WORLD TRADE
ORGANIZATIONWT/GC/W/254
15 July 1999
(99-2939)
General Council Original:  English
PREPARATIONS FOR THE 1999 MINISTERIAL CONFERENCE
Trade Facilitation
Negotiating Objective and Proposed Approach for Advancing
the WTO’s Contribution to Trade Facilitation
Communication from the United States
The following communication, dated 14 July 1999, has been received from the Permanent
Mission of the United States.
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Proposal
1. Negotiations shall aim at strengthening and expanding existing rights and obligations and
simplifying and streamlining the trade facilitation environment through:  clarifying and making more
transparent the procedural requirements necessary for trade under the covered Agreements;
enhancing efficiencies, including through providing for the rapid release of goods from the custody of
government authorities such as customs administrations.  Negotiations shall complement and expandupon existing provisions in the WTO related to trade facilitation while avoiding duplication of work
underway in other fora, with the result being an agreement on the publication and administration of
trade and investment regulations, and formalities connected with importation and exportation.
2. WTO Members recognize that work in this area will result in systemic improvements that
will, in particular, enable less advanced economies, and small- and medium-sized enterprises in allWTO Members to participate effectively in the global economy.  To this end, an integral element of
the negotiating plan shall be an operational programme of assistance in conjunction with other
international organizations in this field that will run concurrently with the negotiations, designed to
ensure effective implementation.
Principal stages of the negotiating process
3. An examination of  Article VIII (Fees and Formalities connected with Importation and
Exportation) and Article X (Publication and Administration of Trade Regulations) of the General
Agreement on Tariffs and Trade 1994, to determine to what extent existing disciplines can be
strengthened and streamlined, including in terms of their applicability to all covered Agreements.
- Negotiators shall complete by 1 December 2000 an identification and assessment of
various specific measures through which GATT Articles VIII and X are
implemented, drawing from experiences of Members, along with an identification
and assessment of measures implementing relevant elements of all coveredWT/GC/W/254
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Agreements which provide enhanced transparency in procedures related to trade
transactions and provide enhanced efficiency in the physical movement of goods by
allowing the rapid release of such goods from government authorities to traders.
4. An examination of existing programmes of assistance and a needs assessment to improve the
basic trade facilitation environment of all WTO Members.
- Concurrently, negotiators shall complete by 1 December 2000, a survey focused on
the adequacy of institutional systems and administrative measures providing
transparency to the private sector and allowing for efficiency in the physical
movement of goods as related to the release of goods from the customs of
government authorities after importation.  The survey will also include an
identification and assessment of needs.  In conducting this survey, Members shall, asappropriate, consult other relevant institutions in order to ensure a collaborative effort
with such organizations, including the World Bank, the IMF, the World Customs
Organization, UNCTAD, and others.
5. During the first phase of work, provision shall be made for the Negotiating Group to consult
as appropriate through symposia or other means to ensure that the Agreement under development and
the technical cooperation programmes are practical and responsive to the needs of WTO Members
and the private sector.
Second phase of the work
6. Not later than 1 March 2001, negotiators shall complete a review of the results of the work
programme and bring together the results of both steps conducted under the first phase of work and
commence the second phase of the work.
- WTO Members shall produce elements of a draft agreement on the publication and
administration of trade and investment regulations, and on the formalities connectedwith importation and exportation.
- The Negotiating Group shall develop a technical assistance programme for WTO
Members that shall include, through the programme, an assessment of the assistance
and follow through of WTO Members in adapting their regimes in accordance with
the elements of the draft agreement.
7. During the second phase of work, provision shall be made for the Negotiating Group to
consult as appropriate with traders through symposia or other means on the progress achieved in the
programme of negotiations.
Rationale8. A disciplined trade transaction environment that is both transparent and efficient is essential
to all WTO Members and increasingly needed in order to attract investment and expand economic
output.  Those who have made a commitment to building such rules-based regimes are the most
successful in participating in the global economy.  The business reality of today means that the
economies of all Members function in an era of just-in-time manufacturing and just-in-timedistribution.  Manufacturers need inputs, consumers need final products, and investors need to know
that sourcing plans and production operations will not be subject to interference because of unknown
procedural requirements or other difficulties in obtaining rapid customs clearance.  The general trade
facilitation environment is now often characterized as a critical element of a country’s economic
infrastructure, because it is so closely linked to economic output and growth.WT/GC/W/254
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9. The operation of successful business enterprises – whether large or small – is driven by three
factors:  quality, price, and delivery.  In an era of instant communication and continually increasing
efficiencies in the movement of physical goods, th e trade transaction environment can easily distort
price and delivery.  Competing in an environment of greater and faster trade flow, small enterprises in
particular are harmed by a lack of openness in trade transaction procedures and especially the suddenunavailability of critical services, or needed inputs that are held for unduly long periods of time before
entering the commerce of the WTO Member.
10. The nature of trade flows have changed substantially in the past ten years, not only in terms of
growth, but also in terms of faster time lines.  The nature of trade in goods has been altered because
for some sectors, product cycles last no more th an 12 to 18 months.  Such dramatic and inexorable
changes have been brought about mainly by two simple developments:  first, the revolutionary
changes in how information moves;  second, the c ontinually increasing efficiencies in how physical
goods move.  Within this new trading environmen t, the regulatory infrastructures of all WTO
Members – developed and developing economies alike – need to more actively keep pace with the
technological advancements and developments in logistical practices.
11. Enhancing the trade facilitation environment – particularly with regard to improving
efficiency and transparency at the level of border transactions – would not diminish administrativecapabilities to ensure effective compliance with customs-related requirements or laws concerning
health, safety, and the environment.  Indeed, such  systemic improvements would enhance the ability
of Members to achieve such objectives.
12. The trade facilitation negotiation the United States envisions will help strengthen the WTO
and its ability to respond to the needs and interests of all Members.  We consider this to be among themost important systemic negotiation that will be launched at the third Ministerial Conference.
Improving the trade facilitation environment is a large task, some of which is not appropriate for the
WTO to address.  The WTO work towards improving the trade facilitation environment should be
cast in its true terms: an undertaking of rules-base d systemic and institutional reforms, rather than a
lengthy complex negotiation involving precise harmonization of specific customs techniques.  Amanageable agenda, building upon the existing Agreements and experience to date, along with an
operational programme of assistance that is developed and implemented as the negotiations proceed,
appears to be the most appropriate way to proceed.
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