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Mata Kuliah Konsentrasi WTO (GATT dan GATS) Topik: MFN dan National Treatment. Dina W. Kariodimedjo FAKULTAS HUKUM UGM. Key concept: Non-discrimination. Principle of the most-favoured-nation (MFN) treatment obligation Principle of the national treatment obligation. GATT 1994.
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Mata Kuliah Konsentrasi WTO (GATT dan GATS)Topik: MFN dan National Treatment Dina W. Kariodimedjo FAKULTAS HUKUM UGM MKK WTO
Key concept:Non-discrimination • Principle of the most-favoured-nation (MFN) treatment obligation • Principle of the national treatment obligation MKK WTO
GATT 1994 • Article I – MFN • Article III - NT MKK WTO
GATS • Article II – MFN • Article XVII - NT MKK WTO
The MFN and NT obligations of the GATT 1994 and the GATS prohibit discrimination on the basis of ‘nationality’ or the ‘national origin or destination’ of the product, service or service supplier MKK WTO
MFN in the GATT 1994 • Nature Article I:1 GATT 1994 • Covers ‘in law’ (de jure) and ‘in fact’ (de facto) discrimination MKK WTO
MFN Consistency Article I:1 GATT 1994 (#1) • Test 1: Whether the measure at issue confers a trade ‘advantage’ of the kind covered by Article I:1; • Test 2: Whether the products concerned are ‘like’ products; and • Test 3: Whether the advantage at issue is granted ‘immediately and unconditionally’ to all like products concerned. MKK WTO
Test 1: The MFN treatment obligation concerns any ‘advantage’ granted by any Member with respect to: • Custom duties, other charges on imports and exports and other customs matters; • Internal taxes; and • Internal regulation affecting the sale, distribution and use of products. (not only concerns advantages granted to other WTO Members, but advantages granted to all other countries –including non-WTO Members) MKK WTO
Test 2: ‘like products’ • The characteristic of the products; • Their end-use; and • Tariff regimes of other Members. MKK WTO
Test 3: advantage granted ‘immediately and unconditionally’ • Once a WTO Member has granted an advantage to imports from a country, it cannot make the granting of that an advantage to imports of other WTO Members conditional upon those other WTO Members ‘giving something in return’ or ‘paying’ for the advantage. MKK WTO
MFN in the GATS • The nature of the MFN treatment obligation provided for in Article II:1 GATS • The test of consistency with Article II:1 GATS • The exemptions from the MFN treatment obligation of Article II:1 of the GATS MKK WTO
The nature of the MFN treatment obligation provided for in Article II:1 GATS • Article II:1 prohibits discrimination between like services and service suppliers from different countries MKK WTO
MFN consistency Article II:1 GATS (#2) • Test 1: Whether the measure is a measure at issue affects trade in services; • Test 2: Whether the services or service suppliers concerned are ‘like’ services or services suppliers; and • Test 3: Whether less favourable treatment is accorded to the services or service suppliers of a Member. MKK WTO
Test 1: Whether the measure is a measure covered by the GATS • A measure by a Member; and • A measure affecting trade in services MKK WTO
Test 2: Whether the services or service suppliers concerned are “like” services or services suppliers • The characteristics of the service or the service supplier; • The classification and description of the service in the United Nations Central Product Classification (CPC) system; and • Consumer habits and preferences regarding the services or the service supplier. MKK WTO
Test 3: Whether less favourable treatment is accorded to the services or service suppliers of a Member • If it modifies the conditions of competition (Article XVII) • De jure and de facto discrimination MKK WTO
Exemptions from the MFN of the GATS • No exemptions from the MFN of the GATT 1994 • Exemptions GATS – Article II:2 GATS: • Member could list measure in the Annex on Article II Exemptions MKK WTO
NT consistency Article III:2, first sentence, GATT 1994 – Internal Taxation (#3) • Test 1: Whether the measure at issue is an ‘internal tax’; • Test 2: Whether the imported and domestic products are ‘like’ products; and • Test 3: Whether the imported products are not taxed in excess of the domestic products. MKK WTO
NT Consistency Article III:2, second sentence, GATT 1994 - Internal Taxation, a broader category of products – ‘like products’, ‘directly competitive or substituable’ (#4) • Test 1: Whether the measure at issue is an ‘internal tax’; • Test 2: Whether the imported and domestic products are directly competitive or substituable; • Test 3: Whether these products are not similarly taxed; and • Test 4: Whether the dissimilar taxation is applied so as to afford protection to domestic products. MKK WTO
NT Consistency Article III:4 GATT 1994 – Internal Regulation (#5) • Test 1: Whether the measure at issue is a law, regulation or requirement covered by Article III:4; • Test 2: Whether the imported and domestic products are ‘like’ products; and • Test 3: Whether imported products are accorded less favourable treatment. MKK WTO
NT GATS – NT GATT • NT Article XVII GATS is different from the NT Article III GATT. • NT GATS: applies only to the extent WTO Members have explicitly committed themselves to grant ‘national treatment’ in respect of specific service sectors • NT GATT: NT obligation has general application to all trade MKK WTO
NT Consistency Article XVII GATS (#6) • Test 1: Whether the measure at issue affects trade in services; • Test 2: Whether the foreign and domestic services or service suppliers are ‘like’ services or service suppliers; and • Test 3: Whether the foreign services or service suppliers are granted treatment no less favourable. MKK WTO
The factors that must be considered in determining ‘likeness’ are, among other relevant factors: (#7) • The characteristics of the products, services and service suppliers; • The classification of the products, services and service suppliers; • Consumer habits and preferences regarding the products, services and service suppliers; and • For products, their end-use. MKK WTO
Case • Newland – a wine drinking country • Richland – a beer exporting country • Customs duties: • 10% on wine • 20% on non-alcoholic beer • 30% on “A type” beers • Exempted: • “A type” beers produced in the US MKK WTO
Bacaan wajib • Van den Bossche, Peter, 2005, The Law and Policy of the World Trade Organization, Text, Cases and Materials, Cambridge University Press, Cambridge, hlm. 308-374. MKK WTO
Terima Kasih MKK WTO