Memorandum on Liberia’s F i T d R iForeign Trade Regime

MFTR Validation WorkshopMFTR Validation WorkshopMonrovia, May 17, 2010

Ramesh Chaitoornmsts@yahoo.ca

Team Leader

TradeCom WTO Accession Project

Enabling Environments Ltd 1

Status of WTO accession

• 153 WTO Members

• 29 countries in accession process – various sizes and levels of development (Algeria, Ethiopia, Equatorial 

d )Guinee, Sudan, Sao Tome, Russia, etc.)

• Accession can be a long and challenging process

• Requires collaboration of many ministries & departmentsp

• Modernization of trade regimes & market opening

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Rationale for WTO Accession1. Increased & diversified export opportunities through 

predictable market access in all other WTO members (MFN treatment)

2. Greater attractiveness to foreign investors

3. Role in multilateral trade negotiations & access to WTO dispute settlement mechanism

4. Strengthened domestic legal framework for trade in goods, services, IP, etc. 

5 Eli ibilit f WTO t h i l i t it b ildi &5. Eligibility for WTO technical assistance, capacity building & new Aid for Trade projects

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Challenges of AccessionChallenges of Accession

• Need to reform domestic legal framework for geconomic activity in economy

• Pressure to accept WTO plus binding• Pressure to accept WTO‐plus binding commitments

• Increased foreign competition 

• Increased susceptibility to external shocksIncreased susceptibility to external shocks

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Article XII (of Marrakesh Agreement 1994)

• Any State or separate customs territory possessing full autonomy in the conduct of its external commercial relations and of the other matters provided for in this Agreement and the Multilateral Trade Agreements may accede to this Agreement, on terms to be agreed between it and the WTO. Such accession shall apply to this Agreement and the Multilateral Trade Agreements annexed thereto.

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The Process at a GlancePrepare Memorandum on the Foreign -Request For AccessionTrade Regime and all Supporting Documents

q-General Council Meeting Prepare ACC/4 and ACC/5

Prepare initial offer on Goods and Services

- Questions/Replies- Working Party Meets to discuss the Foreign Trade Regime Bilateral Negotiations with Trading

Partners

-Observer Status-Working Party Formed

YesNo

Foreign Trade Regime in Conformity with the WTO?

- Bring Foreign Trade Regime into conformity with the WTO-Questions/Replies

Negotiations completed with all countries.

Report by Accession working party & Protocol of Accession

Schedules of Commitments& Concessions

General Council votes on Accession

Working Party recommends accession

Parliament of acceding country ratifies accession

MOET - June 2002

Member on the 30th day after ratification

Memorandum of Foreign Trade RegimeMemorandum of Foreign Trade Regime

• Detailed description of the rules regulations and• Detailed description of the rules, regulations and administrative procedures governing import and export of Goods and Services investmentexport of Goods and Services, investment. 

• And all other areas covered by WTO rules: I t ll t l t i lt b idiIntellectual property, agriculture, subsidies, establishment of companies, safeguards, quotas, etc.

• Trade statistics

• Main laws governing foreign trade

• Details on information needed in ‐ WT/ACC/1 (24 March, 1995)March, 1995)

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1. Framework for Enforcing Policies re Foreign TradeTrade

1. Powers of executive, legislative and judicial branches of government.

2. Government entities responsible for making and i l ti li i ff ti f i t dimplementing policies affecting foreign trade.

3. Division of authority between central and sub‐central governmentsgovernments.

4. Any legislative programmes or plans to change the regulatory régimeregulatory régime.

5. Laws and Legal Acts (Annex 2 refers).

6 Description of judicial arbitral or administrative tribunals or6. Description of judicial, arbitral or administrative tribunals or procedures, if any.

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2. Regime for Trade in Goods2. Regime for Trade in Goods

Import regulations

a) Registration requirements for engaging in importing

b) Description of national tariff

c) Tariff quotas, tariff exemptions

d) Other duties and charges, specifying any charges for services rendered;

e) Quantitative import restrictions, including prohibitions, quotas and licensing systems;

f) Import licensing procedures (Annex 3 refers);

g) Other border measures

h) Customs valuation; other customs formalities

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Goods Import regime (cont’d)

j) pre‐shipment inspection;

k) application of internal taxes on imports;

l) rules of origin;

m) anti‐dumping régime;

n) countervailing duty régime;) g y g

o) safeguard régime.

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Export regime for goods

a) registration requirements for engaging in exporting;

b) customs tariff nomenclature, types of duties, duty rates, weighted averages of rates;

c) quantitative export restrictions, including prohibitions, quotas and licensing systems;

d) t li i dd) export licensing procedures;

e) other measures, e.g. minimum export prices, voluntary export restrictions orderly marketing arrangements;export restrictions, orderly marketing arrangements;

f) export financing, subsidy and promotion policies;

g) export performance requirementsg) export performance requirements;

h) import duty drawback schemes.

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Internal Policies Affecting Trade in Goods

• Industrial policy, Technical standards, SPS p ymeasures, TRIMs, free zones, etc. 

• Regulations re agricultural trade• Regulations re agricultural trade, 

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3. Intellectual Property

• Intellectual property policy;

bl f l f l d• Responsible agencies for policy formulation and implementation;

M b hi f i t ti l i t ll t l t• Membership of international intellectual property conventions and of regional or bilateral agreements;

• application of national and m f n treatment to foreign• application of national and m.f.n. treatment to foreign nationals;

• Fees and taxesFees and taxes.

• Standards of protection ‐ Copyright and related rights, performance rights, trademarks, patents, plant varieties, p g , , p , p ,integrated circuits, etc. 

• Enforcement of IP

• Laws, regulations, etc. re above13

4. Trade in Services

• General description of the overall market and l f hregulatory structures of the most prominent services 

sectors (e.g., financial services, telecommunications, f i l i i iprofessional services, construction, tourism, 

transportation). 

• Policies affecting trade in services – laws, regtns., administrative tribunals, etc. 

• Market access and national treatment

• Import and export data for servicesImport and export data for services 

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5. Trade with Third Countries

1. Bilateral or plurilateral agreements relating to foreign trade d d d ( f )in goods and trade in services (Annex 8A refers).

2. Economic integration, customs union and free‐trade area t (A 8B f )agreements (Annex 8B refers).

3. Labour markets integration agreements.

4 M ltil t l i ti b hi i th4. Multilateral economic cooperation, membership in the multilateral economic organizations, trade‐related programmes of other multilateral organizationsprogrammes of other multilateral organizations.

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Why produce MFTR?Why produce MFTR?

• WTO members want to see regimes that are– Transparentp

– Predictable  (consistent)

Rooted in Laws & Regulations– Rooted in Laws & Regulations

– Consistent with international standards (WTO l )rules)

Need to give clear picture to delegations in g p gGeneva

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Missing Information for MFTRMissing Information for MFTR

• All laws & regulations governing trade and economic activity – only 25 laws in MFTR. y y

• Unable to get any regulations – but these define administrative proceduresdefine administrative procedures

• In absence of adequate laws & regtns, many questions will be asked in Geneva

• ‐ Under what legal instrument is an IPD or• ‐ Under what legal instrument is an IPD or EPD mandatory? Or PSI? 

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Horizontal issuesHorizontal issues• Land holding or tenure – what regulationsLand holding or tenure  what regulations govern leases (length of leases to investors by i t iti t)private citizens vs government)

• What legal basis for leases if Constitution gprevents ownership by foreigners

• Work permits What is the regime?• Work permits – What is the regime? 

‐ investors need to bring managers, specialists.

‐ Service suppliers will need temporary entry to provide servicesto provide services

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Port Customs Border MeasuresPort, Customs, Border Measures

• NPA past record is not flattering. What has changed? Is changing? High idle time for g g g gpersonnel; long delays, lack of clarity of process; unpredictable fees etc etcprocess; unpredictable fees, etc., etc. 

• MFTR will have to show what has improved l l land clearly outline process 

• Traders want ‐ transparent & predictableTraders want  transparent & predictable

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Technical standardsTechnical standards

• If product is stopped at port, must have valid, scientific reason for preventing its importp g p

• Does BIVAC cover product standards or quality? Are any standards employed?quality? Are any standards employed? 

• What exactly is the role of MoCI? 

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Services InformationServices Information

• Most lacking – data, rules, etc

• 160 services activities listed under the General160 services activities listed under the General Agreement on Trade in Services

Wh i i i• What governs accounting, engineering, architecture, legal? Are only citizens allowed to practise? 

• Health services Transport Construction• Health services, Transport, Construction, Environment, etc. 

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Need clarity on:Need clarity on:

• Investment incentives – 2009 Act only? 

• What legitimate current barriers to trade or i h ld b k ?investment should be kept?

• What are non‐defensible? 

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The EndThank You

R h Ch itRamesh Chaitoornmsts@yahoo carnmsts@yahoo.ca

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