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22 March 2010
Committee on Agriculture
Negotiating group on agriculture
Report by the Chairman, H.E. Mr.
to the Trade Negotiations Committee for the Purpose of the TNC
22 March 2010
1. This report is presented entirely
on my own responsibility.
2. In the period since I assumed the role of Chair in April
2009, the Committee on Agriculture in Special Session
(hereinafter referred to as the Negotiating Group) has
undertaken two broad streams of work:
(a) I have undertaken consultations on the issues that are
bracketed or otherwise annotated in the
the Negotiating Group
— TN/AG/W/4/Rev.4 together with TN/AG/W/5, TN/AG/W/6 and TN/AG/W/7;
(b) The Negotiating Group has worked on the technical
development of “Templates” for the presentation of data, both
that required for the establishment of Modalities and that
required for the eventual scheduling of commitments, based on
draft modalities as contained in TN/AG/W/4/Rev.4.
3. This work was intensified from September 2009 consistent with
the programme of work for DDA negotiations overall then drawn up
with the participation of Senior Officials.
4. The Negotiating Group has also separately undertaken some
substantive discussion of data requirements associated with TN/AG/W/4/Rev.4.
5. This report covers each of these activities in turn.
6. I have also advised Members that I am available to hear from
them individually or collectively regarding any technical
ambiguity they consider exists, or technical clarification they
consider is needed, in the text of TN/AG/W/4/Rev.4.
I. CHAIR’S CONSULTATIONS ON ISSUES BRACKETED OR OTHERWISE
ANNOTATED IN DOCUMENTATION BEFORE THE NEGOTIATING GROUP
7. I undertook consultations on ten categories of issues that
are bracketed or otherwise annotated in the documentation as
identified in (i) above. These are presented below in the order
they appear in TN/AG/W/4/Rev.4, which is also the order in which
I undertook initial consultations.
8. The objective of this work was to help Members build
consensus towards concluding Modalities in Agriculture.
9. It was recognised at the outset that the issues identified
potentially differed in nature and in the state of their
preparation in the documentation before the Negotiating Group.
It was nevertheless considered useful to, where necessary and as
far as possible, advance technical understanding and framing of
issues in preparation for when decisions could be taken.
10. In my assessment this judgement has been borne out in
practice albeit, to this point, Members have not been in a
position to substantively resolve matters.
A. BLUE BOX — PRODUCT-SPECIFIC LIMITS (PARAGRAPH 42, TN/AG/W/4/REV.4)
11. Consultations indicate that no further technical preparation
is required for the eventual decision to be taken with respect
to the bracketed numbers in this paragraph.
B. COTTON (PARAGRAPHS 54/55 AND CHAIR’S INTRODUCTION, TN/AG/W/4/REV.4)
12. Consultations confirm that not all Members are in a position
to agree to the text as drafted but no new contributions,
technical or substantive, have been forthcoming in consultations
13. All Members involved, however, have emphasised that they
remain committed to finding a solution that addresses the issue
of cotton “ambitiously, expeditiously and specifically”
consistent with the commitments made at the Hong Kong
Ministerial Conference in December 2005.
14. It has also been suggested that Ministerial-level contacts
that have taken place between particular Members in recent
months have been useful in enhancing understanding of respective
C. SENSITIVE PRODUCTS — DESIGNATION (PARAGRAPH 71, TN/AG/W/4/REV.4
15. The annotation to paragraph 71 reads “Japan and Canada have
declared themselves not to be in a position to agree to this
[the right of developed country Members to designate up to 4
percent of tariff lines as “Sensitive Products”] limitation”.
16. Consultations confirm that Japan and Canada are still
seeking flexibility to designate additional tariff lines under
the “Sensitive Products” category.
17. It remains to be seen whether Members are prepared to agree
any further flexibility in designation of “Sensitive Products”
beyond that already provided in paragraph 71 and, if so, what
payment would be required for such designation.
18. I understand consultations will continue amongst interested
Members on a “without prejudice” basis, including on how any
differential tariff quota expansion requirements might be
allocated across different tariff lines.
D. TARIFF CAP (PARAGRAPH 76, TN/AG/W/4/REV.4 AND TN/AG/W/5)
19. Views remain sharply divided on whether there should be an
exception allowing the maintenance of tariffs in excess of 100
percent ad valorem on products outside a Member’s overall
“Sensitive Product” entitlement.
20. Differing views have also been expressed on the
appropriateness of the payment options in the bracketed text in
paragraph 76, were any such exception to be granted.
E. TARIFF QUOTA CREATION (PARAGRAPH 83, TN/AG/W/4/REV.4 AND TN/AG/W/6)
21. While views remain divided on whether such flexibility
should be afforded, consultations indicate a general willingness
to continue technical discussion, on a “without prejudice”
basis, based on TN/AG/W/6.
22. There is a sense that the operability of criteria contained
in TN/AG/W/6 is difficult to conceive in the abstract and that
discussion may benefit from further factual clarification — for
example in respect of which products amongst those for which
consumption data has been submitted pursuant to Annex C of TN/AG/W/4/Rev.4
are not currently subject to tariff quotas.
23. Transparency more generally remains a key element in
Members’ consideration of this issue.
F. TARIFF SIMPLIFICATION (PARAGRAPH 104, TN/AG/W/4/REV.4)
24. Consultations have involved an initial technical discussion
on how the “or” option in paragraph 104 of TN/AG/W/4/Rev.4 would
be operationalised through the other provisions of paragraphs
103 — 108 of TN/AG/W/4/Rev.4 together with the associated Annex
25. Questions were raised, in this context, concerning some
apparent differences in terminology between the text of
paragraphs 104 — 108 and Annex N and about the interrelationship
of envisaged procedures between the text and the Annex. These
issues will need to be further clarified.
26. Members were also interested in how proposed simplification
would work in practice. The European Union provided an overview
presentation, in an open-ended setting, on its proposed
simplifications to the Meursing table.
27. More broadly, Members expressed interest to continue
discussions amongst themselves to better understand how proposed
simplifications would work in concrete terms.
G. SPECIAL PRODUCTS (PARAGRAPH 129, TN/AG/W/4/REV.4)
28. The annotation to paragraph 129 reads “A number of
developing country Members have expressed reservations
concerning the numbers specified in this paragraph, noting also
that this may be affected by what is decided in other areas of
29. Consultations indicate that this annotation remains
30. Some Members expressed concerns about the potential export
impacts of the treatment provided in paragraph 129. Other
Members considered that the paragraph should be regarded as
H. SPECIAL SAFEGUARD MECHANISM — SSM (PARAGRAPHS 144/145, TN/AG/W/4/REV.4
31. Consultations to date have enefited from analytical
contributions on various elements of a possible SSM architecture
from a range of Members, including a number of contributions
that have been circulated to all Members as JOB documents.
32. These contributions have covered issues such as price and
volume cross-check, seasonality, price-based SSM, flexibilities
for Small, Vulnerable Economies (SVEs), and pro-rating.
33. Initial technical exchanges have been undertaken on the
issues of seasonality, price and volume cross-check, and
price-based SSM. A number of questions were raised on the
existing analytical papers and there are indications that there
may be further analytical contributions to come from others on
34. Papers recently circulated on flexibilities for SVEs and
pro-rating were introduced but Members indicated they would need
some time to study the papers before being in a position to
enter into technical discussion on these issues.
35. The SSM is clearly one of the more politically charged
issues under discussion. Consultations suggest it is arguably
also the most complex.
36. The importance of further focussed analysis and discussion
has been highlighted to contribute to the development of shared
understanding to underpin the compromises necessary for the
establishment of a “fit for purpose” mechanism.
I. TROPICAL AND DIVERSIFICATION PRODUCTS (PARAGRAPH 148 AND
ANNEX G, TN/AG/W/4/REV.4); LONG-STANDING PREFERENCES AND
PREFERENCE EROSION (PARAGRAPH 149 AND ANNEX H, TN/AG/W/4/REV.4)
37. There have been significant developments in these areas.
38. In December, WTO Director General Pascal Lamy and I received
the following communications:
(a) A letter, dated 15 December 2009, from the European Union,
the ACP countries, Brazil, Colombia, Costa Rica, Ecuador,
Guatemala, Honduras, Mexico, Nicaragua, Panama, Peru, and
Venezuela conveying the text of a proposed DDA modality
applicable to tariff reductions by the EU on bananas; and
(b) A letter, dated 15 December 2009, from the European Union,
the ACP countries, Bolivia, Colombia, Costa Rica, Ecuador,
Guatemala, Nicaragua, Panama, and Peru conveying the text of a
proposed DDA modality for the treatment of Tropical Products and
for Preference Erosion.
39. I conveyed these communications to the Members of the
Negotiating Group on 18 December 2009 and subsequently held
further consultations on these two issues identified in TN/AG/W/4/Rev.4.
40. Consultations afforded an opportunity for initial discussion
of the proposed modalities contained in the communications.
Clarification was provided in the course of consultations that
the treatment contained in sub-paragraph (ii) of the proposed
replacement for paragraph 149 of TN/AG/W/4/Rev.4 is intended to
relate only to the tariff lines for sugar contained in the
attached Annex H.
41. Some Members who are not party to the above referenced
communications have expressed concern to understand how the
proposals may affect their interests. I understand consultations
continue amongst relevant Members in this regard.
II. TEMPLATE DEVELOPMENT
42. The work the Negotiating Group has been undertaking on
development of templates is understood by all Members to be of
an exclusively technical nature. It has been a very deliberate
and deliberative process undertaken in the open-ended format.
43. Work has proceeded across each of the three “pillars”
(Domestic Support, Market Access and Export Competition) in two
“steps” as follows:
Step 1 concerns the identification and development of templates
(including possible supporting tables) for the presentation of
base data; and
Step 2 concerns the identification and development of templates
(including possible supporting tables) for the presentation of DDA commitments.
44. It is recognised by all Members that this work is not a
substitute for work towards the conclusion of Modalities.
Indeed, given that work on draft formats of scheduling templates
and supporting tables is based on draft modalities provisions in
TN/AG/W/4/Rev.4, it is not possible to complete all work on
templates until Modalities have been agreed.
45. It should also be noted that the template development work
is just that — the development of templates for the formatting
of the presentation of necessary information, to be used when
such presentation is required or otherwise agreed.
46. Issues involving the timing of the actual provision of
information have been and will continue to be dealt with in a
distinct process. Activity of this nature is covered in the
“Data” section of this report.
47. It has also been recognised that work on templates may raise
questions on substantive interpretation of draft modalities
provisions. Where such situations have arisen, such as the case
of some of the issues covered below in the “Data” section of
this report, these questions too have been and will continue to
be dealt with in a distinct process.
48. Significant effort has been devoted to work on Step 1 across
each of the three pillars and work is well advanced. A
considerable number of documents have been produced to
contribute to this work with many having been amended or
superseded through the course of discussion in the Negotiating
Group. Those documents that remain under discussion will need to
be finalised and consolidated as part of the conclusion of base
data template work.
49. Work on Step 2 has commenced with some initial contributions
to aid discussion having been made. A number of Members have
indicated they are working on developing some “summary table”
overview documentation to help guide more detailed work on
development of scheduling templates and supporting tables for
specific elements in respective pillars.
III. DATA-RELATED ACTIVITIES
50. The way commitments resulting from Modalities can be readily
understood and verified is a data-intensive exercise. The
Negotiating Group has therefore continued to engage separately
on a number of data-related activities.
51. These activities have been focussed, as a priority, around
those areas where the draft modalities provisions in TN/AG/W/4/Rev.4
require data to be available and capable of having been verified
by Members in advance of the establishment of Modalities —
including that data which is required by those provisions to be
annexed to the Modalities themselves.
52. An opportunity was provided, until 4 December 2009, for
additional Members who wished to submit Domestic Consumption
data for the purposes of Sensitive Product declaration
consistent with Annex C of TN/AG/W/4/Rev.4 and for Members to
make technical amendments to data previously submitted. The data
which has been submitted by 10 Members (counting the EU as one)
is subject to an ongoing process of verification.
53. Data provision and verification activity has also continued
in respect of Value of Production (VoP) data to be annexed to
the Modalities (in terms of Members and base years) as required
by paragraph 12 of TN/AG/W/4/Rev.4. As part of this process it
has been clarified that the operating definition of Value of
Production remains that which flows from the Agreement on
54. It is understood that VoP data which has been submitted for
years and by Members beyond that required by paragraph 12 of TN/AG/W/4/Rev.4
currently serves for transparency purposes only.
55. Data has also been sought for the product-specific AMS and
product-specific Blue Box to be annexed to the Modalities as
required by paragraphs 22 and 40 of TN/AG/W/4/Rev.4. It has been
clarified that this data needs to be provided by developed
country Members only.
56. With it being understood that commitments will be expressed
in HS 2002 nomenclature, work is also underway to confirm AVE
(ad valorem equivalent) transposition for the purpose of the
AVEs to be annexed to the Modalities as required by paragraph 60
57. A number of other questions that have been raised relating
to the provision of data remain to be addressed.
IV. FUTURE WORK
58. It is my intention to consult with Members on the
organisation of future work in the Negotiating Group following,
and consistent with, the outcome of this Stocktaking process.
Download this report:
AT A GLANCE
work would take the negotiators through the following
sequence, leading to “schedules” (lists or tables) of
1. Members identify data needs and design blank forms
(“templates”) for data and for commitments (now and
through the autumn)
2. “Modalities” (formulas, flexibilities, disciplines)
agreed, perhaps with agreed blank forms or tables, and
with some data attached
3. “Scheduling” — forms/tables filled in. Some are
draft commitments, based on “modalities” formulas. Some
are supporting tables of data
4. Members verify each others’ draft commitments,
using the supporting data.
5. Commitments are agreed as part of the Doha Round
This work is technical, but some political questions also
still have to be sorted out before “modalities” can be
• bracketed: in official drafts, square brackets
indicate text that has not been agreed and is still under
• modalities: the way to proceed. In WTO negotiations,
modalities set broad outlines — such as formulas or approaches
for tariff and subsidy reductions — for final commitments.
• boxes: categories of domestic support
• Amber Box: domestic support considered to distort
production and trade, eg, by supporting prices or being
directly related to production quantities, and therefore
subject to reduction commitments. Officially, “aggregate
measurement of support” (AMS)
• de minimis: Amber Box supports in small, minimal
or negligible permitted amounts (currently limited to 5%
of the value of production in developed countries, 10% in
developing). To simplify this guide to the “modalities”,
de minimis is treated separately from the Amber box
• Blue Box: Amber Box types of support, but with
constraints on production or other conditions designed to
reduce the distortion. Currently not limited
• Green Box: domestic supports considered not to support
trade or to cause minimal distortion and therefore
permitted with no limits
• distortion: when prices are higher or lower than normal,
and when quantities produced, bought, and sold are also
higher or lower than normal — ie, than the levels that
would usually exist in a competitive market
• sensitive products (available for all countries):
would have smaller tariff cuts than from the formula, but with
quotas allowing imports at lower tariffs (“tariff quotas”) to
provide some access to the market.
• tariff quota: when quantities inside a quota are charged
lower import duty rates, than those outside (which can be
high). (The reductions from the formulas apply to
• Tariff line: a product as defined in lists of
tariff rates. Products can be sub-divided, the level of
detail reflected in the number of digits in the Harmonized
System (HS) code use to identify the product.
• special products (SP): products for which developing
countries are to be given extra flexibility in market access
for food and livelihood security and rural development
• special safeguard mechanism (SSM): a tool that will
allow developing countries to raise tariffs temporarily to
deal with import surges or price falls (explained
• pro-rating: a proposal, to adapt the calculation for
triggering the SSM safeguard so that it takes into account the
effect of an SSM in an earlier period. Imports in an earlier
period when a safeguard was being used might be lower than the
general trend. Therefore the earlier safeguard might
exaggerate an import surge in a subsequent year, triggering
the use of the safeguard again.
• export competition: term used in these negotiations to
cover export subsidies and the “parallel” issues, which
could provide loopholes for governments’ export subsidies
— export finance (credit, guarantees and insurance),
exporting state trading enterprises, and international
> More jargon: glossary