RESTRICTED
PREPARATORY COMMITTEE PC/R/W/1
FOR THE 17November 1994
WORLD TRADE ORGANIZATION
(94-2461)
PREPARATORY COMMITTEE FOR THE
WORLD TRADE ORGANIZATION
PREPARATORY COMMITTEE FOR THE WORLD TRADE ORGANIZATION
DRAFT REPORT TOTHE WTO
1. Thefollowing report ofthePreparatory Committee fortheWorld Trade Organization (WTO)
totheWTO hasbeenprepared inpursuance ofparagraph 8(b)(iv) oftheMarrakesh Ministerial Decision
Establishing thePreparatory Committee (MTN/TNC/45(MIN), Annex IV).
2. Incarryingoutitstask,thePreparatoryCommitteeheld[...]meetingsduringtheperiod29April
to[...]December 1994. Theminutes ofthesemeetings andofthose oftheSub-Committees, contained
indocumentsPC/M/1-[...],(PC/BFA/M1-[...],PC/IPL/M/1-[...],PC/SCS/M/1-[...]andPC/SCTE/M/1-
[...],willremain therecord oftheCommittee 'swork aftertheentry intoforceoftheWTO Agreement.1
Adoption ofthisreport, which setsouttheaction taken bytheCommittee under itsMinisterial mandate
asoutlinedinparagraph8oftheMarrakeshMinisterialDecisionEstablishingthePreparatoryCommittee
andmatters referred totheWTO forfurther action, willconstitute approval bytheMembers ofthat
action taken andofthatreferral.
3. Thefollowing subjects areincluded inthereport:
A. Introduction
(a) Establishment ofthePreparatory Committee anditssubsidiary bodies .....3
(b) Membership andObservers ................................3
(c) Chairmanship ofthePreparatory Committee anditssubsidiary bodies .....4
B. Report ontheindividual items ofthemandate ofthePreparatory Committee
(a) Administrative, budgetary andfinancial matters
(i) theHeadquarters Agreement provided forinArticle VIII:5 oftheWTO
Agreement .....................................5
(ii) financial regulations, including guidelines fortheassessment ofWTO
Members 'budget contributions, inaccordance withthecriteria setout
inArticle VIIoftheWTO Agreement ....................5
(iii) thebudget estimates forthefirstyearofoperation oftheWTO ....6
(iv) thetransfer oftheproperty, including financial assets, ofthe
ICITO/GATT totheWTO ...........................6
(v) thetransfer andtheterms andconditions ofthetransfer oftheGATT
stafftotheWTO Secretariat ..........................6
(vi) therelationship between theInternational Trade Centre andthe
WTO .........................................6
(vii) other budgetary, financial oradministrative matters ............6
1Alistofallthedocuments oftheCommittee anditssubsidiary bodies willbeprovided inAddendum 1tothisreport.PC/R/W/1
Page2
(b) Institutional, procedural andlegalmatters
(i) examination ofandapproval oftheschedules submitted toitin
accordance withthe"Decision onAcceptance ofandAccession tothe
Agreement Establishing theWorld Trade Organization" andproposals
regarding terms ofaccession inaccordance withparagraph 2ofthat
Decision .......................................6
(1) Work onSchedules ...........................6
(2) Requests forAccession under Article XIIoftheWTO
Agreement ................................7
(ii) proposals concerning terms ofreference forthebodies oftheWTO,
inparticular those established inArticle IVoftheWTO Agreement,
andtherulesofprocedure which theyarecalled upontoestablish for
themselves, bearing inmind paragraph 1ofArticle XVI
(1) Terms ofreference ...........................7
(2) Rules ofprocedure ...........................7
(3) Notification formats ..........................7
(4) Standing Appellate Body .......................8
(5) Ethical Code ofConduct .......................8
(iii) recommendations totheGeneral Council oftheWTO onappropriate
arrangements withrespect torelations withotherorganizations referred
toinArticle VoftheWTO Agreement ...................8
(c) Matters related totheentry intoforce oftheWTO Agreement andtothe
activities oftheWTO within theCommittee 'sscope andfunctions
(i) Convening andpreparing theImplementation Conference ........9
(ii) Initiating theworkprogramme arising fromtheUruguay Round results
assetoutintheFinal Act,suchasoverseeing, intheSub-Committee
onServices referred toinparagraph 3oftheDecision Establishing
thePreparatory Committee, negotiations inspecific services sectors,
andalsoundertaking work resulting fromDecisions oftheMarrakesh
meeting
(1) Services ..................................9
I. Overseeing on-going negotiations
II. Issues relating tothescope oftheGATS
III. Guidelines fornotifications under theGATS
IV. Working Party onProfessional Services
(2) Trade andEnvironment ........................11
(iii) Discussing suggestions fortheinclusion ofadditional items onthe
agenda oftheWTO 'swork programme ...................12
(iv) Making proposals concerning thecomposition oftheTextiles
Monitoring Body inaccordance withthecriteria setoutinArticle 8
oftheAgreement onTextiles andClothing .................12
(v) Convening thefirstmeeting oftheMinisterial Conference orthe
General Council oftheWTO, whichever meets first, andpreparing
theprovisional agenda thereof .........................13
C. Transitional Arrangements .....................................13
D. Points forAction ...........................................13PC/R/ W/1
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A. Introduction
(a) Establishment ofthePreparatory Committee anditssubsidiary bodies
(i) Preparatory Committee
4. ThePreparatory Committee fortheWorld Trade Organization (WTO) wasestablished on
14April 1994bytheMarrakesh Ministerial Decision Establishing thePreparatory Committee forthe
World Trade Organization (MTN/TNC/45(MIN), Annex IV).
5. Inaccordance withparagraph 4oftheMinisterial Decision, theCommittee tookdecisions by
consensus. TheCommittee held[...]meetings from29April to[...]December 1994. Ateachmeeting,
theCommittee received reports bytheChairmen ofitssubsidiary bodies ontheirrespective activities
andbytheChairman oftheCommittee himself ontheareas under thedirect responsibility ofthe
Committee.
(ii) Subsidiary Bodies
6. TheMinisterialDecisionEstablishingthePreparatoryCommitteeprovidedfortheestablishment
ofSub-Committees onServices (paragraphs 3and8(c)(ii)) andonBudget, Finance and
Administration (paragraphs 3and8(a)(i)). Atitsfirstmeeting, thePreparatory Committee established
aSub-Committee onInstitutional, Procedural andLegal Matters (PC/M/1, paragraph 2).
7. TheMinisterial Decision onTrade andEnvironment separately provided foraSub-Committee
onTrade andEnvironment tobesetupunder thePreparatory Committee "pending thefirstmeeting
oftheGeneral Council oftheWTO" (MTN/TNC/45(MIN), Annex II).
8. Inorganizing theirwork, further adhocdecisions weretaken bytheSub-Committees mentioned
below:
- TheSub-Committee onServices established anInterim Group onFinancial Services
(PC/SCS/M/2, paragraph 13)andmonitored theactivities oftheNegotiating Groups
onMaritime Transport, Basic Telecommunications andMovement ofNatural Persons,
which hadbeenestablished under therelevant Ministerial Decisions adopted bythe
Trade Negotiations Committee on15December 1993andcontained intheFinal Act
embodying theresults oftheUruguay Round Negotiations.
- TheSub-Committee onInstitutional, Procedural andLegal Matters established four
informal contact groups onAgriculture, TRIPS including TRIMs, Anti-Dumping and
Subsidies, alsocharged withthequestion ofSafeguards, andTextiles.
- TheSub-CommitteeonBudget,FinanceandAdministrationestablishedworkinggroups
todealwithspecific parts ofitsmandate.
(b) Membership andObservers
(i) Membership
9. Inkeepingwithparagraph2oftheDecisionEstablishingthePreparatoryCommittee,membership
oftheCommittee wasopentoallSignatories oftheFinal ActoftheUruguay Round ofMultilateral
TradeNegotiationsandtoanycontractingpartytotheGATT1947eligibletobecomeanoriginalmemberPC/R/W/1
Page4
oftheWTO inaccordance withArticle XIoftheWTO Agreement. Interms ofparagraph 3ofthe
same Decision, membership oftheSub-Committees wasopentoallmembers oftheCommittee.
(ii) Observers
10. TheCommittee decided (PC/M/1, paragraphs 14and15)tofollow thepractice adopted by
theUruguay Round Trade Negotiations Committee andtoinvite asobservers therepresentatives of
theso-called associated governments, i.e.,States orseparate customs territories thatwere currently
negotiating accession totheGATT 1947, andrepresentatives oftheUnited Nations, UNCTAD, IMF
andtheWorld Bank.
11. TheSub-Committees were leftfreetodecide onthequestion ofobservership. The
Sub-Committee onBudget, Finance andAdministration decided nottoinvite observers. The
Sub-Committees onTrade andServices andonInstitutional, Procedural andLegal Matters followed
thepractice ofthePreparatory Committee. TheSub-Committee onTrade andEnvironment invited
thefollowing organizations inaddition tothefourorganizations mentioned inparagraph 10above:
EFTA, FAO, ITC, OECD, UNCommission onSustainable Development, UNDP, andUNEP.
12. Certain international organizations were associated onanadhocbasis withthework ofthe
bodies established under Sub-Committees. TheContact Group onAgriculture established bytheSub-
Committee onInstitutional, Procedural andLegal Matters invited theFAO, theCodex Alimentarius
Commission, theInternational Office ofEpizootics, andtheInternational PlantProtection Convention.
TheContact Group onTRIPS invited theWIPO, andtheContact Group onTextiles invited theITCB.
(c) Chairmanship ofthePreparatory Committee anditssubsidiary bodies
(i) Preparatory Committee: Mr.Peter D.Sutherland
(ii) Subsidiary Bodies:
- Budget, Finance andAdministration: Mr.A.Szepesi (Hungary)
Mr.Szepesi wasassisted inhistaskbyMr.P.Gosselin, (Canada) Chairman
oftheGATT 1947 Committee onBudget, Finance andAdministration
- Services: Mr.C.Manhusen (Sweden)
- Institutional, Procedural andLegal Matters: Mr.K.Kesavapany (Singapore)
- Trade andEnvironment: Mr.L.Lampreia (Brazil)PC/R/ W/1
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B. Report ontheindividual items ofthemandate ofthePreparatory Committee
(Paragraph 8oftheDecision Establishing thePreparatory Committee2)
(a) Administrative, budgetary andfinancial matters3
(i) theHeadquarters Agreement provided forinArticle VIII:5 oftheWTO
Agreement
13. On22July,theCommittee approved Geneva, Switzerland, astheseatoftheWTO (PC/M/4,
Annex 1)subject toasatisfactory conclusion ofthenegotiation ofaHeadquarters Agreement with
theSwiss Authorities.
14. Negotiations onaHeadquarters Agreement withtheSwiss authorities werecarried outover
theperiod September to[...]byateam composed oftenmembers -theChairman oftheWTO
Sub-Committee onBudget, Finance andAdministration, theChairman oftheGATT Committee on
Budget, Finance andAdministration, Argentina, France, Indonesia, Japan, Morocco, Pakistan, Trinidad
andTobago, Zambia andfourrepresentatives oftheSecretariat.
[TOBECOMPLETED]
(ii) financialregulations,includingguidelinesfortheassessmentofWTOMembers'
budget contributions, inaccordance withthecriteria setoutinArticle VIIof
theWTO Agreement
15. Asstipulated inArticle VII:2 oftheWTO Agreement "thefinancial regulations shallbebased,
asfaraspracticable,ontheregulationsandpracticesofGATT1947"which,inaccordancewithdecisions
oftheCONTRACTING PARTIES toGATT 1947, arebased ontheFinancial Regulations andRules
oftheUnited Nations.
[TOBECOMPLETED]
16. Withregard toguidelines forbudget contributions byMembers oftheWTO, thePreparatory
Committee agreed that,inprinciple, theassessment should reflect shares ininternational tradeingoods,
services andintellectual property, butthat,pending further study, thecalculation ofassessments for
the1995budget oftheWTO should follow existing practice under theGATT 1947. Changes toreflect
theabove-mentioned decision inprinciple would beintroduced nolaterthanoneyearafterthecreation
oftheWTO (PC/BFA/M/1).
2Paragraph 8reads: "The Committee shallperform suchfunctions asmaybenecessary toensure theefficient operation
oftheWTO immediately asofthedateofitsestablishment, including thefunctions setoutbelow"
3Theintroductory paragraph 8(a)reads: "Toprepare recommendations fortheconsideration ofthecompetent body of
theWTO, or,totheextent necessary, takedecisions or,asappropriate, provisional decisions inadvance oftheestablishment
oftheWTO, withrespect totherecommendations submitted toitbytheChairman oftheSub-Committee onBudget, Finance
andAdministration referred toinparagraph 3above, incooperation withtheChairman oftheGATT Committee onBudget,
Finance andAdministration, assisted byproposals from theSecretariat on:"PC/R/W/1
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(iii) thebudget estimates forthefirstyearofoperation oftheWTO
17. Atitsmeeting on[...]December, thePreparatory Committee [approved] theBudget Estimates
for1995, asrecommended bytheSub-Committee onBudget, Finance andAdministration (PC/[...]).
[TOBECOMPLETED]
(iv) thetransfer oftheproperty, including financial assets, oftheICITO/GATT
totheWTO
[TOBECOMPLETED]
(v) thetransfer andtheterms andconditions ofthetransfer oftheGATT staff
totheWTO Secretariat
[TOBECOMPLETED]
(vi) therelationship between theInternational Trade Centre andtheWTO
[TOBECOMPLETED]
(vii) other budgetary, financial oradministrative matters
18. Atitsmeeting on22July,thePreparatory Committee mandated theSub-Committee todecide
onmatters relating totheorganizational structure, including amanagement review.
[TOBECOMPLETED]
(b) Institutional, procedural andlegalmatters
(i) examination ofandapproval oftheschedules submitted toitinaccordance
with the"Decision onAcceptance ofandAccession totheAgreement
Establishing theWorld Trade Organization" andproposals regarding terms
ofaccession inaccordance withparagraph 2ofthatDecision
(1) Work onSchedules
19. ThePreparatory Committee established aprocess (PC/M/2, paragraphs 17to24)toimplement
itsmandate under thissub-paragraph. Asagreed bytheCommittee, theChairman informed the
GATT 1947Council ofRepresentatives andtheexisting Working Parties onAccession toGATT 1947,
including theWorking Party onChina 'sstatus asacontracting party, ofthedetails oftheprocess,
requesting themtotakeaction asappropriate. [...]schedules wereexamined. Ofthese, [..]schedules
were deemed tohavebeenverified andapproved bytheCommittee.
20. Theprocess could notbecompleted inrespect ofthefollowing Uruguay Round participants
[...]andofStates andseparate customs territories whose requests foracceptance ofandaccession to
theWTO Agreement werestillunder examination inworking parties established under theGATT 1947.
These cases, along withtherecords ofallthework donesofar,arebeing forwarded totheWTO 's
General Council foraction, asappropriate.
[TOBECOMPLETED]PC/R/ W/1
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(2) Requests forAccession under Article XIIoftheWTO Agreement
21. ThePreparatory Committee tooknoteofCroatia 'srequest toaccede totheWTO Agreement
under paragraph XIIthereof andinkeeping withCroatia 'srequest, instructed theWorking Party
previously established toexamine Croatia 'srequest foraccession totheGATT 1947 toconduct the
necessary work andreport totheCommittee (PC/M/4, paragraph 40).
22. TheCommittee took noteofSudan 'srequest toaccede totheWTO Agreement under
paragraph XIIthereof andestablished aWorking Party toexamine thatrequest andreport tothe
Committee.
[TOBECOMPLETED]
(ii) proposalsconcerningtermsofreferenceforthebodiesoftheWTO,inparticular
those established inArticle IVoftheWTO Agreement, andtherules of
procedure which theyarecalled upon toestablish forthemselves, bearing in
mind paragraph 1ofArticle XVI
(1) Terms ofreference
23. FollowinganexaminationbytheSub-CommitteeonInstitutional,ProceduralandLegalMatters,
thePreparatory Committee decided thatnoparticular work wasneeded inrespect ofbodies whose
mandates weresufficiently welldefined bytherespective WTO Agreements. Theterms ofreference
forcertain WTO bodies, i.e.,theCommittees onBalance-of-Payments Restrictions, onBudget, Finance
andAdministration, andonTrade andDevelopment, wereagreed bytheCommittee andarecontained
indocuments PC/IPL/2, 3and[...], respectively. Terms ofreference were alsoagreed forthe
WTO Committee onAgriculture (PC/IPL/1) andforanewWTO Committee onMarket Access
(PC/IPL/[...]).
(2) Rules ofprocedure
24. As[approved] bythePreparatory Committee, therules ofprocedure fortheMinisterial
Conference, theGeneral Council, theTrade Policy Review Body andtheDispute Settlement Body,
including guidelines forobserver status forgovernments ofStates orseparate customs territories and
forinternational intergovernmental organizations, arecontained indocument PC/IPL/[...]. These are
being forwarded totheWTO 'sGeneral Council forfurther action, asappropriate.
25. Itwasnotpossible todevelop andagree rules ofprocedure forthesubsidiary bodies ofthe
General Council. ThePreparatory Committee, accordingly, recommends thatuntilsuchrulesarein
place, therules oftheWTO General Council befollowed bythese bodies.
(3) Notification formats
26. Additionalworkingproceduresconcerningnotificationformatsandrequirementsweredeveloped
ininformal, open-ended Contact Groups established todealwithparticular aspects ofWTO Agreements
which required attention toensure thattheWTO became fullyoperational from theentry intoforce
oftheWTO orassoon aspossible thereafter. TheCommittee [approved] therecommendations
emanating from these groups. ascontained inthefollowing documents for:
- Agriculture, PC/IPL/..., paragraphs [...]to[...].
- Sanitary andPhyto-Sanitary Measures, PC/IPL/..., paragraphs [...]to[...].PC/R/W/1
Page8
- Anti-Dumping, PC/IPL/..., paragraphs [...]to[...].
- Subsidies, PC/IPL/..., paragraphs [...]to[...].
- Safeguards, PC/IPL/..., paragraphs [...]to[...].
- TRIPS, PC/IPL/..., paragraph 9.
- TRIMs, PC/IPL/..., paragraphs 2,4and5.
27. These recommendations arebeing forwarded totheWTO 'sGeneral Council forfurther action,
asappropriate.
(4) Standing Appellate Body
[TOBECOMPLETED]
(5) Ethical Code ofConduct
[TOBECOMPLETED]
(iii) recommendations totheGeneral Council oftheWTO onappropriate
arrangements withrespect torelations withother organizations referred toin
Article VoftheWTO Agreement
28. ThePreparatory Committee [agreed] guidelines forobserver status forinternational
intergovernmental organizations inthecontext ofitswork onrules ofprocedure, asdescribed in
paragraph 24.
29. TheCommittee tooknoteofformal requests forobserver status intheWTO received bythe
Chairman oftheCommittee from thefollowing organizations: EBRD, EFTA, FAO, GulfStates
Cooperation Council (GCC), OECD, ITCB, UNIDO andtheWorld Tourism Organization. These
requests arebeing forwarded totheWTO 'sGeneral Council forconsideration pursuant totheguidelines
referred toinparagraph 28.
30. Asregards appropriate arrangements with respect torelations with other international
intergovernmental andnon-governmental organizations referred toinArticle VoftheWTO Agreement,
theSub-Committee onInstitutional, Procedural andLegal Matters agreed tofocus firstonorganizations
having functional links withtheWTO arising specifically from their mention invarious WTO
Agreements.Thosewereidentifiedasthefollowing:theIMF,WorldBank,WIPO,CustomsCooperation
Council (since renamed World Customs Organization (WCO)), theCodex Alimentarius Commission,
theInternationalOfficeofEpizootics,andtheSecretariatoftheInternationalPlantProtectionConvention;
andonenon-governmental organization, namely theISO. ThePreparatory Committee sawnogrounds
forinstitutional links between theWTO andtheUnited Nations; asforUNCTAD, theCommittee
feltthattheWTO should establish arrangements foreffective cooperation atanearly stage.
[TOBECOMPLETED]
31. Awork programme aimed atestablishing close cooperation andmutually supportive relations
between theWTO andtheWIPO wasinitiated.
[TOBECOMPLETED]PC/R/ W/1
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32. Anumber ofnon-governmental organizations (NGOs) haveexpressed theirinterest infollowing
theWTO 'swork inspecific areas. TheSub-Committee onTrade andEnvironment conducted initial
work onthesubject oftheNGOs asaninput forongoing discussions intheSub-Committee on
Institutional, Procedural andLegal Matters.
[TOBECOMPLETED]
33. Discussions were heldonthequestion offormalizing, inwriting, thestatus oftheICC, the
IFIAandtheindependent entity mentioned intheAgreement onPreshipment Inspection (PC/IPL/M/6,
paragraph 60). Proposals inthisrespect willbeprepared bytheSecretariat, inconsultation with
interested delegations andwiththeInternational Federation ofInspection Agencies (IFIA) andthe
InternationalChamberofCommerce(ICC),forconsiderationandactionbytheWTO'sGeneralCouncil.
34. ThePreparatory Committee tooknoteoftheinterest oftheOECD andtheWorld Tourism
Organization toconclude formal cooperation arrangements withtheWTO andtransmitted thismatter
totheWTO 'sGeneral Council forfurther action.
(c) Matters related totheentry intoforce oftheWTO Agreement andtotheactivities of
theWTO within theCommittee 'sscope andfunctions
(i) Convening andpreparing theImplementation Conference
35. On22July, thePreparatory Committee set6to15December 1994 asthetarget period for
theImplementation Conference. Italsoagreed thattheConference would becomposed ofameeting
ofthePreparatory Committee atSenior Officials leveltobefollowed immediately thereafter bythe
CONTRACTING PARTIES toGATT 1947 meeting inaSpecial Session.
36. On25October, theCommittee setthedateof8December 1994forholding theImplementation
Conference. TheCommittee alsoagreed theprovisional agenda fortheConference proposed bythe
Chairman (PC/M/6, paragraph 6).
37. ThePreparatory Committee, meeting ontheoccasion oftheImplementation Conference, agreed
...(Items reflected inthePC/AIR/40 -GATT/AIR/3652).
[TOBECOMPLETED]
(ii) Initiating thework programme arising fromtheUruguay Round results asset
outintheFinal Act,suchasoverseeing, intheSub-Committee onServices
referred toinparagraph 3oftheDecision Establishing thePreparatory
Committee, negotiations inspecific services sectors, andalsoundertaking work
resulting from Decisions oftheMarrakesh meeting
(1) Services
38. ThePreparatory Committee 'smandate intheareaontrade inservices wasconducted bythe
Sub-Committee onServices. TheSub-Committee onServices held[six]meetings during theperiod
19May1994 to[...]December 1994 andaddressed thefollowing matters:PC/R/W/1
Page10
I. Overseeing on-going negotiations
39. TheNegotiating Group onBasic Telecommunications held[four] meetings from 6Mayto
[...]December 1994. TheGroup approved aquestionnaire onregulatory issues andmarket structure
(TS/NGBT/W/3). Themajority ofgovernments participating inthenegotiations havecommunicated
theirresponses tothequestionnaire forfurther discussion andexamination. Discussions, based on
aNote prepared bytheSecretariat (TS/NGBT/W/2) arealsounder wayontechnical andconceptual
issues related totheconduct ofnegotiations andthescheduling ofcommitments onbasic
telecommunications. Theparticipants havebeenurged toputforward initial offers byMarch orApril
1995.
40. TheNegotiating Group onMaritime Transport Services heldthree meetings from 5Mayto
[...]December 1994. TheGroup approved aquestionnaire onmaritime transport services
(S/NGMTS/W/2). 15January 1995 wasagreed asthedeadline forthesubmission ofresponses to
thequestionnaire. Discussions intheGroup onadraftschedule onmaritime transport services have
confirmed thegeneral viewthatwould beauseful wayofapproaching thescheduling ofcommitments
inthissector.
41. TheNegotiating Group onMovement ofNatural Persons heldthree meetings in1994.
Preliminary multilateral discussions wereheldonhorizontal commitments inthisarea. Tofacilitate
work, theSecretariat prepared aninformal notedated 15September 1994 which analyzed thenature
ofthevarious possible types ofhorizontal commitments. TheGroup heard preliminary reports from
certain delegations onbilateral consultations aimed atimproving thelevelofcommitments inthisarea.
42. TheInterim Group onFinancial Services established bytheSub-Committee onServices on
15July1994(PC/SCS/M/2, paragraph 13)wasmandated tomonitor progress inthenegotiations under
paragraph 1oftheDecision onFinancial Services adopted atMarrakesh untiltheentry intoforce of
theWTO Agreement andtheestablishment oftheCommittee onTrade inFinancial Services. The
Interim Group has,sofar,heldtwomeetings. Participants stressed theircommitment toachieving
abroad, MFN-based package ofliberalization commitments andreported onpreliminary bilateral
consultations andnegotiations.
II. Issues relating tothescope oftheGATS
43. Todealwithcertain unresolved issues raised during thefinalstages oftheUruguay Round
negotiations, thethenChairman oftheUruguay Round Group onNegotiations inServices hadthen
provided participants withanadditional period upto15December 1994 toconsult onsuchmatters
andreport theresults totheCouncil forTrade inServices under theWTO forappropriate action
(Chairman'sstatementdated14December1993(MTN.GNS/W/260)).TheSub-CommitteeonServices
agreed itwould provide theforum forsuchdiscussions andprepare areport totheWTO 'sCouncil
forTrade inServices. Areport bytheSub-Committee totheCouncil forTrade inServices onthe
issues relating tothescope oftheGATS iscontained indocument PC/SCS/[...].
III. Guidelines fornotifications under theGATS
44. Asrequested byMembers, theSecretariat prepared draftguidelines fornotifications required
under different provisions oftheGATS. Theguidelines wererevised onthebasis ofdiscussions in
theSub-Committee. Theguidelines, asagreed, aresetoutindocument PC/SCS/W/[...].PC/R/ W/1
Page11
IV. Working Party onProfessional Services
45. TheSecretariat wasasked byMembers oftheSub-Committee toestablish contacts withthe
relevant specialized international bodies inpreparation forthecommencement ofwork bytheWorking
Party onProfessional Services upon theentry intoforce oftheGATS. TheMinisterial Decision, in
full,establishing theWorking Party identifies theaccountancy sector asanareaofpriority. Accordingly
theSecretariat began toestablish anddevelop relations withtheInternational Federation ofAccountants
(IFAC). Areport bytheSecretariat ontheseandothercontacts iscontained inparagraph 22ofdocument
PC/SCS/M/3.
46. ThePreparatory Committee tooknoteofthework doneandtheprogramme outlined forthe
future andagreed totransmit ittotheWTO forinformation andaction, asappropriate.
(2) Trade andEnvironment
47. TheMarrakeshMinisterialDecisiononTradeandEnvironment(MTN.TNC/45(MIN),AnnexII),
directs thefirstmeeting oftheGeneral Council oftheWTO toestablish aCommittee onTrade and
Environment opentoallmembers oftheWTO and,pending thefirstmeeting ofthisbody, establishes
aSub-Committee ofthePreparatory Committee opentoallmembers ofthePreparatory Committee,
tocarry outwork inthisarea.
48. TheSub-Committee held[five] formal meetings. Inaddition, theChairman hasheldinformal
consultations on:theorder inwhich thefuture Committee onTrade andEnvironment 'sworkprogramme
should betaken up;howbesttoaddress theseventh itemofthework programme pertaining tothe
issueofexports ofdomestically prohibited goods; andobserver status forintergovernmental andnon-
governmental organizations. Consultations onthelatter issue havebeencarried outinthecontext of
theMinisterial Decision toinvite theSub-Committee, andtheWTO Committee onTrade and
Environment when itisestablished, toprovide input totherelevant bodies inrespect ofappropriate
arrangements forrelations withintergovernmental andnon-governmental organizations referred toin
Article VoftheWTO.
49. Following ageneral exchange ofviews onthework programme, Members agreed tofocus
initially onthefirst,thirdandsixthitems ofthework programme, building where possible onthework
oftheGroup onEnvironmental Measures andInternational Trade (EMIT). Itwasalsoagreed that
delegations would befreetoaddress other items ofthework programme withaviewtoensuring that
workshould progress flexibly andconstructively. TheSecretariat prepared several background papers,
attherequest ofMembers, toassist discussions.
50. Under thefirstitemofitswork programme -therelationship between theprovisions ofthe
multilateral trading system andtrade measures forenvironmental purposes, including those pursuant
tomultilateral environmental agreements -theSub-Committee focused ontheuseoftrade measures
forenvironmental purposes, particularly those applied inthecontext ofmultilateral environmental
agreements andthose applied specifically tonon-parties tothose agreements. Delegations began
reviewing thepotential advantages anddisadvantages ofexanteandexpostapproaches toestablishing
therelationship ofthese measures totheprovisions ofthemultilateral trading system, andinitiated
adiscussion oftheeffectiveness andnecessity ofusing trade measures inthiscontext.
51. Under thethirditemofthework programme -therelationship between theprovisions ofthe
multilateral trading system and: (a)charges andtaxes forenvironmental purposes; (b)requirements
forenvironmentalpurposesrelatingtoproducts,includingstandardsandtechnicalregulations,packaging,
labelling andrecycling -delegations began reviewing theuseofenvironmental taxes inparticular in
thecontext ofGATT disciplines onborder taxadjustment, andextended further theirexamination ofPC/R/W/1
Page12
environmental regulations andstandards, notably those related toeco-labelling, onthebasis ofthe
extensive work thathadalready beenundertaken onthissubject bytheEMIT Group.
52. Under thesixthitemofthework programme -theeffect ofenvironmental measures onmarket
access, especially inrelation todeveloping countries, inparticular totheleastdeveloped among the,
andenvironmental benefits orremoving traderestrictions anddistortions -...[TOBECOMPLETED].
53. Informal consultations ledtoagreement intheSub-Committee ontwoother issues:
- work ontheissueofexports ofdomestically prohibited goods should betaken upearly
nextyear,andwillbeassisted byabackground paper being prepared bytheSecretariat.
- thelistofintergovernmental organizations invited toobserve thework oftheSub-
Committee wasextended toinclude UNEP, FAO, ITC,UNDP, theUNCommission
onSustainable Development, OECD andEFTA. Itwasagreed thatfurther requests
forobserver status fromsuchorganizations should betaken uponacase-by-case basis,
taking intoaccount thegeneral criteria andconditions forobservership for
intergovernmental organizations tobeapproved bytheSub-Committee onInstitutional,
Procedural andLegal Matters.
54. Withregard toappropriate arrangements forrelations withnon-governmental organizations ...
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55. ThePreparatory Committee takes noteofthework doneaswellastheprogramme setoutfor
thefuture, andtransmits ittotheWTO forinformation andaction, asappropriate.
56. ThePreparatory Committee further invites thefirstmeeting oftheGeneral Council oftheWTO
toestablish aCommittee onTrade andEnvironment, opentoallmembers oftheWTO, withtheterms
ofreference andprogramme ofworkascontained intheMinisterial Decision onTrade andEnvironment
(MTN.TNC/45(MIN), Annex II),andtransmits totheWTO Committee theworking documents and
reports oftheSub-Committee.
(iii) Discussing suggestions fortheinclusion ofadditional items ontheagenda of
theWTO 'swork programme
57. Suggestions fortheinclusion ofadditional items ontheagenda oftheWTO 'swork programme
were made bydelegations attheMinisterial Meeting oftheUruguay Round Trade Negotiations
Committee atMarrakesh from 12to14April 1994. TheChairman, Mr.Sergio Abreu Bonilla
(Uruguay), listed thesesuggestions inhisconcluding remarks on15April 1994(MTN.TNC/45(MIN),
page12,sixth paragraph). ThePreparatory Committee, tookupthismatter atitsfirstmeeting on
29April (PC/M/1, paragraph 8).
[TOBECOMPLETED]
(iv) Making proposals concerning thecomposition oftheTextiles Monitoring Body
inaccordance withthecriteria setoutinArticle 8oftheAgreement onTextiles
andClothing
[TOBECOMPLETED]PC/R/ W/1
Page13
(v) Convening thefirstmeeting oftheMinisterial Conference ortheGeneral
Council oftheWTO, whichever meets first, andpreparing theprovisional
agenda thereof
[TOBECOMPLETED]
C. Transitional Arrangements4
[TOBECOMPLETED]
D. Points forAction
58. Thefollowing matters arebeing hereby forwarded totheWTO body(ies) concerned for
further action.
(a) Matters onwhich action hasbeentaken bythePreparatory Committee tobenoted
andimplemented, asappropriate, bytheGeneral Council oftheWTO:
(i) ... paragraph ...
(ii) ... paragraph ...
(iii) ...etc.
[TOBECOMPLETED]
(b) Matters being transmitted bythePreparatory Committee forconsideration and
action bytheGeneral Council oftheWTO:
(i) ... paragraph ...
(ii) ... paragraph ...
(iii) etc.
[TOBECOMPLETED]
4Thesubject of"Transitional Arrangements" wasincluded byconsensus inthemandate oftheCommittee atitsmeeting
on31May 1994 (PC/M/2, paragraph 6and7).