheChairman oftheCommittee onRules ofOrigin
on7February 1997 totheChairman oftheTechnical Committee onRules ofOrigin, asagreed by
theCommittee onRules ofOrigin atitsmeeting on6February 1997.
_______________
"The Committee onRules ofOrigin meton6February 1997. Itreviewed theFifth andthe
Sixth Reports oftheTechnical Committee onRules ofOrigin. Italsoexamined twoproposals by
Members andagreed toconvey thefollowing issues totheTechnical Committee forconsideration:
(i) review oftheFifth andSixth Reports oftheTechnical Committee;
(ii) request totheTechnical Committee onRules ofOrigin regarding theterm"obtained"
indefinition 1(i)ofAppendix 1;
(iii) USproposal pursuant toArticle 9.3(a) oftheAgreement onRules ofOrigin.
RegardingtheReviewoftheFifthandSixthReportsoftheTechnicalCommittee,theCommittee
decided asfollows:
"The Committee carefully considered theFifth Report oftheTechnical Committee onRules
ofOrigin totheCommittee onRules ofOrigin, contained indocument G/RO/9, andtheprovisional
Sixth Report, contained indocument G/RO/11. Theconsideration ofthedetailed reports wasprefaced
byanintroductory overarching statement byMr.Janeczko, theChairman oftheTechnical Committee,
inthecourse ofwhich hehighlighted several issues ofkeyimportance andoutlined thecontinuing
work oftheTechnical Committee inPhase IIoftheWork Programme. These issues wereasfollows:
(a) theproposed management plantobeintroduced attheSeventh Session oftheTechnical
Committee forthetreatment oftheoutstanding items under Phase IIoftheWork Programme;
(b) alistoftheoutstanding issues tobeconsidered bytheTechnical Committee onRules ofOrigin
asfollows:
- initial discussions oforigin rulesproposed forChapters 34(part) -40,52-63 and82-90;
- completion ofBasket 2discussions ofproduct-specific rules forallchapters;
- completion ofPhase IIIdiscussions ofproduct-specific rules forallchapters;
- completion ofarchitectural design andgeneral rules ofinterpretation;G/RO/13
Page2
- finalelaboration oftheDefinitions ofgoods considered asbeing wholly obtained in
asingle country andminimal operations orprocesses thatdonotbythemselves confer
origin toagood; and
- assembly oftheAnnex;
(c) theintention oftheChairman oftheTechnical Committee toraisewiththeTechnical Committee
theissuethatdraftspecific rulesforparticular products andproduct sectors, where thetechnical
possibilities hadbeenexhausted andaresolution needed tobefound atapolicy level, should
betransmitted totheCommittee onRules ofOrigin forconsideration;
(d) concern about reservations byMember states onparticular products andproduct sectors which
haveimplications forthecompletion ofPhase IIoftheWork Programme.
MembersexpressedtheirviewsontheissuesraisedbytheChairmanoftheTechnicalCommittee.
Whilst welcoming hisreport andcommending himforthestatement made, Members agreed withhim
thatmuch needed tobedone inorder toadhere tothetime-frame oftheHarmonization Work
Programme. Several points wereemphasized, including thenecessity offocusing onlastsubstantial
transformation andtheneedforconsistency ofdraftproduct-specific rules, thesimplicity oftherules,
aswellastheneedforthehorizontal consistency oftherules.
Inconsidering thedetails oftheFifthandSixth Reports, under theFifthReport, theCommittee
noted thecontinuing elaboration ofdraftproduct-specific rulesunder Phase IIoftheWork Programme,
thedevelopment oftheoverall architectural design, aswellasthecontinued elaboration ofgeneral
rulesandcommon terminology. Inthisregard Members welcomed andencouraged every effort that
canbemade toguarantee thetimely completion oftheHarmonization Work Programme. TheSixth
Report wasnoted, including thefactthatitwasprovisional. InbothReports theelaboration ofdraft
product-specific rules under Phase IIoftheWork Programme wasnoted inaddition tothefactthat
supplementary criteria which weresupposed tobeexamined under Phase IIIoftheWork Programme
were practically being touched upon.
Finally, following asuggestion bytheChairman oftheTechnical Committee, theCommittee
welcomed hisproposal toforward totheCommittee onRules ofOrigin draftspecific rulesforparticular
products andproduct sectors where thetechnical possibilities hadbeenexhausted andaresolution needed
tobefound atapolicy level.
Onthesecond issue regarding theterm "obtained" indefinition 1(i)ofAppendix 1,the
Committee decided asfollows:
"The Committee reviewed aproposal made bythedelegation ofCanada regarding theneed
forclarification andprecision oftheword "obtained" when usedtogether withtheword "produced"
inthecontext ofdefinition 1(i)ofAppendix 1oftheIntegrated Negotiating Text, ongoods considered
asbeing wholly obtained inonecountry. Several views wereexpressed. Theviewwasalsoexpressed
thatclarification andprecision intheuseoftheword "obtained" were contained, toalarge extent,
inthenotes tothedefinition inAppendix 1.Nonetheless, itwasagreed thatinorder toavoid confusion
andmisunderstanding, particularly intheimplementation ofagreed harmonized Rules ofOrigin in
thefuture, itwasnecessary thattheTechnical Committee should revisit thetwoterms inthecontext
oftherequests oftheCommittee onRules ofOrigin of21Mayand16September 1996 related tothe
meaning oftheterm"produced", withaviewtoachieving greater precision andclarity."G/RO/13
Page3
Onthethirdissueregarding theUSproposal pursuant toArticle 9.3(a) oftheAgreement, the
Committee agreed asfollows:
"1. TheCommittee considered therevised USproposal asastarting point forPhase II
oftheHarmonization Work Programme. Although there wasstrong support byMembers,
theCommittee didnotreach aconsensus infavour oftheproposal.
2. Theviewwaswidely shared thatthegeneral approach oftheUSproposal appeared
tobeaconfirmation oftheapproach being pursued bytheTechnical Committee, tousethe
change intariff classification toexpress thelastsubstantial transformation.
3. Nonetheless, itwasrecognized thatconsideration ofother criteria provided forinthe
Agreement should beundertaken when deemed necessary, where theHSnomenclature does
notallow fortheexclusive expression ofsubstantial transformation.
4. Itwasalsoagreed thattheCommittee 'sviewontheUSproposal should beconveyed
totheTechnical Committee foritsfurther consideration inthecontext ofPhase IIoftheWork
Programme, atthesame timeastheCommittee onRules ofOrigin inGeneva continues with
further consultations ontheUSproposal."
WouldyoupleasekindlybringtheabovetotheattentionofmembersoftheTechnicalCommittee.
Please accept, asalways, theassurance ofmyhighest consideration."