./.WORLD TRADE
ORGANIZATIONG/STR/W/40
24 September 2003
(03-5078)
Working Party on
State Trading Enterprises
DRAFT RECOMMENDATION ON THE
FREQUENCY OF NOTIFICATIONS
Proposal by the Chairperson
1. Article XVII:4 of GATT 1994, and paragraph 1 of the Understanding on the Interpretation of
Article XVII of GATT 1994 (the Understanding) require Members to notify their state trading
enterprises to the Council for Trade in Goods.  GATT Contracting Parties adopted on
9 November 1962 a decision establishing the periodicity of state trading notifications.1  This decision
provides that new and full notifications of state trading enterprises are to be submitted every three
years, with updating notifications to be submitted in  the intervening years.  Following the entry into
force of the Marrakesh Agreement Establishing the WTO and the adoption of the Understanding on
the Interpretation of Article XVII of the GATT 1994, the Council for Trade in Goods decided to
continue the periodicity of notifications set forth in the 1962 decision. In accordance with theUnderstanding, state trading notifications are reviewed by the Working Party on State Trading
Enterprises on behalf of the Council for Trade in Goods.
2. During recent notification review exercises Members have observed that compliance with the
notification obligation is less than satisfactory.  In light of this unsatisfactory state of affairs the
Working Party has held discussions in order to find a solution to the problem of compliance with the
state trading notification obligation.  A similar situation had been observed by Members in the context
of subsidy notifications to the Committee on Subsidies and Countervailing Measures.  In thatinstance, the Committee on Subsidies and Countervailing Measures focussed on the frequency of the
notifications in its efforts to improve compliance.  Members of the Working Party are of the view that
a modification of the frequency of the state trading notification is desirable in order to improve
compliance with the notification obligation.
3. In light of the above considerations the Working Party recommends that:
(a) The periodicity of state trading notifications be modified.
(b) The new and full notifications on state trading be due every two years instead of
every three years.
(c) The requirement of updating notifications in the intervening years be eliminated.
(d) This change in the periodicity of the notifications enter into force as of the year 2004,
with a full and new notification being due in that year.
(e) The guidelines for completing the questionnaire section of the Questionnaire on State
Trading be amended to bring it into conf ormity with the new frequency for state
                                                     
1 BISD 11S/58.G/STR/W/40
Page 2
trading notifications.  Accordingly, the text after the titles Sections I, II and III should
be amended to read: "to be submitted in full every two years."  Also, the text after the
title Section IV should read: "to be subm itted bi-annually on a calendar, fiscal or
marketing year basis…".
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