RESTRICTEDWORLD TRADE
ORGANIZATIONWT/GC/M/63
2 March 2001
(01-1035)
General Council
8 and 9 February 2001
MINUTES OF MEETING
Held in the Centre William Rappard
on 8 and 9 February 2001
Chairman:  Mr. Kåre Bryn (Norway)
Prior to adoption of the agenda, Bulgaria said that the agenda of the present meeting reflected
an attempt by certain Members to block the inclusion of an item, which had been requested by other
Members.  He also questioned the usefulness of the inclusion of certain other items.  He then noted
that the issue of internal transparency had not been included on the agenda.  Although discussions on
internal transparency amongst Members had led to certain improvements in the general functioning of
the WTO, no concrete measures had been taken to provide Members with guarantees with regard to
internal transparency.  He recalled that his delegation had circulated a proposal, which had suggestedminimum guarantees in this respect and he hoped that the General Council would consider it.
However, his delegation did not feel it should request , on its own behalf, that the proposal be taken up
by the General Council, as the issues addressed therein were fundamental in nature and concerned the
functioning of the entire organization.
The Chairman said that there were a number of items which the General Council was
expected to revert to, namely the question of observer status for international intergovernmental
organizations, review of procedures for the circulation and derestriction of WTO documents and
revision of guidelines for scheduling of WTO meetings.  There was also an agreement in the General
Council to revert to the question of internal transparency from time to time.  The proposal circulated
by Bulgaria in the context of internal transpar ency would be considered when the General Council
reverted again to this matter.  Finally, he recalled that there had been a request submitted by Egypt onbehalf of the Informal Group of Developing Countries to include an item on the agenda of the present
meeting concerning the accession of Iran.  However, after consultations, it had been agreed that this
item would be placed on the agenda of the next General Council meeting.
Subjects discussed: Page
1. Request for observer status.................................................................................................. ....2
(a) Sao Tome and Principe ...................................................................................................... ........2
2. Accession of the Federal Republic of Yugoslavia...................................................................3
(a) Communication from the Federa l Republic of Yugoslavia .......................................................3
3. Committee on Budget, Finance and Administration .............................................................6
(a) Report of the Committee .................................................................................................... ........6
4. Committee on Balance-of -Payments Restrictions..................................................................7WT/GC/M/63
Page 2
(a) Consultations with Pakistan ................................................................................................ .......7
(b) Consultations with Bangladesh .............................................................................................. ....7
5. Work programme on el ectronic commerce............................................................................7
6. Procedures for the appointmen t of the Direct or-General...................................................11
7. Proposal to amend certain provisions of the Understanding on Rules and
Procedures Governing the Settlement of Disputes Pursuant to Article X of the
Marrakesh Agreement Establishing the World Trade Organization ................................12
(a) Submission by Bolivia, Canada, Chile, Co lombia, Costa Rica, Ecuador, Japan, Korea,
New Zealand, Norway, Peru, Switzerland and Venezuela for examination and further
consideration by th e General Council ......................................................................................12
8. Situation regarding work in the Committee on Regional Trade Agreements...................17
(a) Communication from Australia, India, Japan, Korea, New Zealand, Pakistan and
Hong Kong, China .............................................................................................................. .....17
9. Proposal for addition of an item to th e General Council agenda:  "Reports of the
special sessions of the Committee on Agriculture and of the Council for Trade in
Services, and of the TRIPS Council on the mandated negotiations on agriculture,
services and geographi cal indicati ons" ................................................................................23
10. Reports of the special sessions of the Committee on Agriculture and of the
Council for Trade in Services ................................................................................................26
11. Appointment of office rs to WTO bodies...............................................................................27
12. Election of Chairperson of the General Council..................................................................28
13. Sanitary and phytosanitary measures by Canada affecting Brazilian beef exports.........2914. Statement by the Chairman of the Committee on Rules of Origin ....................................29
15. Statement by the Chairman on furt her work of the General Council on
Implemen tation ................................................................................................................. ......30
1. Request for observer status
(a) Sao Tome and Principe (WT/L/389)
1. The Chairman drew attention to the communication from Sao Tome and Principe requesting
observer status in the General Council and its subsidiary bodies (WT/L/389), in which it had indicated
its intention to apply for accession to the WTO Agreement and had provided a brief description of its
economy and foreign trade regime, in accordance with the guidelines for observer status for
governments in the WTO (WT/L/161, Annex 2).  He proposed that the request by Sao Tome andPrincipe be granted.
2. The representative of Brazil said that his delegation strongly supported Sao Tome and
Principe's request for observer status.
3. The General Council took note of the statement and agreed  to the proposal by the Chairman.WT/GC/M/63
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2. Accession of the Federal Republic of Yugoslavia
(a) Communication from the Federal Repub lic of Yugoslavia (WT/ACC/FRY/1)
4. The Chairman drew attention to the communication from the Federal Republic of Yugoslavia
requesting accession to the WTO Agreement (WT/ACC/FRY/1).
5. The representative of the Federal Republic of Yugoslavia, speaking as an observer , said that
through its clearly declared intention to apply for and start the accession procedure to the WTO
Agreement, the Federal Republic of Yugoslavia (F RY) was heading towards the realization of a major
goal of its international trade policy, i.e., its participation in the multilateral trading system.
Following the democratic changes in the FRY in autumn 2000 and the process of radical economic
reforms initiated, significant steps had been taken in its external policy.  The FRY had become a
member of a number of international organizations and regional initiatives, including the United
Nations, International Monetary Fund, European Bank for Reconstruction and Development,Organization for Security and Cooperation in Europe, Stability Pact for South East Europe, South
East Cooperative Initiative.  The presence of the FRY in these organizations and institutions
represented a source of encouragement and an incentive for a consistent implementation of the FRY's
plans and intentions.  After ten years of overall economic decline, including trade isolation from the
international community, harsh economic, financial and trade sanctions, the FRY was embarking on aradical economic path with ambitious short-term and medium-term goals.  The FRY's ultimate goal
was to establish a system fully compatible with th e one existing in European countries.  On the
internal side, a number of measures had been undertaken aimed at monetary stabilization, including
the unification of the exchange rate, introduction of current account convertibility and of a managed
floating exchange regime, in parallel with the first measures of trade liberalization and deregulation.Over the past three months, the Dinar exchange rate had been stable, enterprises involved in foreign
trade were no longer obliged to be included in a special register, and the system of mandatory
registration of all foreign trade transactions had been abolished.  An overall review of the foreign
trade system and tariff regime was in progress.  These measures should greatly facilitate international
trade with FRY's major trading partners.  By initiating the procedure of accession pursuant toArticle XII of the WTO Agreement, the FRY was pointing out the importance it attached to
membership in the WTO, especially bearing in mind WTO's role in the world economy and its
contribution to the promotion of international trade as the main pillar of world development.  The
FRY intended to follow the full negotiating proc edure and hoped that this process would assist it in
coordinating and creating domestic trade policy and regulations in all fields covered by the WTO, in
order to achieve the balance between rights and obligations and the development goals of its national
economy.  Finally, he wished to express satisfaction at the wide support demonstrated for the FRY'srequest for accession and the undivided understanding for its needs and subjective intentions.  The
Working Party on the Accession of FRY would coordinate in an objective and transparent manner, the
accession process with the full cooperation of all the relevant institutions and organizations in the
FRY.  The General Council's decision at the present meeting would be one more step towards the
integration of the FRY into the international community.  The FRY was fully aware of the importanceof that decision and would carry out all forthcoming activities with full responsibility.
6. The representatives of India, Romania
, on behalf of the CEFTA Members and Croatia ,
Estonia and Latvia, Slovenia , European Communities , Hungary , Bulgaria , Brazil , Switzerland ,
Turkey, United States , Israel , Thailand,  on behalf of the ASEAN Members , Norway ,
Kyrgyz Republic, Zimbabwe , Mexico , Venezuela , Cyprus , and the Russian Federation , speaking as an
observer, welcomed and supported the application of the Federal Republic of Yugoslavia for
accession to the WTO, and supported the establishment of a working party to examine its request.
7. The representative of India hoped that the Federal Republic of Yugoslavia would be able to
accede to the WTO under appropriate terms and conditions that would be beneficial to it as well as toWT/GC/M/63
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the multilateral trading community of the WTO.  India had strong political, economic and trade
relations with the FRY which would be strengthened with its accession to the WTO.
8. The representative of Romania, speaking on behalf of the CEFTA Members and Croatia,
Estonia and Latvia, said that most of the countries on whose behalf she was speaking had
long-standing historical trade and cooperation ties with the Federal Republic of Yugoslavia.  They
were confident that the adoption of WTO rules would assist the FRY in strengthening its trade
relations in the region, as well as with other Members, and would provide an excellent framework for
further economic recovery through trade.  The accession process of the FRY to the WTO would also
contribute to stability in the region.  The request of the FRY for accession confirmed its determination
to embark upon a comprehensive economic reform process, and was evidence of its intention to
integrate into the global economic community, which would also contribute to the strengthening of
the multilateral trading system.
9. The representative of Slovenia associated his delegation with the statement made by Romania
on behalf of the CEFTA Members, and Croatia, Estonia and Latvia.  His delegation looked forward to
an early accession of the FRY and was ready to work closely with it in a way that would ensure that
its accession would contribute to the reconstruction and transformation of its economy, as well as to
its speedier integration as a European country in  transition into the international community.  The
decision of the FRY to become an integral part of the international rule-based trading system was
important and of particular relevance for South Eastern Europe as a whole.  It sent the right signal and
could contribute significantly to the economic and social development of the region, and to the
process of rebuilding the once prolific and close trade and economic relations.  Slovenia hoped that
the accession working party would proceed in a speedy manner.  His delegation would activelyparticipate in the accession process and would gi ve support to the FRY’s efforts to embrace WTO
rules and principles.
10. The representative of the European Communities said that the FRY's request for accession
was a sign that the region was on the path of peaceful recovery and believed that the accession
process would help the FRY to adopt trade rules which would facilitate its economic recovery.
11. The representative of Hungary shared the views expressed by Romania and said that as a
neighbouring country, Hungary was interested in the FRY's economic prosperity and the well-being
of its people.  The FRY's full integration into the world and into the European economy was a major
pre-condition to achieving that prosperity.  WTO membership was an important step towards its
integration into the world economy.  His delegation would take part actively in the accession process.
He hoped that this process would be smooth and rapid, and that his country would be able to
cooperate with the FRY within the WTO in the near future.
12. The representative of Bulgaria concurred with the statement by Romania which was also
made on behalf of his country.  Bulgaria had historical and geographical ties with the Federal
Republic of Yugoslavia and supported its speedy accession to the WTO.
13. The representative of Brazil said that it was a fundamental principle of his country's foreign
policy, including in relation to trade, to support universal participation in the WTO.  His delegation
looked forward to working with the FRY and interested Members so as to allow the process of
accession to be undertaken and completed speedily.
14. The representative of Switzerland was convinced that the participation of the FRY in the
multilateral trading system would greatly contribute to the success of the economic reforms that were
currently underway in that country, to its economic reconstruction and integration in the worldeconomy.  Switzerland, which was in the same voting group as the FRY in the Bretton WoodsWT/GC/M/63
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institutions, would give full support to the FRY in its accession process by providing appropriate
technical assistance.
15. The representative of Turkey welcomed the return  of the FRY to the midst of the international
community.  His country was a partner with the FRY in the South East European cooperation process
and other regional fora.  The reintegration of the FRY in international organizations was important forregional stability and the process of accession of the FRY to the WTO would also benefit its people.
16. The representative of the United States said that his country supported the FRY's request to
initiate negotiations for WTO accession and welcomed its decision to move to align its trade regime
with WTO.  The United States hoped that the FRY would lose no time in supplying the information
required to activate accession negotiations.  To successfully complete the accession process, the FRY
would need to promote the kind of economic and trade reforms that supported the application of WTO
provisions, including greater transparency, predictability, and rule of law in the application of trademeasures towards minimizing price controls, promoting privatization, eliminating quotas and bans in
trade, and generally reducing government control of trade.  These efforts would not only facilitate the
accession process, but would also help the FRY to use international trade to promote investment and
economic growth, as well as to become more fully integrated in the global economy.  In addition, the
trade-liberalizing commitments made by the FRY in the accession process would help to rebuild andformalize its economic ties with its neighbours, and contribute to regional economic recovery.  WTO
Membership would establish a framework for trade relations with all other Members, and provide a
forum for the pursuit and protection of the interests of the FRY in international trade.  His delegation
looked forward to the negotiations and to welcoming the FRY as a Member.
17. The representative of Israel hoped that the accession process would be speedy and that the
FRY would soon take its place in the WTO and be fully integrated into the world economy.
18. The representative of Thailand, on behalf of the ASEAN Members , said that FRY had
maintained a close trade and economic relation ship with the ASEAN Members.  ASEAN looked
forward to working with the FRY in the accession wo rking party in order to bring the FRY into the
WTO in a speedy manner.
19. The representative of Norway hoped that bringing the FRY into the WTO would foster
growth and prosperity as well as economic and political stability of the region at large.
20. The representative of the Kyrgyz Republic said that his country had historical trade and
industrial relations with the FRY and supported its speedy accession to the WTO.
21. The representative of Zimbabwe said that his country had good trade relations with FRY and
hoped that with its accession to the WTO their trade relations would further develop.
22. The representative of Mexico said that he had no doubt that the accession process of the FRY
would be completed successfully and that the FRY's accession would further enhance the universality
of the WTO.
23. The representative of Venezuela hoped that the negotiation process of the FRY would be
carried out in an expeditious and transparent manne r in order to ensure that the FRY would get, as
soon as possible, rights and obligations resulting from WTO membership.
24. The representative of the Russian Federation, speaking as an observer , welcomed the FRY
among the observers and among acceding countries, and was ready to share with the FRY his view
and experience on the accession process.  He hoped that the FRY would become a fully-fledged
Member as soon as possible.WT/GC/M/63
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25. The General Council took note of the statements and of the expressions of support and agreed
to establish a working party with the following terms of reference and composition:
Terms of Reference:
"To examine the application of the Government of the Federal Republic of Yugoslavia to
accede to the WTO Agreement under Article XII, and to submit to the General Council
recommendations which may include a draft Protocol of Accession. "
Membership
Membership would be open to all Members indicating their wish to serve on the Working
Party.
Chairperson
The General Council would authorize its Chairman to designate the Chairperson of the
Working Party in consultation with representatives of Members and with the representative of the
Federal Republic of Yugoslavia.
The Chairman then invited the representative of the Federal Republic of Yugoslavia to
consult with the Secretariat as to further procedur es, in particular regarding the basic documentation
to be considered by the Working Party.  He also invited the Federal Republic of Yugoslavia, on behalfof the General Council, to attend meetings of the General Council and, as appropriate, meetings of
other WTO bodies as an observer during the period when the Working Party was carrying out its
work.
3. Committee on Budget, Finance and Administration
(a) Report of the Committee (WT/BFA/52)
26. The Chairman drew attention to the report of the Committee on Budget, Finance and
Administration contained in document WT/BFA/52.
27. Mr. Stoler, Deputy Director-General, in the ab sence of Mr. Akil (Turkey), Chairman of the
Committee on Budget, Finance and Administration, introducing the report of the Committee in
WT/BFA/52 recalled that the WTO Members that had accumulated as of 1 January 2001 more than
three years of outstanding contributions in the period since 1988 had become inactive Members.
Consequently, in accordance with paragraph 7(b) of document PC/7, L/7578, the Committee
recommended to the General Council that the Members enumerated in paragraph 4 of the document
WT/BFA/52, and which were listed in category IV of the administrative measures be urged to
liquidate their arrears.  With regard to the WTO Secretariat Performance Award Programme, the
Committee had been able to reach consensus, and therefore recommended that, in application of Staff
Regulation 6.5, the General Council approve the Performance Award Programme to take effect on
1 January 2002, as outlined in document WT/BFA/W/48/Rev.1, together with the consequent
amendments to Staff Rules 106.3, 106.4, 106.13 and Annex 1 thereof.  The Committee had also
examined the draft letter calling for tenders for the appointment of the WTO external auditor, and hadrequested the Secretariat to send out the draft letter incorporating the suggestions made by Members.
In addition, the Committee had heard the International Trade Centre 2002 budget outline, and had
noted that formal authorization of its 2002 budget would take place at the same time as that of the
WTO 2002 budget.  In conclusion, he drew attenti on to points 4 and 7 of the report in WT/BFA/52,
which required a decision by the General Council.  Although, Mr. Akil would return for one moreWT/GC/M/63
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meeting of the Committee he wished, on behalf of the Secretariat, to thank him for his guidance on
administrative and financial matters during his entire mandate.
28. The General Council to took note of the statement, approved  the Budget Committee's specific
recommendations in paragraphs 4 and 7 of its report in WT/BFA/52, and adopted the report.
4. Committee on Balance-of-Payments Restrictions
(a) Consultations with Pakistan (WT/BOP/R/56)
(b) Consultations with Bangladesh (WT/BOP/R/57)
29. Mr. Hovorka (Czeck Republic), Chairman of the Committee on Balance-of-Payments
Restrictions, recalled that at the General Council meeting in December 2000 he had reported on the
conclusions of the consultations held with Pakistan on 20 and 21 November 2000.  The report
contained in document WT/BOP/R/56 had since been circulated.  In the meantime, Pakistan hadsubmitted a notification citing the items made freely importable under the first tranche of its phase-out
plan, and two additional notifications informing th e WTO that it had made certain additional items
freely importable ahead of schedule.
30. The consultations with Bangladesh, suspended in May 2000, had been resumed on
15 December 2000.  These consultations had focused on the phase-out plan that the Committee hadrequested from Bangladesh, and which had been prepared with WTO technical assistance.  During
those consultations, Bangladesh had confirmed that the list of products included in Annexes II and III
of document WT/BOP/N/54 covered the totality of products currently under balance-of-payments
measures.  Members commended the efforts made by Bangladesh in submitting the phase-out plan,
which they considered as a step forward.  The Committee had approved the phase-out plan presentedby Bangladesh in Annex III of document WT/B OP/N/54 and Corr.1 in the period starting from
1 January 2002 and ending 1 January 2005, when all items in the respective HS categories would be
liberalized.  The Committee agreed to come back to discuss items contained in Annex II, for which
Bangladesh would seek justification under other WTO provisions.  On this understanding, the
Committee agreed to resume in June 2001.
31. The General Council took note of the statement, and adopted
 the reports on the consultations
with Pakistan (WT/BOP/R/56) and with Bangladesh (WT/BOP/R/57).
5. Work programme on electronic commerce
32. The Chairman recalled that at its meeting in December 2000, the General Council had
received updated reports from the three sectoral Councils and the Committee on Trade and
Development on their work on electronic commerce.  At that meeting, Members had engaged in aconstructive debate which had shown broad agreement to move forward with the work on
e-commerce and on that basis, he had announced his intention to pursue consultations on the question
of establishing an ad hoc task force to deal with horizontal issues early this year.  Since the December
2000 meeting, there had been no significant developments in respect to Members' views on the
question of the establishment of an ad hoc task force, and consultations which had been held so farhad revealed that Members wished to consider the issue further.
33. The representatives of Canada, Brazil
, Singapore , on behalf of the ASEAN Members ,
Pakistan, Czech Republic , Japan , European Communities , Australia , Panama , Nigeria , Hungary ,
Uruguay, United States , Norway , Honduras , Dominican Republic , Ghana , Switzerland  and HongWT/GC/M/63
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Kong, China said that the work on electronic co mmerce should continue in the subsidiary bodies
while further consultations should be held on the need to create an ad hoc task force to deal with
horizontal issues.
34. The representative of Canada recalled that at the General Council meeting in December 2000,
a number of delegations had been in favour of establishing a non-negotiating task force to ensure that
all aspects of the work on e-commerce in the WTO would be covered.  In addition to finding
considerable support amongst delegations, the issue of setting up a horizontal ad hoc task force had
also met with the approval of many practitioners  in the field of e-commerce, both from developing
and developed countries.  He hoped that the Chairman's successor would make it a priority to engage
in consultations on this matter, so as to allow Memb ers to deepen their understanding of the need for
such a horizontal working group.  His delegation looked forward to participating in these
consultations.
35. The representative of Brazil said that in light of the subsidiary bodies' reports to the General
Council in December 2000, which had indicated that not enough time had been available for all
aspects to be fully examined, it was premature to establish a task force or any other framework for
discussions.  At the same time, his delegation was prepared to participate in any consultations that the
Chairman would undertake on this matter.
36. The representative of Korea said that his delegation supported the establishment of an ad hoc
task force to deal with cross-cutting issues and endorsed the statement made by Canada.
37. The representative of Costa Rica said that, while not opposing the pursuance of work in the
subsidiary bodies, his delegation considered that there would be advantages in setting up a horizontal
task force.  Further consultations should be held on this matter as soon as possible and his delegationwished to participate in these consultations.
38. The representative of Singapore, on behalf of the ASEAN Members
, said that he shared the
views expressed by Canada and looked forward to further consultations on the issue of the
establishment of a task force before a decision was taken by the General Council on this matter.
39. The representative of Cuba said that his delegation agreed with the Chairman's assessment of
the situation with regard to the work on electronic commerce.  He recalled the importance of e-
commerce for his delegation and how it could assist developing countries in their trade efforts.  In his
delegation's view, the creation of a horizontal task force should be considered in light of proposals
made to establish other working groups of importance for the economy of developing countries, such
as trade and transfer of technology and trade and debt.  He hoped that the future consultations would
allow Members, at a subsequent stage, to consider the viability and relevance of setting up a
horizontal group.  These consultations should also take into account the elimination of all types ofbarriers to electronic commerce, including technological barriers artificially set up in international
trade, which prevented certain developing countries from having full access to electronic commerce,
and which ran against the universality of e-commerce and the principles of the WTO.
40. The representative of Pakistan said that in his delegation's view, it was still premature to
consider the establishment of a task force.  He supported the statement made by Cuba and recalled
that his delegation had asked for consultations on the creation of three other working groups to deal
with the relationship between trade and transfer of technology, trade and debt, and trade and finance.
He hoped that when consultations were held on the establishment of an ad hoc task force to deal with
horizontal issues in the area of e-commerce, these other groups would also be remembered.
41. The representative of the Czech Republic, also on behalf of the Slovak Republic , said that
pursuance of the work in the subsidiary bodies sh ould not prevent the General Council from dealingWT/GC/M/63
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with cross-sectoral issues.  His delegation still had reservations on the question of establishing a task
force and he hoped that further consultations would help Members to better understand the need for
the creation of a new body.
42. The representative of Japan said that the issue of e-commerce was important for his
delegation and that Members should continue discussions thereon.  Although he agreed that work
should continue in the subsidiary bodies, he noted that there were issues that went beyond their
mandate.  His delegation was flexible as to how the horizontal issues were addressed but it would be
useful to conduct further consultations on this matter.
43. The representative of the European Communities said that he supported Brazil's position.
44. The representative of Australia said that his delegation supported the establishment of a
horizontal task force.  Time was starting to run short before the next Ministerial Conference in Qatar,
and Members would need to prepare a proper discussion for Ministers on this subject.  He supportedCanada's proposal to continue consultations as soon as possible.  However, his delegation was
prepared to look at a range of possibilities as to how this discussion could be taken forward.
45. The representative of Panama said that it was important to continue with the work programme
on electronic commerce.  His delegation supported setting up a horizontal task force, as long as such a
task force was given a specific mandate.  Further consultations would probably need to be held on thismatter and he hoped his delegation could participate therein.  He noted that work on e-commerce
could be carried out in parallel in the subsidiary bodies and in the General Council, and that there was
no need to exhaust all the work in the subsidiary bodies before the General Council started to examine
certain issues.
46. The representative of Nigeria said that his delegation would participate actively in further
work on e-commerce and would deploy all efforts to bring the discussions forward.
47. The representative of India agreed with the Chairman's assessment that there should be further
consultations to see whether there was a need to establish a non-negotiating ad hoc task force to
consider cross-cutting issues in the area of e-commerce, or whether any other mechanism could be
considered to deal with such issues.  At this poi nt in time, his delegation was not convinced of the
necessity of setting up such an ad hoc task force.
48. The representative of Hungary said that at the General Council meeting in December 2000,
many delegations seemed to be in favour of the continuation and intensification of the work in the
subsidiary bodies.  Therefore, Members should send a strong signal to the subsidiary bodies to
intensify their work on e-commerce and should consider, at a later stage, the institutional implications
of the results of the work of those bodies.
49. The representative of Uruguay said that Members might have to extend the subsidiary bodies'
mandate to enable them to conclude their work.  His delegation supported further consultations on this
issue and wished to participate therein.
50. The representative of the United States wished to associate his delegation with the comments
made by Canada and said that the idea of a horizontal task force was not intended to duplicate or
replace the work of the subsidiary bodies, but to take up cross-cutting issues at the General Councillevel.
51. The representative of Venezuela said that a non-negotiating ad hoc task force should be
established to allow Members to conclude the assessment underway in the subsidiary bodies and to
deal with the horizontal issues identified by the respective bodies.  This would enable Members toWT/GC/M/63
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determine which disciplines and rules would govern electronic commerce, establish whether the
existing rules were sufficient and what implicatio ns e-commerce had for developing countries.  This
would provide certainty and predictability to all interested parties.  The work in the WTO on e-
commerce should adopt a pace commensurate to the development of this tool and to the work carried
out by other international organizations in this area.
52. The representative of Hong Kong, China sa id that his delegation had an open mind with
regard to the establishment of an ad hoc task force, as long as its terms of reference and relationship
with other WTO bodies were clearly set out in advance.  One of the points that should be considered
in the course of future consultations related to the non-negotiating character of such an ad hoc task
force.  The classification of digital products, which had been flagged as one of the cross-cutting
issues, was more of a political matter than a technical one and thus he wondered whether a non-
negotiating task force could achieve the aims pursued by Members.
53. The representative of Norway supported Canada's statement and hoped that informal
consultations on how to bring the work forward on e-commerce could be carried out before a new
round of discussion in the General Council.
54. The representative of Honduras recognized the importance of electronic commerce and
supported the Chairman's proposal to hold further consultations, in which he hoped to participate.
55. The representative of the Dominican Republic said that e-commerce was important to her
delegation but that it was premature at this stage to establish a horizontal working group.  Her
delegation wished to participate in future consultations on this issue.
56. The representative of Argentina noted that Members had already repeated their positions on
this question at previous General Council meetings, and that the issue of e-commerce should be
tackled in a more substantive way in the near future.  At the meeting in December 2000, his country
had clearly stated its position on the matter and had outlined elements of a horizontal nature.  His
delegation remained open to consultations on a procedure that could be adopted for continuation of
the work on e-commerce, notwithstanding the fact that the horizontal issues would need to be
examined.
57. The representative of Mexico supported the views expressed by India.
58. The representative of Chile said that e-commerce was an issue of great interest for a
developing country like his and he associated himself with the statement made by Venezuela in this
respect.  There had not been many developments since Members had last dealt with this item and it
seemed that the WTO was lagging behind as an institution in taking on the necessary work of
clarification, definition and interpretation.  He hoped that consultations would be held as soon as
possible and would lead to a conclusion on the pursuance of work.
59. The representative of Switzerland supported Canada's proposal and highlighted the relevance
of the comment made by the United States.
60. The Chairman said that the crux of the matter was not whether Members should agree on the
establishment of an ad hoc task force.  The main problem was that the General Council had not been
able to carry out its task on e-commerce.  The first set of reports from the subsidiary bodies had beenpresented to the General Council in July 1999.  Thereafter, nothing further had been done on e-
commerce in the WTO until July 2000, as Members could not agree on whether to ask the subsidiary
bodies to continue their work, or to take up the work in the General Council.  In July 2000, Members
had finally agreed to ask the subsidiary bodies to continue their work.  The subsidiary bodies had
presented updated reports in December 2000, which had indicated that most of the work they hadWT/GC/M/63
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been mandated to do had been done, and the outstanding work had related mainly to cross-cutting
issues they had identified.  Members could also decide to engage in an in-depth discussion, in the
General Council, of the various reports by the subsidiary bodies.  In his view, Members had to ensure,
first and foremost, that work on e-commerce woul d move forward.  Further consultations should
focus on how Members could carry out their work, not only with regard to procedures, but mainly to
substance.
61. The General Council took note of the statements.
6. Procedures for the appointment of the Director-General
62. The Chairman recalled that at the July 2000 General Council meeting he had read out a list of
eight questions on procedures for the appointment of  the Director-General, and invited delegations to
reflect on them.  Following that meeting he had held informal consultations, and at theDecember 2000 General Council meeting a number of delegations had presented their views and
suggestions and had had also pointed out that discus sions should begin on this issue.  At that meeting
he had expressed the hope that it would be possible to take this issue further by developing a
discussion paper, which would gradually move towards the formulation of procedures.  However,
since December 2000 he had not been able to take this issue further and stressed that his successorwould carry the issue forward in the months ahead.  He then invited those delegations, wishing to do
so, to supplement the statements they had made at the December 2000 meeting.
63. The representative of the United States recalled that at the December 2000 General Council
meeting his delegation had indicated that it would be reflecting on the questions submitted to
Members by the Chairman, and would be coming back with comments.  The matter at hand wasimportant, as the manner in which Members chose their leadership was not only important to the
functioning of the WTO but also to the way the WTO was perceived by the outside world.  He then
commented on a number of issues raised in the questions posed by the Chairman.  With respect to
qualification criteria, the United States agreed with the views expressed by other delegations that
flexibility was needed.  It was a given that Members would seek an individual with provenmanagement capabilities, whose experience and achievements in the international arena were
recognized in the international economic community.  A three- or four-year term of office was
reasonable, but Members should remain flexibile on the issue of whether one or more renewals would
be appropriate.  Like others, the United States believed that the selection process should be based on
government nominations of candidates.  So far as guidelines were concerned, it would not make sense
to assign geographic qualifications.  Members should seek the best person for the job from any WTO
Member.  The United States shared the views expressed by some delegations that the selectionprocess should begin one year before the expiry of the term of the incumbent, with a deadline of
concluding the process six months in advance of the changeover.  On the decision-making process,
the United States continued to support the selection of the Director-General by consensus.  If
Members could set up a procedure that was effective on the front-end, the kind of acrimony and
division that had ensued during the last selection could be avoided.  The United States had not heard
any reasons for establishing new rules on the role of Deputy Directors-General during any transition
period, and would be interested in hearing more from other delegations.  However, the United States
recognized that the role of Deputy Directors-General as well as that of the Director-General required
that their contracts did not expire at the same time so as to ensure continuity.
64. The representative of Canada said that at the December 2000 General Council meeting, his
delegation had responded to the questions submitted by the Chairman, and had nothing to add in this
respect.  At this stage, Canada wished to submit to Members the idea of consulting on this issue with
previous Directors-General and with other international organizations, such as the IMF and the WorldWT/GC/M/63
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Bank.  Their perspective and views on the issue might help to come up with a better selection process
of the Director-General.  Such consultations would, of course, require a decision by Members.
65. The Chairman said that he would be in contact with his successor so as to ensure follow-up on
this matter.
66. The General Council took note of the statements made, and agreed  to revert to this matter at a
future meeting.
7. Proposal to amend certain provisions of the Understanding on Rules and Procedures
Governing the Settlement of Disputes Pu rsuant to Article X of the Marrakesh
Agreement Establishing the World Trade Organization
(a) Submission by Bolivia, Canada, Chile, Colomb ia, Costa Rica, Ecuador, Japan, Korea, New
Zealand, Norway, Peru, Switzerland and Venezuela for examination and further considerationby the General Council (WT/GC/W/410 and Add.1 and 2)
67. The Chairman recalled that this proposal had been considered by the General Council at its
meeting on 10 October 2000, where it had been agreed that the Chairman would conduct
consultations on how best to move forward on this proposal.  At the General Council meeting in
December 2000, he had informed Members that he had continued consultations with the co-sponsorsof the proposal but that there was nothing to report at that stage.  The General Council had agreed to
revert to the matter at a later date.
68. The representative of Japan, on behalf of the co-sponsors of the proposal
, said that the issue
of sequencing between Articles 21.5 and 22 of the DSU was an issue that had been identified by the
General Council as a priority issue throughout the mandated review of the DSU.  However, it had
acquired new importance due to the Appellate Body Report on "United States - Import Measures on
Certain Products from the European Communities".  In its report, the Appellate Body had implied that
the current language of the DSU on the relationship between Articles 21.5 and 22 lacked clarity, and
had noted that it was Members' responsibility to resolve the issue.  He said that if Members did not act
on this issue, they would fail to fulfil their duty as Members of the WTO.  Furthermore, due to thislack of clarity at such an important stage of compliance with DSB rulings and recommendations,
parties to the disputes had been forced to enter into ad hoc sequencing arrangements.  Although these
arrangements had proved to be useful, they remained ad hoc, required the consent of both parties and
were not negotiated in a transparent manner.  For these reasons, Members needed to find a durable
solution to the issue of sequencing.  An early resolution of this matter would particularly benefit
smaller Members.  The co-sponsors of the proposal intended to start open-ended consultations with
Members, and to organize a meeting to explain the proposal to them.  The co-sponsors' aim was toimprove the proposal on the issue of sequencing by bringing on board the concerns of different
Members so as to command the greatest degree of support and eventually, consensus.  Therefore, they
remained open to any suggestions or recommendations for change.  There were other important issues
than sequencing which were a subject of concern or interest to some Members, and the co-sponsors
would be interested in participating in any cons ultations organized on such issues, if any Member
were to take the initiative.
69. The representative of Colombia, on behalf of the ANDEAN Members and Chile
, said that two
elements were particularly important in considering the proposal to amend certain provisions of the
DSU.  First was the conviction that any lack of transparency in the procedure had more significant
consequences for developing countries than for developed countries.  The essence of disputesettlement procedures was to give certainty to parties and thus a lack of clarity in the DSU increased
the risk of unilateralism.  Second, there was a need for Members to work in all those areas whichWT/GC/M/63
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could contribute to improve the framework in which the work of the WTO was conducted.  For all
Members, it was fundamental to have rules that guar anteed the absolute predictability of the system,
and which ensured that Members' rights were being safeguarded.  In his view, any reform of the DSU
which was intended to eliminate uncertainty in the implementation of the provisions should not be
part of an exchange of concessions.  He hoped that Members would consider this proposal in light oftheir responsibility vis-à-vis  the multilateral trading system and would exercise the pragmatism that
this required.
70. The representative of Costa Rica supported the statements made by Japan and Colombia.  His
country was concerned that the review of the DSU had not led to any results, and that despite the
difficulties encountered in the DSB regarding the application of Articles 21.5 and 22 of the DSU,
Members had not shown sufficient will to find a permanent solution to this problem.  The proposal by
the group of co-sponsors took up the spirit of what had been negotiated during the Uruguay Round,and which at the time had not been clearly reflected in the DSU.  He welcomed Japan's idea to hold
consultations where other Members' suggestions and recommendations could be discussed and his
delegation was willing to engage in such an exercise.
71. The representative of Thailand believed that the DSU provided a workable and viable dispute
settlement mechanism, but that it could be further improved to enhance its multilateral features.  She
was grateful to the co-sponsors for having introduced the proposal.  One of the most urgent issues in
the possible DSU amendment negotiations was the relationship between Articles 21 and 22.  The
solution proposed by the co-sponsors appeared to be a reasonable basis for consideration and should
receive the support of Members.  However, as the proposal had been drafted in 1999, it could require
fine tuning in light of new practices by Members.  A comprehensive approach should be adopted indealing with sequencing, and it would be desirable for the membership to have the opportunity to
reflect further and make possible suggestions.  Her delegation wished to take part in the consultations
mentioned by Japan.
72. The representative of Cuba supported the proposal made by the co-sponsors and agreed with
the statement made by Costa Rica regarding the lack of political will to find a permanent solution to
the problem of sequencing between Articles 21 and 22 of the DSU.  He believed that anything that
could strengthen multilateralism as opposed to unilateralism contributed to ensure the credibility of
the WTO and helped developing-country Members.
73. The representative of Canada supported the statement made by Japan.  The dispute settlement
mechanism needed some changes in order to maximize and enhance its efficiency and to preserve,
both internally and externally, the credibility and integrity of the WTO.  His delegation appreciated
the leadership which had been shown by Japan, in putting forward this proposal.
74. The representative of Brazil welcomed and supported the general spirit of the proposal to
amend certain provisions of the DSU, particularly with regard to the problem of sequencing between
Articles 21 and 22 of the DSU.  However, additiona l informal discussions were necessary regarding
other aspects of the proposal on which his delegation had certain reservations and would like to seek
further clarity.  He welcomed the organization of open-ended consultations and looked forward toparticipating in these discussions.
75. The representative of Switzerland associated himself with the statement by Japan.  The
proposed DSU amendments would bring about a be tter functioning of the dispute settlement
mechanism, as they included procedural clarifications and a shortening of the deadlines.  This would
lead to streamlining the procedures, an objective which his delegation strongly supported.  As theAppellate Body had ruled, it was up to Members to find a solution to the problem of sequencing
between Articles 21 and 22 of the DSU, and the present proposal provided for such a solution in a
way that was fully consistent with the spirit of the DSU.  The growing trend of parties to a dispute toWT/GC/M/63
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rely on mutually agreed procedural rules with re gard to sequencing showed the necessity for the
membership to agree, as soon as possible, on a multilateral solution to this problem.  Ad hoc solutions
did not constitute a valid alternative to an amendment of the DSU, as they neither contributed to the
credibility, nor to the transparency of the dispute settlement procedure.  His delegation agreed with
the course of action proposed by Japan and looked forward to participating in any consultations.
76. The representative of New Zealand supported the statement made by Japan.  His country had
recently had to enter into an ad hoc Articles 21 and 22 "sequencing agreement" with another co-
sponsor of the present proposal.  The negotiation that had led to the conclusion of that "sequencing
agreement" had been constructive and friendly.  However, his delegation had found it unsatisfactory
that it had been forced to take these steps, since the only other alternative would have been to rely on
DSU rules that, as the Appellate Body had stated, were unclear.  The rules in this area needed to be
clarified for the benefit of all Members and the entire membership should take an interest in resolvingthe problem of sequencing, in order to achieve a predictable and clear set of dispute settlement rules.
His delegation looked forward to further consultations amongst all Members on this issue, which was
of crucial systemic importance to the organization as a whole.
77. The representative of Panama thanked the co-sponsors for the work they had accomplished.
His delegation had participated in a number of meetings that had led to the current proposal and had
an interest in participating in the consultations referred to by Japan.  He noted Japan's invitation to
Members to submit any recommendation to modify the present proposal and recalled that his
delegation had had difficulties with the proposal submitted at the Ministerial Conference in Seattle.
These difficulties continued with the present proposal, but his delegation would do everything
possible to submit its views on these points in further consultations.  Finally, while a solution had tobe found to the problem of sequencing between Articles 21 and 22 of the DSU, other problems should
also be resolved, such as how to face the ongoing disregard by some Members of panels and
Appellate Body recommendations and rulings.
78. The representative of Korea supported the statement made by Japan on behalf of the co-
sponsors.  That statement had highlighted that r ecent developments, such as the proliferation of
bilateral agreements between Members to overcome the difficulty arising from the lack of clarity in
the DSU, and the Appellate Body's ruling confirming that the necessary clarity should be provided at
Members' initiative, had confirmed the wide-ranging consensus amongst Members that the
sequencing between Articles 21 and 22 of the DSU was a priority issue that should be resolved to
increase the efficiency of the dispute settlement system.  The amendment had been proposed in
response to this wide-ranging consensus and the momentum created by the proposal had to be fully
utilized.  In this context, the open-ended consultations with all Members announced by Japan shouldstart in the very near future.  He emphasized the open-ended nature of these consultations and
encouraged all Members to participate, so that the necessary groundwork would be laid for the
approval of the amendment in time for the Fourth Ministerial Conference.
79. The representative of Uruguay said that his delegation recognized the importance of the issues
addressed in the present proposal, and wished to be added to the list of co-sponsors.1
80. The representative of the European Communitie s agreed that there was a need for amending
the DSU and that the issue of sequencing between Articles 21 and 22 was one of the problems that
needed to be addressed.  However, his delegation did not want to proceed in a piecemeal way, as the
practice of the DSB had shown that there were several points in the existing rules that needed
clarification.  In taking a comprehensive approach to amend the DSU, he hoped that Members wouldbe able to build upon the work accomplished by the co-sponsors of the present proposal and
synchronize the work of the whole membership in time for the Fourth Ministerial Conference.
                                                     
1 WT/GC/W/410/Add.3.WT/GC/M/63
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81. The Chairman recalled that Members had already been through one comprehensive review of
the DSU, which had not led to any results.  In his view, Members would need to look for the best
approach to attain the changes required.
82. The representative of the United States said that his delegation was prepared to re-engage in a
discussion on improvements to the DSU.  The United States had so far participated actively in the
process and was interested in continuing to participate in the consultations mentioned by Japan.  He
appreciated the recognition by the co-sponsors that there were other areas of interest to Members and
noted that his delegation was interested in the issue of transparency of the dispute settlement process,
with regard to which the proposal did not go far enough.  Therefore, the present proposal did not
provide a basis for consensus to adopt an amendment to the DSU.  He welcomed the indication by
Japan that the co-sponsors were prepared to consult on issues of interest to other delegations.  He
recalled that even if the membership agreed on this proposal, the text could not be adopted without anagreement on appropriate transitional provisions to clarify how or whether amended procedures
would apply to pre-existing disputes.  His delega tion was prepared to discuss improvements to the
dispute settlement system and would listen with interest to other delegations' views on this proposal.
83. The representative of Argentina said that the dispute settlement system did not work as well
as it should, particularly in the case of developing countries.  He agreed with Brazil that some
elements had been left aside in trying to reach an  agreement.  His delegation wished to participate in
any further consultations on this matter.
84. The representative of Hong Kong, China than ked Japan and the other co-sponsors for their
proposal.  His delegation recognized the importance of the matter concerning the effective operation
of the DSU, but questioned whether the approach used in the proposal was still appropriate, in view ofrecent developments in WTO jurisprudence.  He welcomed Japan's indication that the co-sponsors
would try to further refine and improve the proposal,  and his delegation wished to participate in the
consultations they would hold.  Moreover, he considered that given the importance and specialized
nature of the matter, it might be worth considering asking the DSB Chairman to conduct consultations
in this regard, at least initially.
85. The representative of India thanked the delegation of Japan and the other co-sponsors for their
proposal.  Having used the dispute settlement mechanism as both defendant and complainant, his
country had a systemic and practical interest in the matter and found the existing situation
unsatisfactory.  His delegation wished to join in consultations on matters related to the sequencing
between Articles 21 and 22 of the DSU.
86. The representative of Bulgaria agreed that there was a need to clarify the situation on the
question of sequencing between Articles 21 and 22 of the DSU.  He supported the statement made by
Colombia on behalf of Chile and the ANDEAN Members, which pointed out that any reform of the
DSU should not be part of an exchange of concessions.  His delegation was not prepared to pay for
sequencing through a shortening of the time-frames foreseen in the DSU, which would not be in the
interest of smaller and weaker participants in the dispute settlement system.  His delegation was in
favour of exploring other solutions, including an interpretation of the DSU, an option that had beenmentioned by the Appellate Body in its report on "United States - Import Measures on Certain
Products from the European Communities", but that had not been mentioned by Japan.  His delegation
was willing to participate in further consultations as there was clearly no consensus on the present
form of the proposal.  In order to achieve any results, such consultations should be open-ended and
consider the concerns of all Members.
87. The representative of Mexico thanked the co-sponsors of the proposal for their work.  He
encouraged them to pursue their consultations and would like to continue to participate in such
consultations.  He noted that Members should not confuse the exercise carried out by the co-sponsorsWT/GC/M/63
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with what would constitute a review of the DSU.   The DSU review should be carried out by all
Members with the support of the Secretariat, following the formal decision taken at the Ministerial
Conference in Marrakesh.  At the same time, each Member retained the right, individually or as a
group, to propose reforms pursuant to Article X of the Marrakesh Agreement and the co-sponsors of
the present proposal had decided to take such an initiative.  Furthermore, the DSU review was of acomprehensive nature, while the co-sponsors of the present proposal were trying to solve a particular
problem, namely the question of sequencing between  Articles 21 and 22 of the DSU.  If other
Members were interested in other aspects, they sh ould follow the example of the co-sponsors of this
proposal, by putting forward their ideas.
88. The representative of Venezuela agreed with Mexico that the present proposal was not meant
to stand in for the review of the DSU.  Amongst the different Members that had taken part in the
review, it was generally agreed that the sequencing between Articles 21 and 22 of the DSU was one ofthe aspects that had caused the greatest concern and that there was a need to put forward a proposal of
the same nature as the one presented by the group of co-sponsors.  There might be other proposals
which were valid and important and which would have to be considered at a given time, but the
procedure for doing so would be through a spec ific mandate to come back to the DSU review
exercise, or through Members tabling individual, and more specific proposals.
89. The Chairman proposed that the General Council take note of the statements.  He also noted
the request for further consultations and he would advise the incoming Chairperson to consult with the
co-sponsors of the present proposal with regard to further consideration of this proposal.
90. The representative of Mexico said that he had understood from the statement made by Japan
that the co-sponsors would be carrying out consultations under th eir own responsibility and that such
consultations were not to be carried out by the Chairman of any of the regular WTO bodies.  He
would not be in a position to agree that this initia tive which had been put forward by the group of co-
sponsors be institutionalized, as if it was an initiative on the part of the WTO stemming from a
decision in the General Council.  He wished that co-sponsors would pursue their work and his
delegation would respond favorably to any invitation to consultations but these should be under theresponsibility of the Members that had put forward this proposal under Article X of the Marrakesh
Agreement.
91. The Chairman recalled that when this proposal had been made, he had been invited by the
General Council to carry out consultations, which he had done.  His proposal was in furthering that
process, but this had to be done in cooperation with the co-sponsors.  This had now become a formal
proposal before the General Council made by a group of Members and he saw it as a duty of the
Chairman to help Members to reach a conclusion on the proposal.  This would be in line with the waymany proposals were being dealt with.  He agreed that the co-sponsors should retain the main
responsibility for carrying out the consultations, bu t he would have thought that the Chairman would
be interested in seeing how various proposals before the General Council developed and in order to
help Members reach conclusions.
92. The representative of Bulgaria shared the concerns expressed by Mexico and sought
clarification from the Chairman as to his proposal which seemed to imply that Members should take a
decision on his reporting to the incoming Chairperson.  He did not want to institutionalize these
consultations.  He recalled that it had become clear that there was no consensus on this proposal, so
there was no need to take a decision on consultations on this proposal.  If Members were to take a
decision for the Chairman or his successor to hold consultations on the issue of interpretation of the
DSU, it would make sense to him, but otherwise he could not agree to continue consultations.  He
wished to know what exactly had been proposed for a decision by the General Council.WT/GC/M/63
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93. The Chairman said that it was unacceptable for the Chairman of the General Council to be
restricted to carry out consultations.  The Chairman could consult on any subject he considered
necessary in order to further the work.  The current proposal had been put before the General Council
and would remain so until Members either reached a conclusion, or until it was withdrawn by the co-
sponsors.  In this connection, the Chairman had a role to contribute to a possible conclusion.
94. The representative of Mexico said that he shared the views expressed by the Chairman, but
that he wished to avoid any confusion with regard to the fact that this proposal should not be
transformed into anything more than what it actually was, namely a proposal put forward by a group
of Members.  Other Members were not co-sponsors of that proposal and had different ways of
viewing it.  If Members were to take a decision to the effect that the Chairman of the General Council
would hold consultations, such consultations woul d have to be aimed at helping to forward the
process.  The co-sponsors had of course the right to inscribe the matter on the agenda.  As long as thisproposal was sponsored by a group of Members, thos e Members should bear the responsibility of the
substance of the proposal and not the Chairman of the General Council.  The Chairman could only
help the process forward.
95. The Chairman fully agreed with the statement made by Mexico.
96. The representative of the European Communities encouraged the Chairman to consult
informally on this issue, as well as on any other issue.
97. The representative of Bulgaria agreed with Mexico and the European Communities that the
Chairman could carry out consultations without a General Council decision to this effect.  He had no
intention of limiting the Chairman or his successor's prerogatives in this respect, but as far as this
agenda item was concerned, he opposed any decision on the matter.
98. The representative of Peru said that any item on the agenda, including this one, had its merits,
and that the Chairman could hold consultations on it.  He saw no difference between form and content
with regard to the Chairman's right to hold cons ultations on any item on the agenda, that he thought
appropriate.
99. The Chairman proposed that the General Council take note of the statements and that the
incoming Chairperson consult with the co-sponsors of the proposal as to its further consideration.
100. The General Council so agreed.
8. Situation regarding work in the Committee on Regional Trade Agreements
(a) Communication from Australia, India, Japan, Korea, New Zealand, Pakistan and Hong Kong,
China (WT/GC/43)
101. The Chairman said that this item was on the agenda at the request of the above-mentioned
Members.
102. The representative of India, also on behalf of Australia, Japan, Korea, New Zealand, Pakistan
and Hong Kong, China, recalled at the December 2000 meeting of the General Council when the
annual report of the Committee on Regional Trade Agreements had been considered, the Chairman of
the Committee on Regional Trade Agreements (CRTA) had highlighted the difficulties which hadbeen encountered by the Committee in fulfilling its mandate.  The Committee had completed a factual
examination of 62 regional trade agreements (RTAs) out of the 86 which had been referred to it for
examination.  However, the Committee had not been able to conclude the examination and adoptionWT/GC/M/63
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of any of the reports so far.  The Chairman had also underlined the need for the General Council to
provide a political impetus and guidance to enab le the Committee to discharge its responsibilities,
which included an assessment of the consistency of the RTAs with the provisions of the WTO
agreements.  In 2000, the Secretariat had produced two useful documents.  The first was a
comprehensive note on the systemic issues arising mostly from a lack of clarity in the rules.  Somerules had been clarified in decisions by panels and the Appellate Body while others remained
unclarified despite past efforts by Members.  The second document was a mapping of the RTAs,
which gave useful information on the web of RTAs that were either already in place or under
negotiation.  In the discussions that had followed the CRTA Chairman's statement in December 2000,
many Members had expressed concerns about the lack of progress in the work of the Committee.
This situation was not in any Member's interest.  It was necessary and important that the WTO be able
to exercise effective monitoring and oversight in this important area.  Efforts to address the systemicissues in the CRTA had not made much headwa y, thus hampering considerably the Committee's
ability to fulfil its mandate.  Members had to find a pragmatic way forward.  With a view to ensuring
that the deadlock in the CRTA would not be lost sight of by the General Council, it had been
suggested in December 2000 that the General Council request the CRTA Chairman to report back on
the consultations that he would be conducting within the CRTA, to find ways for progressing thework of the Committee.  Along with the co-spons ors, he continued to believe that it would be
important for the General Council to keep itself apprised of the progress of work in the CRTA, and in
particular to support the efforts of the CRTA Chairman to break the impasse.  An informal meeting of
the CRTA had been held on 13 December 2000, when the Chairman had informed Members that he
would conduct further consultations.  On behalf of the co-sponsors, he wished to propose that theGeneral Council invite the CRTA Chairperson to report back to the General Council at its next regular
meeting in May 2001, on the current situation regardin g the work in the Committee.  At that stage
Members could take stock and consider what steps would be helpful in furthering the work of the
Committee.  He hoped that this suggestion would be received in the constructive spirit in which it was
made.
103. The representative of Hong Kong, China said that as one of the co-sponsors of this agenda
item, his delegation fully associated itself with India's statement.  He recalled that in December 2000,
the CRTA Chairman had sought guidance from the General Council on how to break the current
impasse of the Committee in examining individual RTAs and the various systemic issues.  He
believed that all Members would agree that an effective examination mechanism of RTAs was
preferred to the alternative option of dispute settlement.  It was undesirable from the point of view of
all Members, RTA and non-RTA parties alike, that the questions and doubts on individual RTAs beanswered only through litigation.  Inevitably, RTAs being negotiated would encounter additional
uncertainties.  Hong Kong, China therefore urged Members to renew their efforts in the CRTA on
both the examination of individual RTAs and systemic issues in the coming months so that substantial
progress would be achieved when the CRTA Chairperson reported to the General Council next time.
Hong Kong, China expressed appreciation to the Secretariat for the document on the mapping of theexisting and coming RTAs, looked forward to progress in the Secretariat's current study on the
coverage of RTAs and other horizontal issues such as preference qualifying local content rules, and
encouraged the Director-General to provide adequate resources to this important task to ensure its
timely completion.
104. The representative of Romania, on behalf of the CEFTA Members and Croatia, Estonia and
Latvia thanked the co-sponsors for proposing further discussion on this item and reiterated support to
the CRTA Chairman in reaching an agreement on long-standing matters preventing the Committee
from fulfilling its mandate.  On several occasions, they had called attention to the stalemate in the
Committee, which had not allowed it to adopt a single report since the establishment of the WTO.
Such a situation did not contribute to the credibility of the multilateral trading system.  In their view,it was for Members only to find solutions to the differences of interpretation of Article XXIV of the
GATT 1994 and Article V of the GATS.  An interim solution might be provided by the proposal ofWT/GC/M/63
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the CRTA Chairman, but an overall agreement on the outstanding issues could be achieved only by
negotiations within the framework of a new round.  It was clear that until Members were able to
finalize the reviews of the notified agreements and adopt the reports thereof, no constructive
discussion could take place on the so-called systemic issues.  As to India's proposal on behalf of the
co-sponsors, they would further consider it with the greatest of care.
105. The representative of Switzerland was also concerned by the state of work in the CRTA.  The
Committee was at an impasse and Members would have  to find a way out.  Switzerland, however, did
not believe that the General Council in its regular composition could make a meaningful contribution
to the way this impasse could be solved for two main reasons.  First, Members had not as yet
exhausted all the possible ways of action open to the Committee itself and the consultations on the
various reports under examination within the Committee should be intensified.  Second and most
importantly, as already flagged by Romania on beha lf of the CEFTA Members, Croatia, Estonia and
Latvia, there were deep-rooted disagreements between Members as regards the interpretation of the
provisions of Article XXIV of GATT 1994 and Articl e V of GATS.  These disagreements called for a
clarification of the rules which would no doubt require amendments to the rules.  In order to achieve
that goal, Members would need an appropriate context, which was not available as yet.  Switzerland
hoped that during the Fourth Ministerial Conferen ce in Qatar, Members would find such a context,
i.e., the framework of a round of negotiations which should be broad and deal also with some of the
rules of the multilateral trading system.  His delegation wished to underline that if Members were to
be involved in an amendment and clarification exercise of the relevant provisions which applied to
regional or free-trade agreements, the new rules which could result from such an exercise should not
apply retroactively to the existing agreements.  This was a sine qua non  condition his delegation
would set if Members were to embark on such an exercise.
106. The representative of Norway was also concerned by the situation in the CRTA.  As an EFTA
member State, Norway had entered into a substantial number of free trade agreements and was in the
process of negotiating new agreements with several trade partners.  In her delegation's view, RTAs
negotiated in conformity with the WTO agreements contributed positively to the development ofinternational trade.  Differences of interpretation of certain provisions relating to RTAs had prevented
Members from finalizing a great number of reviews of RTAs.  All efforts so far in the CRTA to agree
on the reports from the reviews had been in vain.  She wished, however, to commend the CRTA
Chairman for his sincere contribution to try to find a way out.  Like Switzerland, she also believed
that an overall agreement on the outstanding issues might most successfully be achieved within a
broader framework of negotiations.  Furthermore, it was clear that the results of such negotiations
could not be applied retroactively.  On these grounds she believed that the only message the GeneralCouncil could convey to the Committee at the present time was that it should continue its important
work and that it should adjust its ambitions as to how to finalize the reviews to a level that
corresponded to the present political realities.
107. The representative of the European Communitie s also shared the frustration of the co-
sponsors at the failure of the CRTA to complete any examinations and the resulting mounting
backlog.  This was clearly not the message that Members should be giving on the efficiency or indeed
relevance of multilateral scrutiny of regional agreements.  His delegation had worked actively with
successive CRTA chairpersons and in informal consultations with interested Members to try to find a
way to resolve this situation.  He was afraid that totally non-committal conclusions in the Committee
could undermine the benefits of the clarifications in the rules achieved during the Uruguay Round.The consultation process among Members was however continuing and his delegation would be
interested in any new ideas the co-sponsors might have.  Like others, the Community had observed
increasing activity on the regional or bilateral front over the past months.  This was not, a priori, a
problem for the multilateral system, as long as all relevant WTO rules were observed.  However, the
Community believed that the best way to resolve any concerns over a possible conflict betweenmultilateralism and regionalism or bilateralism, was to launch a new multilateral round quickly.  TheWT/GC/M/63
Page 20
Community would not object if the systemic aspects of regionalism, including clarification of the
relevant WTO rules, were on the agenda of a new round of multilateral negotiations.
108. The representative of Chile supported the co-sponsors' initiative and shared their concerns.
With regard to statements made by two speakers that this issue should be resolved in a broader
context and that any agreement that would be reached could not be applied retroactively, he believedthat from a legal point of view, this was a position that was difficult to sustain.
109. The representative of the United States said that as his delegation had stated at the
December 2000 meeting of the General Council, it did not serve the WTO to have committees
log-jammed and unable to fulfil their mandate, and there seemed to be a broad view that there was a
problem.  However, the US were not convinced that adding this issue to the already overloaded
agenda of the General Council would be the solution to that problem.  The United States could
support the Chair's sharing of the concerns raised in the General Council with the next CRTAChairperson so as to permit the Committee to identify and agree on the precise nature of the problem
and the concerns raised with respect to the various options for drawing up conclusions to the many
draft reports.  Once the problems were articulated, Members might see additional guidance from
capitals as to how to resolve the problem.
110. The representative of the Philippines, also speaking as the outgoing CRTA Chairman
, said
that the growing phenomenon of RTAs were interprete d in contrasting views, as supportive of, or as
inimical to the multilateral trade process.  The CRTA was supposed to provide some clarification as to
the real role of this phenomenon.  This should have emerged from the Committee's examination
reports and from an assessment resulting from the Committee its work on the systemic issues.
Unfortunately this had not been done because of the stalemate that had been persisting in theCommittee since its establishment.  He thanked the co-sponsors for having reverted to this issue as
well as the delegations who were supporting a positive, concerted and serious approach on the part of
the Committee itself.  Members were not passing the responsibility to the General Council but only
wished that the General Council would give political and substantive impetus to the work that should
be carried on by the Committee in order for it to discharge its responsibilities in a more effective wayand help the WTO maintain its primacy over the trade environment.  It was clear to him that the
objectives of the Committee were to make RTAs supportive of the multilateral trade  process through
the observance and adherence to accepted rules.  Unfortunately Article XXIV of GATT and Article V
of GATS did not lend themselves to clarity or very clear standards.  This was the context in which the
Committee was operating.  Therefore, the contrasting interest which justifiably came from the
developmental objectives of different Members had led to a situation which did not allow the
Committee to undertake a concrete examination or an assessment of the complex issues.  Membershad very clear objectives and in order to carry them forward and with the cooperation of all, they
might agree at this point with a transition recommendation before negotiating an interpretation or
amendment of Article XXIV of GATT and Article V of GATS.  Speaking as the representative of the
Philippines, he said that his delegation unfortunately had not supported a new round of trade
negotiations.  Therefore in the meantime he reserved his response to the Community's suggestion thatMembers needed a new round of negotiations in order to resolve the issue in the CRTA.
111. The representative of Pakistan said that as a co-sponsor of the proposal, he fully endorsed the
views expressed by India, as well as those by Hong Kong, China.  With regard to the issue of whether
this matter should be discussed in the General Council, he said that because of the long-term impasse
that existed in the CRTA, its Chairman had asked for guidance and political impetus from the GeneralCouncil, since at a technical level that impasse could not be overcome.  As to the recipe proposed by
some delegations regarding the solution of that issue in the context of a new round, his delegation did
not recall that Members had taken a decision to launch a round so far and in the absence of any such
decision, the most prudent way to proceed was to utilize whatever ways and means were available toWT/GC/M/63
Page 21
them.  His delegation urged that as long as there were no other decisions taken, Members should stick
to the rules they had at their disposal.
112. The representative of Hungary referred to Chile's statement in relation to the view expressed
by some Members that first a solution should be found to the already concluded agreements and
thereafter to try to agree on new rules.  In this respect, he recalled his first participation in a CRTA
meeting, during which the Committee had been examining to what extent the Treaty of Rome,
concluded in the late fifties, was able to take into  consideration the requirements of the provisions of
Article V of GATS, concluded almost 40 years later.  The whole discussion at that meeting had been
very far from reality and he believed that this was not the best way to solve the difficult problems
existing in this field.
113. The representative of Australia, as a co-sponsor of this item, said that it was regrettable that
Members needed to have a discussion on this modest proposal which did not foreshadow rule-making
or rule changes but was an attempt to find a way through a logjam in the CRTA since 1996.  It was
disappointing that those who recognized that there was a problem and that it did not serve the
organization to have committees unable to move forward, were not able to see that there might be
some advantage in elevating the discussion to a more political level in the General Council.  He
believed that the issue was relevant to Members' work since it was one of the hottest topics in theinternational trade field today.  To think that the best solution was to continue discussing in a
Committee that was unable to move forward seemed rather extraordinary.  His delegation was one of
the earliest supporters of a round and could not see any problem in having a political discussion of
this item in the General Council from time to tim e.  In his delegation's view, a report from the
Chairperson of the Committee in May could not be seen as undermining leverage for a new round.Australia thought that those who were in favour of a new round and of including this issue in a broad
encompassing agenda would have wished to have a discussion thereon in the WTO to start to elevate
the profile of the issue and to identify some of the aspects which Members might wish to negotiate on.
It was very disappointing that there was no consensus to move forward in such a modest way which,
in Australia's view, might develop the understanding of the issues involved as well as build supportfor a comprehensive round agenda.  Lastly, he noted that the following agenda item
2 dealt with the
same kind of matter, i.e., having a report from a subsidiary body in the General Council.
114. The representative of Hong Kong, China said th at the idea that the outstanding issues could
only be resolved in a wider context, had been expressed in another context.  His delegation had an
open mind to such an idea.  However, Members should not wait a new round but should make use of
the time that was available now to double their effo rts in the CRTA to try to achieve as much as
possible.  As to the suggestion that any progress on systemic issues would not be forthcoming unlessthe examination of individual reports had been made, his delegation had great difficulty with this
sequencing, which was certainly not envisaged in the terms of reference of the CRTA.  One should
proceed with all aspects of the work in the CRTA at the same time.  Lastly, as rightly pointed out by
the Chairman of CRTA, it was not the co-sponsors' suggestion that the General Council should take
over the work of the CRTA.  Their proposal was for the General Council to indicate concern at thecurrent deadlock of the work in the CRTA and to review the situation from time to time by calling for
a further report by the CRTA Chairperson at the next General Council meeting.  He hoped that
Members would give positive consideration to this very modest request.
115. The representative of Mexico said that his delegation did not believe that by receiving a report
from the CRTA Chairperson, the General Council would be able to find solutions for issues
unresolved in the CRTA.  It was more a problem of substance than of forum.  His delegation could go
ahead with the proposal of including such an item on the agenda of the next General Council meeting.
Members could even consider that this item had been included on the agenda of the present meeting
                                                     
2 See item 9.WT/GC/M/63
Page 22
as the General Council had had a discussion on this issue and had heard a report of the CRTA
Chairman.  Members did not need to discuss whether that was necessary as such a discussion could
happen at any time.  As to the substance of the matter, there was a logjam in the review of the
agreements because there was no progress on the systemic issues.  His delegation believed that
Members were losing from such a situation, as it prevented them from knowing where these variousagreements stood.  Members could not reach a conclusion on any of these agreements because they
were not moving ahead on the systemic issues.  In addition to a lack of clarity of the relevant
provisions, Members were further complicating the problem with their lack of clarity when looking
into the different agreements.  Members had not even managed to agree on what "substantially all
trade" was in various agreements.  Therefore Members should find solutions to the substance, and in
so far as systemic issues were concerned these should be pinpointed so that Members could make at
least an individual comparison of the content of the agreements and therefore assess theircomplementarity to the multilateral system.
116. The representative of India recalled that in 1996 Members had discussed the examination of
various agreements and had felt that the then existing model of separate working parties for
examining various agreements had not been working well because the systemic issues had not being
dealt with in a coherent manner.  On the basis of a proposal by Canada, Members had decided toconstitute the CRTA as a solution to this problem.  Today, nearly four years later, the situation was no
better and Members were having the same type of problem.  There should be a collective concern and
endeavour to address this issue in a meaningful manner to find a way forward.  He had no particular
solution and agreed with Mexico that there were substantive issues and differences in this area that
had to be bridged.  As to the proposal made by the co-sponsors, he wished to recall that their proposalwas that the CRTA Chairperson be invited by the General Council to make a report at its May
meeting and not that the General Council take over the function of the CRTA Committee.  At its May
meeting, the General Council, which was the highest forum in this organization when the Ministerial
Conference was not in session, could devote some attention to this issue and Members could then
decide as to how to proceed further.  After four years, Members were at an impasse which deservedthe attention of the General Council.  The proposal was not seeking to change the position of any
Member but only to call the attention of the Genera l Council to this issue.  With regard to the
concerns about overloading the agenda of the General Council, he did not understand why the
proposal to have a report from the CRTA Chairperson at the May meeting should necessarily overload
the agenda.  When there was a major problem confronting the WTO which required with political
sensitivity there was no harm in the General Council l ooking into the subject.  As to the wider context
referred to by some delegations, this was a different issue.  Those who wanted to raise the profile ofthe issue and bring it into a wider context could have a debate on this matter at the May meeting of the
General Council.  Finally, he proposed that the Chairman hold consultations on the proposal to invite
the CRTA Chairperson to present a report at the May meeting.
117. The representative of the European Communities said that his delegation would be in favour
of having this item on the agenda of the General Council meeting in May.  With respect to his
previous intervention, he wished to clarify that the Community had not said that the way to deal with
the issue was through the launching of a new round but that further discussions in the General Council
on the issue was in no way dependent on the decisions which Members would still have to take
collectively on the launch of a new round.  He welcomed a debate in May and believed that it would
benefit from good preparation in the CRTA itself through intensive consultations between theChairperson of the Committee and its Members.  He agreed with India's proposal that the incoming
Chairman of the General Council should consult informally on the way in which that debate could be
approached and organized.
118. The representative of Mexico said that after having heard India's second intervention his
delegation was now convinced that India's proposal should be accepted by the General Council.WT/GC/M/63
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119. The representative of Thailand said that like Mexico, she was now also fully convinced that it
would be useful to have such a discussion in the May meeting of the General Council.
120. The representative of the United States said that his delegation shared the underlying interest
in these issues and believed that the General Council had had a very good and useful discussion at its
December meeting as well as at the present one.  This issue was difficult and had many complexaspects, which seemed to make it difficult to find a way through.  It had not been the United States'
perception that one of the problems in finding a solution was that the issue suffered from a low
profile .  When he referred to overburdening the agenda of the General Council, his underlying
concern was that he was not convinced that it would be an added value in having a third sequential
discussion on that issue.  He believed however that India had proposed that it was for the incoming
Chairperson to take up this issue.  Members should await the outcome of the next CRTA meeting and
see if there was a possibility of an added value in taking up this issue again in the General Council inMay and take a decision in light of this additional information and experience.
121. The Chairman proposed that the General Council take note of the statements and invite the
incoming Chairperson to conduct consultations on the basis of the proposal made by India on behalf
of Australia, India, Japan, Korea, New Zealand, Pakistan and Hong Kong, China.
122. It was so agreed.
9. Proposal for addition of an item to the General Council agenda:  "Reports of the special
sessions of the Committee on Agriculture a nd of the Council for Trade in Services, and
of the TRIPS Council on the mandated negotiations on agriculture, services and
geographical indications" (WT/GC/W/425)
123. The Chairman said that this item was on the agenda at the request of Bulgaria, Czech
Republic, Egypt, Hungary, Iceland, India, Kenya, Liechtenstein, Mauritius, Pakistan, Slovenia,
Sri Lanka, Switzerland and Turkey.  At the General Council meeting in December 2000, when the
proposal was first introduced by the co-sponsors, he had concluded from the discussion that Members
seemed to disagree on questions of principle and that  they would need to try to resolve them before a
practical way forward could be found.
124. The representative of Switzerland, on behalf of the co-sponsors of the proposal , recalled that
at its December 2000 meeting the General Council had had an extensive debate on this proposal.
Despite efforts undertaken by the Chairman to work  out a mutually acceptable solution in the course
of informal consultations preceding the December meeting, it had not been possible to reconcile the
different positions of Members on this matter and the discussion in the General Council had reflected
those divergences.  This was the reason why the co-sponsors of the proposal had taken the initiative tofurther explore, how this issue could be resolv ed with some Members who had different views.
Although no real progress had been achieved so far, there had been a frank and open exchange of
views that had helped to clarify matters and better understand other delegations' positions.  The co-
sponsors had requested that their proposal be placed on the agenda of the present meeting to reiterate
their position that the General Council, as the overseeing body of the WTO, should be kept informedin like manner about all mandated negotiations, including the negotiations on geographical
indications, which were formally launched in 1996 by way of a decision by the TRIPS Council.  The
most natural and orderly way to achieve a balanced approach to all mandated negotiations was to
enable the General Council to supervise such negotiations.  This was, above all, a practical
arrangement to deal efficiently with the interactions between all mandated negotiations.  Against thisbackground, the co-sponsors of the proposal reaffirmed their position that the TRIPS Council should
regularly report to the General Council on the ongoing negotiations on geographical indications.  This
reporting should be made according to the same arrangements, and under the same agenda item, as theWT/GC/M/63
Page 24
ongoing negotiations on agriculture and services.  The co-sponsors were aware that Members'
positions were still too divergent to take such a decision at the present meeting, but were ready to
continue the dialogue with all interested Members, with a view to arriving at a mutually agreed
solution.  The co-sponsors realized that great strides would have to be made to achieve this goal, and
wished that the incoming Chairperson would assist them in this endeavor by conducting, asappropriate, informal consultations to resolve this issue.
125. The representative of New Zealand said that his delegation had set out its views on this issue
in some detail at the December 2000 General Council meeting.  He noted Switzerland's indication that
they had pursued consultations since December.  His delegation had not been invited to these
consultations but had it been invited, it would have confirmed that its position had not changed.  The
proposal made by Switzerland and others was unclear as to which provisions of the TRIPS Agreement
they were referring to in relation to the "mandated negotiations".  His delegation could not share theinterpretation of the scope of the "mandated negotiations" for geographical indications under the
TRIPS Agreement that Switzerland and some of the co-sponsors had sought to assert in the TRIPS
Council and elsewhere.  It was the right of all Members to bring their different negotiating objectives
to the attention of the wider membership but in so doing, it was important not to mischaracterize new
issues for negotiation as if they were already mandated.
126. The representative of Chile said that at the December 2000 meeting, his delegation had
clearly stated its position on this issue.  There was no reference to mandated negotiations for products
other than wines and spirits in the TRIPS Agreement, as had emerged from the text and the
underlying history of the Agreement.  Therefore, this matter could not be dealt with at the same level
as the mandated negotiations under Article 20 of the Agreement on Agriculture and Article XIX ofthe GATS.  His delegation had not been invited to take part in any consultations since the General
Council meeting in December, where it could have had an opportunity to provide more reasons for its
position.
127. The representative of Argentina said that his delegation's position had not changed since the
December 2000 meeting.  In Argentina's view, there were no legal grounds for likening the mandated
negotiations under Article 20 of the Agreement on Agriculture and Article XIX of the GATS to
geographical indications.  Even in the TRIPS Council, there were still important differences of
opinion among Members as to the content, objective and scope of provisions such as Articles 23.4,
24.1 and 24.2 of the TRIPS Agreement.  It was therefore inappropriate to add an item to the agenda
which likened mandated negotiations such as those on agriculture and services, which Members had
specifically agreed in the respective agreements, to other negotiations such as on geographical
indications, which did not have a similar legal basis.  With regard to the consultations by the incomingChairperson requested by Switzerland, his delegation was open to any type of consultations and any
effort which could be made in this regard.  However, he believed that the incoming Chairperson had
many other matters to deal with before he could address this issue.
128. The representative of Mexico said that his delegation had participated in consultations held by
the co-sponsors of the proposal where it had reiterated its position, which was similar to the one
expressed by New Zealand, Chile and Argentina.  In addition to substantive issues on which his
delegation disagreed with the co-sponsors, a procedural argument also substantiated his delegation's
position.  All permanent bodies reported, either directly or indirectly, to the General Council, except
in agriculture and services where Members had agreed that special sessions of a negotiating nature be
held.  As long as there was no similar agreement to hold special sessions of the TRIPS Council,reporting by this body to the General Council was already covered, through annual reports of the
TRIPS Council.  If Members were to agree in the future to hold special sessions of the TRIPS
Council, then it could be decided that reports of such sessions would also be presented to the General
Council.WT/GC/M/63
Page 25
129. The representative of the European Communities said that his delegation supported the
proposal made by Switzerland and other co-sponsors, as it seemed normal that reports be made to the
General Council on a regular basis for all mandated negotiations, including those under the TRIPS
Agreement.  This was important for the General Council in order to be aware of these discussions.
130. The representative of Cuba said that her delegation fully supported the content of the proposal
under consideration and wished to be included in the list of co-sponsors.3  She also reiterated her
delegation's interest in extending geographical indications beyond wines and spirits.
131. The representative of Canada recalled that his delegation had expressed its views at the
General Council meeting in December 2000 and wished to associate itself with the statements made at
the present meeting by New Zealand, Chile, Argentina and Mexico.
132. The representative of Uruguay noted that Switzerland had mentioned that no progress had
been made on this issue over the last months.  His delegation had not been involved in the
consultations held by the co-sponsors, but it did not share their approach to place on the same
hierarchical footing issues which were not of an equal footing.  Mandated negotiations were provided
for in the areas of agriculture and services, and also in connection with the establishment of a
multilateral system of notification and registration of geographical indications for wines and spirits
under the TRIPS Agreement.  If the issue had been presented to Members as it had been agreed,without any attempt to broaden the scope of that mandate by referring to geographical indications in
general, which went far beyond the mandated negotiations on the establishment of a system of
notification and registration, the discussion would have been more serene and could have enabled
Members to reach certain conclusions.  However, given the way it had been presented, it would be
difficult for Members to make any progress on this proposal in the future.
133. The representative of Bulgaria said that since the minutes of the December 2000 General
Council meeting had been circulated only the day be fore the present meeting, he reserved his right to
revert, at the next General Council meeting, to some of the statements made at the December meeting.
In his view, some statements demonstrated that there was still a misunderstanding on the part of
certain Members who believed that the proposal before the General Council was aimed at extendingthe additional protection of geographical indications to products other than wines and spirits.  The
issue of the scope of mandated negotiations under the TRIPS Agreement had been discussed in the
TRIPS Council and in the Special Sessions of the Committee on Agriculture, where Members had
proceeded on the understanding that  they would not bring up the issue of scope in a way that would
hinder discussions.  This understanding meant that the differences in mandates would not be an
obstacle to substantive discussions.  If the mandate as to what was included in the scope of
Article 24.1 of the TRIPS Agreement was to be brought up again, then consultations by the incomingChairperson would be needed, hopefully before the stocktaking exercise in March 2001.  If the
understanding reached in the Special Sessions of the Committee on Agriculture was no longer valid,
his delegation would need to review its position.  He therefore urged the Chairman to undertake
consultations in order to clarify this issue.
134. The representative of Australia recalled that Ministers from certain Members had stated that
the preparatory work for the Fourth Session of the Ministerial Conference would need to be
completed by July 2001.  This did not leave much time for preparations.  Yet, representatives of some
of these Ministers wished to continue discussing the proposal before the General Council.  It was clear
that despite all the consultations held, Members had not been able to move forward on the proposal, as
there were fundamental legal and procedural differences amongst them.  Members could tie up thetime of the incoming Chairperson of the General Council with further consultations, or tie up time in
General Council meetings, but this would not help  Members to move forward with the preparations
                                                     
3 WT/GC/W/425/Add.1.WT/GC/M/63
Page 26
for the Ministerial Conference.  The fact that the issue of geographical indications was not discussed
in the General Council on the same level as agriculture and services did not mean that work on this
issue was not proceeding in the appropriate body in which it should be conducted.
135. The representative of United States said that his delegation wished to associate itself with the
statements made by New Zealand, Chile, Argentin a, Mexico, Canada, Uruguay and Australia.  In
response to Bulgaria's statement, he said that the issue before the General Council under this agenda
item was not about what would be discussed in other bodies, but what would be discussed in the
General Council.  He did not share the view that if something was important, it had to be discussed in
the General Council.  His delegation would be willing to participate in future consultations if the
incoming Chairperson wished to hold such consultations.  However, he noted that Members should
avoid asking the Chairperson to hold consultations where they knew there was no likelihood of a
meeting of the minds.
136. The representative of India said that his delegation supported the statement by Switzerland.
He considered that it was the duty of the General Council to follow all mandated negotiations,
including on geographical indications.  The proposal to bring this issue to the attention of the General
Council, at least from the perspective of his delegation, was not aimed at resolving the issue at the
present meeting.  However, it was not fair for any delegation to refrain from engaging in good faithconsultations, merely because there were important divergences of views on a particular issue.  He
recognized that there were divergences of opinion on the matter at had.  However, this matter was
considered to be a very important subject by a number of Members, both developing and developed,
and it deserved that other Members engaged in good faith consultations and that the General Council
gave political impetus and guidance on this important subject.
137. The representative of the Czech Republic said that his delegation associated itself with the
statement by Switzerland.  He believed that in de aling with the proposal before the General Council,
Members should be able to show their responsibility.  This was important, not only from the
perspective of the co-sponsors, but also from the perspective of the WTO which had been established
to promote international trade.  The proposal represented the interests of a wide range of countries andtherefore his delegation supported the suggestion to try to move forward on it through further
consultations.
138. The representative of Switzerland said that a number of criticisms had been voiced with
regard to the proposal.  However, he stressed that this was a serious step which had been taken by the
co-sponsors and he wished that the General Council would take it seriously.
139. The Chairman said that those delegations that  were mostly involved in this matter should
continue to consult and explore whether they could agree on a way forward.  The incoming
Chairperson would be in a better position to determin e the role he wished to take in relation to this
matter.
140. The General Council took note of the statements.
10. Reports of the special sessions of the Committee on Agriculture and of the Council for
Trade in Services
141. The Chairman of the Committee on Agriculture, Mr. Voto-Bernales (Peru), recalled that the
Committee on Agriculture, meeting in Special Sessions to conduct the negotiations for continuing the
reform process under Article 20 of the Agreement on Agriculture, was required to report directly to
the General Council.  As agreed by the Special Sessions, these reports were made to the GeneralCouncil on the responsibility of the Chairman of the Committee.  A short factual report by theWT/GC/M/63
Page 27
Chairman on the fifth Special Session, concluded on 7 February 2001, had only just been made
available to Members in document G/AG/NG/5.  The contents of this report had been outlined in
detail to representatives at the conclusion of the Special Session.  In total the Special Session had
17 new negotiating proposals before it.  Details concerning Members involved in submitting or
sponsoring these negotiating proposals could be found in the Chairman's report.  In the time availableit had only been possible to complete the presentation and examination of 10 of these proposals.
Numerous interventions had been made on each of the proposals considered.  Such interventions as
well as the extensive capital-based representation of both developing and developed countries in the
Special Session were clear indications of the importance attached to the negotiations under Article 20
of the Agreement on Agriculture.  Under these circumstances, Members had agreed to schedule an
additional Special Session meeting, which would be held on 22-23 March 2001 in order to complete
the examination of the remaining proposals, of other submissions that had been tabled as well as ofany further proposals that might be tabled in the coming weeks.  Members had also agreed that the
agriculture stock-taking Special Session meetin g would be held on 26 March 2001, with the aim of
concluding the business of that meeting at a morning session on 28 March 2001.  In the course the
Special Session, Members had held informal open-ended consultations on the work of the end-March
stock-taking meeting, as well as on the programme and arrangements for the second phase of thenegotiations under Article 20 of the Agreement on Agriculture.  As already noted in the Chairman's
report, he had indicated that he would continue to hold informal consultations and contacts.  It was
also his intention to convene another open-ended informal meeting before the end-March stock-taking
meeting in order to discuss a draft text sketching out possible elements for the second phase
programme and arrangements.
142. The Chairman of the Council for Trade in Services, Mr. Marchi (Canada), said that since his
last report on 8 December 2000, the Special Session of the Council for Trade in Services had held no
formal meetings, and that the next formal meeting was scheduled for March 2001.  An informal
meeting had been convened on 7 February 2001 to discuss and review the first draft of the Draft
guidelines and procedures for the negotiations prepared, as mandated, by the Secretariat (Job(01)/2).At that meeting, Members had held a very detailed and valuable discussion and it had been agreed
that the Secretariat would produce next week a revised draft of the guidelines and procedures, taking
into account Members' comments and suggestions.  The revised draft would be discussed at an
informal meeting of Council for Trade in Services, scheduled for 20 February 2001.  This would bring
the work on the guidelines, which was very important for the second phase of  the negotiations, close
to conclusion.  The guidelines themselves would hopefully be adopted at the Special Session meeting
in March 2001.
143. The General Council took note of the reports, and agreed
 to revert to this matter at its next
meeting.
11. Appointment of officers to WTO bodies
144. The Chairman said that in accordance with th e guidelines for appointment of officers to WTO
bodies approved by the General Council in January 1995 (WT/L/31), he had conducted informal
consultations on this matter.  On the basis of these consultations, he considered that there was a
consensus on the following slate of names:
General Council Mr. Stuart Harbinson (Hong Kong, China)
Dispute Settlement Body Mr. Roger Farrell (New Zealand)WT/GC/M/63
Page 28
Trade Policy Review Body Mr. Pekka Huhtaniemi (Finland)
Council for Trade in Goods M r. Istvan Major (Hungary)
Council for Trade in Services Mr. Celso Amorim (Brazil)Council for TRIPS Mr. Boniface Guwa Chidyausiku (Zimbabwe)
Committee on Trade and Environment Mr. Alejandro Jara Puga (Chile)
Committee on Trade and Development Mr. Nathan Irumba (Uganda)
Committee on Balance-of-Payments Restrict ions Mr. Hernando José Gomez (Colombia)
Committee on Regional Trade Agreements Mrs.  Laurence Dubois-Destrizais (France)
Committee on Budget, Finance and
  AdministrationMr. M. Supperamaniam (Malaysia)
Working Group on the Relationship between
  Trade and InvestmentMr. Oguz Demiralp (Turkey)
Working Group on the Interaction between Trade
  and Competition PolicyMr. Frederic Jenny (France)
Working Group on Transparency in Government
  ProcurementMr. Ronald Saborío Soto (Costa Rica)
Committee on Agriculture
Chair
Vice-ChairMrs. Apiradi Tantraporn (Thailand)
Mr. Yoichi Suzuki (Japan)
145. The Chairman also said that certain understandings had been agreed upon in reaching a
consensus on the Chairpersons for this year.  First, Mrs. Tantraporn (Thailand) would be appointed as
Chairperson of the Committee on Agriculture and Mr. Suzuki (Japan) would continue for one moreyear to act as Vice-Chairman of the Committee under the same conditions.  These arrangements for
the chair and the vice-chair had been made for a period no longer than one year, and future
appointments would continue to be based on personal experience and expertise, while taking into
account the diversity of constituencies.  Moreover, the organization of work at the Fourth Ministerial
Conference would be decided in due course, irrespective of these arrangements.
146. The General Council took note of the statement and of the consensus on the above slate of
names.
12. Election of Chairperson of the General Council
147. The Chairman thanked the Director-General, Deputy Directors-General, the Secretariat and
all delegations for their cooperation and support during his term of Office.
148. The General Council then unanimously elected Mr. Stuart Harbinson (Hong Kong, China) to
the Chair.WT/GC/M/63
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13. Sanitary and phytosanitary measures by Canada affecting Brazilian beef exports
149. The representative of Brazil, speaking under "Other Business", informed the General Council
that his government would be raising in the appr opriate body a matter related to the responsibility of
sanitary and phytosanitary authorities for declarations concerning risk assessment with impact on
private agents.  This was motivated by the serious trade losses to Brazilian beef exports caused byprecipitated and arbitrary declarations and decisions by Canada.
150. The representative of Canada said that his delegation would attend the meeting of the body
where Brazil would raise that issue.  He also said that the action by Canada had been neither
precipitous nor arbitrary but had been taken for safety and health reasons which were very legitimate.
151. The General Council took note of the statements.
14. Statement by the Chairman of the Committee on Rules of Origin
152. The Chairman of the Committee on Rules of Origin, speaking under "Other Business",
recalled that at  its Special Session on Implementation on 14 and 15 December 2000, the General
Council had adopted the following decision concerning the Agreement on Rules of Origin:
"Members undertake to expedite the remaining work on the harmonization of non
preferential rules of origin, so as to complete it by the time of the Fourth MinisterialConference, or by the end of 2001 at the latest.  The Chairman of the Committee on Rules of
Origin shall report regularly, on his own responsibility, to the General Council on the
progress being made.  The first such report would be submitted to the Council at its first
regular meeting in 2001, and subsequently at e ach regular meeting until the completion of the
work programme."
153. This was his first progress report to the General Council on his own responsibility as
Chairman of the Committee.  Pursuant to Article 9.2(a) of the Agreement on Rules of Origin, the
harmonized work programme for non-preferential rules of origin, which had been launched in
July 1995, had been scheduled for completion within three years of its initiation, i.e. by July 1998.However, while progress had been made during this three-year period, the work had not been
completed as scheduled.  In July 1998, Members had agreed to extend the deadline, and had
committed themselves to making their best endeavours to complete the work programme by
November 1999, but had failed to do so.  Accordingly, the Committee had continued its work in 2000
on the basis of the agreed work programme.  The total number of product-specific rules of origin
agreed among Members to date amounted to approximately 1,800 at the level of HS subheadings (the
total number of HS subheadings being 5,113).  To date about 500 issues were pending.  Notsurprisingly these related to the most sensitive areas, especially textiles, agricultural products,
electronics, machinery and vehicles.  Faced with the realities of globalization and the increasingly
multi-country production of goods, various materials and intermediate goods were used as inputs in a
number of stages of production.  In such an environment, it was difficult to reach consensus as to
whether a certain production process was to be considered as origin-conferring, especially if othertrade policy considerations had to also been taken into account.
154. At its last meeting on 1 December 2000, the Committee had shared the view that Members
were now entering a decisive phase of the harmonization work programme, since less than one year
was left for the Committee to complete its remaining work.  He had urged all Members to mobilise all
the resources available, to exercise the political will necessary and to show maximum flexibility witha view to expediting the remaining work.  Immedi ately after the General Council’s Special Session on
14 and 15 December 2000, the Committee had held an informal meeting on 18 December 2000 andWT/GC/M/63
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had agreed on the notional work programme for 2001.  Under this work programme, the Committee
would hold four two-week negotiatin g sessions this year, starting in early March 2001.  It was also
expected that more intensive bilateral and plurilateral negotiations would take place between these
formal sessions.  Meeting this new deadline was certainly going to be a challenging task and could
only be achieved if all Members were fully committed to accomplishing it.
155. The General Council took note of the statement.
15. Statement by the Chairman on further work  of the General Council on Implementation
156. The Chairman, speaking under "Other Business", sa id that as delegations were aware, at the
beginning of the present week he had held an info rmal heads of delegations meeting to address the
organization of further work on implementation-related issues and concerns, in the light of the
General Council Decision adopted on 15 December 2000.  He wished to outline the conclusions hehad been able to draw from that meeting on the current situation, and his views on a possible way to
proceed.  First, Members had a very clear mandate for the work before them.  The Decision of 3 May
2000 and the June 2000 work programme remained the basic framework of the present process, which
would have to be completed not later than the Fourth Session of the Ministerial Conference and would
have to be composed of a mixture of formal and informal processes.  Concretely, in the year 2000,there had been formal Special Sessions intermingl ed with informal consultations conducted by the
Director-General and himself.  These consultations had had to be conducted in a transparent manner,
and therefore he had held frequent informal open-ended meetings.  Second, all Members recognized
that the process of addressing implementation-related issues and concerns was of utmost priority, and
that there should be no linkages to any other current or future areas of the WTO work programme atthe present time.  However, it had also been clear that for a number of delegations the progress made
in this process could have an important bearing on other work of the organization.  Third, the
remaining issues belonged to the following four ma in categories:  (i) issues referred to subsidiary
bodies for their consideration;  (ii) outstanding paragraph 21 issues, which could contain two
sub-categories, namely those issues which have been the subject of intensive consultations, and thosewhich have not;  (iii) issues raised by Members in the course of our consultations;  and, (iv) issues
contained in paragraph 22.  He sensed that most Members would be prepared to concentrate in the
first instance on the issues referred to the subsidiary bodies and those remaining in paragraph 21 as
well as the other issues raised by Members.  However, a suggestion had also been made that Members
could consider addressing the issues agreement by agreement.  Therefore further reflection was
needed on this matter.  Fourth, it had been suggested that a deadline could be fixed for the reports by
the subsidiary bodies.  However, some delegations would prefer to allow sufficient time for thesebodies to be able to carry out their work adequately.  This was also a matter that needed further
reflection but Members could convey to those bodies the urgency which all attached to the work they
were undertaking in that respect.  Finally, there was a need to develop and implement the continuing
work programme as soon as possible at the formal level, i.e., at Special Sessions of the General
Council.  Clearly, such Special Sessions would need to be well prepared if they were to be productive.He therefore suggested that this should be done through informal consultations to be carried out by
the General Council Chairman and the Director-General.  These consultations would be conducted in
full respect of transparency.  The exact timing of the next Special Session and the informal process by
which Members would prepare for it would be the subject of informal consultations by his successor
as soon as possible.
157. The General Council took note of the statement.
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