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Treaty Amendment: The Problem of the GATT Tariff Schedules

Published online by Cambridge University Press:  09 March 2016

J. S. Stanford
J. S. Stanford*
Affiliation:
Treaty and Economic Section, Legal Division, Department of External Affairs
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Extract

The General Agreement on Tariffs and Trade contains many provisions dealing with non-Tariff barriers to international trade, but the most significant obligations imposed upon the contracting parties to the General Agreement are those set out in Part I, namely, the obligation to extend most-favoured-nation treatment to other contracting parties and the obligation to apply to imports from other contracting parties treatment “no less favourable than that provided for in the appropriate Part of the appropriate Schedule annexed to this Agreement” (Art. II :I (a)). There is annexed to the General Agreement a Schedule in respect of each contracting party, recording the tariff concessions which that party is obliged by Article II to extend to its GATT trading partners. These concessions are constantly being modified, however, and if the General Agreement is to record accurately the tariff obligations of the parties, the Schedules must keep up-to-date with these modifications. Unhappily, in the years following the provisional entry into force of the General Agreement, the Schedules became hopelessly outdated, caught up in a tangle of amending “protocols” and “certifications” to the point where they ceased to be useful either to the contracting parties or to the commercial community as a record of the tariff obligations of the parties. The present note describes the origin of the GATT schedule problem and the steps taken by the contracting partieas to resolve it and restore the Schedules to a useful function, an interesting exercise in the application of treaty law and procedures to the rather unusual amendment provisions of the General Agreement.

Type
Notes and Comments
Information
Canadian Yearbook of International Law/Annuaire canadien de droit international , Volume 7 , 1969 , pp. 255 - 268
Copyright
Copyright © The Canadian Council on International Law / Conseil Canadien de Droit International, representing the Board of Editors, Canadian Yearbook of International Law / Comité de Rédaction, Annuaire Canadien de Droit International 1969

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References

1 55 U.N.T.S. 194. The GATT is applied by virtue of the Protocol of Provisional Application of the General Agreement on Tariffs and Trade. Geneva, October 30, 1947. 55 U.N.T.S. 308. It has never entered definitively into force.

2 62 U.N.T.S. 2.

3 “Rectifications” in GATT practice, refers not only to the correction of errors but also to changes to the Schedules of a purely formal nature. “Modifications,” on the other hand, are substantive amendments to the provisions of the Schedules.

4 Protocol Amending Part I and Articles XXIX and XXX of the General Agreement on Tariffs and Trade. Done March 10, 1955. Abandoned January 1, 1968, by decision of the contracting parties.

5 See Jackson, John H., “The Puzzle of GATT: Legal Aspects of a Surprising Institution,” 1 J.W.T.L. 131, 141 (1967).Google Scholar

6 GATT, Analytical Index (Second Revision) 150, paragraph 2(a).

7 Compare the 1969 Vienna Convention on the Law of Treaties, Article 41, which states the rule of treaty law normally applicable in such cases, that a multilateral treaty may be amended as between certain of the parties alone by agreement among those parties provided the rights of the remaining parties are not thereby impaired.

8 See GATT, Analytical Index (Second Revision) 150, paragraph 1.

9 The provision for modification in these articles is to be distinguished from the provisions in, for example, Articles XVIIII:21; XIX¡3 and XXIII:2 for suspension of the application of a concession to a particular contracting party only. Action under Article XIX : 1 and 2 may be a true modification to the Schedule, in that it applies equally to all parties, but because it is a temporary change only it has not been included in the special modification procedures.

10 Article XXV: i provides that: “Representatives of the contracting parties shall meet from time to time for the purpose of giving effect to those provisions of this Agreement which involve joint action and, generally, with a view to facilitating the operation and furthering the objectives of this Agreement. Wherever reference is made in this Agreement to the contracting parties acting jointly they are designated as the CONTRACTING PARTIES.” Paragraph 4 of the Article provides that: “Except as otherwise provided for in this Agreement, decisions of the CONTRACTING PARTIES shall be taken by a majority of the votes cast.”

11 Protocol of Rectifications to the General Agreement on Tariffs and Trade, signed and entered into force March 24, 1948: 62 U.N.T.S. 2. Second Protocol of Rectifications to the General Agreement on Tariffs and Trade, signed and entered into force September 14, 1948: 62 U.N.T.S. 74.

12 Opened for signature August 13, 1949. Entered into force October 21, 1951. 107 U.N.T.S. 311.

13 Opened for signature April 3, 1950. Entered into force September 24, 1952. 138 U.N.T.S. 398.

14 Opened for signature December 16, 1950. Entered into force June 30, 1953. 167 U.N.T.S. 265.

15 Opened for signature August 13, 1949. Entered into force September 24, 1952. 138 U.N.T.S. 381.

16 Entered into force October 21, 1953. 176 U.N.T.S. 2.

17 GATT, Analytical Index (Second Revision) 151, paragraph 4.

18 Ibid., 184.

19 See GATT, Basic Instruments and Selected Documents, Eighth Supplement 25.

20 Geneva, June 30, 1967. T.I.A.S. 6425.

21 See General Agreement, Annex I, supplementary note to Article XVIII: 7(b), which provides that a compensatory modification to “shall become effective on the thirtieth day following the day on which such modification or withdrawal has been notified to the CONTRACTING PARTIES.” Nothing is said about the entry into force of the protocol incorporating the modification.

22 It is necessary to distinguish between the Schedule of a contracting party, which records its tariff obligations to the other contracting parties, and its national tariff. Once a contracting party’s obligations have been altered, it may alter its national tariff accordingly. But the tariff change is not a necessary step in the modification of the Schedule. If, for example, the modification consists in the unbinding of a rate on a particular item, reference to the item should be deleted from the Schedule whether or not the rate of duty imposed on the item by the national tariff is altered by internal action. See the General Agreement, Annex I, Supplementary note to Article XXVIII: 1, paragraph 2.

23 See, for example, the opening paragraph of the supplementary note to Article XXVIII, which provides only that the contracting parties shall be informed of changes in national tariffs resulting from recourse to the Article. See also GATT, Analytical Index (Second Revision) 144, paragraph 3, which refers to the right of a contracting party to act to change its concession prior to consultation and to the limitation on the right of another contracting party to delay or prevent a modification.

24 See supra note 10.

25 See the 1969 Vienna Convention on the Law of Treaties, Article 79(2) for the procedure for the correction of errors. See Draft Articles on the Law of Treaties, Article 74(2), supra note 6.

26 Jackson, supra note 5, at 160 and 161.