RESTRICTED
WORLD TRADE WT/WGTCP/W/5
19June1997
ORGANIZATION(97-2514)
Original: English Working Group ontheInteraction
between Trade andCompetition Policy
COMMUNICATION FROM THE REPUBLIC OFKOREA
Thefollowing communication hasbeenreceived fromthePermanent Mission oftheRepublic
ofKorea withtherequest thatitbecirculated toMembers.
_______________
I. INTRODUCTION
1. TheWorking Group onTrade andCompetition ismandated bytheSingapore Ministerial
Declaration, interalia,tostudy issues raised byMembers relating totheinteraction between trade
andcompetition policy.
2. Toaccomplish thismandate, itisimportant toensure thattheactivities oftheWorking Group
adhere tothefollowing:
(a) Agradual andeducational approach:
(i) thegrowing linkages between tradeandcompetition policies intheglobalizing
economy haverendered obsolete theconventional distinctions based onthe
applicable market-place (i.e.tradepolicy 'straditional emphasis ontransborder
competition andcompetition policy 'semphasis ondomestic competition);
(ii) however, given thefactthattrade andcompetition policies have evolved
differently,theWorkingGroupshouldadoptagradualandeducationalapproach
toallow forWTO Members 'various levels ofexperience inthese fields.
(b) Acomprehensive andbalanced approach:
(i) tohaveanoverall andbalanced perspective oftheinteraction between trade
andcompetition, noaspect ofrelated policies should beexcluded apriori from
thescope ofthestudy tobeundertaken;
(ii) theWorking Group should study theimpact ofcompetition policies ontrade
(including theiranti-trade bias), aswellastheimpact oftrade measures on
domestic competition (including theiranti-competitive bias).WT/WGTCP/W/5
Page2
II. SUGGESTED WORK PROGRAMME AND ISSUES FOR DISCUSSION
1. Stocktaking
(a) Toconduct asurvey ofthedomestic lawsandpolicies ofWTO Members pertaining totrade
andcompetition, withaparticular emphasis on1:
(i) howconsumer welfare andeconomic efficiency arereflected therein;
(ii) howthemajor concepts (e.g. injury) have been reflected incompetition lawsand
competition-related trade laws.
(b) Totakestock ofexisting international rulesrelated totrade andcompetition, asreflected in:
(i) competition-related WTO provisions;
(ii) theresults ofrule-making efforts inother intergovernmental bodies, including
UNCTAD;
(iii) bilateral andregional agreements.
(c) Totakestock ofacademic work ontheinteraction between trade andcompetition policies.
2. Economic andlegalanalysis (major issues tobeexplored)
(a) Effect ofanti-competitive practices ontrade:
(i) toidentifyanti-competitivepracticeswithanti-tradebias,andanalysehowthesepractices
undermine theeffect oftrade liberalization2;
(ii) toexamine howsuchtrade-restricting effects ofanti-competitive practices areaddressed
innational competition policies andrules;
(iii) toexamine theeffect oftheenforcement ofcompetition policies/rules ontrade
(e.g.extraterritoriality ofcompetition laws).
(b) Effect oftrade policies andmeasures oncompetition:
(i) toidentify trade policies andmeasures withananti-competitive bias,andtoanalyse
howsuchpolicies andmeasures restrain competition inthedomestic market-place;
(ii) toexamine howsuchanti-competitive effects oftradepolicies andmeasures havebeen
addressed inWTO rules.
1Itisexpected thatsuchasurvey mayinitially focus onaspects ofcompetition policy, suchasthecurrent
status androleofthecompetition lawsofWTO Members, which isanareayetunfamiliar totheWTO. Successful
casestudies, inparticular regarding developing countries, would beuseful inthisregard.
2Theeffect ofrestrictive business practices onthepartofinternational cartels maybeexamined under this
topic.WT/WGTCP/W/5
Page3
(c) Interrelations between competition policy /rules andtrade policy /rules:
(i) toexplore thedesirability ofdeveloping amultilateral framework ofcompetition rules,
andtoexamine thelegal problems, ifany,ofdeveloping suchaframework, with
particular emphasis ontheexisting competition-related rules oftheWTO;
(ii) toanalysethehypotheticalrelationshipbetweensuchaninternationalcodeofcompetition
andthemultilateral trading system under theWTO (e.g.whether competition-related
WTO ruleswould remain relevant ifnational competition policies areharmonized under
aninternational competition regime);
(iii) tocomparetherelativedesirabilityintermsofpromotionofoverallcompetitionbetween
thecurrent system ofplacing competition-related traderulesunder general WTO rules
andtheoption ofplacing them under aseparate international regime governing
competition policy.