Bridges Weekly Trade News Digest • Volume 10 • Number 17 • 17th May 2006

EU, NAMA-11 Call For New Mechanism To Deal With NTBs


The EU and the NAMA-11 group of developing countries* have called for the establishment of a new WTO mechanism to rapidly mediate bilateral conflicts over non-tariff barriers (NTBs) affecting trade in goods. However, sources report that at an informal meeting on 15 May, Members including Canada, Japan, and the US questioned the need for a new mechanism, and wondered whether it might undermine the Dispute Settlement Undertaking (DSU).

Paragraph 16 of the Doha Declaration mandates Members to pursue the "reduction or elimination of… non-tariff barriers, in particular on products of export interest to developing countries."

Both proposals argued that the two avenues that exist under current WTO rules for addressing NTBs are inappropriate. Formal dispute settlement is time-consuming and expensive, while the ‘regular’ (as opposed to negotiating) committees that oversee Members’ implementation of obligations are useful for notifying and discussing NTBs that one’s exporters might be facing, but ineffective at resolving problems. The DSU’s two-year timeline does little to address the immediate problems of exporters whose goods are blocked in a port of entry, observed the NAMA-11.

Instead, the EU and the NAMA-11 would like a provision for expert ‘facilitators’ to swiftly broker compromises among Members, without going into whether or not the NTB in question is illegal. Such mediation, they underline, would not in any way detract from Members’ right to launch a formal DSU case at any time.

Some civil society groups have warned that countries are using the negotiations to seek the attenuation of environmental and health standards, pointing to the NTBs that they have notified. The papers took pains to acknowledge that several measures that affect would-be traders may actually aim to serve perfectly legitimate policy goals unrelated to trade. However, they suggested, facilitation could address situations where the implementation of these measures might unnecessarily restrict access to markets or discriminate among WTO Members.

60-day non-binding facilitation process

According to the procedure outlined by the NAMA-11 (TN/MA/W/68/Add.1), a Member facing an NTB would describe how its trade was being affected in the relevant WTO committee, and ask for the matter to be referred to the ‘NTB Resolution Mechanism.’ The country imposing the measure in question would be obliged to cooperate with the process. A mutually-approved ‘facilitator’ from a roster of experts maintained by each committee would then examine the case; consult with Members, affected industries, and other specialists; and provide non-binding recommendations on possible solutions within 60 days. Unlike participation in the process, implementing the recommendations would be optional.

The NAMA-11 emphasised that the mechanism would be oriented towards "creative and pragmatic results" to address the trade impact of NTBs, rather than an evaluation of their legality. It stressed that the "conciliatory negotiations" would be "informal, low-key, and less adversarial than the DSU."

The EU (TN/MA/W/11/Add.8) outlined a similar 60-day non-binding facilitation process. It said that a supplemental mechanism "to facilitate progressive and more rapid resolution" of problems related to NTBs appeared to be necessary, in part because new NTBs continue to emerge and it is often difficult to determine whether or not they are legal.

Sceptics argue that no new mechanisms are necessary. For example, they suggest that the first stage of formal dispute settlement procedures — bilateral consultations — are one existing forum in which Members could solve problems resulting from NTBs.

*The members of the NAMA-11 are Argentina, Brazil, Egypt, India, Indonesia, Namibia, the Philippines, South Africa, Tunisia, and Venezuela.

ICTSD reporting.