Materi Kuliah Hukum Perdagangan Internasional
12/29/2015
TRIMS
Agreement on Trade-Related
Investment Measures
This
Agreement, applies only to measures that
affect trade in goods.
Investment
measures can have traderestrictive and distorting effects, it states that
no Member shall apply a measure that is
prohibited by the provisions of GATT Article III
(national treatment) or Article XI (quantitative
restrictions)
GENERAL FEATURES
1
12/29/2015
TRIMs
Agreement does not apply to
services.
Measures
which require particular levels
of local procurement by an enterprise
( local content requirements ).
Measures
which limit a company s
imports or set targets for the company to
export ( trade balancing
requirements ).
TRADE-RESTRICTIVE & DISTORTING
EFFECTS
2
12/29/2015
A
local content requirement imposed in
a non-discriminatory manner on
domestic and foreign enterprises is
inconsistent with the TRIMs Agreement
because it involves discriminatory
treatment of imported products in
favour of domestic products.
The
fact that there is no discrimination
between domestic and foreign investors
in the imposition of the requirement is
irrelevant under the TRIMs Agreement.
Paragraph
1(a) local content, which
require the purchase or use by an
enterprise of products of domestic origin
or domestic source (local content
requirements);
Paragraph
1(b) covers trade-balancing,
which limit the purchase or use of
imported products by an enterprise to
an amount related to the volume or
value of local products that it exports.
TRIMS INCONSISTENT WITH NT
(ART. III:4) GATT
3
12/29/2015
Paragraph
2(a) measures which limit the importation
by an enterprise of products used in its local
production, generally or to an amount related to the
volume or value of local production exported by the
enterprise.
Paragraph
2(b) restriction of imports in the form of a
foreign exchange balancing requirement. Importation
by an enterprise of products used in or related to local
production is limited by restricting the enterprise's
access to foreign exchange to an amount related to
the foreign exchange inflows attributable to the
enterprise.
TRIMS INCONSISTENT WITH QUANTITATIVE
RESTRICTIONS (ART. XI:1) GATT
Paragraph
2(c) measures involving
restrictions on the exportation of or sale
for export by an enterprise, whether
specified in terms of particular products,
volume or value of products or in terms
of a proportion of volume or value of its
local production.
4
12/29/2015
Short title:
India
Complainant:
United States
Respondent:
India
Third Parties:
European Communities; Japan;
Korea, Republic of
GATT 1994: Art. III, III:4, XI, XI:1
Trade-Related Investment
Measures (TRIMs): Art. 2, 2.1, 2.2
Agreements cited:
(as cited in request for
consultations)
Autos
Request for
Consultationsreceived:
Panel Reportcirculated:
2 June 1999
Appellate Body
Report circulated:
19 March 2002
21 December 2001
CASE
Under
these measures, imports of complete
automobiles and of certain parts and
components were subject to a system of nonautomatic import licenses.
In
accordance with Public Notice No. 60,
import licenses might be granted only to local
joint venture manufacturers that had signed an
MoU with the Indian Government, whereby
they undertook, inter alia, to comply with
certain local content and export balancing
requirements.
EC COMPLAINTS
5
12/29/2015
Achieve
specified levels of local
content;
Achieve
a neutralization of foreign
exchange by balancing the value of
certain imports with the value of exports
of cars and components over a stated
period; and
Limit
imports to a value based on the
previous year s exports.
US COMPLAINTS
India
had acted inconsistently with Article III:4
GATT by imposing on automotive manufacturers
an obligation to use a certain proportion of local
parts and components in the manufacture of cars
and automotive vehicles ( indigenization
condition);
India
had acted inconsistently with Article XI GATT
by imposing on automotive manufacturers an
obligation to balance any importation of certain
kits and components with exports of equivalent
value ( trade balancing condition); and,
PANEL & AB
6
12/29/2015
India
had acted inconsistently with Article III:4
GATT by imposing, in the context of the trade
balancing condition, an obligation to offset
the amount of any purchases of previously
imported restricted kits and components on
the Indian market, by exports of equivalent
value.
7
TRIMS
Agreement on Trade-Related
Investment Measures
This
Agreement, applies only to measures that
affect trade in goods.
Investment
measures can have traderestrictive and distorting effects, it states that
no Member shall apply a measure that is
prohibited by the provisions of GATT Article III
(national treatment) or Article XI (quantitative
restrictions)
GENERAL FEATURES
1
12/29/2015
TRIMs
Agreement does not apply to
services.
Measures
which require particular levels
of local procurement by an enterprise
( local content requirements ).
Measures
which limit a company s
imports or set targets for the company to
export ( trade balancing
requirements ).
TRADE-RESTRICTIVE & DISTORTING
EFFECTS
2
12/29/2015
A
local content requirement imposed in
a non-discriminatory manner on
domestic and foreign enterprises is
inconsistent with the TRIMs Agreement
because it involves discriminatory
treatment of imported products in
favour of domestic products.
The
fact that there is no discrimination
between domestic and foreign investors
in the imposition of the requirement is
irrelevant under the TRIMs Agreement.
Paragraph
1(a) local content, which
require the purchase or use by an
enterprise of products of domestic origin
or domestic source (local content
requirements);
Paragraph
1(b) covers trade-balancing,
which limit the purchase or use of
imported products by an enterprise to
an amount related to the volume or
value of local products that it exports.
TRIMS INCONSISTENT WITH NT
(ART. III:4) GATT
3
12/29/2015
Paragraph
2(a) measures which limit the importation
by an enterprise of products used in its local
production, generally or to an amount related to the
volume or value of local production exported by the
enterprise.
Paragraph
2(b) restriction of imports in the form of a
foreign exchange balancing requirement. Importation
by an enterprise of products used in or related to local
production is limited by restricting the enterprise's
access to foreign exchange to an amount related to
the foreign exchange inflows attributable to the
enterprise.
TRIMS INCONSISTENT WITH QUANTITATIVE
RESTRICTIONS (ART. XI:1) GATT
Paragraph
2(c) measures involving
restrictions on the exportation of or sale
for export by an enterprise, whether
specified in terms of particular products,
volume or value of products or in terms
of a proportion of volume or value of its
local production.
4
12/29/2015
Short title:
India
Complainant:
United States
Respondent:
India
Third Parties:
European Communities; Japan;
Korea, Republic of
GATT 1994: Art. III, III:4, XI, XI:1
Trade-Related Investment
Measures (TRIMs): Art. 2, 2.1, 2.2
Agreements cited:
(as cited in request for
consultations)
Autos
Request for
Consultationsreceived:
Panel Reportcirculated:
2 June 1999
Appellate Body
Report circulated:
19 March 2002
21 December 2001
CASE
Under
these measures, imports of complete
automobiles and of certain parts and
components were subject to a system of nonautomatic import licenses.
In
accordance with Public Notice No. 60,
import licenses might be granted only to local
joint venture manufacturers that had signed an
MoU with the Indian Government, whereby
they undertook, inter alia, to comply with
certain local content and export balancing
requirements.
EC COMPLAINTS
5
12/29/2015
Achieve
specified levels of local
content;
Achieve
a neutralization of foreign
exchange by balancing the value of
certain imports with the value of exports
of cars and components over a stated
period; and
Limit
imports to a value based on the
previous year s exports.
US COMPLAINTS
India
had acted inconsistently with Article III:4
GATT by imposing on automotive manufacturers
an obligation to use a certain proportion of local
parts and components in the manufacture of cars
and automotive vehicles ( indigenization
condition);
India
had acted inconsistently with Article XI GATT
by imposing on automotive manufacturers an
obligation to balance any importation of certain
kits and components with exports of equivalent
value ( trade balancing condition); and,
PANEL & AB
6
12/29/2015
India
had acted inconsistently with Article III:4
GATT by imposing, in the context of the trade
balancing condition, an obligation to offset
the amount of any purchases of previously
imported restricted kits and components on
the Indian market, by exports of equivalent
value.
7