The GATT Uruguay Round A Negotiating History (1986-1994) TERENCE P. STEWART, EDITOR VOLUME IV: THE END GAME (PART I) KLUWER LAW INTERNATIONAL The Hague London Boston
TABLE OF CONTENTS Introduction xxi Agriculture 1 I. Introduction 3 II. Chronology of the Final Stage of Negotiations 3 III. Key Issues in the Final Stage of the Negotiations 17 A. Request to Modify Volume-Based Special-Safeguard Provisions 17 B. Resolution of the Market-Access Dilemma in Japan and Korea 19 1. Korean Compromise 19 2. Japan Concession 21 3. The Market-Access Commitments 22 C. Renegotiation of Blair House Agreement 24 1. Internal Support a. Exemption from Reduction Commitments 24 b. Insulation from WTO Challenges and Countervailing Duty Actions 25 2. Market Access and Tariffication 26 3. Export Subsidies 27 D. Canada's Partial Split from Cairns Group with Respect to Import Quotas For Supply-Management Products 28 E. Special Treatment of Developing and Net-Food-Importing Countries 30 F. "Zero-for-Zero" Proposal on Oilseeds 31 IV. Textual Changes from the Dunkel Draft to the Final Agreement 33 A. Overview of the Agreement 42 B. Specific Changes to the Text of the SPS Agreement 44 V. Review of Market-Access Commitments of Selected Countries 45 A. United States 45 B. European Union 48 C. Canada 52 D. Australia 54 VI. Conclusion 55 A. Consistency with Original Negotiating Objectives 55 B. Concluding Remarks 57 Annexes 59 Comparison of Agriculture Provisions 61 GATT Documents 167 Bibliography 169 GATT Articles 183
xü Contents I. Understanding on the Interpretation of Article II.l(B) 184 II. Understanding on the Interpretation of Article XVII 186 III. Understanding on the Balance-of-Payments Provisions 187 IV. Understanding on the Interpretation of Article XXIV 189 V. Understanding in Respect of Waivers of Obligations (Article XXV) 191 VI. Understanding on the Interpretation of Article XXVIII 192 VII. Conclusion: The Punta Del Este Agenda 193 Annex: GATT Documents 195 Bibliography 199 Customs Valuations 203 I. Changes in Dispute Settlement 205 II. Special Rules for Developing Countries 207 III. Other Annex III Provisions 208 IV. Incorporated Ministerial Decisions 209 V. "Final Provisions" 211 Annex: GATT Documents 213 Bibliography 217 Subsidies and Countervailing Measures 219 I. Final Negotiations: December 1992-December 1993 221 A. Proposed Changes to Dunkel Draft Agreement on Subsidies and Countervailing Measures: December 1992/January 1993 221 B. Period of Stalemate: January 1993-November 1993 225 C. Final Stretch: November-December 1993 227 1. Final Negotiations and Changes to Dunkel Draft 228 2. The U.S. Proposal to Expand R&D Subsidies 229 D. Completion and Wrap-Up: December 1993-April 1994 233 n. Subsidies and Countervailing Measures Agreement: A Summary of the Final Act Text of April 1994 235 III. Subsidies and Countervailing Measures Agreement 236 A. Part I: General Provisions 236 1. Definitions of "Subsidy" 236 2. Specificity 236 B. Part II: Prohibited Subsidies ("Red Light") 237 1. Prohibited Subsidies 237 2. Remedies 237 C. Part III: Actionable Subsidies ("Yellow Light") 238 1. Adverse Effects 238 2. Serious Prejudice 239 3. Remedies 239 D. Part IV: Non-Actionable Subsidies ("Green Light") 240
Contents xiii 1. Assistance for Research and Development 241 2. Assistance to Disadvantaged Regions 242 3. Assistance to Promote Adaptation of Existing Facilities to New Environmental Requirements 243 4. Notification and Review of Non-Actionable Subsidy Programmes 243 5. Consultation and Authorized Remedies 244 E. Part V: Countervailing Measures 244 1. Initiation and Subsequent Investigation 245 2. Standing 246 3. Evidence 247 4. Consultations 249 5. Calculation of the Amount of a Subsidy 249 6. Determination of Injury 250 7. Cumulation 250 8. Definition of Domestic Injury 250 9. Provisional Measures 251 10. Undertakings 251 11. Imposition of Countervailing Duties 251 12. Retroactivity 251 13. Anti-Circumvention Measures 252 14. Duration and Review of Countervailing Duties 253 15. Public Notice 253 16. Judicial Review 254 F. Part VI: Institutions 254 G. Part VII: Notification and Surveillance 255 H. Part VIII: Developing Country Members 255 I. Part IX: Transitional Arrangements 257 1. Existing Programmes 257 2. Transformation into a Market Economy 257 J. Part X: Dispute Settlement 258 K. Part XI: Final Provisions 259 1. Provisional Application 259 2. Final Provisions 259 Annexes 263 Comparison of Subsidies and Countervailing Duties 265 GATT Documents 415 Bibliography 417 Trade-Related Investment Measures 424 I. Introduction 425 II. The Events of 1993 and 1994 425
xiv Contents A. 1993: Expressions of Concerns by the LDCs 425 B. 1994: Completing and Signing the Final Agreement 429 III. The Final Agreement on Trade-Related Investment Measures 429 rv. The Results: Disappointment or Success? 432 V. WhatIstoCome?WhatIsPast May Well BePrologue 434 A. Article III 434 B. Article XI 435 VI. Beyond WTO/GATT: Other Treatments of Foreign Investments 436 A. OECD's Multilateral Agreement on Investment 436 B. Other Trade Agreements: the NAFTA 437 C. Other Trade Agreements: APEC 437 D. Unilateral Liberalization 438 E. GATT/WTO Accession 439 VII. Conclusion 440 Annexes 441 Comparison of Trade-Related Investment Measures 443 GATT Documents 455 Bibliography 457 Trade-Related Aspects of Intellectual Property Rights 463 I. Introduction 465 II. The TRIPS Negotiations from Punta Del Este to the Dunkel Draft 467 A. Positions of the Parties 467 1. Copyright and Related Rights 469 2. Trademarks 469 3. Geographical Indications 470 4. Industrial Designs 470 5. Patents 470 6. Layout-Designs (Topographies) of Integrated Circuits 470 7. Protection of Undisclosed Information 471 B. The Negotiations from 1986 to the Dunkel Draft 471 1. From 1986 to the Mid-Term Review in December 1988 471 a. Problems to be Addressed 471 1. Copyrights 472 Sound and Video recordings 472 Computer programs 472 Duration of Copyright protection 473 2. Patents 473 Appellations of origin and geographical indications 473 Limitations on patentable subject matter 473 Discriminatory protection 474 First to invent 474
Contents xv II. Compulsory licensing Restrictions on foreigners' patent rights 3. Trademarks Prominent foreign trademarks Enforcement provisions 4. Industrial Designs Misappropriation 5. Layout-Designs Protection 6. Other Procedural obstacles to obtaining rights in other countries 7. Dispute Settlement and Enforcement Counterfeiting of branded goods Piracy of books, sound and video recording Discriminatory treatment of imported products Enforcement b. Draft Agreement to Discourage the Importation of Counterfeit Goods c. Initial Proposais 2. A TRIPS Framework Agreement in 1989 3. Proposais During 1989-1991 C. Accomplishments in the Dunkel Draft 1. General Provisions and Basic Principles 2. Standards Conceming the Availability, Scope and Use of Intellectual Property Rights a. Copyrights b. Trademarks c. Geographical Indications d. Industrial Design e. Patents f. Layout-Designs g. Trade Secrets h. Contractual Licenses 3. Remaining Provisions External Pressures Affect the TRIPS Negotiations A. U.S. Special 301 Actions Force Change During Uruguay Round Negotiations 1. Brazil 2. Argentina 3. Thailand 4. India 474 477 477 478 481 483 486 487 488 488 489 490 491 491 493 494 494 495 495 495 497 498 499 500
xvj Contents 5. China 6. Taiwan 502 7. USTR's Priority Watch List 503 8. Saudi Arabia 504 9. South Korea 504 10. European Union 504 11. Australia 505 12. Hungary 506 13. Poland 506 14. Philippines 506 15. Turkey 507 16. Egypt 507 B. NAFTA 508 C. Andean Pact 508 IV. Chronology of the Uruguay Round Negotiations from the Dunkel Draft to the Final Act (1992-1993) 509 A. The Post-Dunkel Draft Stalemate 509 B. U.S. Fast-Track Negotiating Authority Expires As the Clinton Administration Takes Over 514 C. Remaining Market Access Issues Dominate Negotiations 515 D. The Clinton Administration Demands Changes in the TRIPS Draft 518 E. Changes to the TRIPS Text During the Final Hours of Negotiations 525 V. Attempts to Revise the Dunkel Draft on TRIPS 529 A. Patentable Subject Matter: Protection of Plant Varieties 530 B. Pipeline Protection: Patent Protection for Pharmaceuticals and Agricultural Chemicals 533 C. Compulsory Licensing 535 D. Dispute Settlement 537 VI. The TRIPS Enforcement and Dispute Settlement Provision: A Significant Achievement 538 A. Countries Dissatisfied With Enforcement and Dispute Settlement Provisions in WIPO Conventions Demand Improved Procedures in the TRIPS Agreement 538 B. TRIPS Enforcement and Dispute Settlement Provisions 541 1. Enforcement Provisions 541 2. A New Forum for the Resolution of Intellectual Property Disputes Between Countries 544 C. The Role of the WIPO in the Uruguay Round Negotiations 547 D. WIPO's Alternative Dispute Settlement Provisions 551 VII. Future Role of Section 301 557 501
Contents xvii VIII. NAFTA's Intellectual Property Provisions: A Model for Future Negotiations 560 A. Scope of the TRIPS Agreement 561 B. The Scope of the NAFTA Agreement 563 1. National Treatment 565 2. Encrypted Program-Carrying Satellite Signals 567 3. Pipeline Protection for Pharmaceutical and Agrochemical Products 568 4. Dependent Patent Compulsory Licensing 568 5. Ten-Year Minimum Trademark Term 569 6. Marketing Approval 569 7. Adverse Effect on Trade 570 8. Transition Periods 570 IX. Reaction to the Final Act 571 X. Conclusion 574 Annexes 577 Comparison of Trade-Related Aspects of Intellectual Property Rights 579 Sibe-by-Side Comparison of TRIPS and NAFTA Intellectual Property Provisions 673 GATT Documents 745 Bibliography 755 Services 775 I. Introduction 777 II. Summary of the General Agreement on Trade in Services 778 A. The Framework Agreement 778 1. Part I: Article I: Scope and Definition 778 2. Part II: General Obligations and Disciplines 779 a. Article II: Most Favored-Nation Treatment 779 b. Article III: Transparency 779 c. Article III bis: Disclosure of Confidential Information 780 d. Article IV: Increasing Participation of Developing Countries 780 e. Article V: Economic Integration 780 f. Article V bis: Labor Markets Integration Agreements 781 g. Article VI: Domestic Regulation 781 h. Article VII: Recognition 781 i. Article VIII: Monopolies and Exclusive Service Suppliers 782 j. Article IX: Business Practices 782 k. Article X: Emergency Safeguard Measures 782 1. Article XI: Payment and Transfers 782
xviii Contents m. Article XII: Restrictions to Safeguard the Balance of Payments 783 n. Article XIII: Government Procurement 783 o. Article XIV: General Exceptions 784 p. Article XIV bis: Security Exemptions 784 q. Article XV: Subsidies 784 3. Part III: Specific Commitments 785 a. Article XVI: Market Access 785 b. Article XVII: National Treatment 785 c. Article XVIII: Additional Commitments 786 4. Part IV: Progressive Liberalization 786 a. Article XIX: Negotiation of Specific Commitments 786 b. Article XX: Schedules of Specific Commitments 786 c. Article XXI: Modificarion of Schedules 787 5. Part V: Institutional Provisions 787 a. Article XXII: Consultation 787 b. Article XXIII: Dispute Settlement and Enforcement 788 c. Article XXIV: Council for Trade in Services 788 d. Article XXV: Technical Cooperation 788 e. Article XXVI: Relationship with Other International Organizations 788 6. Part VI: Final Provisions 788 a. Article XXVII: Denial of Benefits 788 b. Article XXVIII: Definitions 789 c. Article XXIX: Annexes 789 B. Annexes 789 1. Annex on Article II Exemptions 789 2. Annex on Movement of Natural Persons Supplying Services Under the Agreement 790 3. Annex on Air Transport Services 790 4. Annex on Financial Services 790 5. Second Annex on Financial Services 791 6. Annex on Negotiations on Maritime Transport Services 791 7. Annex on Telecommunications 792 8. Annex on Negotiations on Basic Telecommunications 792 ffl. GATS Negotiations 792 A. The 1993 Game Plan 792 B. Fall 1993 Negotiations 795 1. Textual Issues 797 a. Applicability of the GATS to Certain Measures Maintained by the Parties 797 b. Taxation 797
Contents xix 2. Scope of the GATS 801 a. Measures Relating to Social Security 802 b. Measures Relating to Judicial and Administrative Assistance 803 c. Measures Relating to the Settlement of Disputes Pursuant to Bilateral Investment Protection Agreements 803 d. Measures Relating to Entry and Stay of Natural Persons 804 e. Measures Relating to Entry and Stay of Natural Persons Pursuant to Certain Bilateral Agreements 804 C. Drawing the 1993 Negotiations to a Close: Resolution of Textual Issues, Scheduling Commitments, and Submission of Lists of MFN Exemptions 805 D. Sector-Specific Negotiations 812 1. Financial Services 812 2. Maritime Transportation Services 817 3. Audio-Visual Services 818 4. Movement of Natural Persons 820 5. Basic Telecommunication Services 821 E. Decisions to Continue Negotiations 823 1. Negotiations on Financial Services 823 2. Negotiations on Maritime Transport Services 824 3. Negotiations on Basic Telecommunications 825 4. Negotiations on Movement of Natural Persons 825 IV. GATS Negotiations (1994) 826 V. Conclusion 827 Annex 829 Comparison of Trade in Services 831 GATT Documents 931 Bibliography 933