RESTRICTEDWORLD TRADE
ORGANIZATIONG/SG/Q1/CZE/4
24 April 2002
(02-2361)
Committee on Safeguards Original:  English
NOTIFICATION OF LAWS AND REGULATIONS UNDER
ARTICLE 12.6 OF THE AGREEMENT
Replies to Questions Posed by the UNITED STATES1
Regarding the Notification of the CZECH REPUBLIC2
The following communication, dated 23 April 2002, has been received from the Permanent
Mission of the Czech Republic.
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1. Measures that may be applied .  Section 3 of the Czech safeguard law lists the types of
safeguard measures that may be applied.  The li st includes quantitative restrictions on exports,
a “ban” on imports and exports, import deposits, and restrictions or a ban on transit.
(a) Please identify the provision in th e WTO Safeguards Agreement (SA) that
authorizes a Member to apply a measure in the form of a quantitative restriction
on exports.  Please explain how such a measure might prevent or remedy serious
injury caused by increased imports.
(b) Please identify the provision in the Sa feguards Agreement that authorizes a
Member to apply a measure in the form of a “ban” on the export or import of a
product, and please explain how such a measure would be consistent with the
requirement in SA Article 5.1 that any quantitative restriction on imports not
reduce the quantity of imports below the level of the average for the three most
recent representative years for which import statistics are available.
(c) Please identify the provision in the WT O Safeguards Agreement that authorizes
a Member to apply a measure in the form of “import deposits”, and explain how
such a measure differs from an import duty.
(d) Please explain what is meant by a restriction or ban on transit, and indicate the
provision in the Safeguards Agreement that authorizes the application of a
measure in this form.
Reply
Notification of the Czech Republic (G/SG/ N/1/CZE/3, 3 January 2001)  of Act No. 62/2000
Coll., on Some Measures in the Export or Import of Products and on the Licensing Procedure and on
the Change of Some Acts (hereinafter referred to as “the Act”) goes in certain aspects beyond the
                                                     
1 G/SG/Q1/CZE/3
2 G/SG/N/1/CZE/3G/SG/Q1/CZE/4
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Safeguards Agreement.  It is explained by the fact that the Act also regulates other situations under
which certain measures related to export and import of goods can be introduced if specific conditions
have been met.  In the said notification, the Czech Republic reproduced the full reading of
paragraph 3 of the Act, including those measures that are not related to and applicable under the
Agreement on Safeguards.  This concerns, inter alia , quantitative restrictions on exports, export and
import or transit bans and import deposits.
The Act in its paragraph 5(1) sets out that  “A measure may be introduced following an
investigation carried out by the Ministry or pursuant to another procedure under this Act and in
accordance with the international treaty binding the Czech Republic and published in the Collection
of Laws”.  It is to be understood that all safeguard actions to be taken under the provisions of the Act
will be fully consistent with the Safeguards Agreement and Article XIX of GATT 1994.
2. Basis for applying a measure .  Section 9 of the Czech law sets out three eligibility tests,
expressed in the disjunctive, for applying a safeguard measure.  The second and third of these
tests, which are set out in subsection (b) of section 9, do not appear to have a basis in the
Safeguards Agreement.  These tests would a llow the Czech Republic to apply a measure when
increased imports are causing or threatening to cause (a) “serious disturbances in any sector of
the economy, or [(b)] difficulties which could bring about serious deterioration in the economic
situation of a region of the Czech Republic”.  These tests appear to include a different injury
standard (“serious disturbances” and “difficultie s”, as opposed to “serious injury” or “threat of
serious injury”) and would not require a finding of serious injury to a domestic industryproducing a like or directly competitive product.  Please identify the provision in the WTO
Safeguards Agreement that supports these tests.
Reply
Paragraph 9 of the Act contains conditions for the introduction of a safeguard measure.  The
provision of paragraph 9(a) is fully consistent with Article 2 of the Agreement on Safeguards.
Paragraph 9(b) incorporates into the national legisl ation the relevant provision of bilateral preferential
agreements and is applicable only in accordance with and to signatories of respective agreements.
3. Self-initiation of investigations.   Section 12(2) of the Czech law permits the Ministry to
self-initiate an investigation “if, in performing its functions, it determines that increased importsof specific products cause or threaten to cause serious injury to a domestic industry”.  This
suggests that the Ministry will have pre-decided the case before the investigation is instituted.
Please explain how this provision is
(a) consistent with Article 3.1 of the Safegu ards Agreement, which states that a member
may apply a safeguard measure only followi ng an investigation by the competent
authorities, and providing reasonable public notice to all interested parties, and public
hearings or other appropriate means to present evidence and their views; and
(b) consistent with Article 4.2 of the Ag reement, which requires that the competent
authorities evaluate all relevant factors of an objective and quantifiable nature,
including the listed factors, and provides that an affirmative determination not be made
unless the investigation demonstrates, on the basis of objective evidence, the existence of
the causal link between increased imports and se rious injury or threat of serious injury.
Reply
Paragraph 12(2) empowers the Ministry to initiate an investigation, if it has prima facie
evidence that increased imports cause, or threaten to cause, serious injury.  Provisions of the ActG/SG/Q1/CZE/4
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relating to a notice of the initiation of an investigation, determination of injury, oral hearing,
application of a safeguard measure and also incorporation clause of paragraph 5 bind the investigating
authority to conduct each phase of an investig ation in full consistency with the Safeguards
Agreement.
4. Time for providing information.   Section 15(1) appears to provide that the Ministry will
ordinarily give interested parties only 10 workin g days to furnish evidence.  From what day
does the 10 days run?  Please explain how this requirement provides interested parties with the
“reasonable public notice” required by Article 3.1 of the Safeguards Agreement .
Reply
Counting of the period starts from the day when a request for further information was
delivered to an interested party.  Article 15(1) sets out that the period shall be at least 10 days and may
be extended by an additional 20 working days if due cause is shown.  Relating to interested parties a
request for information according to this provision follows the public notice on initiation of an
investigation set forth in Article 12(4) with the reasonable time-limit of 30 days as set out inArticle 12(4)(d).
5. Provisional relief.   Article 6 of the Safeguards Agreement requires that the competent
authorities, before applying a provisional safeguard measure, find, inter alia , “clear evidence”
that increased imports are causing or threatening to cause serious injury.  Please explain where
this requirement is found in section 19 of the Czech law, which sets out the basis for taking a
provisional action.
Reply
The requirement of Article 6 of the Safeguards Agreement is fully incorporated in
paragraph 19(1) of the Act according to which it must be demonstrated that increased imports have
caused, or threaten to cause, injury to the domestic injury.
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