IMPORT LICENSING PROCEDURES 119
AGREEMENT ON IMPORT LICENSING PROCEDURES
PREAMBLE
Having regard to the Multilateral Trade Negotiations, the Parties to this
Agreement on Import Licensing Procedures (hereinafter ref erred to as "Parties" and
"this Agreement");
Desiring to further the objectives of the General Agreement on Tariff s and Trade
(hereinafter referred to as "General Agreement" or "GATT") ;
Taking into account the particular trade, development and financi al needs of
developing countries;
Recognizing the usefulness of automatic import licensing for certain pu rposes
and that such licensing should not be used to restrict trade;
Recognizing that import licensing may be employed to administer measure s
such as those adopted pursuant to the relevant provisions of the GATT;
Recognizing also that the inappropriate use of import licensing procedu res may
impede the flow of international trade;
Desiring to simplify, and bring transparency to, the administrative procedures
and practices used in international trade, and to ensure the fair and equitable application
and administration of such procedures and practices;
Desiring to provide for a consultative mechanism and the speedy, effe ctive and
equitable resolution of disputes arising under this Agreem ent;
Hereby agree as follows:
Article 1
General provisions
1. For the purpose of this Agreement, import licensing is def ined as administrative
procedures1used for the operation of import licensing regimes requirin g the submission
_______________
1Those procedures referred to as "licensing" as well as other similar administrative procedures.120 TOKYO ROUND AGREEMENTS
of an application or other documentation (other than that re quired for customs
purposes) to the relevant administrative body as a prior con dition for importation into
the customs territory of the importing country.
2. The Parties shall ensure that the administrative procedu res used to implement
import licensing regimes are in conformity with the relevan t provisions of the GATT
including its annexes and protocols, as interpreted by this Agreement, with a view
to preventing trade distortions that may arise from an inapp ropriateoperation of those
procedures, taking into account the economic development p urposes and financial
and trade needs of developing countries.
3. The rules for import licensing procedures shall be neutra l in application and
administered in a fair and equitable manner.
4. The rules and all information concerning procedures for t he submission of
applications, including the eligibility of persons, firms and institutions to make such
applications, and the lists of products subject to the licen sing requirement shall be
published promptly in such a manner as to enable governments and traders to become
acquainted with them. Any changes in either the rules concer ning licensing procedures
or the list of products subject to import licensing shall als o be promptly published
in the same manner. Copies of these publications shall also b e made available to
the GATT secretariat.
5. Application forms and, where applicable, renewal forms s hall be as simple as
possible. Such documents and information as are considered strictly necessary for
the proper functioning of the licensing regime may be requir ed on application.
6. Application procedures and, where applicable, renewal p rocedures shall be as
simple as possible. Applicants shall have to approach only o ne administrative body
previously specified in the rules referred to in paragraph 4 above in connection with
an application and shall be allowed a reasonable period ther efor. In cases where it
is strictly indispensable that more than one administrativ e body is to be approached
in connection with an application, these shall be kept to the minimum number possible.
7. No application shall be refused for minor documentation e rrors which do not
alter basic data contained therein. No penalty greater than necessary to serve merely
as a warning shall be imposed in respect of any omission or mis take in documentation
or procedureswhich is obviously made without fraudulent in tent or gross negligence.
8. Licensed imports shall not be refused for minor variation s in value, quantity
or weight from the amount designated on the licence due to dif ferences occurring
during shipment, differences incidental to bulk loading an d other minor differences
consistent with normal commercial practice.IMPORT LICENSING PROCEDURES 121
9. The foreign exchange necessary to pay for licensed import s shall be made
available to licence holders on the same basis as to importer s of goods not requiring
import licences.
10. With regard to security exceptions, the provisions of Ar ticle XXI of the GATT
apply.
11. The provisions of this Agreement shall not require any Pa rty to disclose
confidential information which would impede law enforceme nt or otherwise be contrary
to the public interest or would prejudice the legitimate com mercial interests of
particular enterprises, public or private.
Article 2
Automatic import licensing1
1. Automatic import licensing is defined as import licensin g where approval of
the application is freely granted.
2. The following provisions2, in addition to those in paragraphs1 to 11 of Article 1
and paragraph 1 of Article 2 above, shall apply to automatic i mport licensing
procedures:
(a) Automatic licensing procedures shall not be administered i n a manner so
as to have restricting effects on imports subject to automat ic licensing;
(b) Parties recognize that automatic import licensing may be ne cessary whenever
otherappropriateproceduresarenot available. Automatic import licensing
may be maintained as long as the circumstances which gave ris e to its
introduction prevail or as long as its underlying administr ative purposes
cannot be achieved in a more appropriate way;
(c) Any person, firm or institution which fulfils the legal requ irements of the
importing country for engaging in import operations involv ing products
subject to automatic licensing shall be equally eligible to apply for and to
obtain import licences;
_______________
1Those import licensing procedures requiring a security whi ch have no restrictive effects on imports,
are to be considered as falling within the scope of paragraph s 1 and 2 of Article 2 below.
2A developing country Party, which has specific difficultie s with the requirements of
sub-paragraphs (d)and(e)below may, upon notification to the Committee referred to in paragraph 1 of
Article 4, delay the application of these sub-paragraphs by not more than two years from the date of entry
into force of this Agreement for such Party.122 TOKYO ROUND AGREEMENTS
(d) Applications for licences may be submitted on any working da y prior to
the customs clearance of the goods;
(e) Applications for licenceswhen submittedin appropriatean d complete form
shall be approved immediately on receipt, to the extent admi nistratively
feasible, but within a maximum of ten working days.
Article 3
Non-automatic import licensing
The following provisions, in addition to those in paragraph s 1 to 11 of Article 1
above, shall apply to non-automatic import licensing proce dures, that is, import
licensing procedures not falling under paragraphs 1 and 2 of Article 2 above:
(a) Licensing procedures adopted, and practices applied, in co nnection with
the issuance of licences for the administration of quotas an d other import
restrictions, shall not have trade restrictive effects on i mports additional
to those caused by the imposition of the restriction;
(b) Parties shall provide, upon the request of any Party having a n interest in
the trade in the product concerned, all relevant informatio n concerning:
(i) the administration of the restrictions;
(ii) the import licences granted over a recent period;
(iii) the distribution of such licences among supplying cou ntries;
(iv) where practicable, import statistics (i.e. value and/ or volume) with
respect to the products subject to import licensing. The dev eloping
countries would not be expected to take additional administ rative or
financial burdens on this account;
(c) Parties administering quotas by means of licensing shall pu blish the overall
amount of quotas to be applied by quantity and/or value, the o pening and
closing dates of quotas, and any change thereof;
(d) In the case of quotas allocated among supplying countries, t he Party applying
the restrictions shall promptly inform all other Parties ha ving an interest
in supplying the product concerned of the shares in the quota currently
allocated, by quantity or value, to the various supplying co untries and shall
give public notice thereof;
(e) Where there is a specific opening date for the submission of l icensing
applications, the rules and product lists referred to in par agraph 4 of
Article 1 shall be published as far in advance as possible of s uch date, orIMPORT LICENSING PROCEDURES 123
immediately after the announcement of the quota or other mea sure involving
an import licensing requirement;
(f) Any person, firm or institution which fulfils the legal requ irements of the
importing country shall be equally eligible to apply and to b e considered
for a licence. If the licence application is not approved, th e applicant shall,
on request, be given the reasons therefor and shall have a rig ht of appeal
or review in accordance with the domestic legislation or pro cedures of the
importing country;
(g) The period for processing of applications shall be as short a s possible;
(h) The period of licence validity shall be of reasonable durati on and not be
so short as to preclude imports. The period of licence validi ty shall not
preclude imports from distant sources, except in special ca ses where imports
are necessary to meet unforeseen short-term requirements;
(i) When administering quotas, Parties shall not prevent impor tation from being
effected in accordance with the issued licences, and shall n ot discourage
the full utilization of the quotas;
(j) When issuing licences, Parties shall take into account the d esirability of
issuing licences for products in economic quantities;
(k) In allocating licences, Parties should consider the import performance of
the applicant, including whether licences issued to the app licant have been
fully utilized, during a recent representative period;
(l) Consideration shall be given to ensuring a reasonable distr ibution of licences
to new importers, taking into account the desirability of is suing licences
for products in economic quantities. In this regard, specia l consideration
should be given to those importers importing products origi nating in
developing countries and, in particular, the least-develo ped countries;
(m) In the case of quotas administered through licences which ar e not allocated
among supplying countries, licence holders1shall be free to choose the
sources of imports. In the case of quotas allocated among sup plying
countries, the licence shall clearly stipulate the country or countries;
(n) In applying paragraph8 of Article 1 above, compensating adj ustments may
be made in future licence allocations where imports exceede d a previous
licence level.
_______________
1Sometimes referred to as "quota holders".124 TOKYO ROUND AGREEMENTS
Article 4
Institutions, consultation and dispute settlement
1. There shall be established under this Agreement a Committ ee on Import Licensing
composed of representatives from each of the Parties (refer red to in this Agreement
as "the Committee"). The Committee shall elect its own Chair man and shall meet
as necessary for the purpose of affording Parties the opport unity of consulting on
any matters relating to the operation of this Agreement or th e furtherance of its
objectives.
2. Consultations and the settlement of disputes with respec t to any matter affecting
the operation of this Agreement, shall be subject to the proc edures of Articles XXII
and XXIII of the GATT.
Article 5
Final provisions
1. Acceptance and accession
(a) This Agreement shall be open for acceptance by signature or o therwise,
by governments contracting parties to the GATT and by the Eur opean
Economic Community.
(b) This Agreement shall be open for acceptance by signature or o therwise
by governments having provisionally acceded to the GATT, on terms related
to the effective application of rights and obligations unde r this Agreement,
which take into account rights and obligations in the instru ments providing
for their provisional accession.
(c) This Agreement shall be open to accession by any other govern ment on
terms, related to the effective application of rights and ob ligations under
this Agreement, to be agreed between that government and the Parties, by
the deposit with the Director-General to the CONTRACTING PA RTIES
to the GATT of an instrument of accession which states the ter ms so agreed.
(d) In regard to acceptance, the provisions of Article XXVI:5 ( a) and ( b) of
the General Agreement would be applicable.
2. Reservations
Reservations may not be entered in respect of any of the provi sions of this
Agreement without the consent of the other Parties.IMPORT LICENSING PROCEDURES 125
3. Entry into force
This Agreement shall enter into force on 1 January 1980 for th e governments1
which have accepted or acceded to it by that date. For each oth er government it shall
enter into force on the thirtieth day following the date of it s acceptance or accession
to this Agreement.
4. National legislation
(a) Each government accepting or acceding to this Agreement sha ll ensure,
not later than the date of entry into force of this Agreement f or it, the
conformity of its laws, regulations and administrative pro cedures with the
provisions of this Agreement.
(b) Each Party shall inform the Committee of any changes in its la ws and
regulations relevant to this Agreement and in the administr ation of such
laws and regulations.
5. Review
The Committee shall review as necessary, but at least once ev ery two years,
the implementation and operation of this Agreement taking i nto account the objectives
thereof and shall inform the CONTRACTING PARTIES to the GATT of developments
during the period covered by such reviews.
6. Amendments
The Parties may amend this Agreement, having regard, inter alia, to the
experience gained in its implementation. Such an amendment , once the Parties have
concurred in accordance with procedures established by the Committee, shall not come
into force for any Party until it has been accepted by such Par ty.
7. Withdrawal
Any Partymay withdrawfrom this Agreement. The withdrawal s hall take effect
upon the expiration of sixty days from the day on which writte n notice of withdrawal
is received by the Director-Generalto the CONTRACTING PART IES to the GATT.
Any Party may upon such notification request an immediate me eting of the Committee.
_______________
1For the purpose of this Agreement, the term "governments" is deemed to include the competent
authorities of the European Economic Community.126 TOKYO ROUND AGREEMENTS
8. Non-application of this Agreement between particular Part ies
This Agreement shall not apply as between any two Parties if e ither of the Parties,
at the time either accepts or accedes to this Agreement, does not consent to such
application.
9. Secretariat
This Agreement shall be serviced by the GATT secretariat.
10. Deposit
This Agreement shall be deposited with the Director-Genera l to the
CONTRACTING PARTIES to the GATT, who shall promptly furnish to each Party
and each contracting party to the GATT a certified copy there of and of each
amendment thereto pursuant to paragraph 6, and a notificati on of each acceptance
thereof or accession thereto pursuant to paragraph 1 and of e ach withdrawal therefrom
pursuant to paragraph 7 of this Article.
11. Registration
This Agreement shall be registered in accordance with the pr ovisions of
Article 102 of the Charter of the United Nations.
Done at Geneva this twelfth day of April, nineteen hundred and sev enty-nine
in a single copy, in the English, French and Spanish language s, each text being
authentic.