RESTRICTEDWORLD TRADE
ORGANIZATIONWT/WGTCP/M/19
15 November 2002
(02-6373)
Working Group on the Interaction
between Trade and Competition Policy
REPORT ON THE MEETING OF 26-27 SEPTEMBER 2002
1. The nineteenth meeting of the Working Group on the Interaction between Trade and
Competition Policy took place on 26-27 September 2002, under the chairmanship of
Professor Frédéric Jenny.
2. As had been agreed at the informal meeting of the Working Group on 27 February 2002, the
agenda for the Working Group's meeting consisted of the following items:
- elements contained in paragraph 25 of the Doha Ministerial Declaration.  In
particular, focused attention was given to the following element:  core principles,
including transparency, non-discrimination and procedural fairness;
- technical assistance and capacity-building, as called for by paragraph 24 of the Doha
Ministerial Declaration;  and
- other business, including stocktaking of national experience and legislation.
I. ELEMENTS CONTAINED IN PARAGRAPH 25 OF THE DOHA MINISTERIAL
DECLARATION, WITH FOCUSED ATTENTION ON THE FOLLOWINGELEMENT:  CORE PRINCIPLES, INCLUDING TRANSPARENCY,
NON-DISCRIMINATION AND PROCEDURAL FAIRNESS
3. The representatives of New Zealand, Australia
, Korea , Thailand , Switzerland , India  (two
contributions), Japan, the United States  (two contributions) and South Africa  introduced written
contributions relevant to this item (docum ents WT/WGTCP/W/210, 211, 212, 213, 214, 215 and 216,
217, 218 and 219, and 220, respectively).  In addition, as had been requested by the Working Group at
its informal meeting on 26 February 2002, the Working Group had before it a background note by theSecretariat (document WT/WGTCP/W/209) on the matter of core principles, including transparency,
non-discrimination and procedural fairness.  The note provided a synthesis of the issues raised and
points made by Members on this topic in previous meetings of the Working Group, drawing
principally on the Working Group's annual reports for the past four years and on written submissions
by Members.  A previous note by the Secretariat on the Fundamental WTO Principles of NationalTreatment, Most-Favoured-Nation Treatment and Transparency (document WT/WGTCP/W/114,
issued on 14 April 1999) was also made available for the meeting.  In addition, the OECD provided a
non-paper relevant to this item (subsequently issued, with the assent of the Working Group, as
document WT/WGTCP/W/221).  The representatives of Argentina;  Brazil
;  Canada ;  China;
Chinese Taipei;  the Czech Republic ;  Cuba ;  Egypt ;  the European Community and its member
States;  Hong Kong, China ;  Indonesia ;  Kenya ;  Malaysia ;  Morocco ;  Mexico ;  Nigeria ;  Norway ;  as
well as the observers from the Russian Federation and UNCTAD  made oral statements or posed
questions on this matter.WT/WGTCP/M/19
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4. With regard to the importance of core WTO principles for the multilateral trading system
and/or the administration of competition policy and the desirability and scope for including these
principles in a multilateral framework on competition policy, the representative of New Zealand,
introducing document WT/WGTCP/W/210, said that a key matter to be addressed was how widelythe principles would be applied.  There were two basic options:  (i) a narrow application of principlesalready inherent in WTO rules in the field of comp etition law and enforcement, which in itself could
be a relatively useful outcome;  or (ii) a wider application of the principles that would inform the
development of competition policies and/or laws in Member countries as well as providing a
framework for the further elaboration of work on trade and competition policy within the WTO itself.
His delegation favoured the latter approach, which would bring a new and important dimension to the
development of multilateral rules not only in respect of the field of competition policy and/or law but
also in regard to related work in such areas as investment services, technical barriers to trade and tradefacilitation.  Whatever the approach adopted, New Zealand believed that three factors needed to be
borne in mind.  First, the need to preserve flexibility at the national level.  Core principles should
provide a broad template for WTO Members to take into account in developing their approaches to
competition policy without specifying what a pproaches should be adopted in individual Member
countries, or in what sequence.  For some developing countries it might be more appropriate to seek toimprove conditions of competition through means such as allowing increased scope for imports as
opposed to the implementation of a comprehensive competition law and enforcement institution.
Second, the principles of transparency, non-discrimination and procedural fairness were derived
largely from current WTO disciplines.  They provided necessary but not sufficient conditions for an
adequate competition policy.  In particular, these pr inciples did not adequately deal with the issue of
exemptions and exceptions.  An additional principle, namely comprehensiveness, was needed to
achieve this.  In advocating the principle of comprehensiveness, New Zealand recognized that all
countries would need exemptions and exceptions in their competition policy and law.  However,
under a principle of comprehensiveness these exemptions and exceptions would be subject to
re-examination from time to time within the cont ext of an overall framework or commitment to
competition principles.  Third, at this stage the WTO should put its main effort into developing the
suggested core principles and proceed with caution in the development of rules.  This was not only
because of the diversity of circumstances in WTO Member countries but also because a number of
countries were still learning about competition policy.  If rules were adopted too quickly, the risk
arose of prohibiting practices that in fact were welfare-enhancing rather than welfare-reducing.  In the
eventual development of rules, a flexible approach should be favoured.  A useful option might be to
look at a GATS-type framework where Member countries could opt in and perhaps opt in partiallywhen they felt ready.  In any case, WTO commitments on competition should be backed up by the
provision of enhanced technical assistance for developing countries.
5. The representative of Australia, introducing document WT/WGTCP/W/211, emphasized that
the core principles of transparency, non-discrimination and procedural fairness were fundamental
underpinnings of any successful competition regime .  Without these elements, a competition regime
would lack credibility, authority and respect within the community, and therefore be ineffective.
Accordingly, it was desirable that these principles be included both in domestic competition regimes
and in an eventual multilateral framework to be developed within the WTO.  In fact, due to the
fundamental nature of those core principles, they should not raise great concerns for WTO Members.
Any country that was serious about implementing a competition regime should already be committedto the principles.  The inclusion of the principles into a WTO agreement on competition policy was a
logical next step and would support domestic competition agencies in applying the principles, and in
resisting pressures from domestic sources, in particular from businesses and other government
agencies.  This was a problem in developed and developing countries alike.  Ideally, the principle of
transparency should permeate all aspects of a coun try's competition regime, including legislation,
policies, institutional structures, decision-making processes, enforcement priorities, policy and
procedural guidelines, case selection criteria, exemption criteria, appeal processes, and details of all
relevant outcomes and decisions made.  Further, while it was optimal to minimize the existence of any
exemptions, in any case, it was critical that they be made public, and the process and criteria forWT/WGTCP/M/19
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granting such exemptions be clear and transparent.  Australia had achieved a high level of
transparency through various mechanisms, such as the use of media releases (over 300 per year), press
articles and interviews, speeches (around 150 every year), publications and guidelines
(240 publications by the Australian Competition and Consumer Commission), maintaining a
comprehensive and up-to-date Internet website, and having effective liaison programmes with allstakeholders of the competition agency.  Aggressive communication with stakeholders had the added
benefit of promoting voluntary compliance with the la w, in that it ensured a high level of awareness
of the law in the business community.  In impl ementing the principle of transparency, it was
important to make due provision for the protection of confidential information.  Transparency
provisions should not force competition agencies to disclose confidential information gathered in the
course of investigations, decisions regarding which should lie solely with the competition authority.
6. Continuing, with regard to the principle of non-discrimination, she pointed out that this drew
together the principles of most-favoured-nation and national treatment.  In the field of competition
policy, it involved the application of policy and legislation in a manner that did not differentiate
among economic entities on the basis of nationality, which was important, in any case, to the
credibility and effectiveness of such a policy.  In this regard, it was important to note that a
comprehensive and well-functioning competition policy consistent with the principle of non-discrimination could co-exist with other government  policies designed to promote particular economic
or social goals.  For instance, Australia maintained a non-discriminatory approach to the
administration of its competition law.  At the same time, there were other government policies that co-
existed with competition policy and had allowed the Government to meet other priorities and goals,
e.g. foreign ownership restrictions on Australian me dia.  Furthermore, while Australia's competition
regime was non-discriminatory, provision was made for exemptions from the law through legislative
means, provided that the exemptions met a public interest test, and through an administrative
"authorization" process conducted by the competition authority, which was also based on a public
interest test.  As well, economic and social policies other than competition policy were already
subject, in many circumstances, to various elements of existing WTO Agreements;  Membersnonetheless maintained significant discretion in this area.  These considerations made clear that
adopting a national competition law consistent with WTO principles of non-discrimination and
transparency would not negate Members' ability to  implement appropriate national industrial policies,
consistent with existing WTO disciplines.  In relation to enforcement cooperation, her delegation
believed that a non-discrimination clause in a possible WTO framework on competition policy should
not force competition authorities to provide enforcement assistance or to exchange information with
all of their counterparts on equal terms.  An expl icit safeguard might be needed to make this point
clear.  While a system of voluntary cooperation within the WTO context would be useful, individual
agencies should retain the discretion to decide wh at information should be shared and with whom.  As
to procedural fairness, this principle encompassed due process, transparency, accountability,
predictability and independence, all of which were similarly important to the credibility and
effectiveness of a competition agency.
7. The representative of Korea, introducing document WT/WGTCP/W/212, said that clarifying
the application of the three core principles of transparency, non-discrimination, and procedural
fairness in the field of competition policy was important to facilitate trade and investment as well as to
ensure the effectiveness of competition policy.  Implementation of the principles would not be
difficult because, by and large, existing competition laws in Member countries already embracedthem.  Nevertheless, clarifying the application of these principles in the field of competition policy
would reinforce adherence to the principles by competition agencies and provide assurance for traders
and investors.  In fact, competition policy, when it affected trade, was already subject to the principles
of non-discrimination, transparency and procedural fairness, at least in a general way, since WTO
principles applied to internal as well as border measures that affected trade.  However, given theunique characteristics of competition policy and its inherent differences from conventional trade
issues, it was desirable to consider and make more explicit the application of the principles in this
area, in a manner that took account of the special characteristics of the field.  As the note prepared byWT/WGTCP/M/19
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the Secretariat for the meeting (document WT/WGTCP/W/209) had indicated, the three core
principles were applied in a variety of ways in different WTO agreements, reflecting the particular
characteristics of the subject-matter of each agreement.  For example, while the GATT rules on the
core principles broadly covered all sectors of an economy, they were applied in respect of products,
rather than persons.  In the GATS, the core principles applied to services and service providers.  Asfor the TRIPS Agreement, the core principles were applied to intellectual property rights and right
holders.  In defining the application of core principles in relation to a particular subject area, it was
therefore an established practice to incorporate adju stments suitable for the subject-matter at hand and
the legal traditions in that field.  Further elaborating on the special characteristics of competition
policy and their implications for the application of the core principles, he pointed out that competition
policy, when soundly applied, did not discrimi nate between firms or persons on the basis of
nationality.  However, unlike trade rules, competition law enforcement often followed a "rule ofreason" or case-by-case approach, using a broad framew ork of law.  Each case was a unique situation,
and there was considerable variation in how key elements, such as "like products", the "relevant
market", and the effects on the market were defined for each case.  It was important to give due regard
to these special characteristics and methodological considerations in any WTO agreement on this
subject.
8. Continuing, he said that, while there would be no difficulty in identifying de jure  violations of
this principle, identifying de facto instances of discrimination was a different matter, since seemingly
like cases might result in different verdicts due to the contextual differences surrounding the case.  He
gave the example of an international cartel case where a domestic firm had qualified for leniency
while a foreign firm had failed to do so under the same leniency programme.  If this difference oftreatment could be explained by the fact that the two companies had different positions in the market
and/or that the domestic firm had come to the author ities first, then the differential treatment could be
fully justified and would not constitute discrimination.  Rigid application of a rule against
discrimination would not be  appropriate in these circumstances.  Another source of legitimate
discrimination could involve different standards for the evaluation of particular practices such ascartels, mergers, and abuses of market dominance in particular countries.  In any case, discussions in
the Working Group had not advanced sufficiently to address de facto instances of discrimination.  For
these reasons, Korea believed that a multilateral framework on competition policy should focus on
de jure  instances of discrimination - discrimination based on nationality that was written into the
law - and should not attempt to deal with de facto discrimination.
9. Continuing further, he said that as a core principle of the multilateral trading system,
transparency referred to:  (i) the obligation to publish, or at least make publicly available, all relevantlaws, regulations, and decisions;  and (ii) the notification of various forms of governmental action to
the WTO and other Members.  Most countries published the relevant laws before they took effect.
However, it would be useful to define more precisely in the multilateral framework on competition
policy the scope of the information subject to the publication and notification obligations.  In addition
to competition-related laws, information relating to investigations, judicial proceedings, the process ofseeking a remedy and appeals to the competition authority decisions should generally be made
publicly available and notified to the WTO.  Of particular importance were rules and procedures on
granting exemptions to cartels.  In most countries, at least some cartels were believed by governments
to enhance efficiency or otherwise contribute to public welfare and were therefore granted
exemptions.  In view of the harm that cartels usually caused, rules relating to such exemptions shouldbe notified to the WTO to ensure transparency and to facilitate review by Members.  He pointed out
further that, in the area of competition policy, individual case decisions were particularly important
since, as noted, enforcement was often based on the rule of reason.  Korea was open to the idea of
reviewing competition policies of Members throug h an appropriately-defined mechanism similar to
the Trade Policy Review Mechanism that would not create undue administrative burden.  This wouldenhance transparency and provide momentum to the discussions on substantive issues, contributing to
the convergence of views in the long term.  Taking into account the various constraints faced byWT/WGTCP/M/19
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developing countries, adequate technical assistance should be provided to enhance their capacity to
implement transparency-related obligations and co mmitments should embody appropriate flexibility.
10. With regard to the principle of procedural fairness, this was of great importance for both trade
policy and competition law enforcement.  Parties to competition investigations and proceedings
should have assurance that the relevant procedures adequately protect their rights and interests in thematter.  Therefore, a separate, specialized set of provisions for procedural fairness should be
developed in the context of a multilateral framework on competition policy.  Due notice of charges,
fair and equitable administrative proceedings, and an appeal process were required to provide
appropriate checks and balances.  These requirements were important for the assurance of traders and
investors and would facilitate the enforcement of rules-based trade and competition policy.  The
TRIPS Agreement provided a good reference on this point.  For example, the following aspects found
in the TRIPS area were also relevant to competition policy:  (i) all processes pertaining to competitionlaw enforcement should apply equally to foreign and domestic persons (natural and legal) in a fair and
transparent manner;  (ii) all parties should have the right to appeal against an unfavourable decision
made by a competition authority or court;  (iii) both domestic and foreign individuals or firms should
be guaranteed the right to appeal to request remedy measures from competition authorities or courts
against anti-competitive practices;  (iv) the proceedings must unfold in a timely fashion in order toensure prompt measures to protect rights and prevent uncertainty or excess costs resulting from undue
delays.  WTO rules should also recognize the disclosure responsibilities of private entities in a
competition case.  Existing WTO agreements, such as the Agreement on Anti-Dumping Practices and
the Agreement on the Application of Sanitary and Phytosanitary Measures, which contained some
regulations on disclosure, could provide guidance in this regard.
11. With regard to necessary exemptions from the referenced core principles, because of their
general nature, principles such as national treatment should be applied to all substantive areas covered
by competition-related laws existing within a Member country.  However, exceptions similar to those
in GATT Articles XX and XXI should be available.  In addition, the Working Group needed to
consider whether exceptions should be provided from the application of the MFN principle forbilateral or regional cooperation arrangements regarding competition law enforcement and to the
exchange of information.  This was an important issue since the level and modalities of international
cooperation, voluntary assistance and informational exchange tended to vary depending on a Member
country's legal system, competition law enforcement system and degree of experience in the area of
competition law.  As in other WTO agreements, the key exception to be considered in the area of
transparency related to the issue of confidential in formation.  Protection of confidential information
was important in a competition law context, because actions of private firms were involved and alsobecause of the requirements of criminal investigations.  Each Member should be allowed to determine
the level and nature of protection of confidential information.  Appropriate exceptions to MFN were
important in this regard, since Members would be hesitant to share information at all if they were
required to make the information available to all requesting countries.
12. The representative of Thailand, introducing document WT/WGTCP/W/213, said that the
administration and enforcement of a competition law should be subject to the principles of
transparency, non-discrimination and procedural fairness in order to guarantee effective enforcement
and fair treatment for all parties concerned, as well as to enhance the credibility of such policy and
provide security for traders and investors.  A lack of transparency, the absence of due process or
discrimination in the administration and enforcement of the law could seriously hamper the attainment
of fair competition in the market.  However, in the spirit of the Doha Ministerial Declaration, various
needs and constraints faced by developing countries had to be taken into account.  To this end, the
principle of special and differential treatment should be adopted as a fourth core principle applicable
under a WTO agreement on competition policy.  In addition, she suggested that the approach taken to
define the core principles thus far had been f undamentally flawed in that the focus had been on
domestic rather than on cross-border trade.  For example, non-discrimination had been used
interchangeably with "national treatment", which refered to equal treatment between foreign andWT/WGTCP/M/19
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domestic firms operating within a domestic market.  This was certainly a view that would serve the
interest of those with significant overseas investment that would like to ensure access to the host
countries' markets.  Most developing countries, however, were importers and exporters, rather than
investors.  Thus, priority in the application of the core principles should be focused in the first place
on cross-border trade.  A competition law should not discriminate between export and non-exportfirms.  In other words, if bid-rigging and price or quantity-fixing agreements were prohibited in the
national competition law, export cartels should be subject to the same provisions.  The use of export
cartels as a strategic trade policy to extract "rents" from foreign countries was unacceptable.  A vast
number of studies had shown that most such cartels involved large companies and that there was little
or no efficiency justification for their practices.  Export cartels – be they national or international -
were unfair trade practices which were potentially damaging to developing countries' economies in
that they distorted the terms of trade.  If the Doha Ministerial Declaration was truly a developmentagenda, then unfair cross-border trade, not unfair domestic trade, should be given priority.  The Thai
Trade Competition Act B.E. 2542 (A.D. 1999) and its enforcement did not discriminate among firms
based on their origin or nationality and did not discriminate between exporting firms and non-
exporting firms.  Concerning transparency, she agr eed that laws, regulations, exemptions, guidelines
and competition authorities' decisions as well as court deliberations should normally be disclosed.Members should ensure transparency in the admini stration and enforcement of the competition law to
the extent possible within the domestic legal, institutional and social environment.  Thailand's Public
Information Law 1997 guaranteed access to public information and the Administrative Law 1996
guaranteed transparent and fair administrative procedures.  Each country should maintain the freedom
to implement sectoral exemptions consistent with the requirements of national industrial policies.However, international cartels, such as shipping conferences, did not have a development justification
and thus should not be exempted.  Many studies, including a recent one from the OECD
(Competition Policy in Liner Shipping:  Final Report 2002) had confirmed that the existence of liner
conferences had not contributed to greater efficiency in the global liner shipping market.  The Thai
Competition Act provided block exemptions for the central, regional and local administrations and forstate-owned enterprises, agricultural cooperatives, and other sectors or industries as stipulated by the
ministerial regulation.  As for due process, rights to appeal and protection of confidential information
were crucial.  However, each country should have the freedom to design its own appeal process and
procedures for the protection of confidential information consistent with the local legal, political and
institutional environment.  In Thailand, a Prime Minister's regulation provided a guideline on the
classification and handling of confidential information.  The Trade Competition Act 1999 provided
for an administrative appeal procedure, with well-defined time limitations.  If the complainant was notsatisfied with the Appeal Committee's decision, he could bring the case to the administrative court.
Elaborating on the content of the fourth proposed core principle, i.e. special and differential treatment,
she said that developing countries should be allowed to exempt national and international export
cartels, since most developing countries' exporters or importers were mainly small scale and might
need to bind together to counter the bargaining power of larger buyers or sellers from industrializedcountries.  In addition, developing countries should be given a time-frame to build transparency and
due process in the administration and enforcement of the competition law, as Thailand was already
doing.
13. The representative of Switzerland, introducing document WT/WGTCP/W/214, said that the
principle of transparency was important because it helped to increase predictability in an area where
the scope for discretion was relatively large due to the rule-of-reason approach; moreover,
transparency helped the public understand the concepts used by the competition authority, which in
turn was important for creating a "culture of competition".  Therefore, it would seem useful, on the
one hand, to make publicly available, and, on the other hand, to notify to the WTO, the relevant laws
and information necessary to understand the functioning of the competition framework.  This wouldof course include exceptions and exemptions as well as procedural rights and obligations, but also
procedures for investigations, and important case decisions.  Further, to strengthen professional
relations between competition authorities, it might be worth considering to notify information on
bilateral competition agreements, and to notify certain non-public – but non-confidential –WT/WGTCP/M/19
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information that might be of interest to partic ular WTO Members, for example, information on the
opening of an investigation.  On the specific matter of most-favoured-nation treatment, it could be
useful to differentiate between the broader framework of competition policy as a whole, and the
narrow framework of applying a competition law.  In regard to the former, a general commitment to
cooperate would ensure that MFN was respected as an overall guiding principle.  However, theapplicability of MFN in this context should be limited because cooperation could not be enforced and
had to be voluntary.  For cooperation to work, confidence needed to be built gradually, and views on
competition policy had to be converging.  To make clear that bilateral agreements were exempted
from MFN, an explicit MFN-exception might be appropriate in the expected multilateral framework.
Nevertheless, Switzerland could imagine taking certain procedural steps to establish positive
incentives for enhancing contacts, with the aim of not excluding certain countries a priori from
cooperation, and thus working in the spirit of MFN.  This could be done, for instance, through acommitment to respond to requests by other WTO Members asking for case-specific cooperation, and
to explain the reasons if the request could not be taken into consideration.  In the narrow framework
of applying the national competition law, MFN would not pose a great problem;  it was hardly
conceivable that an authority would accept certain anti-competitive practices of firms originating in
one country, while prohibiting those originating in other countries.
14. Continuing, he said that the principle of national treatment posed more difficult issues.  As in
the case of MFN, it might be helpful to draw a li ne between the broader context and the narrow, direct
application of a competition law.  In the latter context, national treatment would apply, and economic
actors approaching the competition authority were to be treated the same way, no matter if they were
domestic or foreign.  The reason for this was that, in applying national competition law, competitionauthorities were to focus on the functioning of markets without regard to the origin of the players.
However, in the broader context of competition policy, the situation was different, and a sovereign
state had to maintain the discretion to differentiate, so national treatment could not necessarily be
applied.  He mentioned that there was already an example of such an exception in a
competition-related area in the existing WTO agreements, notably the national treatment exception forsubsidies, contained in GATT Article III:8, which explicitly allowed subsidy payments exclusively to
domestic producers.  As to the third principle, namely due process, he suggested that it would seem
appropriate in the competition context to agree on certain procedures which would provide for fair
access to the investigation authorities at all stages of an investigation procedure, and for rights of
appeal.  Good precedents for this were available in existing WTO agreements, for example the TRIPS
Agreement, the Agreement on Anti-Dumping Practices and the Agreement on the Application of
Sanitary and Phytosanitary Measures.  In order not to re-invent the wheel, at an appropriate time theSecretariat could be requested to provide an overview and synthesis on the elements of due process in
existing agreements.  Close linkages existed between due process and the other principles that had
been discussed.  For example, as regards transparency, the parties concerned should be informed of
the initiation of an investigation.  Likewise, with regard to national treatment, it was essential that
domestic and foreign-based firms have equal rights in administrative procedures, and for appeals.This illustrated that the three principles were clos ely inter-linked and mutually reinforcing;  discarding
any of them would weaken the remaining principles  and the functioning of competition policy as a
whole.  Finally, he noted that he had mentioned several times the terms "national competition laws"
and "national competition authorities".  However, this was not to deny the need for flexible and
gradual approaches which take into account that not all countries were at the stage of economic andinstitutional development in this area.  Nevertheless, he believed that all countries would benefit from
dealing with competition issues in one way or anot her, and that the approach he had outlined was
flexible enough to accommodate the needs of developing and least-developed countries.
15. The representative of Japan, introducing document WT/WGTCP/W/217, said that
competition laws generally stipulated only general requisites, and whether any actions taken by
business entities met such requisites was judged on a case-by-case basis.  It was necessary, therefore,
to place much emphasis on clarity and transparency through fair procedures that were made clearly
known to business entities and consumers.  It was also vital that such laws be applied equally andWT/WGTCP/M/19
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impartially to all business entities regardless of their nationalities.  Core principles regarding
transparency, non-discrimination and procedural fairness should therefore find their places within a
multilateral framework on competition policy.  However, there was enormous diversity in existing
competition laws and policies, necessitating flexibility in the actual application of the core principles.
In this regard, it was important to ask whether detailed criteria or minimum standards necessarywithin the possible multilateral framework on compet ition policy, in addition to general provisions?
Two options could be considered.  One was to set up a minimum standard on the core principles.  By
so doing, a certain level of transparency, common to all countries, could be secured.  The other option
was to set up a non-binding guideline providing detailed explanations and concrete examples, or a
"menu of options", while leaving the multilateral framework only with general provisions.  Another
question concerned the extent to which the core principles could be secured in the framework.  To
what extent should each country bear obligations?  What about special and differential treatment fordeveloping countries?  Bearing in mind the diversity of national situations, it might not be practical to
impose uniform obligations, nor to require immediate revision of national competition laws as well as
operational regulations.  Concerning special and differential treatment, its application should not
necessarily be limited to developing countries.  Ra ther, flexibility could be extended to all countries
that had no competition law, regardless of their stage of economic development.  As well, appropriateprovision for technical assistance and capacity-building must be a coherent part of making the
multilateral framework on competition.  A fourth matter concerned the treatment of other
anti-competitive practices such as abuse of dominant position and mergers or concentrations.
Although the discussion in the Working Group had focused, to a large extent, on hard core cartels, it
was desirable that voluntary cooperation also take place in regard to these matters, as well.  It wasalso important to consider whether cooperation within bilateral or regional agreements went against
the principle of non-discrimination and, if so, what arrangements might be needed to accommodate
these.  In any case, for the sake of transparency, it was desirable to notify bilateral or regional
agreements to the WTO.
16. With regard to questions, concerns and/or reservations regarding incorporation of the
referenced core principles in a WTO agreement on competition policy, the representative of India,
introducing documents WT/WGTCP/W/215 and WT/WGTCP/W/216, said that India was continuingto assess the issues but was not convinced of the need for a multilateral framework on trade and
competition policy in the WTO.  Both transparency and procedural fairness were desirable qualities
that any administrative or judicial process must re spect.  However, in the context of competition
policy, if they are interpreted to mean that the rule s should be precisely formulated so as to admit only
one interpretation, then international experience showed that this was not possible.  There was littleagreement amongst theorists on many competition issues, and legally the same competition principle
had been interpreted in different ways in different jurisdictions, and also at different times within the
same jurisdiction.  For example, predatory pricing behaviour was regarded by one school to be
irrational and therefore not worthy of consideration by competition authorities, while another school
held that "rational predation" was a distinct possibility under various circumstances.  For practicalpurposes, a comparison of price with average costs was widely used as a test of predatory pricing, but
many economists believed that a price below marginal costs was neither necessary nor sufficient to
establish predation.  There was a similar lack of consensus about the efficiency properties of vertical
market restraints and mergers.  Furthermore, in developed countries rules and interpretations had
changed significantly even without any change in the relevant statutes.  Since developing countries
had much less experience with competition policy than developed countries, there would be a
"learning-by-doing" process in which some amount of inconsistency and evolution was inevitable.
This was where assistance for capacity-building could play a vital role in developing administrative
guidelines that were appropriate to the policy objectives, constraints on data availability, and
institutional framework of developing countries.  Since these would differ from country to country,there could not be a simple transfer of a blueprint that was used in countries at a different stage of
economic and institutional development.  Such guidelines, made available to competition agencies
and firms, could go a long way to reduce uncertainty and the costs of vexatious litigation.WT/WGTCP/M/19
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17. Continuing, with regard to the principle of non-discrimination, he noted that national
treatment constituted an important element of this principle in the context of trade policy for three
interrelated reasons, not all of which were automa tically applicable to competition policy.  First,
national treatment ensured that concessions made by Members in respect of trade barriers at the
border were not nullified by within-the-border discrimination between imported anddomestically-produced goods.  Mergers and vertical restraints often had anti-competitive effects both
on domestic and foreign producers.  These had to be evaluated in relation to the possible efficiencies
they might generate, but it was difficult to see how they unfairly blocked market access to imports,
which was the concern of the national treatment principle.  Second, national treatment was designed
to support trade liberalization, which was desirable because, on the whole, it was believed to be
beneficial to the participating countries.  Competition policy, however, was by definition concerned
with imperfect competition, where the presumption in favour of free trade was much less clear cut.  It
was now widely recognized that although there was a theoretical case for optimal trade interventions,
the information requirements for such "strategic tr ade policy" were prohibitive.  However, the same
caveat did not apply to competition policy in respect of mergers and cartels, which obviously had
different welfare effects on different countries, depending on where the producers and consumers
were located.  Developing countries had few products that were exported under conditions ofimperfect competition, but they had to deal with oligopolistic market structures in respect of imports
and inbound foreign direct investment.  They were thus likely to be predominantly on the losing side
of mergers and restrictive business practices with cross-border effects, and had little to gain from the
application of the national treatment principle in the competition law of developed countries.  At the
same time, partly as a result of concessions made in multilateral trade negotiations, developingcountries were undergoing a process of structural transformation in which many industries were being
exposed for the first time to international competition.  While there might be benefits from the
downsizing and even elimination of non-competitive industries, there was also a case for orderly
restructuring, involving mergers and perhaps rationalization cartels, which had been practiced in
many developed countries.  The need for such measures was greater in developing countries.  Giventheir imperfect land, labour and capital markets, these resources could not be easily transferred to new
activities.  A relatively liberal treatment of mergers and cartels involving domestic firms would
prevent the wastage and under-utilization of scarce resources, at least until arrangements were made
for their redeployment in other activities.  The third justification for the national treatment principle in
trade agreements was that even in cases where a country could gain unilaterally from departing from
free trade, the gains turned into losses if other countries act the same way.  However, it had not been
established that departures from an international competition policy norm could be mutuallydestructive in the same way.  The theoretical literature was ambivalent about whether harmonization
of competition policy principles was desirable.  These distinctions between the national treatment
principle as it applied to trade in goods and its potential applicability to competition policy cautioned
against the appropriateness of carrying it over to the field of competition policy.  It was perhaps
because some of these distinctions were relevant even in relation to the cross-border supply ofservices that national treatment had not been uniformly applied in the GATS;  instead, Members had
been allowed to specify exemptions from national tr eatment in their commitments.  Its applicability to
competition policy in general was even less obvious.  Much of the discussion so far in the Working
Group had been based on the idea of promoting static allocative efficiency as the sole objective of a
multilateral agreement.  In an earlier submission (document WT/WGTCP/W/149), India had drawnattention to the dynamic objectives of promoting investment and total factor productivity growth,
which were more important for developing countries.  Regarding investments in technology,
significant deviations from the idea of free markets were allowed in the WTO itself, for example, in
the TRIPS Agreement.  In developing countries, where both private and public resources for research
and development (R&D) were limited, promotion of investment might require a stable degree ofeconomic concentration.  Increasing exposure to international trade consequent on trade liberalization
could be relied upon to keep a check on market power and limit static resource misallocation.  A
competition policy that ostensibly applied to all Members equally was likely in practice to
discriminate against firms in developing countries.  Since prosecuting restrictive business practices
perpetrated by firms based abroad would be extremely difficult for countries with limited resources,WT/WGTCP/M/19
Page 10
domestic producers would, in practice, bear the brunt of a competition law that enshrined the national
treatment principle, while allowing foreign producers to get away with similar infractions.  Further,
many developing country Members had repeatedly pointed out in the Working Group that they had
little experience or expertise in regard to competition policy.  This meant that competition law
principles drawn from countries with much more experience, apart from possibly being intrinsicallyinappropriate for developing countries, would impose greater compliance costs.  These costs would be
borne both by their governments, which would have to set up the necessary institutions, and by their
firms, which would have to invest in legal resource s.  Such costs, which could in no way be related to
comparative advantage or efficiency in production, unfairly discriminated against producers in
developing countries and put them at a competitive disadvantage against their rivals in developed
countries.  Developing countries did not yet have the kind of well-developed safety nets that existed in
industrial countries to provide for those displaced by import competition.  There was thus a greaterneed to cushion the impact of such competition through suitable industrial restructuring measures
which would also enable developing countries to embrace greater trade liberalization.  In this sense, a
discriminatory competition policy could be a concomitant to a non-discriminatory trade policy.  Such
policies had been practiced in many developed countries until fairly recently, particularly in periods
when they were adjusting to international integration of the kind that many developing countries werenow undergoing.  In the context of meeting the needs of developing countries, it was more appropriate
to adopt the concept of non-discrimination in term s of the need to treat different countries with
different capacities in a differential manner, and of the need and responsibility to provide assistance,
positive measures and affirmative action to local firms and institutions in developing countries to
ensure their viability and development so that they could become increasingly efficient andcompetitive.
18. The representative of the United States, introducing her delegation's written submission
dealing with procedural fairness (document WT/WGTCP/W/219), noted that it was divided into two
parts.  The first part summarized the procedures in place at the United States' antitrust agencies to
ensure that their decisions were made fairly and impartially, whereas the second part raised a numberof issues and questions for the Working Group to consider as it clarified the concept of procedural
fairness.  In regard to the issues and questions, she suggested that the biggest challenge for the
Working Group was to define what was really meant by procedural fairness in a competition law
context and how it might be defined for the purposes of a possible WTO agreement on competition
policy.  Currently, there was no broad consensus on the meaning of procedural fairness in an antitrust
context.  This was partly because notions of fundamental fairness differed from legal system to legal
system, and were also influenced by the political and legal cultures in which relevant agenciesoperated.  Nevertheless, there were a number of broad concepts that an agency could embrace that
were likely to promote fairness, including:  (i) the right of access and rights to petition a competition
authority;  (ii) the right of a firm subject to an investigation to know the basis for an antitrust
authority's objection before the authority took action, and the right of that firm to respond;  (iii) the
right to appeal an agency's decision;  and (iv) timeliness.
19. With regard to the matter of access to the competition agency and the right to petition the
agency, she noted that for a competition regime to be fair, the agency should not arbitrarily treat the
complaints of some more favourably than the complaints of others.  In clarifying procedural fairness,
and considering access as an element for inclus ion in a possible WTO agreement on competition
policy, the Working Group needed to consider a number of issues.  First, on the matter of what wasmeant by appropriate access, some competition agencies, including those of the United States and
most other common law countries, dealt with complaints largely on an informal basis.  There were no
rules requiring the agency to formally respond in any way, and agencies were given broad
prosecutorial discretion to determine whether or not to open an investigation and, once opened,
whether to pursue enforcement action.  Other jurisdictions dealt with complaints in a more formalmanner, for example, by responding to each comp laint in writing or by issuing an opinion that
justified that the agency's decision not to take acti on on a complaint, or to pursue one.  She wondered
whether both types of systems would be considered fair in the WTO context and, if so, how agenciesWT/WGTCP/M/19
Page 11
with more informal procedures and broad prosecutorial discretion would demonstrate that their
procedures and their decisions to pursue some compla ints but not others were fair.  Another issue for
the Working Group to consider in designing a possible procedural fairness provision related to access,
notably the question of who ought to have access rights.  Would everyone have to have equal access
rights, or could more extensive rights be conferred on certain classes of parties, such as customers ofthe firms who were the subject of investigation?  She asked, further, whether the competition
authority should be required to accord procedural ri ghts to third parties that might, for example, be
harmed by a merger transaction but not in a traditional antitrust sense.  Further, would the agencies of
Members whose legal systems allowed for broad rights of private action to pursue competition law
claims directly through the use of the courts be required to provide as much formal access to the
agency as those that did not?  Would all Members be required to have private rights of action?
20. Concerning the right to respond, she noted that in forming subjects of an investigation of the
basis for the competition authority's objection before it took action, and allowing the subject to
respond, also promoted fairness.  In addressing this issue as a possible element for inclusion in a
WTO agreement on competition policy, many of the same issues would have to be considered as
those that she had discussed previously relating to  access.  For example, what form should such a
practice take?  Would objections need to be notified formally and in writing or could this be done on amore informal basis?  Further, to what extent a nd when would the authority be required to divulge the
details of its case?  Should this concept be expanded to allow third parties to be given an explanation
of the basis for the authority's objections or decisions not to take action?  As to appeal rights and the
role of the judiciary, she said that there was no question that independent review of competition law
decisions disciplined agency decision-making, leading to more accurate and equitable results.  Inaddressing appeal rights for possible inclusion in a WTO agreement on competition policy, she
encouraged the Working Group to consider what types of decisions ought to be reviewable.
21. Turning to timeliness, a competition authority  might have extensive procedural fairness
mechanisms in place, but if it could not resolve its investigations, cases, and appeals in a timely
fashion, those protections were not worth a great deal.  With regard to including the concept oftimeliness in a possible WTO agreement on competition policy, she encouraged the Working Group
to consider what would be considered timely.  Would the concept be flexible enough to reflect the
reality that some matters were more complex than others?  How would timeliness be evaluated for the
significant number of competition regimes that did not impose deadlines for action or who relied on
the judicial system as the final arbiter?  Who would determine what was timely in a WTO context?  In
conclusion, she stated that the main challenge for Members would be achieving consensus on
procedural fairness concepts that were sufficiently flexible to respect differences in legal and politicalsystems and cultures.  Nevertheless, Members would need to be careful and avoid language that was
too generic and abstract.  For example, statements such as "all agencies' procedures shall recognize
the due process rights of all parties" were ambiguous because terms like "due process" meant different
things to different people.
22. Another representative of the same delegation, introducing her delegation's written
submission on transparency and non-discrimination (document WT/WGTCP/W/218), noted that in
July 1999, her delegation had made a submission on the Relevance of Fundamental WTO Principles
to Competition Policy (WT/WGTCP/W/131), which provided general background on the referenced
principles.  Beginning with the principle of non-di scrimination, she noted that this included both MFN
and national treatment, and that in the WTO context, it could be applied to facially discriminatorylegislation (" de jure  discrimination") as well as to discrimination under facially neutral legislation
("de facto discrimination").  Given her delegation's view that competition law enforcement should
serve the protection of competition and not individual competitors, it believed that discrimination on
the basis of nationality in favour of an individual competitor was inconsistent with the purpose of
competition rules.  The application of the WTO pr inciples in the competition law context, however,
raised complex issues.  First, what was discrimination in this context?  The WTO non-discrimination
principles were generally applied to "like" products and services;  however, competition analysis andWT/WGTCP/M/19
Page 12
enforcement was case-specific, and no two situations were or would be wholly analogous or
comparable.  Thus, in practice it was extremely difficult to determine whether de facto discrimination
existed with respect to antitrust enforcement actions , given the individual focus of such actions.  She
referred, in this regard, to an example discussed in her delegation's written submission, which
suggested that a Member enforcing its competition provisions with the aim of protecting small andmedium-sized business might disparately impact foreign firms, which were less likely to be small and
medium-sized enterprises.  Should this be considered discriminatory under a WTO agreement on
competition policy?  Further, even if the application of WTO national treatment and MFN principles
was limited to de jure discrimination, questions remained.  For example, how should sectoral
exemptions to competition rules be treated?  Most countries, if not all, exempted certain sectors from
the application of antitrust rules or regulated them through sectoral legislation instead of, or in
addition to, antitrust rules.  In the GATT, Article XX exceptions regarding, for example, theprotection of public morals or human health, a nd law enforcement, would be available for such
exemptions and exceptions.  However, should a prospective WTO competition chapter address these;
and, if so, were there particular factors in the competition context that should be addressed, for
example, the state of liberalization of the national economy, or whether or not there was effective
national regulatory oversight with respect to exceptions?  Reiterating a point made in her delegation'swritten submission on the modalities for voluntary cooperation in July 2002 (WT/WGTCP/W/204),
she asked whether the WTO MFN principle could potentially be used to challenge bilateral and/or
multilateral cooperation agreements.  Her delegation believed that this should not be the case, given,
for example, that cooperative situations should not be considered "like" situations.  Similarly, she
asked whether ad hoc assistance without an agreement on cooperation could be challenged under anMFN-type argument.  Would these cooperative situations require a specific exception or exemption
from the MFN principle, and, if so, how should Members phrase these exceptions?
23. Continuing, with regard to the principle of transparency, she noted that her delegation's
written submission focused on three particular issues, namely:  (i) the types of decisions subject to the
transparency obligation;  (ii) transparency and the protection of confidential information;  and
(iii) transparency and resource allocation.  In the WTO context, transparency generally comprised two
components:  an obligation to publish and an obligation to notify.  Further, WTO transparency
obligations generally covered laws, regulations, judicial decisions and administrative rulings of
general application.  In the Japan Photographic Film case
1, the panel had found that administrative
rulings in individual cases were to be considered rulings of general application, if such individual
rulings established or revised principles or criteria applicable in future cases.  Therefore, under a
WTO transparency provision, such individual rulings could be subject to publication and notificationrequirements.  Moreover, administrative assessments that did not result in formal decisions, such as
determinations not to pursue a third-party complaint, could also be subject to publication and
notification obligations under this logic.  What role , if any, would a private person have in enforcing
WTO transparency obligations and provisions?  If such a role was afforded private parties, for
example, in national courts, what limitations should be employed to prevent abuse and strategiclitigation?  An important related topic concerned the balance between transparency and the protection
of confidential information at the national level, and how to maintain this balance.  Currently, WTO
transparency principles included an exception for confidential information, which each Member
tended to interpret differently according to its own laws and legal traditions.  United States' practices
in this regard clearly fell within this exception.  However, United States' practices with respect toconfidentiality could prevent its competition authorities from publishing basic information, including
clearance reports or the fact that individual transactions were notified.  Given the varying approaches
to the confidentiality of information among WTO Members, what would be the appropriate scope of a
prospective WTO transparency principle?  Further, would a prospective rule also address remedies
that might be available to a notifying Member for fa ilure of a recipient Member to adequately protect
the confidentiality of any information provided?  Whereas her delegation believed that all countries
                                                     
1Japan - Measures Affecting Consumer Photographic Film and Paper  (WTO WT/DS44/R,
31 March 1998).WT/WGTCP/M/19
Page 13
with competition laws published such laws and accompanying regulations, many countries, including
the United States, did not publish and/or notify all individual case assessments.  Could a transparency
requirement be interpreted to require agencies to publish and notify decisions when they did not
currently do so?  If so, this could cause a significant drain on resources for both the notifying and
notified Members.  In this regard, she urged the Working Group to consider both the costs andbenefits of the application of the transparency principle in the context of competition law
enforcement.  If not properly framed, such a principle could entail significant expenditure of resources
that could detract from enforcement resources.  In conclusion, she expressed her delegation's hope
that the questions posed would assist the Working Group in its clarification effort.
24. The representative of Malaysia said that his delegation had no objection to transparency rules
and regulations as stipulated in the current Article X of GATT 1994 and GATS Article III that
required the publication of official materials, i.e. laws, regulations, government measures, newspapersand journals.  It recognized the need for these requirements, to enable Members to be acquainted with
policies and measures of other Members.  In the field of competition policy, transparency was
important in three areas:  transparency in general pr ovisions of the law;  transparency in enforcement
of competition law; and rights of firms in competition procedures.  Notwithstanding this, Malaysia
was of the view that transparency rules should be applied in a flexible way in developing countries in
order to take account of the need to continue the development agenda of domestic industries.  A full
and equal accessibility to information on the rules of the game would ensure a level playing field for
both domestic and foreign firms.  On the other hand, the requirement for transparency should not
result in questioning the decision-making process nor the decisions thereof.  Developing countries like
Malaysia lacked the capacity to comply with the requirement of notification and publication;therefore, any obligations in this field should not be onerous or burdensome.
25. Continuing, with regard to the principle of non-discrimination, it was stated that Malaysia's
position was in line with India's.  The principle of non-discrimination in the context of the WTO
meant adherence to the principles of most-favoured-nation and national treatment.  National treatment
referred to the equal treatment of foreign and domestic firms in the domestic market.  The majority ofdomestic industries in Malaysia and other developing countries were of small and medium size.  The
adoption of the principle of national treatment w ould allow foreign firms, with their widespread
international market linkages, expertise, knowledge and technologies, to compete freely on equal
terms with local firms which did not have the same knowledge or experience.  Malaysia therefore
believed that it was inappropriate to adopt the principle of national treatment in respect of competition
policy.  Because of globalization, local firms were already confronted with intense foreign
competition.  Industries in developing countries should be given a sufficient time-frame to build upcapacity to meet international competition.  A multilateral framework should focus on cross-border as
opposed to domestic issues affecting competition.  Even so, it was important to consider the fact that
no single standard could be used to judge a particular economic activity that involved a foreign and a
domestic entity or two domestic entities.  Given the developmental and socio economic constraints
faced by developing countries, it might not be possible to guarantee national treatment in all instances.Furthermore, what could be construed as an "anti-competitive activity" from the perspective of a
competition authority in a developed country mi ght be a necessity for the attainment of the
developmental objectives of countries like Malaysia.  Domestic firms should benefit from various
types of assistance to ensure their viability, to become efficient and to compete on better terms.
Sovereign governments were supposed to ensure that domestic industries were sufficiently competentbefore foreign firms could be allowed to compete freely in the domestic economy.  Developed
countries could assist in this respect by facilitating better access of developing countries' products into
their countries.WT/WGTCP/M/19
Page 14
26. Another representative of the same delegation, focusing on procedural fairness, said that any
eventual multilateral framework on competition policy should be non-binding.  Therefore, the
question of obligations relating to procedural fairness would not arise.  Regarding the application of
domestic competition law, Malaysia was still in the process of trying to finalize a fair trade law;  if the
latter came into being, a fair trade office and a fair trade commission would be established.  Anyperson could avail themselves of these bodies to air their grievances.  Like many other developing
countries, Malaysia did not understand what the delegation of the European Community and its
members States meant by applying the principle of national treatment in the competition area.  In the
view of his delegation, it was sometimes necessary, for the sake of development, to accept some
anti-competitive practices (such as a discrimination against a foreign firm) or mergers in order to
achieve long-term gains.  For these reasons, developing countries should be exempted from the
application of the principle of national treatment in any multilateral agreement on competition policy.
27. The representative of Hong Kong, China said that discussions within the Working Group
should be guided by two conditions set out in the Doha Ministerial Declaration.  First, as noted in
paragraph 23 of the Declaration, the relevance of the principles should be seen in the context of
enhancing "the contribution of competition policy to international trade and development".  Second,
as noted in paragraph 25, "full account shall be taken of the needs of developing and least-developedcountry participants and appropriate flexibility provided to address them".  With these conditions in
mind, he suggested, firstly, that there had been fairly limited discussion in the Working Group on the
practical implications of possible provisions relating to transparency, non-discrimination and
procedural fairness for domestic industrial and economic policy options of developing Members.
Certain obligations arising from applying the core principles in a multilateral competition frameworkcould be burdensome to some developing Members.  For example, the proposal on procedural fairness
as set out in the contribution of Korea (WT/WGTC P/W/212) would require a Member to set up and
maintain a judicial framework for handling appeal cases.  Similarly, requirements for comprehensive
notification of competition laws and related information to both the public and the WTO might
require a lot of resources.  There was a need for more studies and discussions to enable developingcountries to have a more realistic assessment of the costs and benefits of such provisions before
Ministers decided on the modalities of negotiations.  Secondly, he agreed that "special and differential
treatment" should be considered as another core pr inciple to be reflected in a possible multilateral
framework on competition policy.  In this regard, commenting on the role of special and differential
treatment at the trade, competition and developmen t interface, at the April meeting of the Working
Group, the observer from the OECD had drawn the attention of the Working Group to various
possible types of special and differential trea tment like the GATS-type approach, exceptions,
exemptions and exclusions, plurilateral approach, transitional periods and technical assistance, etc.
(see WT/WGTCP/M/17, paragraph 41).  More focused deliberations were needed on the effectiveness
and implications of all these various ways of meeting the needs and concerns of developing country
Members.  Thirdly, much of the past discussion in the Working Group had focused on proposals built
on the premise that Members had national competition laws.  However, as was pointed out in thebackground note by the Secretariat for the meeting, "in cases where no such law existed or the law
was not effectively applied, or where competition rules were applied through sector-specific
legislation, the relevance of the fundamental WTO principles to competition rules was unclear"
(WT/WGTCP/W/209, paragraph 25).  In this context, the Working Group had failed to address the
concerns of Members having no comprehensive competition law or authority.  Over one-fourth of theWTO's membership was in such a category.  As New Zealand had pointed out, it was important that
the development of core principles preserved flexibility for developing Members and did not put
pressure on developing countries to drive towards particular competition policy outcomes, which
might be inappropriate and/or premature.  On this basis, it would be useful if the Secretariat could be
asked to carry out a further study on how the core principles could be applied in those economieswithout a general competition law.WT/WGTCP/M/19
Page 15
28. Continuing, he commented on some specific elements of the referenced core principles.
Clearly, the principle of transparency was relevant in the context of competition policy.  From the
perspective of existing WTO requirements, transparency had two aspects.  First, laws, policies and
decisions that bore upon a WTO obligation should be published or otherwise made available publicly.
Second, relevant government actions bearing on a WTO obligation should be notified.  The twoaspects entailed different resource implications for Members.  Besides, there was a question as to
whether laws, policies and decisions that were not explicitly meant to be "competition laws", but that
nonetheless de facto bore on competition would be subject to the same transparency requirement.  If
so, the question was whether it might be overly burdensome for developing country Members to meet
such a requirement.  However, a realistic assessm ent of the impact of a transparency requirement
would not be possible until the Working Group had a good idea of the specific substantive obligations
that might be required under a possible WTO agreement on competition policy.  Given the diversity insocial and economic development levels among Members, sufficient flexibility must be incorporated
into any possible framework to make it workable for all Members.  Provision for exceptions and
exemptions would provide important flexibility for WTO Members to achieve other national
objectives such as industrial and economic development, support for small and medium-sized
enterprises, employment and the environment and to cater to differences in the scope and emphasis oftheir competition policy and implementation instruments.  As had been pointed out by a number of
Members, the enforcement of competition law often involved the application of a "rule of reason" or
case-by-case approach, involving the exercise of considerable discretion on the part of
decision-makers.  This made the application of a non-discrimination principle difficult and
complicated.  The application of the principle of non-discrimination to competition law enforcement,particularly with respect to de facto instances of discrimination, was therefore not appropriate.  On
procedural fairness, account had to be taken of the resource implications of any procedural fairness
requirement to be incorporated in a possible multilateral framework.  Appeal and review proceedings
could be costly to developing country Members, in particular to small economics.  Relatively little
had been said in the Working Group about the content and coverage of this principle.  In this regard,Hong Kong, China urged further discussion to clarify the meaning of "procedural fairness" under a
possible multilateral framework and the obligations it would entail so that Members could have a
more realistic assessment of its implications for their domestic regimes.
29. The representative of Kenya emphasized that the application of core WTO principles with
respect to competition policy must support the objectives of the WTO as stated in the preamble of the
Marrakesh Agreement.  These objectives included achieving higher standards of living, ensuring full
employment and ensuring that developing and least-developed countries secured a share in the growthin international trade.  Paragraph 25 of the Doha Ministerial Declaration, which formed the basis of
the discussions in the Working Group, stated in part that "Full account shall be taken of the needs of
developing and least-developed country participants and appropriate flexibility provided to address
them".  It therefore followed that, in the consideration of core principles for an international
framework on trade and competition policy, the development needs and interests of developingcountries should be given the highest priority.  As a developing country, Kenya needed maximum
flexibility to institute policies that would promote development.  In other words, competition from a
development perspective would mean the establishment of conditions and policies in which local
firms and production units were able to remain viable in the market.  They would develop through
time, thus providing full employment, adequate income and improved standards of living.Transparency should be limited to the availability of relevant rules, procedures and decisions.  It
should not be burdensome to developing countries and should not digress into the area of the
substantive national decision-making process.  Technical assistance would be important for
developing countries to meet transparency obligations.  The principle of non-discrimination should be
applied in a flexible way because the economies of most developing countries, including Kenya, weredominated by small and medium-sized enterprises whose impact on the market was insignificant.  The
question here was how could small firms in developing countries remain competitively viable so that
they were not wiped out by the current trends of mergers and acquisitions by multinationals which
tended to create monopolies and anti-competitive practices, when applying the principle ofWT/WGTCP/M/19
Page 16
non-discrimination?  Kenya agreed with South Africa that the principle of non-discrimination had the
potential of being abused if not properly addressed.  Therefore, the principle of non-discrimination in
any possible future multilateral framework on competition policy should be implemented on a
case-by-case basis so that it would not be applied in those cases where it conflicted with countries'
development objectives.  Kenya also agreed that the principle of special and differential treatmentshould be fully reflected in any future multilateral framework on competition.
30. Illustrating and drawing lessons from the actual application of the principles of transparency,
non-discrimination and procedural fairness in national competition law, the representative of
South Africa, introducing document WT/WGTCP/W/220, noted that the submission dealt almost
entirely with the application of the principles of transparency, non-discrimination and proceduralfairness in South African competition law and practice, in the hope that it could offer some pointers
for the discussion in the Working Group.  The Constitution of the Republic of South Africa set highstandards with respect to the application of these principles.  All administrative actions, including
actions taken by the competition authorities, had to adhere to them.  For instance, there was a clear
institutional separation between the functions of investigation and adjudication, and high standards
with respect to the provision and publishing of the reasons for any decision made, including decisions
that were favourable to merging parties.  Although the South African decision-making body incompetition cases, the Competition Tribunal, was an administrative tribunal, and a body of
laypersons, rather than of judges, it had effectively th e status of a high court, and had to adhere to all
the principles and procedures characteristically adhered to by institutions of that nature.  In the three
years of competition law enforcement in South Africa, the Competition Tribunal had been challenged
on constitutional grounds on a number of occasions.  Although it had always won the challenges, theyhad underlined the requirement for adherence to those standards at a high level.  Elaborating on the
principle of non-discrimination, he said that this was the principle that, despite its high-minded tone,
provided the greatest potential for abuse in an unequal world.  The Constitution of the Republic of
South Africa enshrined the right to equality and the right not to be discriminated against.  Two points
had to be made in that context.  First, the South African Competition Act applied to all economicactivity within, or having an effect within, South Africa.  This clause, read with the
non-discrimination clause in the Constitution, had enabled the competition authorities to take action
against cartels consummated outside of South Africa – including cartels that were legal in their own
country – as long as the activities of the cartel had an effect within South Africa.  In other words,
there was no discrimination in the application of South African competition law insofar as foreign or
domestic firms operated in the confines of the South African market.
31. Secondly, he said that the South African Competition Act contained provisions designed to
advance and promote the interests of small and medium-sized enterprises and those of black-owned
enterprises, in the words of the Competition Act, "to extend and promote control of those historically
disadvantaged".  These two objectives were not only incorporated in the broad objectives of the Act,
but were taken into consideration in applications for exemptions under the legislation and constituted
specific criteria to be considered in the evaluation of mergers.  These aspects of the legislation hadpassed constitutional muster because the Constitution of the Republic of South Africa provided that in
order to promote equality, legislative and other means could be taken to protect or advance persons
previously disadvantaged by discrimination.  Thus, the Competition Act had not prevented the
Government from pursuing industrial and social policies even though the application of such policies
required the selective promotion of particular interest groups.  In other words, South Africa's limitedexperience tended to confirm that the existence of a competition law and policy and adherence to
appropriately-defined core principles such as non-discrimination and transparency in the
administration of such policy need not unduly constrain the scope for industrial and social policies
designed to achieve particular objectives, provided that the relevant legal instruments took cognizance
of these objectives.  He suggested that, in this respect, South Africa's experience was already mirroredin the wording of the Doha Ministerial Declaration, which stipulated that full account should be taken
of the needs of developing and least-developed country participants, and appropriate flexibility
provided to address them.WT/WGTCP/M/19
Page 17
32. Continuing, and referencing Thailand's intervention, he agreed that special and differential
treatment should be added as a fourth principle of a multilateral agreement on competition policy.
Further, he concurred with the caution called for by  the United States not to take for granted the
meaning of terms such as "procedural fairness".  Gi ving content to the fourth principle might facilitate
reaching agreement on the appropriate meaning and scope of procedural fairness and the otherproposed core principles.
33. The representative of the European Community and its member States, reflecting on some of
the comments that had been made and setting out its own perspective on the issues, said that a
framework agreement on competition policy in the WTO would, in any case, not require the
harmonization of national competition laws, something which would be unwise.  This was despite the
fact that there was already an increasing degree of commonality among national approaches.  He
assumed that, if there was a WTO agreement on competition policy, eventually every WTO Memberwould be subject to a competition regime of one kind or another.  This did not, however, mean that
each WTO Member would have to adopt a domestic competition law, nor that this would happen
overnight or even at the end of the negotiations.  Clearly, progressivity and flexibility in the
implementation of competition laws and policies were important for countries that had not yet chosen
to do so.  He recognized the need for transitional periods and technical assistance, as well as to takeinto consideration at what stage a country wished to proceed in the implementation of a domestic
competition regime.  On the matter of technical assi stance, he recognized that the speed with which a
country could build capacity had to be taken into consideration.  In any case, the experience of the
European Community illustrated that countries that  could go without national competition laws for
decades, relying instead on a regional system.  In the light of this, there was no doubt that regionalinstitutions were at least part of the answer to the question of capacity and flexibility for developing
countries.
34. Continuing, he reminded the Working Group that, with regard to substantive competition law,
his delegation's proposal would require only a ban on hard core cartels.  Nevertheless, he expected
that most countries would voluntarily go further than this, as indeed most countries that already had acompetition law sought to deal not only with cartels but other anti-competitive practices such as abuse
of a dominant position.  With regard to core princi ples to be included in the proposed agreement, his
delegation had looked only at the three principles mentioned in the Doha Ministerial Declaration,
namely transparency, non-discrimination and procedural fairness, since it had not found other
principles that showed a sufficient degree of commonality among WTO Members.  Nevertheless, his
delegation was open to considering principles that might be proposed by other Members.  In
particular, his delegation would look at the suggestion put forward by Thailand and South Africa thatspecial and differential treatment should be adopted as a core principle of any agreement in this field.
As a preliminary comment, he noted that special a nd differential treatment had typically been seen as
a core principle of the WTO system as a whole rather than of specific agreements in specific areas.
Furthermore, consideration needed to be given to how special and differential treatment related to the
concepts he had mentioned earlier, namely progressivity, flexibility, capacity-building and regionalinstitutions.
35. The three core principles mentioned in paragraph 25 of the Doha Ministerial Declaration had
been present in the WTO for a long time in various forms and in various areas.  An undertone in some
delegates' interventions had been that these principles were complicated, and that one had to be
careful in handling them.  However, this point could be over-stated.  The meaning ofnon-discrimination and transparency was not so obscure as was sometimes made out.  Nonetheless, he
accepted that adapting the principles to the needs and characteristics of specific policy areas was
challenging.  Still, for more than forty years the GATT/WTO had done this in a variety of complex
fields.WT/WGTCP/M/19
Page 18
36. Concerning non-discrimination, which encompassed both national treatment and
most-favoured-nation (MFN) treatment, it was difficult to imagine a situation where a competition
law regime would need to establish a distinction on the basis of nationality of firms; no competition
regime that he was aware of did so.  Certainly, competition regimes often dealt with different types of
economic operators or practices in a different manner but this did not imply discrimination on thebasis of nationality.  He emphasized, as well, that in the view of his delegation, Members should be
careful to ensure that a WTO provision on the subj ect of non-discrimination in competition law/policy
did not spill over to other policy areas, whether or not they were covered by existing WTO
disciplines.  A typical formulation of the principle of non-discrimination in the WTO was that foreign
operators should be given treatment no less favourable than domestic ones.  In this regard, his
delegation saw no difficulty in designing a non-discrimination provision based on equality of
treatment – in both directions (between domestic and foreign operators).  Another important matterwas the distinction of de jure  and de facto discrimination.  According to his delegation's position, a
provision on non-discrimination should apply only to de jure  discrimination, to the discrimination that
could be created by laws, regulations and guidelines of general application, and not to de facto
instances of discrimination.  While the latter was not inconsequential, as many had pointed out, at the
current stage it was difficult to distinguish potential de facto discrimination from the application ofrule of reason in particular market circumstances, and from reasonable exercises of prosecutorial
discretion based on objective factors.
37. With regard to concerns that had been raised  regarding the implications of MFN for current
practices with regard to cooperation, first of all, the MFN principle would only be meaningful to the
extent there were binding obligations.  In this regard, his delegation's proposal was that the proposedWTO agreement on competition policy would have binding obligations only in respect of hard core
cartels and the three core principles, but not regarding cooperation.  Since cooperation ultimately had
to be based on the relationships that existed betw een individual national competition authorities, it
was hard to envisage a binding rule of general application in this area.  Rather, Members should create
mechanisms in the WTO that facilitate and encourage cooperation to the largest possible extent.Since there should not be binding rules on cooperation, in his view there was no need for an MFN
exemption with regard to current practices.
38. With regard to concerns that adopting a general commitment against discrimination in the
field of competition law and policy would interfere with national industrial or other policies, the
existence of a functioning competition regime had a general impact on market access in the sense that
it made existing market access commitments more effective.  Where market access commitments had
been made, firms would feel more assured in entering a foreign market if they knew that there was anefficient competition regime.  Certainly, this would facilitate international trade and investment in a
general sense.  However, in and of itself, competition law did not and should not affect the existence
or non-existence of market access.  With regard to the related issue of sectoral exclusions or
exemptions, according to the position of his delegation, a competition agreement would explicitly
allow Members to exclude sectors from the application of their competition laws.  Clearly, in somecases these would be necessary to accommodate objectives other than the preservation of competition.
However, transparency was important in this respect.
39. Another representative of the same delegation said that it was useful to recall the reasons for
some delegations' interest in addressing the matter of transparency in a WTO agreement on
competition policy.  This was necessary first and foremost for the reason that transparency was afundamental objective of the multilateral trading system, to provide assurances to traders and
investors, and because it was vital to the credib ility of competition authorities and to efforts to
establish a "competition culture".  This had been addressed in the Working Group at some length.
Transparency was also important for consumers.  The principle of transparency was well-established
in WTO agreements such as the GATT (Article X regarding publication and administration of traderegulations), the GATS (Article III regarding tr ansparency) and the TRIPS Agreement (Article 63
regarding transparency).  It was, perhaps, of pa rticular importance in regard to "behind-the-border"WT/WGTCP/M/19
Page 19
measures such as competition law and policy, since it was a means to ensure that such measures were
not used as a trade-restrictive measure.  At the same time, reliance on transparency mechanisms could
help to ensure that the reach and the coverage of substantive disciplines in an agreement were not
unnecessarily intrusive, thereby ensuring that an appropriate balance was struck.  Certain aspects of
transparency, including the publication of laws, regulations and guidelines of general application,might entail administrative costs, and therefor e would have implications for capacity-building.
However, representatives of newly-established competition authorities who had participated in the
Working Group had frequently pointed to the fact that developing transparent procedures, and having
a transparent legislative framework was a key requirement for promoting compliance with the law and
for the establishment of a credible enforcement inst itution.  To this extent, the objectives of the
multilateral trading system and of credible and efficient competition law enforcement would both be
served by an appropriately-designed transparency provision in a multilateral agreement oncompetition policy.  He recognized, nonetheless, that certain elements of such a provision might need
to be introduced in a progressive manner, and perhaps would need to be identified as priority areas for
technical assistance and capacity-building activities.
40. Continuing, he suggested that in the field of competition policy, a transparency commitment
would apply to laws, regulations, and guidelines of general application.  There would be an obligationupon WTO Members to ensure the publication of such laws, regulations and guidelines in a
comprehensive and timely manner.  This might be done either in print in an official gazette, journal or
the like, or possibly on a publicly accessible website.  This "external" transparency obligation would
apply not only to laws, regulations and guidelines, but also to any sectoral exclusions and exemptions.
Such exclusions and exemptions could be importa nt determining factors for economic operators in
making business decisions.  In particular, transparency in regard to matters such as sectoral exclusions
and exceptions as well as the application and content of competition law could be one of several
factors which could eventually serve to bring about an increase in the FDI flows.  A further aspect of
transparency would be an obligation on WTO Members to notify their laws, regulations and
guidelines as well as the sectoral exclusions and exemptions to the WTO.  Such notifications mightusefully be made to the WTO Committee on Competition Policy that would need to be established to
administer the proposed agreement and could play a potential role in peer review processes, in
reviewing notified laws, regulations, guidelines and sectoral exclusions and exemptions, and in
facilitating the design of multi-year technical assistance and capacity-building programmes.
41. A third representative of the same delegation said that procedural fairness was an issue that
was at the core of effective competition regimes.  Such regimes reflected a variety of organizational
forms, including regimes based on a judicial system, administrative regimes, regimes that enforcedcompetition rules through a central government body and regimes based on independent agencies or
courts.  Nonetheless, a common feature of all effective regimes was that they included guarantees that
the rights of parties facing adverse decisions and sanctions be recognized and respected.  Such
guarantees could vary both in content and in form, because essentially they were crafted with the tools
of the legal system and the traditions that had generated the competition regime.  Individual rights andprocedural guarantees would not have to be prescribed in excruciating detail in a WTO agreement on
competition policy.  Rather, four broad categories of guarantees were relevant.  First, there should be
guarantees relating to access to the system.  For example, this could refer to the right of firms that
receive a surprise investigation in their premises to  receive at the beginning of the search information
regarding the subject-matter and the purpose of the investigation.  It could also involve the right offirms to have notice that a formal investigation by the competition authority was pending against
them, and what the authority's objections to their conduct were.  Typically, such notices should
contain factual descriptions of contested practices, the authority's provisional legal assessment of the
facts, and its intentions to impose sanctions or a cease and desist order.  A second basic guarantee
related to the defence of the firms involved.  Firms should have the opportunity and the time to maketheir views known to the authority in writing or by  participating in hearings, by submitting evidentiary
proof or documents, and by having an opportunity to introduce testimony from witnesses who might
corroborate their views on the facts.  These types of guarantees would typically include some accessWT/WGTCP/M/19
Page 20
to the authority's file.  A further guarantee that had been mentioned by many delegations was the right
of firms involved in competition proceedings to  have decisions affecting them reviewed by an
independent judicial body.  Finally, the protection of confidential information, including business
secrets, should also be guaranteed.  These basi c guarantees did not need to be harmonized across
regimes, but should be described in a future agreement with some clarity.
42. The representative of the Czech Republic said that without respect for the basic WTO
principles of transparency, non-discrimination and procedural fairness, the effectiveness of
competition policy in creating fair conditions for all market participants would be materially
undermined.  A healthy market economy would be difficult or impossible to achieve if different
participants had different information about the market, resulting from different sources, or if the
regulator applied different conditions on different market participants or the firms involved did not
have the chance to defend their rights before independent authorities in a fair and transparentproceeding.  A substantial part of the activity of the Office for the Protection of Competition of the
Czech Republic was aimed at strengthening enforcement of the principles of transparency,
non-discrimination and procedural fairness in legislation and in the decision-making activity of the
Office.  A significant contribution to the application of these principles was the adoption of a new Act
on the Protection of Competition in 2001.  The provisions of the Act were more precise than theprevious legal regulation.  It was also less selective and therefore less susceptible to discriminatory
application.  For instance, it applied both to natural and legal persons, to associations of persons, to
domestic and foreign undertakings and even to public services.  The previous, rather obscure criterion
of "public interest", which had been used as the basis for granting individual exceptions had been
eliminated in favour of more objective criteria.  Also, the obligation of the Office to maintain a cartel
register, i.e. a list of all cartels, whether they were exempted or condemned, was intended to
contribute to greater transparency.  All decisions of the Office were available on its website
(www.compet.cz) and an annual report provided information on the most important cases and on the
legal developments.  Fair proceedings were also crucial.  Undertakings had the opportunity to lodge
appeals against the decisions of the Office, which would assess whether the first instance decisionswere compatible with the Act on Protection of Competition, with related legal acts of the Czech
Republic and even with the European Community law.  Undertakings could also ask the opinion of
the Office on the applicability of the Act to a particular practice.  Undertakings whose rights could be
affected by anti-competitive practices had the opportunity to file a complaint to the Office.
Furthermore, undertakings that were parties to a proceeding before the Office had the opportunity to
defend their rights at all stages of the proceedings.
43. The representative of Canada said that a commitment to all of the principles identified in
paragraph 25 of the Doha Ministerial Declaration, namely transparency, non-discrimination and
procedural fairness, was fundamental to a WTO agreement on competition policy.  As the
Secretariat's Note for the meeting (WT/WGTCP/W/209) had pointed out, competition laws in most
jurisdictions were already broadly consistent with the fundamental WTO principles.  Nonetheless, in
Canada's view, a WTO agreement on competition policy would reinforce the process of tradeliberalization as well as the sound application of competition law and policy.  It was increasingly
important to reach clarity on the application of these principles, given that more and more Members
were adopting domestic competition regimes.  With globalization, domestic competition laws would
be applied increasingly to domestic and foreign firms.  Moreover, there was mounting evidence that
anti-competitive practices were undermining the gains from trade, and the prosperity of Membercountries.  This had been made clear, for example, from the Working Group's discussion on hard core
cartels in its meeting of July 2002.  Her delegation concurred with the general need to tailor the core
WTO principles to the context of competition policy as well as to accommodate diverse national
situations through exemptions and exceptions where appropriate.  The interaction of competition
policy and industrial policy might also be addressed in this way.WT/WGTCP/M/19
Page 21
44. Continuing, she said that, in Canada's view, non-discrimination should be a core principle of
all competition laws.  However, the application of this principle could raise complex issues.  As had
been pointed out by several delegations, a review  of existing WTO agreements showed that this
principle had already been adapted to accommodate the characteristics of various policy areas.  A
similar approach was needed in the area of competition law enforcement.  In the area ofnon-discrimination, competition policy should not give harbour to protectionist forces and distinctions
based on the nationality of firms;  in this regard, she supported incorporation of the principle of
non-discrimination in a multilateral framework on competition policy.  Nonetheless, application of the
principle should not intrude on the necessary and legitimate exercise of prosecutorial discretion in this
field.  Recognizing this, individual decisions of national enforcement authorities should not be subject
to review by the WTO.  In this regard, her delegation supported discussion of a de jure  approach to
non-discrimination, as had been suggested by Korea, the United States and the European Communityand its member States.  As others had noted, many antitrust cases required a detailed rule of reason
analysis.  The outcome of the analysis depended on weighing the reasons for, and the competitive
consequences of, the alleged conduct.  For example, even if the actions of a foreign firm had been
judged differently from those of a domestic firm, this might not be the result of discrimination based
on nationality;  rather, it could reflect the particular factual circumstances of the case.  For thesereasons, the question of what might constitute discrimination in a competition law or regime and the
application of non-discrimination in the context of a competition agreement needed to be worked
through carefully to avoid unintended consequences.  As had been pointed out by other delegations,
the interaction between MFN provisions and bilateral cooperation also had to be addressed.  Canada
wanted to ensure that the principle of MFN did not apply to bilateral or regional cooperationagreements, or to bilateral or regional trade agreements with cooperation provisions.  In this regard,
Canada continued to support a voluntary approach to cooperation in a WTO agreement on
competition policy.  Under such an approach, cooperation provisions would not be binding, and
therefore they would not be subject to the MFN obligation.
45. In the area of transparency, Canada agreed with the need for broad commitments to
publication and notification of relevant information within the proposed multilateral framework.  As
many delegations had said, openness and transparency were central to the effectiveness and credibility
of competition regimes.  Transparency was also important in regard to exceptions and exclusions from
competition law.  A WTO agreement on competition policy should include specific elements related
to the publication of national competition laws, enforcement policies and procedures, judicial
decisions and appeal procedures.  However, it sh ould not cover decisions of competition authorities
not to take a case.  Public justifications as to why an agency had decided to pursue or not to pursue anindividual enforcement action could be counter-productive to the administration of justice.
Furthermore, as others had mentioned, a WTO transparency obligation should not require the release
of confidential information and commercial secrets.   As well, she recognized that transparency
obligations would entail costs for developing c ountries, for example, publishing guidelines or
maintaining a website to disseminate information.  In order to try to reduce the burden of such
obligations, transitional measures could be negotiated.  For example, she supported a progressive
approach whereby countries would gradually comm it to transparency obligations.  As had been
proposed by Thailand, technical assistance could also be appropriate to help countries establish a
transparent regime.
46. Finally, certain basic provisions on procedural fairness should be enumerated in a WTO
agreement on competition policy.  Such provisions were necessary to provide assurances to parties
affected by competition investigations that the pr oper procedures were followed in order to protect
their rights and interests.  She concurred with other delegations that a notice of charges, fair and
equitable administrative proceedings, and an appeal process provided essential checks and balances
for relevant parties.  Still, procedural guarantees n eeded to be flexible in order to take into account the
different legal traditions and competition systems of WTO Members.  Therefore, while she supported
the incorporation of basic elements of procedural fairness in a WTO agreement on competition policy,WT/WGTCP/M/19
Page 22
further work would be needed in order to determ ine how these elements could be specified.  The
questions that had been raised by the delegation of the United States were relevant in this regard.
47. The representative of Norway said that the principle of non-discrimination – which covered
both MFN and national treatment – would be an important cornerstone of a multilateral framework on
competition.  In the application of national competition legislation, the principle of non-discriminationwas fulfilled primarily in the form of national tr eatment, which meant that national competition laws
had to be enforced in a uniform manner in relation to firms of all nationalities.  It was clear from
previous discussions in the Working Group that th e relevance of non-discrimination to the sound and
effective application of national competition laws was recognized by most, if not all, national regimes.
At the same time, under a multilateral framework, all Members should be able to safeguard their
domestic industrial or economic policy interests.  Therefore, a multilateral framework on competition
had to provide for the possibility of appropriate ex emptions or exclusions.  Two different situations
needed to be distinguished in this regard.  First, many Members – including least-developed countries
and other developing countries, but also some industrialized countries – wished to provide greater
flexibility for small and medium-sized enterprises than for other firms under their competition laws.
A multilateral framework should permit this kind of flexibility.  As Malaysia had proposed, one way
to reflect this consideration would be to exclude SMEs from the scope of a multilateral framework.Perhaps, a better way, but in principle achieving the same objective would be to permit Members to
make certain exemptions from substantive requirements of a multilateral framework based on
objective criteria.  Such criteria could, for instance, be stated in the form of combined market shares
of the companies involved, or other types of de minimis limitations relevant to SMEs.  Second,
national interests might be safeguarded simply by providing for exclusion of sensitive economicsectors altogether from the substantive provisions of a multilateral framework, or from some of the
core principles.  The exclusion of important economic sectors should, in any case, be limited and
transparent, including by being subject to appr opriate requirements for notification to the WTO.
Under any circumstances, it would be important that, when a Member defined and delimited what
type of economic activities were excluded, others be able to see clearly what was inside and outsidethe excluded sector.  Moreover, in line with the principle of procedural fairness, recourse might be
guaranteed to national judicial or administrative review to see whether national legislation or
enforcement by national competition authorities respected the delimitation of excluded economic
sectors as notified to the WTO.
48. Continuing, he said that to the extent that a Member chose to enact national legislation
regulating additional types of anti-competitive actions beyond what was required by the foreseen
multilateral framework, the principle of non-discrimination as well as other core principles wouldhave to be respected unless such actions fell within excluded sectors.  Moreover, the general principle
of non-discrimination would not prevent Members from applying a different standard in all matters
that fell outside the scope of the multilateral framework or other WTO agreements, provided that such
actions were compatible with public international law.  Finally, under the principle of transparency, as
many other delegates had said, laws and regulations should be published and notified to the WTO.  Aswell, there should be a requirement that decisions in competition cases be made public and that
interested parties have the right to be heard.  The confidentiality of business secrets should be
respected.
49. The representative of Morocco, referencing key elements of paragraphs 23-25 of the Doha
Ministerial Declaration, suggested that the various interventions during the meeting thus far had
substantially clarified implications of the proposed core principles, namely transparency, non-
discrimination, procedural fairness as well as special and differential treatment for developing
countries.  His delegation believed that it was appropriate to engage in the ambitious project of
constructing an international competition regime on the basis of multilateral rules, in parallel with
working towards establishing effective competition regimes at a national and/or regional level.  Thiswas the interpretation given by his delegation to the text and underlying objectives of the Doha
Ministerial Declaration.  The principles of transp arency, non-discrimination and procedural fairnessWT/WGTCP/M/19
Page 23
were fundamental principles of trade upon which the multilateral trading system had been built.
These principles were consistent with the spirit and principles of competition, and were the very
foundation of any proper competition policy.  In f act, all competition laws embodied these principles.
With the discussion that had taken place in the Working Group, Members were in a position to begin
to prepare the elements of a multilateral framework based on commonly shared rules.  Theprogressive, flexible and differential application of such rules over an appropriate transition period
could only be beneficial for the regulation of international trade, especially by combating hard core
cartels, so as to guarantee economic efficiency, that is lower prices, higher quality and a wider product
variety, as well as the interests and well-being of consumers.  This applied to developed countries,
which had surveillance and enforcement mechanisms for treating such cartels, and even more so to
developing countries, whose markets were increasingly exposed to distortions stemming from anti-
competitive practices by cartels.  Another benefit of a multilateral competition framework was that itwould encourage countries without competition laws to adopt such laws.  The principle of special and
differential treatment would address the concerns of developing countries in this area.  He suggested
that it would not be in any country's interest to remain outside the gradual building-up of this
competition framework.  It was not in the interest of any economy or enterprise to avoid the
competitive process because it affected its performance, development, viability and perhaps even itssurvival.
50. Continuing, he said that sectoral or other exemptions to accommodate development objectives
could be considered and adopted, provided that such exemptions were objective and transparent.  He
did not believe that Members should try to deal with  theoretical divergences of interpretation;  rather,
they should abide by certain universal principles, and have faith in the enterprise of internationalcooperation.  Naturally, cooperation could only take place on a voluntary basis, respecting the rights
and interests of the parties concerned.  Such cooperation could take the form of "negative" comity
involving the notification of laws, but could also take the form of cooperation based on a degree of
"positive" comity or courtesy involving the comm on treatment of anti-competitive practices in terms
of investigation, analysis, consultation, etc.  The confidentiality of business secrets should, of course,be respected.  Finally, with regard to the scope of a multilateral agreement, Members had been made
aware of the harm caused by abuses of market dominance, vertical anti-competitive practices and
economic concentration in addition to cartels.  He proposed that work on a multilateral framework
should begin with the most harmful anti-competitive practices, notably price-fixing and
market-sharing cartels, and then proceed to address other harmful practices.  As regards mergers and
acquisitions, special and differential treatment should be provided for developing countries so as to
enable their economies and their enterprises to achieve a critical mass, which could enable them tocompete on an equal footing with enterprises of th e same size on international markets.  In that
respect, his delegation supported the proposals made by Thailand on special and differential treatment
for developing countries.
51. The representative of Argentina said that his country was already committed to the principles
of non-discrimination, transparency and procedural fairness in the context of its competition policy.
He did not have a preconceived idea on how these principles should be reflected in a multilateral
agreement.  Argentina was in the process of anal ysing the implications of such an agreement and
wanted to convey its experience regarding the application of such principles at the national level.  In
general terms, it could be said that the application of the principles of national treatment and of MFN
to competition policy meant that legal provisions on competition should apply in a non-discriminatoryway to all enterprises, products and services whether they were domestic or foreign.  This was
consistent with the fundamental principles of competition policy, under which such policy should
reflect the competitive nature of the market as a whole and not merely the competitive position of
individual players.  The competition law of Ar gentina guaranteed both national treatment and MFN
treatment.  Insofar as their activities affected the national market, domestic and foreign firms and
individuals were treated equally and were subjected to the same procedures.  Argentinean legislation
also stipulated that state-owned enterprises were bound by competition law.  All sectors of the
economy, whether regulated or not, whether in the primary sector, industry or services, wereWT/WGTCP/M/19
Page 24
subjected to the application of competition policy.  For this reason, the competition authority kept in
close contact with government entities regulating specific economic sectors.  The size, nationality or
ownership (public or private) of firms did not just ify exceptions.  As indicated in the background note
prepared by the Secretariat (WT/WGTCP/W/209), the principle of transparency implied publication
of substantive and procedural rules (ex ante transparency) and the decisions, with their motivations, ofthe competition authority ( ex post  transparency).  Argentina guaranteed both forms of transparency.  It
defined the practices that were considered anti-competitive and the rules of investigation.  The
competition authority also published guidelines to clarify procedures for defendants before the
competition court.  Regarding ex post  transparency, he said that Article 44 of the Law n° 25.256
contained an obligation to notify and publish the decisions imposing sanctions in the official journal.
Thus, the principle of transparency had a wide scope of application under Argentine competition law,
which made it easier for consumer organizations and competitors to participate both in a particularprocedure and in the ex post  monitoring of a particular economic sector.  A public register recorded
all mergers and the final decisions of the competition authority in regard to each merger.  However,
confidential information was protected.  For example, the confidential character of merger projects
and the ensuing investigations was guaranteed.
52. The representative of Brazil said that, although the Brazilian legislation did not establish
exceptions, these should be included in discussions on the proposed principles.  As was well known,
exceptions existed in other WTO agreements, such as the GATT, the TRIPS Agreement and the
GATS.  Moreover, exceptions were present in other international instruments such as those related to
sectors such as oil and natural gas or to certain beneficiaries such as state trading companies, state
monopolies and small and medium-sized enterprises or even those related to the attainment of certainpublic policies.  Regarding the relationship between competition and other agreements, a careful
examination was necessary, especially in the light of market access considerations.  Competition laws
should be confined to addressing violations of the economic order by economic agents that are
authorized to operate in the mark et according to domestic legislation and international commitments.
The sovereign right of a government to offer a higher or lower degree of openness of the domesticmarket of goods and services to foreign companies should not be affected.  In other words, the
possible application of the core principles to competition in a multilateral framework should not alter
or prejudge the commitment of the state, as far as market access in the WTO is concerned.  On the
question of special and differential treatment for developing countries, the need for inclusion of such a
principle in a possible framework was obvious.  Further to this point, it was necessary to consider
measures and initiatives that facilitated or stimulated the progressive adoption of a national
legislation;  in this respect, special and differ ential treatment and capacity-building were crucial
elements and could take several forms, including specific exceptions or transition periods.  Finally,
transparency in a multilateral framework should be envisaged in three ways.  First, this principle
would imply the publication and notification of laws and regulation of each country so that the
economic operators knew the exact parameters acco rding to which they should operate.  A second
aspect should be the provision of information and procedures in the conduct of cases, while givingdue importance to the protection of confidentiality of information as called for in the legislation of
each country.  Finally, information should be provided on administrative and judicial measures.
53. The representative of Indonesia, without prejudice to Indonesia's future position, said that he
supported incorporation of the principle of special and differential treatment as a fourth important
element of the core principles to be included in a possible multilateral framework on competitionpolicy.  Relevant issues in this context included increasing trade opportunities for developing
countries, safeguarding their developmental interest s, flexibility in any commitments for developing
countries and least-developed countries, and transitional periods.  Development provisions should be
established that had linkage to trade dimensions, so that they were closely related to the work in the
WTO.  In this regard, he supported Thailand's suggestion concerning exemption of developingcountries' national and international export cartels.  As to non-discrimination, as a Member of the
WTO, Indonesia fully recognized the principle of non-discrimination in the multilateral trading
system, and had applied that principle in her international trade policy.  However, in regard toWT/WGTCP/M/19
Page 25
domestic competition policy, he saw a need to implement it only insofar as it was in line with national
economic policy.  Indonesian competition law did not  discriminate economic operators on the basis of
origin or nationality.  It contained exceptions for SMEs, for example, for cooperatives, for IPR
agreements, and for research cooperation to improve the national standard of living.  Notwithstanding
this, implementing non-discrimination required careful analysis of its potential implications foreconomic development and was clearly more contentious than MFN.  Given the different level of
development between companies in developing and developed countries, developing countries should
be allowed to exercise flexibility to give more fa vourable treatment to companies in certain sectors of
particular interest.  This would be necessary to help countries build their industries in sectors where
they had comparative advantage.  A clear reference to this issue was in GATT Article XVIII, which
allowed developing countries to deviate from their obligations in order to build their own industries.
As an integral part of non-discrimination, the Working Group needed to discuss what kind ofexceptions were necessary to the principle.  For instance, the WTO included general and security
exceptions as well as regional trade arrangements as exceptions to non-discrimination.  In the area of
trade and competition policy, Members should consider whether they needed more specific
exceptions, including sectoral or country-specific exceptions.  Finally, he noted that he shared many
of the concerns that had been highlighted by Indi a with regard to implementing national treatment in
the field of competition policy as it was implemented in the WTO.
54. Continuing, he said that Indonesia recognized the importance of transparency in all economic
fields in enhancing predictability for foreign and domestic economic operators.  Regardless of
whether or not there was a discipline on competition policy in the WTO, Indonesia intended to
promote transparency in this field so that all foreign and domestic companies had the same access to
information.  Still, transparency in the WTO incl uded obligations that might be burdensome for
developing countries.  The lack of capacity of many countries had to be considered in this regard.  He
agreed that a balance was needed between transparency and the protection of confidential
information.  On procedural fairness, he pointed out that, in principle, Indonesia saw the value in
discussing this issue;  however, flexibility was needed to accommodate different judicial systems andrelated factors in developing countries.  More in-depth discussion was needed of this issue.  Among
other matters, it would be useful to clarify whether GATT Article X was an appropriate reference for
discussion of this issue in the Working Group or whether a more specific concept of procedural
fairness had to be developed for competition policy.
55. The representative of Cuba welcomed the proposal for inclusion of the fourth principle,
namely special and differential treatment, as proposed by the delegation of Thailand and the principle
of comprehensiveness proposed by New Zealand.  The need for special and differential treatment inthis area went further than the simple element of progressivity that had been referred to by the
delegation of the European Community and its members States.  Clearly, the list of principles
mentioned in paragraph 25 should not be considered as exhaustive.  The focus of work on core
principles should be on promoting the developmental needs and the interest of all countries,
particularly the developing ones.  The principle of non-discrimination could be interpreted in differentways, depending on the context and the objectives being sought.  In the context of the GATT, for
example, this principle was normally interpreted as including both most-favoured-nation treatment
and national treatment.  However, even in the GATT itself, the principle of national treatment was not
absolute; therefore, it should not be assumed th at the principle of national treatment was a core
principle that applied across the board in the WTO.  Regarding possible rules in the area ofcompetition, it would be inappropriate to adopt a principle of non-discrimination since if this was
done, foreign firms and their products would be free to compete on equal terms with domestic firms.
For a developing country like Cuba, this would in fact mean an imbalance since the domestic firms
were weaker and smaller and could not compete.  For this reason, it would be more appropriate to
adopt a concept of non-discrimination in terms that would give different treatment to countries whichhad different capacity levels.  It was also important to provide assistance and to adopt positive
measures to ensure the viability of local firms and institutions.  Any possible framework on
competition should not include the principle of transparency.  However, if this principle were to applyWT/WGTCP/M/19
Page 26
to any future rules, it should cover the private as  well as the public sector, bearing in mind that, in
most cases it was private companies which participated in mergers and international cartels.
Regarding procedural fairness, which had not been sufficiently discussed in the Working Group, the
delegation of Cuba supported the concerns noted in the submission of India (WT/WGTCP/W/215).
56. The representative of Egypt said that, as  a preliminary comment, he agreed that
non-discrimination was a basic principle of the multilateral trading system.  Nevertheless, it was
important not to lose sight of flexibility and genera l exceptions in addition to the specific exemptions,
and security or emergency exceptions embodied in the system itself, as contained in the GATT, the
GATS, and the TRIPS Agreement as well as in Article XIII of the WTO Agreement.  Finally, he
associated Egypt with the comments on special and differential treatment made by Malaysia;
Thailand;  Hong Kong, China;  Indonesia;  Cuba;  and India.
57. The observer from the Russian Federation described the application of the principles of
non-discrimination and transparency in Russia's anti-monopoly law.  The law applied both to national
and international entities and to physical persons whose activities had a negative impact on the
Russian market, regardless of nationality and even if the relevant activities took place beyond the
borders of the Russian Federation.  The principles of national treatment and most-favoured-nation
were fully applied.  From the point of view of access of foreign companies to the Russian goodsmarket, the provisions on mergers and acquisitions were especially important.  A preliminary
notification was required for major concentrations which met the criteria contained in the law.
Concentrations could be blocked if they would resu lt in the creation or strengthening of a dominant
position or a restriction of competition in the releva nt market.  In practice, the proportion of negative
decisions was small.  There were no special provisions concerning foreign as opposed to domesticcompanies involved in a merger and the responsible Minister had never received a complaint from a
foreign company alleging discrimination.  Despite the financial crisis of 1992, in the past few years
the activities of foreign investors in his country had increased.  In the fuel and energy sector, where
the concentration process was developing fast, the number of transactions with foreign capital was
growing rapidly.
58. The observer from the OECD, introducing a non-paper by his organization (subsequently
issued as document WT/WGTCP/W/221), explained that it examined the principles of transparency,
non-discrimination and procedural fairness in each of the contexts of both trade and competition
policy;  it did not, on the other hand, proceed to the more difficult task of setting out the application of
these concepts in a possible multilateral framework on competition policy.  The latter task would be
the subject of further work by the OECD Joint Group on Trade and Competition in the coming
months.  The concept of transparency in the WTO agreements, which covered both publication andnotification obligations, was broad in scope and provided vital information to market participants as
well as facilitating compliance with a WTO law.  A key exception allowed Members to refrain from
disclosing confidential information.  With regard to the principle of non-discrimination, an interesting
feature of the WTO framework was that its two constituent elements, national treatment and most-
favoured-nation treatment, had been operationalized differently across the WTO agreements.  Thisreflected the different contexts in which the principles were applied.  This sort of flexibility might also
be important should multilateral disciplines in re lation to competition law be negotiated within the
WTO.  Although procedural fairness had perhaps been more explicitly developed in the domain of
competition policy than in that of trade policy, various provisions in the WTO could be identified
which were closely related to this principle.  These included:  (i) requirements for fair and equitableprocedures in administrative and judicial proceedings;  and (ii) the capacity for review of
administrative and judicial decisions, as reflected for example in GATT Article X:3.  In addition, the
TRIPS Agreement and the plurilateral Agreement on Government Procurement implicated a limited
form of private party standing in the context of pr ocedural fairness-related provisions at the national
level.  In the field of competition law and policy, transparency was important for variousconstituencies including the business sector, victims and complainants of anti-competitive conduct
and the public at large.  Work done recently by the OECD Joint Group had set out possible standardsWT/WGTCP/M/19
Page 27
for transparency at various stages of an enforcem ent proceeding.  With regard to non-discrimination,
the paper noted that de facto as opposed to de jure  instances of discrimination would be the most
difficult to identify and to deal with in a multilateral context.  Both types of discrimination could exist
in laws providing for sectoral exemptions or for "public benefit" or "industrial policy" rules in the
competition context, but relatively little was known about the extent to which discrimination of thistype actually occurred.  Laws embodying such standards need not be inherently discriminatory, and,
in any event, one could conclude that discrimination of this type should not be addressed in a
multilateral framework on competition.  The OECD contribution noted that procedural fairness was
considered important within the competition community because the context was one of law
enforcement, in which all parties had certain fundamental rights of due process.  As with
transparency, the paper outlined how the requirements  for procedural fairness applied in competition
law enforcement to different types of interested parties.  In particular, it described recent work by theOECD Joint Group setting forth minimum standards for the rights of private parties to pursue redress
from harm caused by anti-competitive conduct, which could also be relevant to the discussion in the
Working Group.
2
59. The observer from UNCTAD said that, as part of the post-Doha work, his organization was
preparing a preliminary report on core principles to be included in a possible multilateral framework
on competition policy.  Regarding transparency, the report addressed three questions.  First, the WTO
agreements to date required transparency only for decisions and rulings of general application
whereas the work done in the Working Group seemed to lead to the conclusion that a more
comprehensive standard was both appropriate and achievable in a competition enforcement context.
The question, therefore, was whether it would be possible and feasible to include such a standard in amultilateral framework?  Second, would such a standard create problems for or entail major
amendments to current national approaches in competition policy?  Third, would the rules be different
if the multilateral agreement dealt only with hard core cartels?  Concerning the issue of procedural
fairness, the report addressed the question of whether it was possible to articulate a set of minimum
standards on this matter in a multilateral framework on competition policy.  As had been mentionedduring the meeting, there was no need for convergence here.  A third question concerned
complications that could arise from the fact that, in  some countries, hard core cartels were prosecuted
as crimes and not in others.  Regarding non-discrimination, the following questions could be raised:
(i) should the principle of national treatment and MFN apply to cooperation between national
competition authorities? (ii) in the light of the first question, would it be appropriate to provide the
sort of exemptions from MFN which were permitt ed under the TRIPS Agreement relating to judicial
assistance in law enforcement?  Finally, regarding special and differential treatment, what would bethe appropriate form to give to such a principle in a multilateral framework?
60. In the ensuing discussion, the representatives of Australia, China
, Chinese Taipei , the
European Community and its member States, Japan , Mexico , Morocco , New Zealand , Switzerland
and Thailand affirmed the relevance of core WTO principles, including, though not necessarily
limited to, transparency, non-discrimination and procedur al fairness, to the field of competition policy
and/or the desirability of incorporating these principles into a WTO agreement on competition policy,
on the assumption that various concerns and conditions regarding flexibility and other matters could
be addressed.  Continuing, the representative of Japan said that a multilateral framework would
contribute to further liberalization of trade in goods and services and thus would enhance worldeconomic growth and be positive for all countries, developed and developing alike.  It would alsoenhance the credibility and effectiveness of competition policy.  Liberalization needed to be
accompanied by appropriate measures to protect competition among economic actors;  without this,
the benefits sought would be undermined by anti-competitive practices such as cartels.  Governments
were responsible for providing such safeguards for the sake of competition, not only in the traditional
                                                     
2 OECD (2000), "Remedies Available to Private Pa rties Under Competition Laws", OECD Joint Group
on Trade and Competition, COM/DAFFE/CLP/TD(2000) 24/FINAL.  Available on the OECD websites:
http://www.oecd.org/ech and http://www.oecd.org/competition.WT/WGTCP/M/19
Page 28
domestic context but also in the context of inte rnational cross-border transactions in goods and
services.  Trade liberalization and competition policy were two different sides of the same coin.
61. The representative of China said that the principles of transparency, non-discrimination and
procedural fairness should be incorporated in future multilateral rules on competition, subject to
further official comment on the papers that had been submitted and provided Members could reachexplicit consensus on modalities before the Cancun Ministerial Conference for the negotiations on
such a framework.  The principle of special and differential treatment should also be reflected in the
framework.  China's law governing legislation and related administrative procedures was in line with
the principle of transparency.  It required publication of applicable laws and regulation and
administrative rulings.  However, he agreed with the point made by Thailand that developing
countries should be given enough time to build transparency (and due process) in the administration
and enforcement of the competition law.  On the principle of non-discrimination, China's currentAnti-unfair Competition Law treated domestic and foreign firms equally, which meant there was no
discrimination based on nationality.  However, he shared the concern regarding potential conflicts
between competition policy and industrial or deve lopment policy.  Appropriate flexibility was needed
for developing countries in this area.  Provisions on procedural fairness should also be incorporated in
any future multilateral competition rules.  China had an Administrative Review Law, AdministrativeLitigation Law and Administrative Penalty Law to safeguard procedural fairness in Government
administration, including the administration of competition policy.  On the other hand, due to the
differences in development stages among Members, each Member should be able to design its own
procedural system.
62. With regard to the scope of a WTO commitment relating to transparency in the field of
competition policy, the representative of the European Community and its member States clarified
that his delegation was not proposing that a notification obligation should apply to all individualdecisions, which would indeed be excessively burdensome.  However, when such decisions had a
legally binding precedential value, they constituted general regulations and were not just individual
cases any more.  In these circumstances, they should be notified.  In response, the representative ofthe United States said that, at least in common law jurisdictions, this was an extremely broad class of
decisions because all the court and agency decisions – at least the published ones – could haveprecedential effect.  Thus, according to this standard, any decision by the courts of the United States –
not only in government cases but in the hundreds and thousands of private antitrust cases that were
adjudicated every year potentially had precedential effect and could thus be caught by a notification
requirement.  It was important to be clear about this since, if this was the intent, it could indeed be
burdensome.  The representatives of India and Hong Kong, China
 indicated that they shared this
concern.  The resource costs of the proposed transparency requirements needed to be assessed.
However, a realistic assessment would not be possible unless one had a good idea of the specific
terms of the obligations that would be included in a WTO agreement on competition policy.
63. Responding to these concerns, the representative of the European Community and its member
States said that to the extent that a Member published individual decisions, some form of
non-burdensome notification could be found.  With  the suggestions and positive engagement of
Members, it would be possible to define a practical set of transparency obligations that would be
useful and yet not unduly burdensome, as indeed had been done in other areas of the WTO.  He had
mentioned the notion of case decisions with a precedential effect as an example, but did not suggest
that this was the only possible solution.  Even in common law countries, the extent to which courtdecisions were binding varied according to the country and the area of law.  In any case, this was an
issue that the WTO should not address.  He emphasized that, once the overall framework was set, the
manner in which it would be satisfied should take account of the realities and diversity of domestic
legal systems.  Finally, he emphasized that when talking about transparency, his delegation was
suggesting only that the existence of certain basic procedures would be subject to dispute settlementin the WTO, and not the issue of whether the procedures had been properly exercised in a particular
case.  The distinction between de jure  and de facto violations also applied in this context.WT/WGTCP/M/19
Page 29
64. The representative of Chinese Taipei suggested th at an alternative approach was to establish a
competition law and policy database, which could provide a convenient one-stop shop for all
Members.  He referred, in this regard, to the example of the APEC Competition Policy and Law
Database developed by Chinese Taipei, which contained policy statements, competition laws,
regulations, guidelines, case-handling procedures and decisions of all APEC members.  He would be
pleased to provide further information regarding the database, which might be an alternative for WTO
Members in the transition period before full publication and notification was required.
65. On the subject of non-discrimination, the representatives of the European Community and its
member States and Hong Kong, China  affirmed that the principle of non-discrimination should not be
extended to address situations of de facto non-discrimination since, as had already been noted by
various Members, the enforcement of competition law was often based on the application of a rule of
reason and/or the exercise of prosecutorial discretion based on a range of legitimate factors, whichwould make the assessment of claims of de facto discrimination difficult and complicated.
66. Continuing, the representative of the European Community and its member States, responding
to the concerns that had been raised by the representatives of India, Malaysia and other delegations,
said that although his delegation did not believe in a discriminatory competition policy, not all forms
of different or differential treatment were in and of themselves discriminatory;  indeed, there could beplenty of reasons why a government might wish to treat different economic operators in a different
manner.  All his delegation was saying was that, as a matter of principle, the reason for the differential
treatment could not and should not be nationality.  He believed that the majority of Members shared
this view, and indeed it followed from the founding principles of the WTO.  It might also happen that
some of the economic operators that a government was treating in a certain manner were allforeigners.  For instance, as pointed out by delegates from developing countries, the economic
structure of a country might not be sufficiently diversified or sufficiently developed, and in certain
areas economic operators with certain characteristics could all be foreign.  He would not characterize
that in itself as discrimination; however, the underl ying reasons for the different treatment had to be
based on objective policy factors.  In other words, maintaining the requisite policy space forgovernments to pursue goals other than competition did not in itself contradict the principle of
non-discrimination.  Continuing, he said that with regard to Malaysia's argument that Members could
ensure de facto non-discrimination but not de jure  discrimination, he took this to mean that Members
might not know in advance when they needed to  apply differential treatment.  In other words,
Members might have a policy of non-discrimination that applied to 99 per cent of the cases, but they
might not wish to be bound by that for the one case where they had a problem with
non-discrimination.  However, a priori exclusions and exemption were not the only tools to permitthis.  There were also public interest clauses and several other policy tools that Members with a
competition authority could adopt.  He had no objection to this so long as Members and economic
operators knew about the existence of such tools, i.e., they were administered in a transparent manner.
67. Commenting on the distinction that had been drawn by the representative of Thailand
between cross-border and domestic trade, the representative of the European Community and its
member States suggested that this was untenable in practice.  Any anti-competitive behaviour that
involved cross-border trade or cross-border investment necessarily involved domestic economicactors; the only cases where this was not so were situations where there were no imports, exports or
foreign direct investment with respect to a given area or product, and trade was purely domestic.  If a
country decided not to apply competition law to that particular situation, the WTO probably wouldnot have anything to say about that because it was a purely national choice.  However, the majority of
situations would have a cross-border dimension of one kind or another.  In response, the
representative of Thailand said that the discussions thus far in the Working Group had seemed to
concentrate mainly on situations of anti-compe titive practices involving investment, meaning
commercial presence.  This required focusing on the nationality of companies that were alreadyoperating within the home country or the host country.  This was why the Thai delegation felt that a
greater focus on cross-border movements of goods would be desirable.  There were many unfairWT/WGTCP/M/19
Page 30
practices related to cross-border movement of goods in terms of exports and imports, in particular in
cartels.
68. On the subject of procedural fairness, the representatives of the European Community and its
member States;  the United States ;  and Hong Kong, China  said that it was important to address this
issue, if at all, in ways that took account of the diversity of Members' legal cultures and the
established practices of national judicial systems and competition authorities, where the latter existed.
Continuing, the representative of the European Community and its member States said that, while
accepting that this was a complex topic, it was also possible to overstate the complexity involved.  Allcompetition systems – no matter how different they were – respected certain basic criteria of fairness.
Furthermore, experience in other areas of the WTO had shown that procedural fairness could be
addressed in ways that were simple and practical and yet took account of the evident diversity in
Members' legal cultures and systems.  To take the example of judicial review, there were a number ofprovisions in the WTO agreements that provided for judicial review without any interference
whatsoever in how judicial reviews were organized in a given country, or the scope of such judicial
reviews.  In practice, these provisions had not created problems of the type which had been alluded to,
and had been useful in terms of reassuring traders and investors that the national systems of countries
with which they often had, at best, limited familiarity, respected certain basic norms.  Anotherexample concerned the treatment of confidential information, which was not defined in any of the
WTO agreements;  despite this, there were several references in the agreements to the protection of
confidential information as provided for in national laws.  Panels had consistently deferred to national
laws that were in themselves coherent and provided for this kind of protection.
69. In response, the representative of the United States expressed the view that even what the
representative of the European Community and its member States had characterized in his first
intervention as some of the more basic procedural fairness rules that might be envisioned in a
multilateral agreement could raise problems.  For instance, one of the basic rules would involve the
right to receive notice of an investigation.  There would be no problem if the required notice was
supposed to be addressed to the party being investigated, but – at least for the United States – thesituation was different if there was to be widespre ad notification, for example, to the WTO and/or its
Members.  The practice of the United States was not to disclose publicly the existence of an
investigation when it had not been determined that the target of an investigation had done anything
wrong, out of respect for the rights of the person being investigated.  In response to this point, the
representative of the European Community and its member States said that he accepted the need for a
clear distinction between notification of investigations to the parties, and notification to the WTO.
His delegation's position was merely that one of the essential elements of procedural fairness was thatthe target of an investigation be so notified.  To show compliance with a procedural fairness
obligation in the WTO, Members should simply be in a position to demonstrate that they had made
provision for targets of an investigation to be notified in an appropriate manner.  This was an example
of how the questions and concerns that had been raised by some Members concerning his delegations
proposals could be clarified with appropriate discussion.  The representatives of Hong Kong, China;
and India said that appeal proceedings could nonet heless be costly to developing country Members
and, particularly, to small economies.  Further discussion was necessary to clarify what obligations
would be entailed by this principle in order that Members could make a realistic assessment of its
impact on their domestic regimes.
70. The representative of Hong Kong, China asked for clarification of a point made in the
submission of Korea (document WT/WGTCP/W/212) that rules defining the disclosure
responsibilities of private entities in competition cases should be made part of the procedural fairness
provisions in the multilateral framework.  In response, the representative of Korea said that if it was
important to focus on the rights of companies which were being investigated, it was also important toemphasize the importance of efficient investigatory powers for competition authorities.WT/WGTCP/M/19
Page 31
71. With regard to additional core principles that might be incorporated in a multilateral
framework on competition policy, the representatives of China;  Hong Kong, China ;  India ;  Japan  ;
Nigeria;  and Thailand  noted the relevance of the principle of special and differential treatment in this
regard.  The representative of Hong Kong, China, referring to an earlier comment by the
representative of Japan, said that his delegation believed that this principle should mainly cater for the
needs and concerns of the developing country Members.  The representative of India said that special
and differential treatment implied that time should be granted to developing countries to implement a
competition regime and any related commitments, and the amount of time should depend on the level
of development of the country.  He noted, as well, that if exemptions and exclusions became part and
parcel of the general framework of the agreement, there would be less of a need for special and
differential treatment at least on this ground.
72. The representative of Hong Kong, China, refe rring to the suggestion in the contribution of
New Zealand (WT/WGTCP/W/210) that the principle of comprehensiveness be included as an
additional principle in any multilateral framework, said that this was one of the principles used in the
APEC to enhance competition and regulatory reform s, but it was not clear what this meant in the
WTO.  In response, the representative of New Zealand said that comprehensiveness was not a core
WTO principle, but a core principle of competition policy.  His key concern was how to give a
multilateral agreement some strength and avoid a situation whereby the value of the agreement was
undermined by exemptions.  For this reason, exemp tions and exceptions should from time to time be
re-examined in the context of the competition framework as a whole.  The representative of Australia
said that the broad objective of seeking to apply competition in as many areas of the economy was inthe public interest and had been critical to the successful implementation of competition policy inAustralia.  This highlighted the relevance of New Zealand's proposal regarding the principle of
comprehensiveness.
73. The representative of Nigeria said that transparency, non-discrimination and procedural
fairness were instruments for achieving the objectives of the WTO, in particular "raising the standard
of living, ensuring full employment, and a large and steadily growing volume of real income andeffective demand, and expanding the production and trade in goods and services".  The objectives also
recognized that "there [was] a need for positive effo rts designed to ensure that developing countries,
and especially the least-developed among them, secure a share in the growth in international trade
commensurate with the needs of their economic development".  In the view of his delegation, the way
the core principles were intended to be applied in the proposed framework on trade and competition
policy would work against these objectives of the WTO.  Therefore, he was not convinced of the need
for a multilateral agreement on trade and competition policy in the WTO.  Instead of affirmativeaction to assist the development of local firms in developing countries to ensure their viability, the
current proposals regarding core principles would achieve the opposite result.  Further, important
questions had been posed as to how the core principles would be applied.  Since the list of core
principles in paragraph 25 of the Doha Ministeria l Declaration was not exhaustive, he suggested that
consideration be given to the following additional principles:  (i) the obligations of foreign firms tothe host country;  (ii) the obligation of home governments to ensure that foreign firms meet their
obligations;  (iii) measures to be taken by domestic firms and government in a possible multilateral
framework;  (iv) enabling local firms, especially small firms, to remain competitive and to grow;
(v) impediments to competition by government actions, for example anti-dumping actions;
(vi) impediments to competition by intellectual property rights protection, global monopolies andoligopolies, and their effect on local firms in their countries;  and (vii) large mergers and acquisitions
by transnational companies, and their effects on developing countries.  The proposed exercise would
enable the Working Group to identify appropriate technical assistance and special and differential
treatment measures that could assist developing countries.  More importantly, it would help identify
the best way to approach the subject of trade an d competition, which was a highly technical subject,
on which Members had just scratched the surface.WT/WGTCP/M/19
Page 32
74. In response to the intervention of Nigeria, the representative of the European Community and
its member States said that it had puzzled him because in the first part of the intervention the
representative of Nigeria had suggested the existe nce of an opposition between core principles of
competition law and development needs, whereas in the latter part he had drawn attention to the needs
of developing countries in this area.  He acknowledged that developing countries did not necessarilyhave the resources, the ability or perhaps even the market size to make the establishment of national
competition authorities a priority.  As a solution, he reiterated his delegation's proposal to establish
regional competition authorities.  Further, he offered the assurance that technical assistance and
capacity-building would be available for Nigeria and other relevant Members on a bilateral basis in
the context of the economic partnership agreement negotiations with those countries.  He did not see
any contradiction between the policy objectives that Nigeria had enumerated and the use of
competition law.
75. On the subject of the possible implications of core principles in a WTO agreement on
competition policy for national industrial and other economic and social policies, the representative of
India said that much of the debate turned on this .  India and other developing countries needed the
flexibility to resort to a range of developmental tools, including those that normally fell under the
rubric of "industrial policy".  In any case, the resolution of conflicts between competition anddevelopment policies should be left to each Member, subject to the transparency consideration.  What
should be avoided was an overly prescriptive or intrusive approach.
76. In response, the representatives of Australia, the European Community and its member States
,
Japan and Morocco  suggested that, at least to some extent, the view that competition policy was
fundamentally at odds with developmental objectives was mistaken.  This was not in any way to
diminish the importance of developmental objectives - certainly, it was understandable that
development was the utmost priority of economic policy in developing countries - but only to suggest
that broad application of competition policy principles across national economies might be consistent
with or even serve to advance those objectives.  Experience had shown that competition in markets
led to greater economic efficiency, thereby contributing to sustainable development in the long termand guaranteeing the interests of all market players, including small and medium-sized enterprises as
well as consumers.  For these reasons, an approach based on sweeping exclusion of whole sectors of
the national economy from the scope of competition principles might well damage the objectives that
it was intended to promote.
77. Notwithstanding the foregoing, the representatives of Australia, the European Community
and its member States, Japan  and Morocco  affirmed their belief that the proposed multilateral
framework could and should preserve adequate "policy space" for developing countries to pursue the
economic and social policies they deemed necessary for their own development.  It was perfectly
legitimate for a government to decide that there were policy goals that overrode the need to protect
competition.  Among other possible tools, the preservation of appropriate policy space might be
addressed through:  (i) clear delineation of the scope of the proposed core principles regarding
competition policy, with the intent of ensuring that they did not spill over into related policy fields;(ii) appropriate exemptions or exceptions from national competition law and/or the proposed
multilateral framework;  and/or (iii) the principle of special and differential treatment.
78. With regard to  the relevance of exceptions and/or exemptions from national competition laws
and/or from a multilateral framework as a tool for managing any conflicts with national industrial
policies,  the representatives of the European Community and its member States;  Hong Kong, China
;
India;  Japan ;  Switzerland ;  and Thailand  discussed the role and importance of these.  Continuing, the
representative of Hong Kong, China said that, given the diversity in stages and patterns of economic
development among Members, sufficient flexibility must be incorporated in any possible framework
to make it workable among all WTO Members.  Provisions for exemptions and exceptions would
provide greater flexibility for WTO Members to achieve other national objectives such as industrialand economic development.  If a multilateral framework on competition policy was adopted, it wouldWT/WGTCP/M/19
Page 33
be difficult to justify why exemptions should be granted to export cartels, at least in the case of most
countries.  However, under the principle of special and differential treatment, some exemptions of this
nature could be given to developing countries.  The representative of India suggested that the ability
to implement exemptions should not be phased out over time.  The representatives of the European
Community and its member States, Japan , Switzerland  and Morocco  said that, in any case, exceptions
and exemptions must be subject to appropriate transparency procedures, in order that economic
operators trading with a Member or investing in  a Member's economy would know where they stood.
Continuing, the representative of Switzerland said that, on the one hand, it was important that each
state have the possibility to define its own exemptions and exceptions.  On the other hand, it wouldnot be sensible in a multilateral framework on competition policy to give Members unlimited
possibilities to undermine the main points of such an agreement.  The right balance had to be struck.
79. With regard to the argument that a modest agreement would be better than none, the
representative of the United States said that his delegation was concerned about the danger of
provisions on procedural fairness and other matters than were excessively vague.  Sometimes, whenissues were difficult, Members tended to take refuge in ambiguous terminology, for example, to say
that a proceeding "should be fair" or that "parties s hould be accorded due process".  In the view of his
delegation, this would be a mistake because those terms would have different meanings to differentMembers, and would therefore be subject to continual misunderstandings and challenges.
80. The representative of Japan said that the paper by his delegation (document
WT/WGTCP/W/217) offered a possible way forward on the issue of core principles:  it proposed that
a WTO agreement on competition policy should embody only general provisions with regard to the
core principles, while also offering more detailed interpretations or possible approaches for theapplication of the core principles in the form of non-binding guidelines or menu of options.  This
would foster common understanding of the core principles among Members, while also taking into
consideration the diversified approaches of competition law enforcement adopted by each Member.
The representative of Hong Kong, China welcomed this proposal.  Notwithstanding this, all aspects of
the proposed provisions on core principles should be subject to an assessment of benefits and costs.
The representative of the European Community and its member States said that aspects of the
Japanese proposal regarding non-binding arrangements could indeed be part of a possible wayforward.  However, he doubted whether a pure ly non-binding framework would be adequate.
81. The representative of Thailand said that, as the representative of the United States had
suggested, setting international standards on these elements could be complicated in practice and
might not be feasible given the different legal, political, and institutional environments of each
Member country.  It therefore seemed preferable to focus instead on the substantive aspects ofcompetition policy, in particular on exemptions and exclusions.  Here, there seemed to be a consensus
that sectoral exemptions were justified on the ground that national industrial policies were acceptable.
Yet, the Working Group seemed to overlook the role of export and international cartels that did not
have a development justification.  A good national competition law should not have an exemption for
export cartels, except in the case where exporters were small and medium-sized enterprises thatneeded to bind together to counter the bargaining strength of large multinational buyers.
82. The representative of Mexico said that, rather than clarifying the core principles as was
required by the Doha Ministerial Declaration, some delegations had called their relevance into
question.  These principles were the basis of the multilateral trading system and were known by all
countries.  To bring them over to competition legislation would not be difficult if Members engagedthemselves positively in the exercise.  No competition law was opposed to these principles;  on the
contrary, competition policy and the WTO principles were mutually supportive.  Furthermore,
everybody knew that transparency gave more credibility to competition agencies.  Delegations should
therefore adopt a more positive stance in this area, starting with an analysis of how the principles were
reflected in their own legislation.  In this way, common approaches and positions could be readilyidentified.WT/WGTCP/M/19
Page 34
83. The representative of Morocco said that abuses of a dominant position and anti-competitive
agreements could have a negative economic impact on national or international markets;  however,
only those actions or agreements that could distort competition were prohibited.  Certainly, there was
no need to prohibit agreements whose negative effects on competition were mitigated by benefits for
economic development.  Agreements between small and medium-sized enterprises were likely to beadvantageous because they allowed such enterprises to compete with big enterprises.  This justified
appropriate exemptions for SMEs.  In any case, enforcing respect for fundamental competition rules
was indispensable for developing the economy.  She urged the establishment of international rules in
parallel with the adoption of national rules, which should be non-discriminatory, should be based on
established experience and should be adapted to national and international circumstances.  Flexibility
and adaptability should be the leitmotiv of the eventual agreement.
84. The representative of Thailand said that her delegation wished to elaborate on some concerns
that had been raised earlier in the meeting and at the last meeting of the Working Group.  First, on
hard core cartels and cooperation, if the WTO managed to reach an agreement with a binding
commitment on hard core cartels and a voluntary commitment in cooperation, it would mean that each
Member would be bound to pass a national competition law that banned hard core cartels, but
enforcement of such law would rely on cooperation from foreign competition authorities that would
only be voluntary.  Without a guarantee of assist ance, it was doubtful whether a developing country
competition authority, with limited resources, could prosecute these cartels on its own.  There was a
possible alternative to fight hard core cartels more efficiently.  If everybody agreed that these cartels
had no redeeming qualities, an international law to ban them would be appropriate.  In response, the
representative of Morocco noted that studies that had been refered to in the Working Group, in
particular the study by Levestein and Suslow for the World Bank3, had found that the impact of cartels
on developing countries amounted to many billions of dollars annually.  The objective, therefore,
should not be to merely prohibit cartels in principle but to effectively discipline them.
85. The Chairman drew attention, inter alia , to the following points, emphasizing that they were not
in any way implied to be comprehensive and were simply personal impressions which had no official
standing:
- There had been a rich and penetrating discussion of issues concerning the element of core
WTO principles as it was referred to in paragraph 25 of the Doha Ministerial Declaration,
including transparency, non-discrimination and procedural fairness, and the significance of
these principles for both competition policy and the multilateral trading system.  Attention
had also been given to the particularities of competition law and policy and how these would
need to be taken account of in any WTO agreement on competition policy.
- At least at a general level, the relevance of the core principles in respect of the field of
competition law and/or policy had been widely recognized.  In particular, the point had been
made that adherence to the principles could bring important benefits both in terms of
assurance for traders and investors and in ensuring the credibility and effectiveness ofcompetition policy and institutions.  The discussion had also called attention to
complementarities that were deemed to exist between the various principles – for example,
the relationship between procedural fairness and transparency had been highlighted.
- The point had also been made that, in the event that a WTO agreement on competition policy
was developed, the referenced core principles would likely have to be adapted to the special
characteristics and modalities of the field of competition policy.  The suggestion was made
that precedent for this approach could be found in various existing WTO agreements in which
                                                     
3 Margaret Levenstein and Valerie Suslow, Priv ate International Cartels and Their Effect on
Developing Countries (Background Paper for the World Bank's World Development Report 2001,9 January 2001) (available on the Internet at http://www-unix.oit.umass.edu/~maggiel/WDR2001.pdf).WT/WGTCP/M/19
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the core principles had been adapted to the particularities of subjects such as trade in services,
intellectual property and sanitary and phytosanitary measures.
- A number of questions had been raised as to the technical feasibility, modalities and
desirability of incorporating the various core principles in a WTO agreement on competitionpolicy.  Some of the questions did not necessarily reflect a view that the principles were
unimportant or not relevant to the field of competition policy – rather, they were concerned
with bringing to the surface problems that might be entailed by incorporation of the principles
in an explicit WTO agreement on this subject,  including possible implications for national
enforcement processes.  It was recognized that the severity of these problems would depend
partly on matters such as the precise formulation of the relevant principles and the degree to
which they were subjected to dispute settlement.
- A particular concern that had been flagged in the discussion involved the implications of the
principle of most-favoured-nation treatment (MFN) for existing cooperation arrangements at
the bilateral and regional levels.  Most countries that had spoken on this issue seemed to be of
the view that they did not want existing arrangements to be called into question under theMFN principle.  To this end, some had suggested that consideration be given to an explicit
exemption for these arrangements.  On the other hand, some had suggested that, to the extent
that cooperation was treated as voluntary and hence not subject to binding commitments in
any WTO agreement on competition policy, there might not be a need for an explicit
exemption.
- On the other hand, some representatives of developing countries had explicitly questioned the
desirability of incorporating the various core principles in a WTO framework on competition
policy.  A particular concern had involved the potential implications of the core principles for
national industrial and other economic and/or social policies.  In addition, the question hadbeen posed as to whether WTO action in this area was likely to result in an imbalance of
benefits in favour of developed countries.  For the countries raising these questions, the
greatest concern had seemed to be with the principle of national treatment.  Nonetheless, this
did not necessarily mean that the other principles posed no difficulties.  In particular, the point
had been made that the benefits of any commitments on transparency should be weighed
against the resource costs of such commitments.
- Much attention had been given to the subject of exemptions, as an aspect of flexibility and a
possible tool for managing any conflict between competition and development policies.
- As a further aspect of the discussion on the principle of non-discrimination, the suggestion
had been made, including by some proponents of a multilateral agreement on competitionpolicy, that such an agreement should attempt to deal only with de jure  as opposed to de facto
instances of discrimination.  This did not reflect a view that de facto discrimination was
unimportant; rather, it was felt that discussions in the Working Group had not advanced
sufficiently to address de facto instances of discrimination.  As well, the point had been made
that identification of de facto instances of discrimination in the field of competition law andpolicy could be particularly difficult, given the prevalence of "rule of reason" approaches
under which the treatment of individual firms might depend on diverse contextual factors.
The importance of preserving the unfettered ability to exercise prosecutorial discretion at least
under common law-based competition policy systems had also been cited in this regard.
- Another set of questions had concerned the implications of incorporating the WTO core
principles in a multilateral framework on competition policy for countries lacking
comprehensive competition laws.  The suggestion had been made that, at an appropriate
stage, this should be the subject of further discussion in the Working Group.WT/WGTCP/M/19
Page 36
- Finally, some Members had suggested that, in addition to the three principles referred to
specifically in paragraph 25 of the Doha Ministerial Declaration, namely transparency,
non-discrimination and procedural fairness, consideration should be given to incorporating in
any multilateral framework either or both of the following two additional principles:  (i)
special and differential treatment;  and/or (ii) comprehensiveness.  Concerning the former, thepoint had also been made that the relationship of this principle to the element of flexibility
which is highlighted in paragraph 25 of the Doha Ministerial Declaration would have to be
clarified.
86. Following discussion, the Working Group agreed that the Secretariat be asked to prepare a
background document on provisions relating to procedural fairness in existing WTO agreements.
87. In response to a suggestion by the representativ e of Hong Kong, China that the Secretariat be
asked to prepare a study of the costs of complying with the various core principles with particular
reference to the situation of countries without a comprehensive competition law, the Chairman noted
that the study that had already been commissioned by the Working Group to be prepared by theSecretariat with the assistance of a consultant, Dr. Simon Evenett, would examine related subjects.  In
the light of this, the Working Group agreed to put off any consideration of a further study pending
review of the initial results from the current study.
II. TECHNICAL ASSISTANCE AND CAPACITY-BUILDING, AS CALLED FOR BY
PARAGRAPH 24 OF THE DOHA MINISTERIAL DECLARATION
88. The representative of Australia introduced a written contribution relevant to this item.  In
addition, the representatives of Argentina, China , Guatemala , Japan , Korea , Morocco , Thailand  and
Uruguay in addition to the observer from the Russian Federation  made oral statements.  The
representative of the Secretariat as well as the observers from UNCTAD  and the OECD  provided an
update on relevant activities of their organizations.
89. The representative of Australia, introducing Australia's written contribution (document
WT/WGTCP/W/211), said that it provided an update on recent technical assistance and
capacity-building activities of the Australian Competition and Consumer Commission in the area of
competition law and policy.  He encouraged other Members to look at Australia's experience and to
liaise with Australia if they were interested in benefiting from that experience.
90. Recalling the points he had made at previous meetings about staff capacity limitations, the
representative of the Secretariat said that, in July 2002, the Secretariat had recruited an additional staff
member who would boost its ability to provide tec hnical cooperation and capacity-building.  Since the
Working Group's meeting of 1-2 July, the Secretariat had organized a national workshop on trade andcompetition policy for China, in cooperation with the Government of China, and a regional workshop
for Central American countries, organized in coop eration with the Inter-American Development Bank
and the Government of Guatemala.  The latter had been attended by representatives of Costa Rica,
Cuba, the Dominican Republic, El Salvador, Guat emala, Honduras, Nicaragua and Panama.  Both
events had benefited from the participation of UNCTAD.  In addition, the Secretariat had contributedto sessions on trade and competition policy at a national seminar held in Nigeria and to special
sessions of the WTO Trade Policy Course that had been held recently for officials from
French-speaking and English-speaking African countries, in Casablanca and Nairobi, respectively, in
addition to a session of the regular WTO Trade Policy Course, in Geneva.  With regard to the
technical assistance programme for 2003, this was being developed and would be submitted to theCommittee on Trade and Development at its meeting on 8 October 2002.  As had been the case
in 2002, in 2003 the Secretariat's technical assistance activities would place considerable emphasis on
cooperation with other intergovernmental organizations, especially UNCTAD.  In this regard, he
noted that a first series of regional workshops had been organized by UNCTAD, with the participation
of the WTO, in the first half of 2002.  A second series was now being organized by the WTO, withWT/WGTCP/M/19
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the participation of UNCTAD, and would continue into  the first part of 2003.  Following this, it was
planned to organize a third round of regional workshops jointly by the WTO and UNCTAD, in all
major regions of the developing world.  In addition, as part of the 2003 Plan, the Secretariat would
organize another symposium in Geneva, mainly for the benefit of the Geneva delegates and
participants in the Working Group.  The number of national events that the Secretariat could hold
would be limited, though the Secretariat was conscious that it had some commitments to a number of
countries that it might or might not be able to deliver on in 2002.  To the extent possible, these would
be carried over into 2003.  In addition, wherever possible and useful, speakers from the WTO
Secretariat would be supplied for technical cooperation activities of other intergovernmental
organizations when they dealt with, as they often did, the Doha mandate and the ongoing work on
trade and competition policy in the WTO.  He appealed to the other intergovernmental organizations
to give the WTO Secretariat details as soon as possible of the technical cooperation activities in whichthey would like the WTO to participate in 2003, so that the Secretariat could have the events included
in the Secretariat 2003 Technical Cooperation Plan;  if they were not listed in the Plan, there could be
difficulties in obtaining the required funding.  The Secretariat was also discussing with the World
Bank the possibility of organizing two intensive training courses on trade and competition policy for
officials from Africa and Asia, during the second half of 2003.  Finally, it was envisaged that in 2003,there would be a number of workshops or training activities which would cover the four so-called
"Singapore issues".
91. Turning to the study that the Secretariat had been  asked to conduct at the July meeting of the
Working Group (WT/WGTCP/M/18, paragraphs 95-98), the representative of the Secretariat said that
this was something that went beyond the in-house resources of the Secretariat to conduct.  The
Secretariat had, therefore, contracted the services of an expert consultant, Dr. Simon Evernett, who
was the Director of Economic Research at the World Trade Institute in Berne.  He was the author of a
number of papers in the area of trade and competition.  Work had commenced, and it was hoped that
the study would be available at the November meeting of the Working Group, at least in a preliminary
form.
92. The representative of Uruguay referred to a technical cooperation event which had taken
place in Montevideo at the beginning of Sept ember and which had been organized by UNCTAD in
cooperation with the Government of Uruguay, in line with the mandate in paragraph 24 of the Doha
Ministerial Declaration. This seminar had been most useful.  Competition legislation had been
adopted in Uruguay in 1999, in response to a need to curtail certain unfair practices and perceived
abuses of a dominant position.  At the regional level, Uruguay had adopted the competition defense
protocol of Mercosur, although this had not yet been ratified.  As for other developing countries, thesupport that Uruguay could obtain from international organizations and other competition agencies
was essential.  This experience permitted a better evaluation of the consequences of multilateral
cooperation.
93. The representative of Japan provided information on ongoing efforts to which his country
contributed within the framework of the APEC.  On 6-8 August 2002, the first session of the "APEC
Training Programme on Competition Policy" was held in Bangkok.  This programme, which was part
of a joint project conducted by Japan and some of its APEC colleagues was the first three-day seminar
in a series of five programmes scheduled over a period of three years.  The second training seminar of
this programme was scheduled to be held in Viet Nam in March 2003.
94. The representative of Korea said that the need of developing and least-developed countries for
enhanced support for technical assistance and capacity-building in competition policy, mentioned by
the Doha Ministerial Declaration, was a cross-cutting issue whose importance should not be
underestimated in the discussion on the multilateral framework on competition policy.  In this vein, he
announced that The Korean Fair Trade Commissi on, in cooperation with the OECD and UNCTAD,
would hold a major international forum and workshop on 6-8 November 2002.  These events wouldWT/WGTCP/M/19
Page 38
have an important focus on the Doha mandate on trade and competition policy and would provide a
venue in which to promote understanding of the issues among all participating countries.
95. The representative of Thailand informed the Working Group of technical assistance activities
that had been taking place in Thailand over the past several years.  Thailand had relied extensively on
technical assistance, in particular from Canada, even before the national competition law was passed,in 1999.  Afterwards, extensive support had been provided by Japan as well as other donors, including
the World Bank and UNCTAD.
96. The representative of Guatemala thanked the Secretariat for having organized the recent
regional workshop on trade and competition policy for Central American countries.
97. The representative of China thanked the Secretariat for having organized the recent national
workshop on trade and competition policy in Beijing, in cooperation with the Chinese authorities.
The workshop had been well received by representatives from China's competition authorities andother participants, who had appreciated the opportunity to share their experience and exchange
opinions.  Competition policy was crucial to the establishment of the socialist market economic
system in China.  In this regard, China's new competition law was expected to come into effect in the
near future.  The ongoing discussion in the Working Group was highly relevant to China and the
technical assistance provided would certainly contri bute to the effective participation of China in the
Working Group discussion.  Before the Fifth Ministerial Conference, technical assistance and
capacity-building activities should focus on helping developing Members to clarify basic concepts
and principles of competition policy, analysing domestic experience with legislation and
implementation, providing basic training to implementation officials, promoting a "culture of
competition", analysing the relationship between competition policy and market economicdevelopment and strengthening the exchange of information and experience among WTO Members.
In this regard, China welcomed more focused a nd targeted technical assistance activities from the
WTO, UNCTAD and other organizations in the foll owing two areas:  (i) cooperation between WTO
Members in the field of competition law and policy;  and (ii) the impact of future multilateral
competition rules for its trade and development.  These issues might be addressed in regional and/ornational workshops or in other contexts.  He also expressed appreciation for assistance received from
the Governments of Japan, Korea and France.  China looked forward to participating actively and
sharing its experiences in the course of the Working Group's discussions and in technical assistance
activities at both the regional and multilateral levels.
98. The representative of Argentina informed the Working Group of a conference that had been
organized recently in his country, in cooperation with UNCTAD, that was relevant to the mandate in
paragraph 25 of the Doha Ministerial Declaration.  The conference had enabled the nationalauthorities to draw the attention of officials in certain sectors, like transport, and local consumer
organizations, to the importance of competition policy and of a multilateral framework on
competition.  Argentina had also been visited by experts from the US Federal Trade Commission, the
US Department of Justice and the EC Commission, which had contributed to training and mutual
understanding between different competition authorities.  All these activities were welcome andassisted countries to better evaluate the need for a multilateral agreement on competition policy.
99. The representative of Morocco said that the Doha Ministerial Declaration had been precise
about the need for enhanced levels of technical a ssistance and capacity-building, in order to assist
countries to better evaluate this complex area.  Training managerial staff of national competition
agencies would clearly serve capacity-building.  There was also a need for studies on competitivenessand the competitive behaviour of economic actors.  Further, there was a need to launch a campaign to
establish a competition culture among consumers and economic actors.  More information was needed
on restrictive business practices, and the ways they could arise as well as the harmful effects they
could have, particularly on the economies of developing countries.  The role of competition in the
development process and its basic preconditions also needed to be studied.  The CasablancaWT/WGTCP/M/19
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Declaration based on the work of the Euro-Mediterranean Competition Law and Policy Seminar had
put special emphasis on the need to strengthen voluntary cooperation among competition authorities
within and across regions.   Assistance should be primarily targeted toward helping countries without
competition legislation and those that were trying to implement such legislation.  Given the expertise
of UNCTAD, cooperation between that organizati on and the WTO was of major importance.  His
country would participate actively in the forthcoming regional workshop organized by the WTO
Secretariat in Libreville, and Morocco would be pleased to host similar events in the future.
100. The observers from UNCTAD and the OECD  provided information on their organizations'
activities relevant to paragraph 24 of the Doha Ministerial Declaration and indicated that this
information could be found on their respective websites.4  They affirmed their continued willingness
to cooperate closely with the WTO in the post-Doha  activities.  Continuing, the observer from the
OECD referred to the Global Forum on Trade which had been held on 19-20 June in Hong Kong,
China to promote dialogue between non-OECD and OECD members on the "Singapore issues".
101. The representative of the European Community and its member States said that the
Community provided assistance principally through financing related work of international
organizations.  One of the problems that would soon become critical was the scarcity of human
resources for participating in seminars.  Therefore, they were preparing a roster of Europeancompetition experts, which they planned to share with the WTO, UNCTAD, the OECD and with any
other organization that needed to draw on experts for seminars.  He welcomed the focus on technical
assistance in the Working Group because it provided an opportunity to have a more complete view of
what was going on in that area, and to target activities where they were most needed.
102. Continuing, he noted that, on that same day, the negotiation on the Economic Partnership
Agreements under the Cotonou Agreement were being officially launched in Brussels.
Capacity-building and the regional dimension was a major component of those agreements.  He
expressed his delegation's intention to follow up on the question of competition policy in that context.
On 18 September, the Commission had adopted a Communication to the European Council and
Parliament on Trade and Development, a large port ion of which was devoted to technical assistance
and capacity-building, and to ways to make European assistance more effective.  The Communication
would be discussed by the Council in October, and he promised to report back to the Working Group
on the conclusion of the Council on that issue.
III. OTHER BUSINESS, INCLUDING STOCKTAKING OF NATIONAL EXPERIENCE
AND LEGISLATION
A. 
REQUESTS FOR OBSERVER STATUS FROM INTERNATIONAL INTERGOVERNMENTAL
ORGANIZATIONS
103. The Working Group agreed to revert to requests made by SELA, the Organisation of the
Islamic Conference, the South Centre and the United Nations Economic Commission for Latin
America and the Caribbean (ECLAC) at its next mee ting, having regard to the ongoing consultations
on related matters in the framework of the General Council.
B. PREPARATION OF THE WORKING GROUP 'S REPORT TO THE GENERAL COUNCIL FOR 2002
104. Regarding the nature and process for preparation of the Working Group's report to the
General Council on its activities in 2002, the Working Group agreed that the Secretariat be asked to
prepare a draft report of the type that had been done at the end of 1998 (WT/WGTCP/2), 1999(WT/WGTCP/3), 2000 (WT/WGTCP/4) and 2001 (WT/WGTCP/5).  The draft report would be made
                                                     
4 http://www.unctad.org/competition and http://www.oecd.org/competition.WT/WGTCP/M/19
Page 40
available for review in advance of the Wo rking Group's next meeting, to be held on
20 November 2002, the primary purpose of which would be the review and approval of the report.
105. With regard to other matters that might be considered at the meeting, the Chairman noted
following discussion that, while there was nothing to prevent Members from submitting papers in
advance of the meeting, they should not necessarily expect that Members would be in a position todiscuss such papers or that they could be reflected in the Working Group's report for the year.
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