RESTRICTED
WORLD TRADE G/TMB/R/6
8December 1995
ORGANIZATION(95-4009)
Textiles Monitoring Body
REPORT OFTHE SEVENTH MEETING
1. TheTextiles Monitoring Body helditsseventh meeting on13-17 November 1995.
2. Thefollowing members andalternates were present: Messrs. Daly; Lee/Tong; Mukerji;
Munir/Malik; Pangaribuan; doPrado; Saeki; Saint-Jacques/Rey; Tagliani; Wentzel/Hovorka.
3. TheTMB adopted thereport ofitssixth meeting (G/TMB/R/5).
4. Inpursuance ofadecision adopted bytheGeneral Council on15November 1995 onthe
procedures foranannual overview ofWTO activities andforreporting under theWTO (WT/L/105),
theTMB discussed andadopted itsreport for1995 (G/L/40).
5. Inpursuance ofadecision adopted bytheGeneral Council on15November 1995 onthe
guidelines forscheduling meetings (WT/L/106), theTMB discussed andapproved itstentative schedule
ofmeetings for1996. Meetings arescheduled asfollows: 31January-2 February, 26-28 February,
25-27 March, 22-24 April, 29-31 May, 24-26 June, 22-23 July,16-18 September, 28-30 October and
25-27 November. TheTMB alsorecalled theunderstanding reached bytheGeneral Council that,whilst
allefforts should bemade toschedule TMB meetings inaccordance withtheapproved guidelines, the
necessary flexibility would beapplied ininstances where -duetoparticular requirements -thiswould
notbepossible.
Notification under Article 8.6oftheAgreement onTextiles andClothing (ATC)
United States/India: imports ofwomen ’sandgirls’wool coats (UScategory 435)
6. TheTMB received acommunication from India under paragraph 6ofArticle 8,following
thereview bytheTMB on12-15 September 1995 ofthesafeguard action taken bytheUnited States
onimports ofproducts ofcategory 435(women ’sandgirls’wool coats) from India. Inthis
communication, Indianoted thattheTMB hadarrived ataconsensus ontheabsence ofserious damage,
butcould notreach aconsensus ontheexistence ofactual threat thereof. Thus, theTMB hadnotbeen
abletomake appropriate recommendations, though paragraph 6ofArticle 6mandated ittodosoin
situations where therehadbeennoagreement between theMember proposing totakesafeguard action
andtheMember which would beaffected bysuchaction. Itwastheunderstanding oftheGovernment
ofIndiathat,intheabsence ofaclearrecommendation oftheTMB upholding thevalidity oftherestraint
action bytheUnited States, itwasincumbent upontheUnited States towithdraw therestraint. India
therefore requested theTMB toreview theaction bytheUnited States incontinuing itsrestraint on
imports ofcategory 435fromIndia, assuchaction wasdetrimental toIndia’sinterests. Inaddition,
thecommunication reiterated themostimportant arguments raised byIndia during thereview ofthe
casebytheTMB (seeG/TMB/R/3, paragraph 17).
7. TheTMB invited bothparties toitsreview ofthematter; India sentadelegation topresent
itscase.G/TMB/R/6
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8. Inhispresentation, therepresentative ofIndia added tothearguments mentioned intheir
communication thatArticle 6oftheATC, initsgeneral thrust, envisaged thatthetransitional safeguard
measures could continue toexist-andbetreated asjustified -onlywiththeendorsement oftheTMB.
Since therestraint imposed bytheUnited States hadnotbeenendorsed bytheTMB, itshould have
beenwithdrawn forthwith. TheUnited States hadnotdoneso,therefore Indiarequested thattheTMB
recommend thatthemeasure berescinded.
9. TheTMB reviewed thematter referred toitbyIndiaunder paragraph 6ofArticle 8initsletter
dated 17October 1995. TheTMB heard thepresentation byIndia, andconsidered theelements put
forward. TheBody could notmake anyrecommendation inaddition totheconclusions ithadreached
atitsmeeting on12-15 September 1995 (G/TMB/R/3, paragraph 19),norcould theTMB reach a
consensus onwhether ornottherestraint oncategory 435could continue tobemaintained inlight
oftheabsence ofconsensus ontheexistence ofactual threat ofserious damage. TheTMB therefore
considered itsreview ofthematter under therelevant provisions oftheATC completed.
Notification under Article 8.10oftheATC
United States/India: imports ofwoven wool shirts andblouses (UScategory 440)
10. TheTMB received acommunication from India under paragraph 10ofArticle 8,following
thereview bytheTMB on12-15 September 1995 ofthesafeguard action taken bytheUnited States
onimports ofproducts ofcategory 440(woven wool shirts andblouses) from India. Inthis
communication, India conveyed itsinability toconform withtherecommendation theTMB hadmade,
which allowed forthecontinuance oftherestraint levels imposed bytheUnited States. Inaddition,
thecommunication reiterated themostimportant arguments raised byIndia during thereview ofthe
casebytheTMB (seeG/TMB/R/3, paragraph 24).
11. TheTMB invited bothparties toitsreview ofthematter; India sentadelegation topresent
itscase.
12. Therepresentative ofIndia stated thathiscountry wasunable toconform withtheTMB
recommendation forthefollowing main reasons:
- theabsence, inadequacy orinfirmity ofthedatapresented bytheUnited States with
regard toseveral factors referred toinArticle 6hadalready beenpointed outbyIndia,
andIndiaremained convinced thattherewasnoserious damage oractual threat thereof
caused toUSproducers ofwoven wool shirts andblouses;
- theTMB hadnotexamined thecriteria fordetermining theexistence ofactual threat
ofserious damage;
- thusIndia wasnotaware ofthereasoning leading totheTMB recommendation;
- noguidance orrecommendation wasgiven concerning anappropriate levelofrestraint
ortheperiod oftimeforwhich itcould bemaintained.
13. India therefore appealed totheTMB toappreciate thesituation oftheUSdomestic industry
andofimports from India inrespect oftheproducts ofthiscategory. Itrequested theBody togive
athorough consideration ofthereasons given byIndiaandtorecommend thattheUnited States rescind
therestraint.
14. TheTMB reviewed thematter referred toitbyIndia under Article 8.10initsletter dated
16October 1995. TheTMB heard thepresentation byIndia, andconsidered theelements putforward.G/TMB/R/6
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TheBodycouldnotmakeanyrecommendationinadditiontotheconclusionsithadreachedatitsmeeting
on12-15 September 1995 (G/TMB/R/3, paragraph 26). TheTMB therefore considered itsreview
ofthematter completed.
Notifications under Article 2.1oftheATC
15. TheTMB completed itsreview ofthenotifications received under thisprovision from the
EuropeanCommunities(G/TMB/N/60andAdds.1&2),Norway(G/TMB/N/61),Canada(G/TMB/N/62
andAdd.1), andtheUnited States (G/TMB/N/63, Adds. 1to4,andCorr. 1).
Notifications under Article 2.2oftheATC
16. TheTMB completed itsreview ofthenotifications made byColombia (G/TMB/N/105),
Hong Kong (G/TMB/N/106) andKorea (G/TMB/N/120). Itnoted thattheobservations made inthese
notifications hadbeentaken intoaccount intheCorrigendum orAddenda tothenotifications made
under paragraph 1ofArticle 2bytheWTO Members concerned. TheTMB decided torevert toits
review ofthenotification made byMacau (G/TMB/N/108) atalaterstage.
Notifications under Articles 2.6and2.7(a) oftheATC
European Community (G/TMB/N/1 andCorr.1)
17. Inreviewing, under paragraph 21ofArticle 2,theintegration programme notified bythe
European Community pursuant toparagraphs 6and7(a)ofArticle 2,theTMB noted that,inaccordance
withparagraph 6ofArticle 2,thevolume ofproducts thusintegrated amounted to16.4percentof
thetotalvolume ofimports intotheEuropean Community in1990 oftheproducts falling under the
coverage oftheAgreement, including products fromeachofthefourgroups: topsandyarns, fabrics,
made-uptextileproductsandclothing.Notwithstandingtheprovisionsofparagraphs6and7ofArticle2,
theTMBwasawarethattheproductsthusintegratedwerenot,priortotheirintegrationintoGATT1994,
subject toquantitative restrictions notified under paragraph 1ofArticle 2.
Canada (G/TMB/N/2 andCorrs. 1&2)
18. Inreviewing, under paragraph 21ofArticle 2,theintegration programme notified byCanada
pursuant toparagraphs 6and7(a)ofArticle 2,theTMB noted that,inaccordance withparagraph 6
ofArticle 2,thevolume ofproducts thusintegrated amounted to16.34 percentofthetotalvolume
ofimports intoCanada in1990oftheproducts falling under thecoverage oftheAgreement, including
products fromeachofthefourgroups: topsandyarns, fabrics, made-up textile products andclothing.
Notwithstanding theprovisions ofparagraphs 6and7ofArticle 2,theTMB wasaware thatoneproduct
category thusintegrated was,priortoitsintegration intoGATT 1994, subject toquantitative restrictions
notified under paragraph 1ofArticle 2.
Norway (G/TMB/N/3 andAdd.1)
19. Inreviewing, under paragraph 21ofArticle 2,theintegration programme notified byNorway
pursuant toparagraphs 6and7(a)ofArticle 2,theTMB noted that,inaccordance withparagraph 6
ofArticle 2,thevolume ofproducts thusintegrated amounted to16.26 percentofthetotalvolume
ofimports intoNorway in1990oftheproducts falling under thecoverage oftheAgreement, including
products fromeachofthefourgroups: topsandyarns, fabrics, made-up textile products andclothing.
Notwithstanding theprovisions ofparagraphs 6and7ofArticle 2,theTMB wasaware thattheproducts
thusintegrated werenot,priortotheirintegration intoGATT 1994, subject toquantitative restrictions
notified under paragraph 1ofArticle 2.G/TMB/R/6
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United States (G/TMB/N/5 andCorr.1)
20. Inreviewing, under paragraph 21ofArticle 2,theintegration programme notified bythe
United States pursuant toparagraphs 6and7(a)ofArticle 2,theTMB noted that,inaccordance with
paragraph 6ofArticle 2,thevolume ofproducts thusintegrated amounted to16.21 percentofthe
totalvolume ofimports intotheUnited States in1990 oftheproducts falling under thecoverage of
theAgreement, including products from eachofthefourgroups: topsandyarns, fabrics, made-up
textile products andclothing. Notwithstanding theprovisions ofparagraphs 6and7ofArticle 2,
theTMBwasawarethattheproductsthusintegratedwerenot,priortotheirintegrationintoGATT1994,
subject toquantitative restrictions notified under paragraph 1ofArticle 2.
Notifications under Articles 2.6and2.7(b) oftheATC
21. TheTMB reviewed under paragraph 21ofArticle 2thenotifications made, pursuant to
paragraphs 6and7(b)ofArticle 2,byThailand (G/TMB/N/41), Turkey (G/TMB/N/44), Mexico
(G/TMB/N/45), Korea (G/TMB/N/46), Brazil (G/TMB/N/49), ElSalvador (G/TMB/N/52), Venezuela
(G/TMB/N/54), Colombia (G/TMB/N/55), theCzech Republic (G/TMB/N/74), Peru(G/TMB/N/86),
CostaRica(G/TMB/N/102/Add.1),Indonesia(G/TMB/N/113),Slovenia(G/TMB/N/129)andBangladesh
(G/TMB/N/131). During thisreview, theTMB noted that,inaccordance withparagraph 6ofArticle 2,
thevolume ofproducts integrated amounted tothefollowing percentage of1990imports oftheproducts
falling under thecoverage oftheAgreement: Thailand, 16.02 percent; Turkey, 18percent; Mexico,
16percent; Korea, 16.35 percent; Brazil, 16percent; ElSalvador, 16percent; Venezuela,
16percent; Colombia, 16.21 percent; theCzech Republic, 16.16 percent(1993 imports); Peru,
16.26 percent; Costa Rica, 16percent; Indonesia, 16percent; Slovenia, 18.61 percent(1992
imports); andBangladesh, 16.04 percent(1990 value ofimports). TheTMB alsonoted that,in
accordance withparagraph 6ofArticle 2,ineachnotification theproducts integrated included products
from eachofthefourgroups: topsandyarns, fabrics, made-up textile products andclothing.
22. TheTMB began itsreview ofthenotifications made byJapan, Guatemala, Nicaragua, the
Dominican Republic, Uruguay, India, Switzerland, Argentina, Poland, thePhilippines, Paraguay,
Romania,Pakistan,Honduras,Hungary,theSlovakRepublic,Malaysia,BoliviaandTunisiaand,seeking
further information andclarification, decided torevert tothem atalaterstage.
Notifications under Article 2.15oftheATC
23. TheTMB reviewed thenotification made byNorway under paragraph 15ofArticle 2,ofthe
elimination ofcertain restrictions withrespect tosome WTO Members, witheffect asof1January 1996
(G/TMB/N/130). TheMembers affected hadalsobeeninformed inadvance. TheTMB commended
Norway fortheearly elimination ofsome ofitsrestrictions maintained under thisAgreement.
Notifications under Article 3.1oftheATC
24. TheTMB continued itsconsideration ofsome ofthenotifications made under paragraph 1
ofArticle 3,anddecided torevert tothem atalaterstage.
Notifications under Article 6.1oftheATC
25. TheTMB tooknoteofthenotifications made under Article 6.1bythefollowing WTO Members
thattheywished toretain therighttousetheprovisions ofArticle 6:Japan, ElSalvador, Honduras,
Colombia, Uruguay, Thailand, Guatemala, Nicaragua, Argentina, Brazil, Dominican Republic, Turkey,
Mexico, Korea, India, Switzerland, SriLanka, Bangladesh, Poland, Egypt, Costa Rica, thePhilippines,
Venezuela,Peru,Paraguay,Mauritius,Jamaica,Romania,Malaysia,Hungary,Pakistan,CzechRepublic,G/TMB/R/6
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Slovak Republic, Slovenia, Israel, Zambia, Indonesia, Kenya, Bolivia, South Africa, Malta, Trinidad
andTobago, Myanmar, Cyprus, Morocco, Senegal, Lesotho, Côted’Ivoire andTunisia.
26. TheTMB alsotooknoteofthenotifications made bythefollowing WTO Members thatthey
didnotwishtoretain therighttousetheprovisions ofArticle 6:Hong Kong, Macau, Singapore,
Cuba, NewZealand andChile.
Information received bytheTMB
27. TheTMB wasinformed andtooknotethat,following therecommendation made bytheBody
atitsfifthmeeting (G/TMB/R/4, paragraph 8.2),theUnited States haddecided torescind thesafeguard
measure ithadintroduced onimports ofproducts ofUScategory 440(woven woolshirts andblouses)
from Hong Kong.