. /.RESTRICTEDWORLD TRADE
ORGANIZATIONWT/REG55/M/2
22 October 1999
(99-4609)
Committee on Regional Trade Agreements
EXAMINATION OF THE FREE TRADE AGREEMENT BETWEEN
CROATIA AND SLOVENIA
Note on the Meeting of 22 September 1999
Chairman:  Mr. Krirk-Krai Jirapaet (Thailand)
1. Under Agenda Item B.III of its Twenty-Fourth Session, as found in Airgram WTO/AIR/1166,
dated 15 September 1999, the Committee on Regional Trade Agreements (CRTA) took up the
examination of the Free Trade Agreement (FTA) between Croatia and Slovenia.
2. The Chairman recalled that the Committee had previously held one round of examination for
this Agreement in July 1999 and the corresponding minutes of this meeting had been distributed
(WT/REG55/M/1).  As usual, the Standard Format  found in document WT/REG55/2 would guide the
debate.
3. The representative of Slovenia remarked that no additional written questions had been
received since July 1999, but there were some outstanding questions, to which her delegation was
prepared to provide answers.
4. One of these questions, asked by the United States, regarded the expected date of formal
ratification of the agreement.  In response, the representative of Slovenia said that Slovenia had
already ratified the Agreement, but her authorities were unaware of the possible date of Croatia's
ratification.  She added that this was not a matter of concern for Slovenia since the provisions of the
Agreement were being implemented.  With respect to Canada's query about the scope of coverage of
industrial products in the Agreement, she affirmed that all tariff lines listed in Chapters 25-97 of the
Harmonized Commodity Description and Coding Syst em were covered, with the exception of tariff
No. 3502, "albumins", which was treated as an agricult ural product.  She also noted, in regard to the
assessment made by the United States in July 1999, that apparently 30 per cent of products traded
among the Parties carried non-zero preferential tariffs, that the percentage referred to 1998, the first
year of application of the Agreement, and included agricultural as well as industrial products from
Annexes C, D, and E of the Agreement yet to be fully liberalised and subject to a transitional period
ending on 1 January 2001.  She added that, assuming similar trade patterns at the end of 2000, only
14 per cent of total bilateral trade would not be covered by zero tariffs by then, given that industrial
products constituted 86 per cent of trade.
5. Answering a question posed by the United States regarding the harmonization of rules of
origin, the representative of Slovenia said that the relevant text in the Agreement was practically
identical to that contained in the Pan-European Sy stem of Cumulation of Origin, including in relation
to the definition of the procedures for obtaining materials originating in third countries; the only
difference resided in that Protocol 3 to the Agreement provided for bilateral cumulation but not fordiagonal cumulation.  To another query, related to whether processing requirements to qualify for
benefits under the Pan-European System were different for Slovenia's imports from Croatia than to
those from other WTO Members, she replied that, for imports under the Agreement, rules were
different because preferential rules of origin would need to be used, which were stricter than those ofWT/REG55/M/2
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a non-preferential nature.  She added that benefits under the Pan-European System of cumulation
could not be applied to imports from Croatia, since Croatia had not concluded preferential agreements
with the other countries that were parties to this System.
6. Finally, the representative of Slovenia recalled that, at the previous Session, her delegation
had stated that the Agreement did not contain any specific provisions for granting further concessions
in agriculture (see section II.8, paragraph 14 of WT/REG55/M/1).  She clarified that statement,
drawing the attention of the Committee to Article 12 of the Agreement, which contained the
possibility of granting further concessions also in trade in agricultural products.
7. The representative of the United States said that he would need to contact his capital in order
to evaluate the answers provided by the representative of Slovenia, given their technical nature.  His
delegation might also wish to pose further questions.
8. The representative of Australia, on behalf of his delegation, apologised for the delay in
submitting questions by the July deadline and asked if it would be possible to submit those in writing.
The representative of Slovenia indicated her delegation's readiness to answer further questions.
9. The Chairman asked Members to submit further questions in writing within two weeks and
the Parties to provide answers within four weeks.   The examination of this Agreement would resume
at a later date.
10. The Committee took note of the comments made.
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