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dti
the department for Enterprise
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GATT accessions in the late 1960s and early 1970s for Yugoslavia, Poland, Hungary and Romania. For example, when Romania applied to become a contracting party the US, invoking Article XXXV, did not grant Romania MFN status. But Article XXXV can only be invoked when a new member accedes to GATT, since formally the invoking Contracting Party (ie the USA) may not enter into tariff negotiations with the new member. The US appear to have signalled that they intend to take the same route for China. The implication of the US stance is that China will be de facto acceding to GATT and not reacceding, as it is otherwise not possible for the USA not to have conducted tariff negotiations with China.
Accession/Reaccession
6 The GATT does not include reaccession provisions. Although there is no precedent, the China reaccession is being treated in many respects as if it were a de facto accession; eg Working Party examining the foreign trade regime, a protocol of
reaccession.
7 However the Chinese see the situation differently. Because it was the Republic of China which withdrew China from GATT, the People's Republic have always insisted that they see the withdrawal as an illegal act which
act which is null and void as the Republic of China was not empowered to take this decision.
8 Although the Chinese claim to want their original accession to be regarded as valid, viewed from a strict legal standpoint this would also have adverse consequences for them, including the following:
the original Chinese tariff schedule would still be valid, but would be totally out of date and inappropriate to the present circumstances. It would have to be renegotiated;
arguably the Chinese would be unable to claim any grandfather rights since all the present Chinese legislation postdates the original Chinese accession. This would leave all their present legislation open to challenge by GATT Contracting Parties (which could cause the Chinese considerable problems);
- not only would the US ability to apply the Article XXXV opt out clause be
clause be in question, but China would not be permitted to apply any opt outs of its own, say against South Africa;
- at least de jure China would "owe" many years financial contributions to GATT.
Recycled Paper
888-273