TNAG-0132-FCO40-168-Tariff-preferences-for-developing-countries-1969 — Page 87

CONFIDENTAL

7.

(d) both other donor and beneficiary countries would in certain

circumstances be justified in requesting consultations in the

event of preferences being withdrawn (the former on grounds of burden-sharing; the latter if their exports suffered as a result); (e) such consultations might take place cither before or after with-

drawal, but it was recognized that consultation would in practice

probably take place after withdrawal, on an analogy with the

"critical circumstances" procedure in para. 2 of article XIX of

the GATT;

(f) the OCD would provide a satisfactory forum for consultations with

other donors, who would be notified of any withdrawals;

(g) consultations with developing countries might take place either in

a restricted group of those countries most directly concerned:

or, if a wider forum were accepted, as part of a regular review

of the operation of the scheme as a whole; it was generally

reɔɔgnized that the LDC's would want such consultations to take

place under UNCTAD rather than GATT auspices, and no-one objected to this in principle;

(h) no-one objected to the Japanese proposal that a donor country whose

exports had suffered as a result of the granting of a particular

preference should be entitled to make representation to the

importing country.

One point, made by the Turkish delegate, was that the sudden and apparently arbitrary withdrawl of preferences could disrupt the development plans of LDCs. He pointed out that the crucial question was injury and considered that an objective definition could be made of this. He also made a distinction between injury and competitiveness.

8.

As a conclusion it was agreed, on the Chairman's proposition, that the Working Party of the Trade Committee (composed of permanent delegations in Paris) should be asked to draft a short paper, on the basis of the

CONFIDENTIAL

/discussion,