. /.RESTRICTEDWORLD TRADE
ORGANIZATIONG/C/W/172
12 January 2000
(00-0096)
Council for Trade in Goods Original:  Spanish
REQUEST BY CHILE UNDER THE PROVISIONS OF ARTICLE 5.3
OF THE AGREEMENT ON TRADE-RELATED
INVESTMENT MEASURES
The following communication, dated 29 December 1999, has been received from the
Permanent Mission of Chile.
_______________
The Government of Chile, pursuant to Article 5.3 of the Agreement on Trade-Related
Investment Measures (TRIMs), requests an extension until 31 May 2000 of the transition period forupdating the exemption from payment of customs duties envisaged in Article 3 of the Chilean
Automotive Statute (Law No. 18.483), which wa s notified in document  G/TRIMS/N/1/CHL/1.
Introduction
On 19 January 1996 Chile notified, in accordance with Article 5.1 of the TRIMs Agreement,
its Automotive Statute contained in Law No. 18.483, and specifically the following provisions:
"ARTICLE 3, allowing exemption from paymen t of customs duties for imports of CKD
(completely-knocked down) and SKD (semi-knoc ked down) units used for vehicle assembly,
to the extent that they are offset by exports of domestic components for an equivalent amount,
within a period of 12 months, in accordance with a programme approved by the MotorVehicle Commission.
ARTICLE 9, establishing entitlement to a tax credit for end processors (assemblers) "in
respect of the local content of vehicles produced and transferred (sold) within the country for
offsetting exports or other exports of local components", with a ceiling of 35 per cent of thecustoms value of the corresponding finished vehicle."
It should be pointed out that as indicated in the notification itself, the measures mentioned in
Article 9 of the Automotive Statute (tax credit for local content and for exports of local components)
expired on 31 December 1998, in keeping with paragraph 8 of the above-mentioned notification andthat Chile therefore fully dismantled these two measures in advance.
Unlike Article 9, which provided for a specific and early date of expiry with respect to Chile's
WTO commitments, the measure concerning exemption from customs duties contained in Article 3 of
the Law requires express legislation in order to be dismantled.  Accordingly, a draft Law is now beingenacted which, among other things, will eventually bring the Automotive Statute into line with Chile's
obligations under the TRIMs Agreement by revoking its Article 3 and thereby eliminating the
measure in question.G/C/W/172
Page 2
Request for extension
Scope
This requested extension refers to the trade-related investment measure concerning exemption
from the payment of customs duties contained in Article 3 of Law No. 18.483 (Automotive Statute)
notified by Chile in January 1996 in document G/TRIMS/N/1/CHL/1.
Duration
Until 31 May 2000.
Basis
This request for an extension is based on the need for more time to complete the legislative
process already under way in order to dismantle the aforementioned measure, thereby bringing the
Chilean Automotive Statute fully into line with the commitments under the TRIMs Agreement.
__________