Handbook On Duty-Free and Quota-Free Market Access and Rules of Origin For Least Developed Countries (Part I)

QUAD Countries

Least developed countries (LDCs) have been granted preferential tariff treatment in the markets of developed and developing countries under a number of schemes and arrangements, such as the Generalized System of Preferences (GSP), the trade preferences under the former African, Caribbean and Pacific Group of Countries (ACP)–European Community (EC) Cotonou Partnership Agreement, and other preferential instruments granted to selected countries and groups of countries. In spite of these existing initiatives, significant obstacles to LDCs market access remain.

The 1996 Singapore Ministerial Declaration refocused the attention of the trading community on the idea of unilateral preferences by launching the initiative of special trade preferences for LDCs, including provisions for taking positive measures, for example duty-free market access on an autonomous basis.

In response to the Singapore proposal, a number of initiatives were taken to provide more favourable market access conditions for LDCs. In spite of these initiatives the LDCs and the international trade community considered that the progress made was not yet sufficient. In fact the Hong Kong (China) Ministerial decision re-launched the idea of providing duty-free and quota-free to LDCs.

Following the 2005 Hong Kong (China) decision, progress has been made by preference-granting countries in order to achieve duty-free and quota-free market access for products originating in LDCs. For this purpose, new developments in the existing DFQF arrangements have taken place.

The 2013 Bali Ministerial declaration did not include substantial changes to the 2005 Hong Kong (China) Decision on Measures in Favour of Least Developed Countries; nevertheless it did introduce a Decision on preferential rules of origin for LDCs, setting the guidelines for preference-granting countries to build upon their individual rules of origin, in a manner that promotes the utilization of their preferential arrangements and therefore contributing to facilitating market access for LDCs.

The 2015 Nairobi declaration on preferential provided for guidelines, a format for notification of Rules of origin and utilization rates of DFQF.

The present handbook reviews the progress made to implement the Hong Kong (China) decision until the Nairobi WTO Ministerial of 2015 and subsequent changes that individual QUAD countries have made to their schemes till 31 December 2017.

The first part focuses on the special provisions in favour of LDCs and related rules of origin, as contained in the GSP schemes of the Quad countries, namely Canada, those of the European Union Japan and the United States.

A second part of this handbook will focus on the implementation of the Hong Kong (China) Ministerial decision on duty-free and quota-free (DFQF) market access by other developed countries and developing countries.