./.WORLD TRADE
ORGANIZATIONG/SG/27
22 December 2000
(00-5608)
Committee on Safeguards Original:  English
PROVISIONAL SAFEGUARD MEASURES IMPOSED
BY EGYPT ON POWDERED MILK
Request for Consultations under Article 12.4
of the Agreement on Safeguards
The following communication, dated 20 December 2000, has been received from the
Permanent Mission of Poland.
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On 26 September 2000, Egypt notified the WTO in document G/SG/N/6/EGY/3 of the
initiation of the safeguard investigation as regards imports of powdered milk.
On 25 September 2000 Egypt notified its intention of applying a safeguard measure in
document G/SG/N/7/EGY/2 and on 26 September 2000 imposed the provisional safeguard measure
on imports of powdered milk establishing an ad valorem  tariff surcharge of 45 per cent on imports of
the above-mentioned products.
Poland is of the view that this measure is inconsistent with Article XIX of the GATT and the
Agreement on Safeguards and considers that the requirements contained in the Agreement onSafeguards for the adoption of a provisional safeguard measure have not been met.
Imports of the product concerned declined in the first two quarters of 2000 with respect to a
comparable period of 1999.
It is difficult to prove that the Egyptian domestic industry has suffered serious injury or threat
thereof taking into account that Egyptian milk production and sales volume has increased from about
2.9 million tons in 1996 to about 3.6 million tons in 1999.
While there is some price competition in the fluid milk home market due to increased
production, sales revenues decreased accordingly.  In fact, it is difficult to prove that this fall in prices
was caused by imports, which accounts only for 10 per cent of the market share.
Even if there was serious injury being felt by the domestic industry there is no evidence that
this is being caused by increased imports of powdered milk.  Apart from the decline in imports in thefirst half of 2000 the world prices of powdered milk have been increasing.
In addition, in accordance with Article 6 of the Agreement on Safeguards, Egypt should have
proved the existence of critical circumstances, before adopting provisional safeguard measures, which
Egypt has failed to do.G/SG/27
Page 2
Taking into consideration that the consultations, under the Agreement on Safeguards, should
be initiated immediately after the measure has been taken, Poland formally requests the holding of
consultations under Article 12.4 with the aim to review the information provided and obtain additional
information necessary.
Poland requests Egypt not to take any measures until consultations have taken place.
It is proposed that consultations be held forthwith at a mutually agreed date and place.Poland reserves all its rights under the Agreement on Safeguards, in particular Article 14, as
well as under the Dispute Settlement Understanding.
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