04-22739. WTO Dispute Settlement Proceeding Regarding European Communities-Selected Customs Matters

AGENCY:

Office of the United States Trade Representative.

ACTION:

Notice; request for comments.

SUMMARY:

The Office of the United States Trade Representative (“USTR”) is providing notice that on September 21, 2004, in accordance with the Marrakesh Agreement Establishing the World Trade Organization (“WTO Agreement”), the United States requested consultations with the European Communities regarding (a) the non-uniform administration by the European Communities of laws, regulations, judicial decisions, and administrative rulings pertaining to the classification and valuation of products for customs purposes, and to requirements, restrictions or prohibitions on imports, and (b) the failure of the European Communities to institute judicial, arbitral or administrative tribunals or procedures for the purpose, inter alia, of the prompt review and correction of administrative action relating to customs matters. USTR invites written comments from the public concerning the issues raised in this dispute.

DATES:

Although USTR will accept any comments received during the course of the dispute settlement proceedings, comments should be submitted on or before November 8, 2004, to be assured of timely consideration by USTR.

ADDRESSES:

Comments should be submitted (i) electronically, to [e-mail], Attn: “European Communities—Selected Customs Matters (DS315)” in the subject line, or (ii) by fax to Sandy McKinzy, at [phone], with a confirmation copy sent electronically to the e-mail address above.

FOR FURTHER INFORMATION CONTACT:

Theodore R. Posner, Associate General Counsel, Office of the United States Trade Representative, 600 17th Street, NW., Washington, DC 20508, [phone].

SUPPLEMENTARY INFORMATION:

Section 127(b) of the Uruguay Round Agreements Act (“URAA”) (19 U.S.C. 3537(b)(1)) requires that notice and opportunity for comment be provided after the United States submits or receives a request for the establishment of a WTO dispute settlement panel. Consistent with this obligation, but in an effort to provide additional opportunity for comment, USTR is providing notice that consultations have been requested pursuant to the WTO Understanding on Rules and Procedures Governing the Settlement of Disputes (“DSU”). That request may found at http://www.wto.org contained in a document designated as WT/DS315/1. If such consultations should fail to resolve the matter and a dispute settlement panel is established pursuant to the DSU, such panel, which would hold its meetings in Geneva, Switzerland, would be expected to issue a report on its findings and recommendations within six to nine months after it is established.

Major Issues Raised by the United States

On September 21, 2004, the United States requested consultations with the European Communities pursuant to Articles 1 and 4 of the Understanding on Rules and Procedures Governing the Settlement of Disputes (“DSU”), and Article XXII:1 of the General Agreement on Tariffs and Trade 1994 (“GATT 1994”) regarding:

(a) The non-uniform administration by the European Communities of laws, regulations, judicial decisions and administrative rulings pertaining to the classification and valuation of products for customs purposes, and to requirements, restrictions or prohibitions on imports, and

(b) The failure of the European Communities to institute judicial, arbitral or administrative tribunals or procedures for the purpose, inter alia, of the prompt review and correction of administrative action relating to customs matters.

The principal law-making organs of the European Communities, the Council and the Commission, over time have adopted certain measures pertaining to the classification and valuation of imported goods for customs purposes, as well as procedures for the entry and release of goods into the European Communities. These measures include:

• Council Regulation (EEC) No. 2913/92 of 12 October 1992 establishing the Community Customs Code, including all annexes thereto, as amended;
• Commission Regulation (EEC) No. 2454/93 of 2 July 1993 laying down provisions for the implementation of Council Regulation (EEC) No. 2913/92 of 12 October 1992 establishing the Community Customs Code, including all annexes thereto, as amended;
• Council Regulation (EEC) No. 2658/87 of 23 July 1987 on the tariff and statistical nomenclature and on the Common Customs Tariff, including all annexes thereto, as amended;
• The Integrated Tariff of the European Communities established by virtue of Article 2 of Council Regulation (EEC) No. 2658/87 of 23 July 1987 on the tariff and statistical nomenclature and on the Common Customs Tariff, including all annexes thereto, as amended; and
• For each of the above laws and regulations, all amendments, implementing measures and other related measures.

Administration of the foregoing measures generally is a matter for the national customs authorities in each EC member State. This has led to disparate administration in a number of important areas, including but not limited to:

• Differences in the classification and valuation of goods;
• Differences in procedures for the classification and valuation of goods, including the provision of binding classification and valuation information to importers;
• Differences in procedures for the entry and release of goods, including use of automation in some member States but not others, different certificate of origin requirements, different criteria among member States for the physical inspection of goods, different licensing requirements for importation of food products, and different procedures for processing express delivery shipments;
• Differences in procedures for auditing entry statements after goods are released into the stream of commerce in the European Communities;
• Differences in penalties and differences in procedures regarding the imposition of penalties for violation of customs rules; and
• Differences in record-keeping requirements.

USTR believes the lack of uniformity in administration of EC customs measures to be inconsistent with the obligations of the European Communities, as a member of the World Trade Organization, under Article X:3(a) of the GATT 1994. Article X:3(a) requires a WTO Member to “administer in a uniform, impartial and reasonable manner all its laws, regulations, decisions and rulings of the kind described in [Article X:1].” Disparate administration from member State to member State appears to be inconsistent with the requirement of uniformity.

Furthermore, the Community Customs Code expressly provides that EC member States are responsible for appeals from administrative decisions on customs matters. Thus, an importer or other interested party seeking to challenge a decision by national customs authorities must bring its appeal to a national administrative tribunal or court. USTR understands that only after proceeding through administrative and/or judicial review is the interested party able to have the matter considered by the European Court of Justice.

The lack of procedures for prompt review by a tribunal with EC-wide jurisdiction appears to be inconsistent with the European Communities' obligation under Article X:3(b) of the GATT 1994, which provides, in relevant part, “Each contracting party shall maintain, or institute as soon as practicable, judicial, arbitral or administrative tribunals or procedures for the purpose, inter alia, of the prompt review and correction of administrative action relating to customs matters.”

Public Comment: Requirements for Submissions

Interested persons are invited to submit written comments concerning the issues raised in the dispute. Persons may submit their comments either (i) electronically, to [e-mail], Attn: “European Communities—Selected Customs Matters (DS315)” in the subject line, or (ii) by fax to Sandy McKinzy, at [phone]. For documents sent by fax, USTR requests that the submitter provide a confirmation copy to the electronic mail address listed above.

USTR encourages the submission of documents in Adobe PDF format, as attachments to an electronic mail. Interested persons who make submissions by electronic mail should not provide separate cover letters; information that might appear in a cover letter should be included in the submission itself. Similarly, to the extent possible, any attachments to the submission should be included in the same file as the submission itself, and not as separate files.

Comments must be in English. A person requesting that information contained in a comment submitted by that person be treated as confidential business information must certify that such information is business confidential and would not customarily be released to the public by the commenter. Confidential business information must be clearly designated as such and “BUSINESS CONFIDENTIAL” must be marked at the top and bottom of the cover page and each succeeding page.

Information or advice contained in a comment submitted, other than business confidential information, may be determined by USTR to be confidential in accordance with section 135(g)(2) of the Trade Act of 1974 (19 U.S.C. 2155(g)(2)). If the submitter believes that information or advice may qualify as such, the submitter—

(1) Must clearly so designate the information or advice;

(2) Must clearly mark the material as “SUBMITTED IN CONFIDENCE” at the top and bottom of the cover page and each succeeding page; and

(3) Is encouraged to provide a non-confidential summary of the information or advice.

Pursuant to section 127(e) of the URAA (19 U.S.C. 3537(e)), USTR will maintain a file on this dispute settlement proceeding, accessible to the public, in the USTR Reading Room, which is located at 1724 F Street, NW., Washington, DC 20508. The public file will include non-confidential comments received by USTR from the public with respect to the dispute; if a dispute settlement panel is convened, the U.S. submissions to that panel, the submissions, or non-confidential summaries of submissions, to the panel received from other participants in the dispute, as well as the report of the panel; and, if applicable, the report of the Appellate Body. An appointment to review the public file (Docket WTO/DS315, European Communities—Selected Customs Matters Dispute) may be made by calling the USTR Reading Room at [phone]. The USTR Reading Room is open to the public from 9:30 a.m. to noon and 1 p.m. to 4 p.m., Monday through Friday.

Daniel E. Brinza,

Assistant United States Trade Representative for Monitoring and Enforcement.