RESTRICTED
WORLD TRADE G/STR/W/1
28March 1995
ORGANIZATION(95-0733)
EXPLANATORY NOTE ONTHE AGENDA ITEMS
FOR THE FIRST MEETING OFTHE WORKING PARTY
ONSTATE TRADING ENTERPRISES
A. NOTIFICATIONS TOBEMADE BYMEMBERS IN1995
Under thisagenda itemthefollowing issues would beraised:
1. TheCouncil forTrade inGoods established, atitsmeeting on20February 1995, adeadline
of30June1995 fornewandfullnotifications onstatetrading enterprises byMembers. The
Working Party willtakenoteofthisdeadline, aswellastheneedforevery Member tomake
anotification, evenincases where nostatetrading enterprise ismaintained. Itwillalsotake
notethatstatetrading enterprises aretobenotified byMembers according totheworking
definition inparagraph 1oftheUnderstanding ontheInterpretation ofArticle XVII ("the
Understanding"), andthattheyaretobenotified evenifnoimports orexports havetaken place.
2. Inlinewithparagraph 2oftheUnderstanding, theWorking Party willtakenotethateach
Member istoconduct areview ofitspolicy withregard tothesubmission ofnotifications,
taking account oftheprovisions oftheUnderstanding andtheneedforeachMember toensure
maximum transparency initsnotifications.
3. Itmight beuseful fortheWorking Party totakeadecision thatMembers whofailtomake
notifications bythedeadline of30June1995should submit awritten explanation ofthereason
forthisfailure.
4. Itwillberecalled thatinaccordance withparagraph 4oftheUnderstanding, Members may
make counter-notifications forconsideration bytheWorking Party.
B. DATES FOR SUBMISSION OFFUTURE NOTIFICATIONS
1. TheCouncil forTrade inGoods established, atitsmeeting on20February 1995, adeadline
forsubmission ofthefirstnotifications onstatetrading enterprises under theWTO system.
2. Forfuture notifications intheareaofstatetrading, itmight beuseful toestablish abasic
schedule; forexample, thatallnewandfullnotifications (thefirstofwhich willbemade in
1995) should besubmitted notlaterthan30Juneinevery thirdyearafter1995, andthatthe
updating notifications dueineachofthetwointervening years should besubmitted notlater
than30Juneoftherespective year. Thedates inthisschedule could ofcourse bealtered by
adecision oftheWorking Party atanytime, should theneedarise, provided theparameters
ofthenotification obligation under Article XVII andtheUnderstanding were respected.G/STR/W/1
Page2
C. BACKGROUND PAPER TOBEPREPARED BYTHE SECRETARIAT
Paragraph 5oftheUnderstanding ontheInterpretation ofArticle XVII (the"Understanding")
provides thatthesecretariat willprepare ageneral background paper fortheWorking Party onthe
operations ofstatetrading enterprises astheyrelate tointernational trade. TheWorking Party should
discuss thetypeofpaper itexpects fromthesecretariat andthemodalities formaking thepreparation
ofsuch apaper possible (forexample, thedataneeded andtheavailability ofsuch datainthe
GATT/WTO orelsewhere), withaviewtogiving cleardirection tothesecretariat, particularly asthe
Understanding doesnotspecify theinformation baseforthisbackground paper. Theavailable sources
inGATT/WTO would beessentially thenotifications under Article XVII thathavebeensubmitted
overtheyears andtheGATT Trade Policy Reviews ofindividual countries. However, there are
problems withrespect tothesufficiency1ofthisinformation, asfollows:
1. With respect tothestatetrading notifications:
(a) Onlyaverysmall percentage ofcontracting parties provide statetrading notifications
onaregular basis. Lessthan30(outofaminimum of85totalcontracting parties
in1980 andamaximum of125in1994) haveeversubmitted anotification, andof
those whohave, several havesubmitted lessthanfivenotifications during aperiod
of14years.
(b) Ofthose countries which donotify, onlyafewprovide whatcould beconsidered to
beafullresponse tothequestionnaire, andeveninthemore complete notifications,
theinformation provided isoften quite general and/or doesnotcorrespond towhat
isrequested.
2. With respect totheGATT Trade Policy Reviews:
(a) Responses tothequestions onstatetrading puttocontracting parties inthecourse of
GATT trade policy reviews havebeenuneven. These questions basically track with
theinformation sought intheArticle XVII questionnaire (BISD 9S/184-185) butin
considerably lessdetail thanthelatter.
(b) AnexaminationofthecontentofthesectionintheTradePolicyReviewsonstatetrading
enterprises (carried under theheading "Trade Policies andPractices byMeasure" and
sub-heading "Measures Directly Affecting Imports" inthevolume entitled "Report
bytheGATT Secretariat"), inanumber ofreviews indicates thatwhile thisinformation
doessometimes complement whatiscontained intheArticle XVII notifications (where
these havebeenmade) through, forexample, theprovision oftables onvolume and
value oftrade conducted bystatetrading enterprises, itdoesnotconsistently provide
aclear ordetailed picture ofacountry 'sstatetrading operations.
(c) Inaddition, trade policy reviews have todatebeen completed forfewer than
50contracting parties (39ofwhich arecurrently WTO Members), sothefullspectrum
hasclearly notbeencovered.
1Seetheinformation inAnnexes IandII,attached.G/STR/W/1
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D. PROGRAMME OFWORK FOR THE WORKING PARTY
TheWorking Party ischarged withthefollowing tasks:
1. Toreview, onbehalf oftheCouncil forTrade inGoods, thenotifications andcounter-
notifications submitted byMembers; inthelight ofthisreview, theCTG maymake
recommendations regarding theadequacy ofnotifications andtheneedforfurther information.
2. Toreview theadequacy ofthe1960 questionnaire andthecoverage ofthestate trading
enterprises notified, andtocoordinate itsactivities withthose oftheWorking Group on
Notification Obligations andProcedures.
3. Todevelop anillustrative listofthekinds ofrelationships between governments andstatetrading
enterprises andthekinds ofactivities engaged inbythese enterprises.
Thefollowing timetable might besuggested forthecarrying outofthiswork programme:
4. Asthedeadline forsubmission ofthefirstnotifications is30June1995, theWorking Party
could meetforthepurpose ofreviewing these notifications sometime intheautumn, andat
thesame meeting could begin itsreview oftheadequacy ofthe1960 questionnaire andthe
coverage oftheenterprises notified.
5. Thedevelopment ofanillustrative list(asdescribed inparagraph 3above) could onlyreasonably
beundertaken oncetheWorking Party hasreceived andconsidered thebackground paper to
beprepared bythesecretariat. Atentative dateforthesubmission ofthisbackground paper
totheWorking Party would beintheautumn, assuming thenecessary information hasbeen
made available tothesecretariat inatimely manner. Thus, work ontheillustrative listwould
getunderway inlate1995 orearly 1996.G/STR/W/1
Page4
ANNEX I
ARTICLE XXVII:4(a) STATE TRADING NOTIFICATIONS
Symbol Date Type Adds. No.of
contracting
parties notifying
L/4933 25.1.1980 Updating 1-Czechoslovakia
2-Sweden
3-Canada
4-NewZealand
5-Romania
6-South Africa
7+Rev.1 -United Kingdom
8-Austria
9-Japan
10-Switzerland
11-Yugoslavia
12-Peru
13-Australia13outoftotalof
85contracting
parties (1979)
L/5104 28.1.1981 Full 1-Luxembourg
2-Romania
3-Yugoslavia
4-Switzerland
5-Australia
6-Belgium
7-United Kingdom
8-Norway
9-Finland
10-South Africa
11-France
12-NewZealand
13-Ireland
14-Germany, F.R.
15-Peru
16-Israel
17-Austria17outoftotalof
85contracting
parties (1980)
L/5281 13.1.1982 Updating 1-Sweden
2-Canada
3-Finland
4-Czechoslovakia
5-Austria
6-Switzerland
7-United Kingdom7outoftotalof
86contracting
parties (1981G/STR/W/1
Page5
Symbol Date Type Adds. No.of
contracting
parties notifying
L/5445 10.1.1983 Updating 1-Australia
2-Romania
3-Yugoslavia
4+Suppl.1 -Austria
5-South Africa
6-Finland
7-Spain
8-Switzerland
9-Canada
10-United Kingdom10outoftotalof
88contracting
parties (1982)
L/5601 10.1.1984 Full 1-Hungary
2-Yugoslavia
3-United States
4-Poland
5-South Africa
6-Sweden
7-Finland
8-Norway
9-Austria
10-Australia
11-Spain11outoftotalof
90contracting
parties (1983)
L/5765 7.1.1985 Updating 1-Yugoslavia
2-South Africa
3-Norway
4-Austria
5-Peru
6-Switzerland6outoftotalof
90contracting
parties (1984)
L/5937 3.1.1986 Updating 1-Yugoslavia
2+Suppl.1&2 -Japan
3-South Africa
4-Switzerland
5-Norway
6-Finland
7-Austria
8-Australia8outoftotalof
90contracting
parties (1985)
L/5955 29.1.1986 Communi-
cationChileG/STR/W/1
Page6
Symbol Date Type Adds. No.of
contracting
parties notifying
L/6107 23.12.1986 Full 1-Hong Kong
2-Yugoslavia
3-Japan
4-Finland
5-Sweden
6-South Africa
7-Austria
8-Norway
9-Switzerland9outoftotalof
92contracting
parties (1986)
L/6293 4.1.1988 Updating 1-Yugoslavia
2-Sweden
3-Austria
4-South Africa
5-Finland
6-Peru
7-Norway
8-Australia8outoftotalof
95contracting
parties (1987)
L/6446 3.1.1989 Updating 1-Yugoslavia
2-Austria
3-South Africa
4-Norway
5-United Kingdom
6-India
7-Sweden
8-India7outoftotalof
96contracting
parties (1988)
L/6629 5.1.1990 Full 1-Australia
2-Hong Kong
3-Finland
4-Norway
5-Sweden
6-South Africa
7-United Kingdom7outoftotalof
96contracting
parties (1989)
L/6797 7.1.1991 Updating 1-Hong Kong
2-Yugoslavia
3-Switzerland
4-United Kingdom
5-Sweden
6-South Africa
7-Austria
8-Norway
9-Austria (1990 figures)9outoftotalof
100contracting
parties (1990)G/STR/W/1
Page7
Symbol Date Type Adds. No.of
contracting
parties notifying
L/7161 11.1.19932Full 1-Yugoslavia
2-Finland
3-Sweden
4-Poland
5-Peru
6-Austria
7-Australia
8-Norway
9+Corr.1 -United Kingdom
10-Indonesia
11-NewZealand11outoftotalof
105contracting
parties (1992)
L/7374 11.1.1994 Updating 1-Indonesia
2-NewZealand
3-Switzerland
4-Australia
5-Czech Republic
6-Austria
7-Norway
8-Slovak Republic
9-South Africa9outoftotalof
114contracting
parties (1993)
2Norequest forupdating notifications wascirculated in1992, duetoanerror onthepartofthe
secretariat.G/STR/W/1
Page8
ANNEX II
CONTRACTING PARTIES SUBMITTING STATE TRADING NOTIFICATIONS
Country Years inwhich anotification
hasbeen submitted
Australia 1980, 1981, 1983, 1984, 1986, 1988, 1990,
1993, 1994
Austria 1980, 1981, 1982, 1983, 1984, 1985, 1986,
1987, 1988, 1989, 1991, 1993, 1994
Belgium 1981
Canada 1980, 1982, 1983
Czechoslovakia 1980, 1982
Czech Republic 1994
Finland 1981, 1982, 1983, 1984, 1986, 1987, 1988,
1990, 1993
Germany, F.R. 1981
Hong Kong 1987, 1990, 1991
Hungary 1984
India 1989 (x2)
Indonesia 1993, 1994
Ireland 1981
Israel 1981
Japan 1980, 1986, 1987
Luxembourg 1981
NewZealand 1980, 1981, 1993, 1994
Norway 1981, 1984, 1985, 1986, 1987, 1988, 1989,
1990, 1991, 1993, 1994
Peru 1980, 1981, 1985, 1988, 1993
Poland 1984, 1993
Romania 1980, 1981, 1983
Slovak Republic 1994
South Africa 1980, 1981, 1983, 1984, 1985, 1986, 1987,
1988, 1989, 1990, 1991, 1994
Spain 1983, 1984G/STR/W/1
Page9
Sweden 1980, 1982, 1984, 1987, 1988, 1989, 1990,
1991, 1993
Switzerland 1980, 1981, 1982, 1983, 1985, 1986, 1987,
1991, 1994
United Kingdom 1980, 1981, 1982, 1983, 1989, 1990, 1991,
1993
United States 1984
Yugoslavia 1980, 1981, 1983, 1984, 1985, 1986, 1987,
1988, 1989, 1991, 1993