RESTRICTED
GENERAL AGREEMENT PC/SCTE/M/1
24May1994
ONTARIFFS AND TRADE Special Distribution
(94-0901)
World Trade Organization -Preparatory Committee
Sub-Committee onTrade andEnvironment
REPORT OFTHE MEETING HELD ON11MAY 1994
Note bytheSecretariat
1. TheSub-Committee onTrade andEnvironment helditsfirstmeeting on11May1994 under
thechairmanship ofAmbassador LuizFelipe Lampreia ofBrazil. Theagenda forthemeeting contained
inPC/AIR/1 wasadopted. Thepurpose ofthemeeting wastoconsider organizational matters relating
totheactivities oftheSub-Committee andtoallow delegations afirstopportunity toexpress theirviews.
2. TheChairman saidthatthecreation oftheSub-Committee wasanimportant stepintheefforts
GATT contracting parties hadbeenmaking tocopewiththetasks required bytheRioPrinciples and
Agenda 21which resulted fromtheUNConference onEnvironment andDevelopment (UNCED) in
June1992. Thework oftheSub-Committee wastobeguided bytheterms ofreference established
bytheMinisterial Decision onTrade andEnvironment adopted inApril 1994inMarrakesh. Inorder
topromoteaconstructivediscussionintheSub-Committee,itwouldbeimportantthatthebasicprinciples
established inthatDecision berespected. They were: first,theneedtokeepthemultilateral trading
system astheaxisofthediscussions, asexpressed bytheMinisters 'desire "tocoordinate thepolicies
inthefieldoftrade andenvironment, andthiswithout exceeding thecompetence ofthemultilateral
tradingsystem,whichislimitedtotradepoliciesandthosetrade-relatedaspectsofenvironmentalpolicies
which mayresult insignificant trade effects foritsmembers"; andsecond, toensure thatanyresults
ofthediscussions were "compatible withtheopen, equitable andnon-discriminatory nature ofthe
system".
3. Hecontinued bysaying thattheSub-Committee 'sinitial taskwastodiscuss howtoorganize
workinthelightoftheworkprogrammeapprovedinMarrakesh.Itwouldseemconvenientandcoherent
withtheMinisterial Decision thatdiscussions intheSub-Committee takealready astheirtimeframe
theperiod uptothefirstWTO Ministerial meeting, when thework oftheWTO Committee onTrade
andEnvironment would bereviewed. Thework programme opened upacomprehensive fieldfor
discussion ofthetradeandenvironment relationship. Itwould benecessary toestablish some priorities
andtrygradually, butnotinapremature manner, toform asense ofwhatcould beachieved inthe
envisaged timeframe. Thisshould bedone overawell-prepared terrain, andinthatsense itwould
behisintention todevote thismeeting andsubsequent consultations andmeetings, asrequired, toa
discussion ofhowtoorganize work initially.
4. Heinvited delegations tobegin toreflect onwhich issues required initial attention, andtotake
intoconsideration thefollowing elements: previous workaccomplished intheGroup onEnvironmental
MeasuresandInternationalTradeontradeprovisionscontainedinmultilateralenvironmentalagreements,
trade effects ofnewforms ofpackaging andlabelling requirements, andtransparency oftrade-related
environmental measures, andprevious work undertaken there aswellasintheCommittee onTrade
andDevelopment andintheCouncil onUNCED follow-up; previous work onexport ofdomestically
prohibited goods; previous work inGATT onrelated issues, suchasborder taxadjustment, internal
taxes, andtariff escalation; andequilibrium between issues already dealtwithandnewissues inthisPC/SCTE/M/1
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area. TheChairman added thatinthelightoftheissues requiring attention, itwould benecessary
toidentify whatstudies from theSecretariat delegations feltwould beneeded.
5. TheChairman invited delegations toaddress three organizational matters.
Observers
6. Asregards observers fromgovernments thatwerenotmembers ofthePreparatory Committee
oftheWTO, theChairman suggested thattheSub-Committee follow thesame practice adopted by
thePreparatory Committee; thatis,governments which hadbeenassociated withthework oftheTNC
would beinvited toattend formal meetings oftheSub-Committee.
7. Asregards observers from intergovernmental organizations, hesuggested thatthose
intergovernmental organizations which hadregistered theirinterest infollowing GATT work onthe
subject oftrade andenvironment andthatwereaccepted asobservers intheGroup onEnvironmental
Measures andInternational Trade might beinvited tobeobservers intheSub-Committee. The
organizations concerned were: IBRD, IMF, FAO, OECD, UNCTAD, UNEP, EFTA, UNDP, and
theUNCommission onSustainable Development.
8. Therepresentative ofAustralia saidhisgovernment feltstrongly thatthere should notbeany
difference inthelistofobservers invited toattend formal meetings ofthePreparatory Committee and
itssub-committees. Therepresentative oftheEuropean Communities expressed thesamepointofview.
9. Therepresentative ofIndia asked whether itwasnecessary totakeadecision nowongranting
observership toother intergovernmental organizations, andsuggested reflecting further onwhether
alloftheintergovernmental organizations thathadobserved theformal meetings oftheGroup on
Environmental Measures andInternational Trade, suchastheOECD, should necessarily begranted
observer status intheSub-Committee. Therepresentatives ofSingapore, speaking onbehalf ofthe
ASEAN countries, andVenezuela alsosawaneedforreflection onthisissue andsaidthere might
beotherregional, intergovernmental organizations which should beinvited tobeassociated asobservers
because oftheirparticular interest andexpertise intheareaoftrade andenvironment.
10. Therepresentative ofBrazil saidhisdelegation could support theChairman 'sproposal, but
hesawvalue inholding further consultations onthematter inorder toarrive atasolution acceptable
toall.Therepresentative ofJapan saidhisdelegation could support theChairman 'sproposal subject
tothepossibility ofinviting further organizations asobservers inthefuture. Therepresentative of
theUnited States saidthatwhile hecould agree totheChairman 'sproposal, hisdelegation would be
flexible ontheissueofobservers andcould understand aneedforfurther reflection. Hesawtwoaspects
totheissue: theneedtoagree relatively quickly onwhocould participate intheimmediate future
intheSub-Committee 'smeetings asobservers, andtheneedtoexamine within theSub-Committee 's
ownwork programme thematter ofobservers within thecontext ofArticle VoftheWTO Agreement
andtoprepare recommendations inthisregard forthePreparatory Committee andlatertheWTO.
Hisdelegation insisted thatnodecisions taken onobservers nowshould prejudice future consideration
oftheissue. Therepresentative ofSweden, speaking onbehalf oftheNordic countries, saidhewas
sympathetic totheChairman 'sproposal butthathewasquiteprepared toallow other delegations time
forreflection. Hisdelegation feltintergovernmental organizations withspecific expertise andinterest
intheareaoftradeandenvironment should beinvited toattend formal meetings oftheSub-Committee
asobservers, andthattheywerenotnecessarily thesameasthose organizations interested infollowing
thegeneral issues ofthePreparatory Committee. HesaidthattheOECD hadbeeninvolved inwork
ontrade andenvironment formany years anditwaslogical toinvite itasanobserver. Hefeltitwas
important nottobetoocautious about inviting organizations thathadaninterest inthesubject andPC/SCTE/M/1
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acontribution tomake. Therepresentative ofNigeria sawaneedtoensure thatdebate within theSub-
Committee wasexpanded, thatthere should beavenues andopportunities forother groups andother
people withexpertise andknowledge tobeallowed tocontribute, butthattheSub-Committee should
bediscriminating ingranting rights toobserve toensure thattherewasabalanced reflection ofviews.
Hisdelegation would notoppose inprinciple theChairman 'srecommendation.
11. TheChairman saidhesensed general support forhisproposal butsawaneedforfurther
reflection bysome delegations. TheSub-Committee would therefore nottakeadecision onthematter
now. Hewould holdfurther consultations andbring theissue backtotheSub-Committee oncehe
feltthatanacceptable solution hadbeenfound.
Documentation
12. TheChairman proposed thatthedocumentation prepared fortheGroup onEnvironmental
Measures andInternational Trade should beavailable asresource documentation forthework ofthe
Sub-Committee. Itwasagreed.
13. Heasked fordelegations 'views ontheforminwhich theywished themeeting records tobe
kept,taking intoaccount theSecretariat resources available toservice theSub-Committee. Herecalled
thatinthecaseoftheGroup onEnvironmental Measures andInternational Trade thepractice adopted
wasfortheSecretariat toprepare detailed reports ofeachmeeting, intheform ofextensive minutes
withattribution ofstatements todelegations byname. Those minutes remained restricted documents,
butherecalled thedecision taken bythatGroup toderestrict certain background working documents
inorder tohelpincrease public appreciation ofthescope andcomplexity ofthediscussions.
14. Several delegations suggested theChairman takeupthematter ofSecretariat resources directly
withtheDirector-General.
15. TherepresentativesofIndia,NewZealand,Nigeria,Japan,Canada,Sweden,speakingonbehalf
oftheNordiccountries,theRepublicofKorea,Turkey,Argentina,Uruguay,theUnitedStates,Thailand,
speaking onbehalf oftheASEAN countries, theEuropean Communities, andSwitzerland expressed
support forcontinuing thesame practice ofrecord-keeping oftheproceedings offormal meetings that
hadbeenusedintheGroup onEnvironmental Measures andInternational Trade. This, intheview
ofmany, served thepurposes ofensuring fulltransparency among Sub-Committee members, informing
capital-based officials oftheproceedings offormal meetings, andbuilding upabody ofknowledge
ontheviews ofdifferent delegations onthesubstance under discussion. Therepresentative ofMexico,
while expressing noobjection tomaintaining pastpractice inthisarea,suggested thatintheinitial phase
itmight encourage amore intellectual debate ifnodetailed orconcise meeting records werekeptso
thatdelegations would avoid simply stating national positions. HesaidthattheSub-Committee was
onlyjustbeginning itswork, andconstructive dialogue atthisstage might bepromoted ifpositions
were notattributed.
16. Generally, itwasfeltthatthekeeping offormal, detailed minutes withattribution should not
beallowed tostand inthewayofthefreeflowofdebate intheSub-Committee. Some feltthatthis
wasnotlikely tooccur, while some others feltthatfurther thought might begiven toalternative means
ofbuilding upthebodyofdocumentation suchasissuing inanorganized waynon-papers byindividual
delegations orthepreparation ofsummaries ofthesubstance ofthedebate, aswellasholding informal
meetings without official records toallow delegations greater freedom toexpress theirpoints ofview.
17. Itwasstated thatderestriction ofminutes wasasensitive subject andthatitwould remain up
totheSub-Committee todecide which ofitsdocuments could bederestricted; onefactor tobetaken
intoaccount inthisregard wasthatderestriction should notbeallowed tohamper thework oftheSub-PC/SCTE/M/1
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Committee. Several delegations considered itimportant tokeepawider public audience informed
ofthework oftheSub-Committee soastobuild uppublic support forit,andsuggested thatfurther
reflection begiven tothisissue. Onesuggestion inthisrespect wastoderestrict formal records of
theSub-Committee. Another wasthepossibility ofpreparing separate reports ofmeetings ofasummary
nature orwithout attribution todelegations, onepossibility being along thelinesofthose prepared
already bytheSecretariat under itsownresponsibility.
18. TheChairman saidthathefeltthemajority ofdelegations favoured keeping meeting records
inthesame wayashadbeenthepractice oftheGroup onEnvironmental Measures andInternational
Trade. Forthetimebeing, fullrecords would bekeptofformal meetings, andthematter ofrecord-
keeping would bereviewed astheSub-Committee 'swork proceeded.
Rhythm andfrequency ofmeetings
19. TheChairman saidthatinorder toprepare forthenextformal meeting, where hebelieved
theSub-Committee should begin tackling substantive, thematic issues, hefeltitwould beuseful to
meet atleastonceinformally inorder todiscuss inmore detail thework programme which wasto
betaken up.Hewould firstconduct consultations onanindividual basisorwithrepresentative samples
ofparticipants fromtheSub-Committee, andthenconvene aninformal meeting oftheSub-Committee.
Hesuggested thatdelegations consider thepossibility ofworking uptothesummer break withthe
aimofholding thenext, formal meeting oftheSub-Committee inlate-June orearly-July.
20. TherepresentativeoftheUnitedStateshopeditwouldbepossibletobeginsubstantivediscussions
assoonaspossible, butsaiditwasimportant toreach agreement through informal contacts onthe
approach tobetaken tothework programme sufficiently inadvance ofthenextformal meeting to
allow delegations toprepare properly forit.Therepresentative ofSwitzerland saiditwould beimportant
alsotohaveaclearindication assoonaspossible ofthefuture schedule ofmeetings toallow delegations
toprepare properly forthem. Therepresentative oftheEuropean Communities saidthatastheSub-
Committee approached theoperational partofitswork, itmight prove useful toalternate formal and
informal meetings. Therepresentative ofVenezuela urged theChairman tokeepdelegations thatdid
notparticipate intheinformal process fully informed ofdevelopments. Therepresentative ofthe
Republic ofKorea asked forindications oftheprobable composition, levelofparticipation andfrequency
ofinformal meetings. TheChairman replied thathehadnofixed ideas other thanthattheinformal
process should befunctional andrepresentative. Hehadnointention ofcreating exclusive sub-groups
ofparticipants, andwould ensure fulltransparency wasmaintained.
21. Therepresentative ofCuba asked forSecretariat summaries oftheproceedings ofrecent
discussions inGATT ontrade andenvironment tobemade available atthenextmeeting.