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of "substantial transformation". Denmark suggested starting with value added and adding processes bit by bit in the light of experience. When process criteria had been established developing countries could then choose which system they preferred to operate fer the product concerned. Sweden went further and wondered whether LDCs might be allowed to operate the methods with which they were familiar (e.g. Commonwealth countries would use Commonwealth preference rules, Yaoundé countries the EEC rules, etc. for their exports under preference to all markets). This idea was pronounced "interesting" but I doubt whether it will get very far. The ELC said that their system was easy to operate and would cause least difficulty for LDCs.
(e) There was also disagreement on whether the incorporation
of the importing country's own materials should count towards origin for preference purposes. The EEC seemed to be in favour of this but some EFTA countries were violently opposed, partly on grounds of burden- sharing. This is another point on which further dis- cussion will be needed.
(f) On documentation and control the general opinion seemed
to be that certificates signed by recognised authorities, e.g., Customs administrations, Chambers of Commerce, etc. should be demanded. However, it was pointed out that some degree of collaboration would need to be devised with the authorities in developing exporting countries as they would be required to check doubtful documenta- tion.
The question of sanctions (if any) was also raised but not resolved. Certainly the Australians appeared to be in a minority in their willingness to accept exporters' declarations.
(g) There was general agreement on the exclusion of minimal
processes and on direct shipment (about the only agreements reached).
Consideration of Existing Preferential Systems
6. A good deal of the time of the group was also taken up with questions and answers on existing systems as described in the UNCTAD document. The systems dealt with were (in order) the ETC/Yaoundé; the United States; EFTA; Australia; and U.K./Ccm onwealth.
There was also same discussion of
the Canadian and Japanese origin systems which were not covered in the UNCTAD document. Fothing very new emerged from any of these examinations except to show up the extent to which they all differed in various important aspects. For instance, in the case of the Fhilipines, the U.S. requires 80% Philippine content (but only 50% from their Island Territories); the EFTA basic Materials List was based on products not produced in EFTA countries and would not be aplicable as it stood to schemes covering developing countries, etc., etc.
7. Following this examination the general consensus seemed to be that, for one reason or another, none of the existing systems which had been examined really fulfilled all the
/criteria
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