Cablegate: Wto Committee On Technical Barriers to Trade (Tbt)

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 05 GENEVA 002778

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PASS USTR FOR DWOSKIN AND TROJE
DOC/ITA FOR SJACOBS/NMORGAN/BO'BYRNE
DOC/NIST FOR AMEININGER
USDA/FAS FOR DBREHM/ATALLEY/KKEZAR
DOT/NHTSA FOR JABRAHAM
EPA FOR KFEITH/JSHOAFF
FDA FOR RCAMPBELL/MECHOLS
STATE FOR EB/KBARR

E.O. 12958: N/A
TAGS: EAGR ETRD WTRO USTR
SUBJECT: WTO COMMITTEE ON TECHNICAL BARRIERS TO TRADE (TBT)

1. Begin Summary: On November 2, 2005, the WTO TBT Committee
met to review new trade concerns arising from the following
notifications (or lack thereof): China's proposed regulations to
control pollution from electronic information products, the EU's
Directive on eco-design requirements for energy using products
(EUP), Colombia and South African footwear labeling requirements,
Peru infant formula requirements and China's Health Food
regulation. China also raised its concerns with the short
comment period provided on the U.S. notification (USA/128)
concerning DTV tuners, and with Japan's failure to respond to PRC
comments on several Japanese notifications. Although the
Committee was requested to refrain from raising issues previously
brought to its attention, a number of Members reiterated concerns
with the EU's proposed chemical regulation (known as REACH). The
Committee also concluded its fourth transitional review of China,
focusing on statements submitted by the U.S., Japan and EC with a
detailed oral response provided by China. The Committee agreed
on an agenda for a Workshop on Conformity Assessment, to be held
in March 2006, with Members requested to nominate speakers no
later than January 16, 2006. It also reached agreement on a
voluntary notification format on technical assistance.
Preparations for the fourth triennial review focused on possible
topics to include in the review, with no consensus reached on
labeling (raised by EC) or intellectual property (raised by PRC).
The U.S. presented a paper on its "good regulatory practice".
The Committee adopted its annual report to the CTG. Under "other
business," the U.S. raised concerns with the treatment of
international standards in the recent Secretariat publication,
"World Trade Report 2005." The Committee will meet again March
14 (pm) and 15, preceded by the Workshop on Conformity Assessment
March 13 and 14 (am). U.S. positions are contained in TPSC 2005-
186. End Summary.

Implementation Concerns:

2. China's "Administration on the Control of Pollution Caused by
Electronic Information Products" (G/TBT/N/CHN/140): Japan briefly
noted questions about the relevant standards for implementation
and asked, joined by the EC, China to consider their forthcoming
comments.

3. U.S. "DTV Tuner Requirements" (G/TBT/N/USA/128): China
lamented the notification allowed only 19 days for comments and
its request to extend that period had been denied. It expressed
concern that the proposal to advance the date on which all new
television receiving equipment must include DTV capability to a
date no later than December 31, 2006 would add unnecessary costs.
It noted it had provided comments to the FCC in response to the
notification. Given the lack of advance notice of its concern,
the U.S. noted it would look into the matter.

4. EU Directive on Eco-design Requirements for Energy Using
Products (EUP) (2005/32/EC): China noted compliance with the
Directive is mandated for August 11, 2007 and this will require
CE marking for a broad range of products. The Directive has not
been notified to WTO members. China expressed concern that there
will be uneven enforcement by Member States. It noted it was not
seeking amendments to the Directive but an opportunity for Member
States to receive copies of all comments submitted, as the EC had
promised it, and requested training and seminars on how to
comply. In its response, the EC noted that the framework in the
EU Directive was not subject to TBT notification requirements but
comments were welcome. It assured the Committee that any
"implementing measure" would be notified for 60-days comment.
The Commission intends to assess transposition measures to assure
coherence among Members States implementation. It indicated it
could not respond at the meeting to the request for technical
assistance.

5. Japan's Failure to Respond to Chinese Comments: China raised
concerns with Japan's failure to respond to comments it had
recently provided on five notifications, including those on
pickled agricultural products (JPN/148), carbonated drinks
(JPN/150), and carrot juice (JPN/151). Japan was unable to
respond at the meeting.

6. Colombia "Regulation on Labeling of Footwear" (COL/45 and
Add.): The EC raised concerns with burdensome requirements to
include a registration number and other comments it had made in
response to Colombia's notification, to which Colombia indicated
it had already responded (with no substantive information
provided to the Committee).

7. South Africa "General Notice of the Merchandise Marks Act and
Country of Origin Labeling" (for footwear and apparel) (SAF/49):
The EC noted it had provided comments and expressed concern with
the registration and other burdensome requirements of the
proposal, which it understood had not yet been implemented. With
the support of the U.S., it noted its request that South Africa
consider less trade-restrictive alternatives, such as post-
importation stickers. The U.S. also sought confirmation of
reports by industry that South Africa was considering withdrawal
of the requirement. South Africa confirmed the regulation was
not being enforced and that it was seeking inputs to address the
concerns raised.

8. Peru "Infant Formula Regulations" (PER/11): The U.S. noted
Peru's recent notification and comments that had been submitted
by the U.S. Government and industry. We noted a response to
those comments had not been received but we hoped Peru would
allow sufficient time for producers in exporting Members to adapt
their products to the new requirements. (Peru was not
represented at the meeting).

9. China "Health Food Regulation" (CHN/160): The U.S. noted
China's recent notification of its health food regulation and
recalled prior requests to China that this proposal be notified.
The notification indicates the "final date for comments" as "not
applicable" and the U.S. sought confirmation, which China
provided, that its comments (submitted just prior to the
notification), would be taken into consideration.

10. EU Chemical Regulation (REACH): The U.S. noting the process
in developing the REACH regulation, which had been a longstanding
issue before the Committee, was at a critical juncture and
reiterated its hope that changes to the original proposal would
result in an approach that is more streamlined, science-based and
cost-effective. The U.S. noted the EC's promise to update its
TBT notification if there are changes and welcomed the
opportunity to further engage in a substantive and constructive
dialogue on those changes. Canada reiterated its concerns with
the workability of the proposal, noted its June position paper,
and sought clarification of the status of the text. Chile,
China, Mexico, Japan and Korea all noted they had expressed
concerns bilaterally and welcomed a continued dialogue. The EC
noted it was too early to predict changes and noted the first
reading by Parliament would be held on November 14.

11. U.S. MRAs with Norway, Iceland and Liechtenstein: The U.S.
noted its intention to notify two MRAs reached with these EEA
member countries on telecommunications equipment, electromagnetic
compatibility, recreational craft and marine equipment upon their
entry into force.

12. Kenya's "Verification of Conformity to Standards of
Imports": On the margins of the meeting the U.S. provided Kenya's
Geneva-based rep with a copy of comments previously provided in
response to the above notification (KEN/14 and Add.1). Kenya was
previously unaware of the comments and U.S. questions and
concerns and promised to follow-up with its Bureau of Standards
(KEBS).

Annual Transitional Review Mechanism for China:

13. Questions and concerns raised by Japan, EC and United States
are detailed in written statements submitted in advance of the
meeting (G/TBT/W/255, 256 and 257) and were highlighted at the
meeting. Among other issues, all three statements raise concerns
with China's compulsory certification system ("CCC mark"). At
the meeting, Korea echoed its concerns with the CCC mark
highlighting difficulties associated with the time period,
sometimes more than six months, required to obtain certification,
the protection of confidential information, and requirements for
spare parts, components and assembly.

14. China responded to the various questions and comments raised
in a single statement. In response to a U.S. request, the
Committee agreed to attach a record of its discussion, including
China's statement, to the report transmitted to the Council for
Trade in Goods. Some highlights of its response follow.

15. China informed the Committee that it had translated the TBT
notification handbook and had been conducting workshops to
upgrade its implementation, highlighting the increasing number of
notifications it had submitted (84 pursuant to TBT from January
through October 2005). Notice of proposals was published in the
foreign trade and economic gazettes in addition to publications
by the responsible authority. It noted its standardization body,
SAC, had completed a review of its standards with a view to
aligning them with international standards and as a result some
1,416 were nullified, including 114 mandatory standards. It
noted that technical regulations (which are mostly mandatory
standards) are published jointly by AQSIQ/SAC and AQSIQ/CNCA.
The various ministries, including Health, Environment and
Industry, carry out conformity assessment on both domestic and
imported products. It clarified that a number of notifications
identify SAC as the "agency responsible" in the notification
format and these include regulations of other ministries.

16. [Comment: In bilateral discussions, China complained about
the excessive work created when questions are raised with
multiple contact points about proposals and their status of
notification. It suggested when such issues arise, the U.S.
direct its inquiry to the inquiry point at AQSIQ, with a copy to
MOFCOM (chenying@mofcom.gov.cn), who has overall responsibility
for all WTO notifications.]

17. On certification, China noted it recognizes foreign testing
reports under the IEC CB scheme, and also through mutual
recognition agreements with CNCA or authorized by the State
Council. Up to now, it reported cooperation agreements with more
than twenty countries. In reference to concerns raised by the
U.S. with the recent detention of a tile shipment, it indicated
the problem was with the HS codes that guide Customs inspections
for CCC marking. China indicated it was working a detailed
product list to prevent similar problems in the future. [Comment:
When raised bilaterally, China indicated that there has been a 19-
month transition period for decorative building materials and a
16-month transition period for security products, and that it
would not postpone their implementation. It also provided stats
on the number of companies affected to demonstrate these were
primarily Chinese and again asserted implementation would not
"significantly affect trade."] China indicated when deemed
necessary, it could make changes to the products subject to CCC
marking and that it was exploring alternatives, such as reliance
on supplier's declaration of conformity, based on its experience.
It rejected the EU proposal that registration to ISO 9001 replace
factory inspection, and the CCC mark cannot be replaced by
another (e.g., DOT, UL, CE). It clarified it aims to complete
certification within 90 days of receiving an application, and
that spare-parts for re-exported products are not subject to the
certification requirements. It noted fees had been lowered this
year and in March a notice was published on exemptions.

18. On information and communications products, it agreed that
regulations should be limited to "essential requirements" and
noted CNCA is discussing the issue with other authorities. It
noted international standards were sometimes deficient in
addressing concerns, such as national security. It asserted its
WAPI standard is advanced technology and the fact that its
allowed under fast track (in ISO) reflects that fact. It
confirmed there were no developments to report with respect to
RFID. On its regulation of waste from electrical products
(WEEE), it noted a consultation draft had been submitted for
review by the State Council and it was not in a position to
provide more details at this time. On chemicals it noted it was
working hard to join the OECD good laboratory practice program.
[Comment: China was more forthcoming in its statement at this TRM
than it has been in the past where responses were only provided
in bilaterals with those who had submitted written statements.
Bilaterally and in the Committee, they continued to urge members
to raise issues under appropriate agenda topics, rather than save
them for the TRM].

Conformity Assessment: Follow-up from Third Triennial Review

19. Members provided reactions to a revised agenda for the
workshop circulated by the Secretariat (JOB(05)/108/Rev.1.
Chinese Taipei called for more time and more presentations by
developing country members on their national experience, and for
the industry perspective to be balanced by the perspective of the
consumer. Canada suggested regulators, rather than certification
bodies, would be more appropriate for providing a `users'
perspective on accreditation; and, that a presentation be made on
accreditation-based mutual recognition agreements which have a
global basis (e.g., ILAC or IAF), and suggested a presentation by
a developing country on regional cooperation in accreditation.
With these modifications, the Committee agreed upon the agenda
for the Workshop and chair requested members to identify speakers
no later than January 16, 2005.

Technical Assistance Notification Format: Follow-up from Third
Triennial Review

20. Members reviewed a revised notification format (JOB(05)/265)
following suggestions that had been made in informal discussions
held in September. With some modification to accommodate a
request by China to delete the section on "policy area covered,"
and noting comments from Chinese Taipei and the EC that it may be
necessary to supplement the notification with additional
information, the Committee adopted the format for the voluntary
notification of specific technical assistance needs and responses
on a trial basis for two years.

Other outstanding issues from the Third Triennial Review

21. Canada, with support from the EU and United States, noted
that there still had not been a full discussion on how to better
coordinate the Secretariat plans for technical assistance with
the needs and discussions emanating from the TBT Committee as
recommended in the last review. Canada suggested the Committee
discuss the Secretariat plans at a future meeting. It also noted
the expectation that the Committee could serve as a forum for
feedback and that this had not yet happened in a very specific
way. The U.S., with support from Mexico, noted the previous
Committee recommendation which encouraged Members to disseminate
their comments and responses by means of national websites and,
noting some information from Members had been provided, suggested
the Secretariat compile a room document or provide an oral report
at the next meeting. The Secretariat indicated it would provide
a factual note on the comprehensive work undertaken by the
Committee in follow-up to the last Triennial review.

Preparation for the Fourth Triennial Review

22. At the U.S. suggestion, the Committee agreed that the
circulation of draft of factual elements for the review should
precede the deadline for submission by delegates of proposals for
recommendations, which is anticipated prior to the March meeting.
Topics which have been raised include:

23. Conformity Assessment Procedures: The U.S. noted proposals
may emanate from the March Workshop. The EC noted its intention
to submit a paper on its experience with mutual recognition
agreements. Canada noted it had comments on the Secretariat's
background paper (JOB(05)/261) and members were invited to submit
comments by the end of November.

24. Technical Assistance: China, Canada, El Salvador, Cuba and
the EC all spoke in favor of addressing this topic in the 4th
review. (Proposals submitted by China were not discussed).

25. Special and Differential Treatment: Brazil and Cuba
expressed general support for China's proposed notification of
S&D, with China noting the need for coordination and regulatory
cooperation in priority sectors.

26. Intellectual Property Rights: The ISO observer, at the
request of China, made a presentation on the ISO and IEC joint
patent policies and noted collaboration with the ITU in the World
Standards Congress (WSC) on a common approach to "reasonable and
non-discriminatory" terms. China informed the Committee of a
submission by Japan in the WSC and its view that this activity
was complementary to the WTO. It also noted the relevance of the
TRIPs Council and suggested that there be parallel discussions to
those in the TBT Committee. Brazil stated that property rights
should not become an obstacle to development and should be in
line with the TBT Agreement. Korea, the U.S., Mexico, El
Salvador and Chile all raised questions about the appropriateness
of discussing the issues raised in the TBT Committee. China
continued to assert the relevance of the topic to standardization
and the TBT Agreement's obligation to use international standards
(and thus within the mandate of the TBT Committee). It shared
the concerns it may not be able to resolve the new and complex
issues, but it viewed the TBT Committee as the most able body
related to standardization. In response to a question raised by
Canada, China noted it was still preparing information on
specific cases. Given the lack of consensus, the topic is not
part of the 4th review.

27. Labeling: The U.S. , Chile and New Zealand expressed concern
with the EU resurrecting this topic which had been addressed in
the last review. There agreement had been reached that labeling
was not a special class of issue. The EU had not presented any
information on what was to be addressed in the 4th review and
given the lack of consensus, it is not on the agenda.

28. Good Regulatory Practice: The U.S. presented a paper
providing information on the institutional underpinnings to its
good regulatory practice (G/TBT/W/258). Canada raised specific
questions to which the U.S. agreed to respond in the future
(i.e., further details on regulatory evaluation and review; more
information on enforcement; question as to whether "equivalency"
is contained in regulatory guidance). Korea expressed some
concern with the EU's proposal to develop guidelines, noting that
good regulatory practice goes beyond the scope of the TBT
Agreement (as was noted in the U.S. paper).

29. Transparency: The Chair recalled proposals made by Canada,
China, and the EC (W/234, W/252, and W/253, respectively).
Jordan noted its support both for China's proposal that final
texts of technical regulations should be notified to the
Secretariat and for the EC's proposal that notifications contain

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more descriptive information and the inclusion of the text (or
link to) the technical regulation. Jordan raised concerns that
the provision of texts should be restricted to governments as it
could be a useful source of revenue for countries selling the
texts to industry. The EC disagreed, saying that the text should
be available to anyone concerned.

30. Technical Cooperation: The EU, Norway and WTO Secretariat
provided information on their assistance activities.

31. The Committee adopted its Report to the Council for Trade in
Goods based on a draft contained in JOB(05)/267.

32. Other Business: WTO Secretariat Report, "World Trade 2005":
The U.S. noted the recent WTO publication included over 120 pages
devoted to "standards" and related topics. Noting the report was
informative and useful in highlighting the importance of
"standards" to trade, the U.S. expressed concern that it also
contains certain statements and references that are subjective,
confusing and otherwise troublesome. Of particular note is the
impression given by the report that standards developed by the
ISO and IEC are somehow recognized by the WTO and their use given
primary importance. The U.S. noted the SPS Agreement does
identify 3 specific bodies but noted there is no corollary
identification in the TBT Agreement. She recalled discussions in
the Second triennial review where the Committee rejected the
notion of attempting to identify and agree upon a list of
relevant bodies for purposes of TBT. Instead, the Committee
agreed upon principles to guide the development of international
standards. She also took exception with the assertion that the
WTO strictly regulates the work of the ISO, noting that in
drafting the Committee Decision on International Standards it had
recognized the limitations of the WTO imposing disciplines on
other international bodies. She suggested the report could have
benefited from consultation with Members and possibly peer review
so that such misunderstandings could be avoided. The Secretariat
welcomed the U.S. interest in the report and clarified the report
was prepared by its Economic Research and Statistics Division who
was represented at the meeting. He added that the Report has a
clear disclaimer that it was prepared on the basis of the
Secretariat's own responsibility. Allgeier

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