TNAG-0135-FCO40-171-Tariff-preferences-for-developing-countries-1969 — Page 61

charged with .f.n. rates of duty. The other possibility was that m.f.n, tariff ates would be reduced to the levels operative on imports from developing count: 25. The Group agreed that it was not possible to make a recommendation at this

staga on the depth of tariff outs, The Group emphasized that any arrangement for special tariff treatment would not prevent developed countries from consulting among überunelves to decide whether they would be prepared to make further m.f.n. tariff

Chis.

#

Safemand and Adjustment Procedures

?7. The Group agreed that some provision would have to be made enabling dozor

„ either to discontinue or modify the grant of special tariff treatment on

pounds with products or to impose limits on the volume of such products admitted on

special Ariff terms. This would be necessary in order to mitigate the possible effects of increased competition in their markets, or to provide a means of safe- guarding the export interests of third countries, whether beneficiary countries or

nob.

The conventional method of dealing with this contingency would be an "escape clause" provision which could be used if the donor county judged that increased competition in its market, arising becuase of the grant of special taxiff treatment, ind resulted or threatened to result in injury to a domestic industry or to an expræt. industry in a third country. The escape clause action might take the form of removal of the product from the scheme entirely, en inrease in the special inte of duty, 02 a tariff quota.

#

29. Another method of dealing with it, which was described in the Group's interim report, would be the tariff quota cum "adjustment procedure" device under which upooial tariff treatment would in principle be limited for any product to an amount or value equivalent to a specified proportion of national production or consumptica, without regard to the concept of injury to a specifio domestic industry; and a

developing country might cease to qualify for participation in the "quotas" for

particular products in individual developed markets on the basis of its export

performance in those products in these markets. The imposition of the total tariff

quote as well as the use of the adjustment procedure might he mandatory or permissive.

30, Although the Group devoted a considerable part of their time to the examination

of the merits and shortcomings of the different methods of providing against the

possible dangers referred to in paragraph 27, they were not able to reach agreement

that any one method was so demonstrably superior to the others or was so sufficiently

free from risks or difficulties of its own that they could recommend it for general

acceptance.