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<html> <head> <meta name="Generator" content="Corel WordPerfect 8"> <meta name="DATE" content="3/19/1998"> <meta name="Author" content="compex"> <title>'MINISTERIAL DECLARATION OF SAN JOSÉ' - FOURTH WESTERN HEMISPHERE TRADE MINISTERIAL MEETINGOF THE FREE TRADE AREA OF THE AMERICAS - SAN JOSÉ, COSTA RICA</title> </head> <body text="#000000" link="#0000ff" vlink="#551a8b" alink="#ff0000" bgcolor="#c0c0c0"> 98/21 "MINISTERIAL DECLARATION OF SAN JOSÉ" FOURTH WESTERN HEMISPHERE TRADE MINISTERIAL MEETING OF THE FREE TRADE AREA OF THE AMERICAS SAN JOSÉ, Costa Rica March 19, 1998 This document is also available on the Department's Internet site: http://www.dfait-maeci.gc.ca I. INTRODUCTION 1. We, the Ministers Responsible for Trade, representing the 34 countries that participated in the Summit of the Americas, in Miami, in December 1994, met at the Fourth Ministerial Meeting on Trade in San José, Costa Rica, to review the results of the preparatory work for the negotiations of the Free Trade Area of the Americas (FTAA) with the intent to recommend to our Heads of State and Government the initiation of the negotiations. 2. We note the progress achieved in trade liberalization in this Hemisphere, since the Miami Summit of the Americas, as a result of the implementation of the obligations assumed by our Governments in the context of the Uruguay Round of Multilateral Trade Negotiations and of the World Trade Organization (WTO); the widening and deepening of existing subregional and bilateral integration and free trade agreements; the signing of new agreements; and the unilateral trade liberalization measures adopted by some countries. Even as countries in our region have been tested by financial and other economic pressures, the overall course in the Americas has been one of faster economic growth, lower inflation, expanded opportunities, and confidence in participating in the global marketplace. A major reason for this positive record has been our countries' steadfast and co-operative efforts to promote prosperity through increased economic integration and more open economies. We are confident, therefore, that the FTAA will improve the well-being of all our people. 3. With the intent of contributing to the expansion of world trade, we reaffirm our commitment that the FTAA shall not raise additional barriers to other countries, and we will continue to avoid to the greatest extent possible the adoption of policies that adversely affect trade in the hemisphere. 4. Furthermore, we reiterate that the negotiation of the FTAA shall take into account the broad social and economic agenda contained in the Miami Declaration of Principles and Plan of Action with a view to contributing to raising living standards, to improving the working conditions of all people in the Americas and to better protecting the environment. 5. In designing the FTAA we shall take into account differences in the levels of development and size of the economies in our Hemisphere, to create opportunities for the full participation of the smaller economies and to increase their level of development. 6. We recognize the wide differences in the level of development and size of economies existing in our Hemisphere and we will remain cognizant of these differences as we work to ensure their full participation in the construction of the FTAA. 7. We reviewed and approved the work submitted to us by the Preparatory Committee of Vice-Ministers on how to proceed with the negotiations of the FTAA. II. INITIATION OF THE NEGOTIATIONS 8. We recommend to our Heads of State and Government that they initiate negotiation of the FTAA during the Second Summit of the Americas, which will be held in Santiago, Chile, on April 18 and 19, 1998, in accordance with the objectives, principles, structure, venue and other decisions set forth in this Declaration. 9. We reaffirm the principles and objectives that have guided our work since Miami, as set out in Annex I, including inter alia that the agreement will be balanced, comprehensive, WTO-consistent, and will constitute a single undertaking. It will take into account the needs, economic conditions and opportunities of the smaller economies. The negotiations will be transparent and built on consensus decision making. The FTAA can co-exist with bilateral and subregional agreements, to the extent that the rights and obligations under these agreements are not covered by or go beyond the rights and obligations of the FTAA. We remain committed to concluding the negotiations no later than 2005 and to achieving concrete progress toward the attainment of this objective by the end of the century. III. STRUCTURE AND ORGANIZATION OF THE NEGOTIATIONS 10. We have agreed to an initial structure for the negotiations. This structure is flexible and we expect to modify it over time as required to assist the negotiations. We will exercise the ultimate oversight and management of the negotiations and therefore we will meet as required and no less than every 18 months. We establish the Trade Negotiations Committee (TNC) at the vice-ministerial level. The TNC will have a Chair and a Vice-Chair. The TNC will select the Chair and Vice-Chair of each negotiating group. The TNC will have the responsibility of guiding the work of the negotiating groups and of deciding on the overall architecture of the agreement and institutional issues. The TNC is to take overall responsibility for ensuring the full participation of all the countries in the FTAA process. It will also ensure that this issue, in particular the concerns of the smaller economies and concerns related to countries with different levels of development, will be dealt with within each negotiating group. The TNC should meet as required and no less than twice a year. It should hold its first meeting no later than June 30, 1998. 11. We establish nine negotiating groups on: market access; investment; services; government procurement; dispute settlement; agriculture; intellectual property rights; subsidies, antidumping and countervailing duties; and competition policy. The Chair and Vice-Chair of each group will be selected taking into account the need to maintain geographic balance among countries. They will serve for a period of 18 months or until the subsequent ministerial meeting. As a general principle, there should not be immediate re-election of the Chair and Vice-Chair. This principle establishes a presumption against immediate re-election, but should not be inflexibly applied. The negotiating groups will be guided in their work by the general principles and objectives in Annex I as well as specific objectives in Annex II. We mandate the TNC in its first meeting to develop a work program for the negotiating groups in order to ensure that they begin their work no later than September 30, 1998. We have agreed that the meetings of the negotiating groups will be held in a single venue, which will rotate among the following three countries: Miami, United States: from May 1, 1998 to February 28, 2001 Panama City, Panama: from March 1, 2001 to February 28, 2003 Mexico D.F., Mexico: from March 1, 2003 to December 31, 2004 The period for which Mexico hosts the venue of the negotiations will be up to the conclusion of the negotiations. The following countries will assume the Chair and Vice-Chair of the negotiating groups for the first 18-month period: <table width="100%"> <tr valign="TOP"><td></td> <td align="CENTER"></td> <td align="CENTER"></td></tr> <tr valign="TOP"><td>Negotiating Group Market Access</td> <td>Chair Colombia</td> <td>Vice-Chair Bolivia</td></tr> <tr valign="TOP"><td>Investment</td> <td>Costa Rica</td> <td>Dominican Republic</td></tr> <tr valign="TOP"><td>Services</td> <td>Nicaragua</td> <td>Barbados</td></tr> <tr valign="TOP"><td>Government Procurement</td> <td>United States</td> <td>Honduras </td></tr> <tr valign="TOP"><td>Dispute Settlement</td> <td>Chile</td> <td>Uruguay-Paraguay</td></tr> <tr valign="TOP"><td>Agriculture</td> <td>Argentina</td> <td>El Salvador</td></tr> <tr valign="TOP"><td>Intellectual Property Rights</td> <td>Venezuela</td> <td>Ecuador</td></tr> <tr valign="TOP"><td>Subsidies, Antidumping and Countervailing Duties</td> <td>Brazil</td> <td>Chile</td></tr> <tr valign="TOP"><td>Competition Policy</td> <td>Peru</td> <td>Trinidad and Tobago</td></tr></table> Work in different groups may be interrelated, such as agriculture and market access; services and investment; competition policy; and subsidies, antidumping and countervailing duties; among others. The TNC shall identify linkages and outline appropriate procedures to ensure timely and effective co-ordination. We agree to give the mandate to the relevant negotiating groups to study issues relating to: the interaction between trade and competition policy, including antidumping measures, and market access and agriculture, in order to identify any areas that may merit further consideration by us. The groups involved will report their results to the TNC no later than December 2000. This is without prejudice to decisions made by the TNC to dissolve, establish or merge groups. Likewise, the negotiating groups may establish ad hoc working groups. Chairmanship of the FTAA 12. The Chairmanship of the FTAA process will rotate among different countries at the end of each Ministerial Meeting. The country that chairs the FTAA process will host the Ministerial Meetings and will also chair the TNC. The countries holding the positions of Chair and Vice-Chair of the FTAA process will be: <ins></ins>May 1, 1998-Oct. 31, 1999: Chair, Canada; Vice-Chair, Argentina Nov. 1, 1999-Apr. 30, 2001: Chair, Argentina; Vice-Chair, Ecuador May 1, 2001-Oct. 31, 2002: Chair, Ecuador; Vice-Chair, Chile Nov. 1, 2002-Dec. 31, 2004: Co-Chairs, Brazil and the United States of America The period in which the United States of America and Brazil exercise the co-chairmanship will be until the conclusion of the negotiations. In the last period, from November 1, 2002, to December 31, 2004, there will be at least two Meetings of Ministers Responsible for Trade, one in each co-chair country. In the first 18-month period, three meetings of the TNC will be held, one in each of the following countries: Argentina, Suriname and Bolivia. In the second 18-month period, from November 1, 1999 to April 30, 2001, Guatemala will hold the first meeting of the TNC. Consultative Group on Smaller Economies 13. We have agreed to establish a Consultative Group on Smaller Economies, open to the participation of all the FTAA countries and reporting to the TNC. For the first period, the Chair will be Jamaica, with Guatemala serving as Vice-Chair. Succession criteria will be the same as those applying to the negotiating groups. The Consultative Group will have the following functions: a) follow the FTAA process, keeping under review the concerns and interests of the smaller economies; and b) bring to the attention of the TNC the issues of concern to the smaller economies and make recommendations to address these issues. Administrative Secretariat for the Negotiations 14. We have agreed to create an Administrative Secretariat for the negotiations, which will conclude no later than the year 2005. It will report to the TNC and will: a) provide logistical and administrative support to the negotiations; b) provide translation services for documents and interpretation during the deliberations; c) keep the official documents of the negotiation; and d) publish and distribute documents. This Administrative Secretariat will be located at the same venue as the meetings of the negotiating groups. It should be funded from local resources and existing resources of the Tripartite Committee institutions. We recommend our Governments to instruct their representatives in the institutions of the Tripartite Committee -- in particular the Inter American Development Bank -- to allocate appropriate existing resources within their institutions to support the Administrative Secretariat. The TNC will determine the size and composition of the staff and will appoint the Head of the Secretariat. Tripartite Committee 15. We express our appreciation to the Tripartite Committee for the technical and logistical support given during the preparatory phase of the FTAA negotiation. We request that the respective institutions of the Tripartite Committee continue to provide the appropriate existing resources necessary to respond positively to requests for technical support from FTAA entities, including reallocation for this purpose if necessary. Furthermore, we ask the three institutions to provide technical assistance related to FTAA issues to member countries, particularly smaller economies, at their request, according to the procedures of the respective institutions. 16. We also express our appreciation and reiterate our interest, that the pertinent multilateral, regional and subregional institutions continue to offer, in their areas of recognized specialization, additional contributions in response to specific requests from the TNC and the negotiation groups. IV. OTHER ISSUES Participation of Civil Society 17. We reaffirm our commitment to the principle of transparency of the negotiation process, to facilitate the constructive participation of the different sectors of society. We also reaffirm our commitment to the Belo Horizonte Ministerial Declaration and to paragraph 4 of the Singapore Ministerial Declaration of the WTO. We recognize and welcome the interests and concerns that different sectors of society have expressed in relation to the FTAA. Business and other sectors of production, labour, and environmental and academic groups have been particularly active in this matter. We encourage these and other sectors of civil societies to present their views on trade matters in a constructive manner. We have, therefore, established a committee of government representatives, open to all member countries, who shall select a chair. The committee shall receive inputs, analyse them and present the range of views for our consideration. In this regard, we value the contributions made by the business sector through the Business Fora of the Americas of Denver, Cartagena, Belo Horizonte and San José. Concrete Progress by the Year 2000 18. We reaffirm our commitment to make concrete progress by the year 2000. We direct the negotiating groups to achieve considerable progress by that year. We instruct the TNC to agree on specific business facilitation measures to be adopted before the end of the century, taking into account the substantive work that has already emanated from the FTAA process. Electronic Commerce 19. We noted the rapid expansion of Internet usage and electronic commerce in our Hemisphere. In order to increase and broaden the benefits to be derived from the electronic marketplace, we welcome the offer of Caricom to lead a joint government-private sector committee of experts that will make recommendations to us at our next meeting. Acknowledgment 20. We wish to express our gratitude to the Government of Costa Rica for its notable contribution to the advance of the FTAA process during the last year, by presiding over the deliberations of the Preparatory Committee of the Negotiations, as well as the Fourth Meeting of the Ministers Responsible for Trade in the Hemisphere, which concluded the preparations to initiate the FTAA negotiations. Annex I GENERAL PRINCIPLES AND OBJECTIVES The negotiations for the construction of the FTAA will be guided by the following General Principles and Objectives: General Principles a) Decisions in the FTAA negotiating process will be made by consensus. b) Negotiations will be conducted in a transparent manner to ensure mutual advantage and increased benefits to all participants of the FTAA. c) The FTAA Agreement will be consistent with the rules and disciplines of the WTO. With this purpose, the participating countries reiterate their commitment to multilateral rules and disciplines, in particular Article XXIV of the General Agreement on Tariffs and Trade (GATT) 1994 and its Uruguay Round Understanding, and Article V of the General Agreement on Trade in Services (GATS) d) The FTAA should improve upon WTO rules and disciplines wherever possible and appropriate, taking into account the full implications of the rights and obligations of countries as members of the WTO. e) The negotiations will begin simultaneously in all issue areas. The initiation, conduct and outcome of the negotiations of the FTAA shall be treated as parts of a single undertaking that will embody the rights and obligations as mutually agreed upon. f) The FTAA can co-exist with bilateral and subregional agreements, to the extent that the rights and obligations under these agreements are not covered by or go beyond the rights and obligations of the FTAA. g) Countries may negotiate and accept the obligations of the FTAA individually or as members of a subregional integration group negotiating as a unit. h) Special attention should be given to the needs, economic conditions (including transition costs and possible internal dislocations) and opportunities of smaller economies, to ensure their full participation in the FTAA process. i) The rights and obligations of the FTAA will be shared by all countries. In the negotiation of the various thematic areas, measures such as technical assistance in specific areas and longer periods for implementing the obligations could be included on a case by case basis, in order to facilitate the adjustment of smaller economies and the full participation of all countries in the FTAA. j) The measures agreed upon to facilitate the integration of smaller economies in the FTAA process shall be transparent, simple and easily applicable, recognizing the degree of heterogeneity among them. k) All countries shall ensure that their laws, regulations and administrative procedures conform to their obligations under the FTAA Agreement. l) In order to ensure the full participation of all countries in the FTAA, the differences in their level of development should be taken into account. General Objectives a) To promote prosperity through increased economic integration and free trade among the countries of our Hemisphere, which are key factors for raising standards of living, improving the working conditions of people in the Americas and better protecting the environment. b) To establish a Free Trade Area, in which barriers to trade in goods and services and investment will be progressively eliminated, concluding negotiations no later than 2005 and achieving concrete progress toward the attainment of this objective by the end of this century. c) To maximize market openness through high levels of disciplines through a balanced and comprehensive agreement. d) To provide opportunities to facilitate the integration of the smaller economies in the FTAA process, in order to realize their opportunities and increase their level of development. e) To strive to make our trade liberalization and environmental policies mutually supportive, taking into account work undertaken by the WTO and other international organizations. f) To further secure, in accordance with our respective laws and regulations, the observance and promotion of worker rights, renewing our commitment to the observance of internationally recognized core labour standards, and acknowledging that the International Labour Organization is the competent body to set and deal with those core labour standards. Annex II OBJECTIVES BY ISSUE AREA We have agreed that the negotiations for the construction of the FTAA, in the different issue areas, will be guided by the following objectives: MARKET ACCESS a) Consistent with the provisions of the WTO, including article XXIV of the General Agreement on Tariffs and Trade (GATT) 1994 and its Understanding on the Interpretation of Article XXIV of the General Agreement on Tariffs and Trade 1994, to progressively eliminate tariffs and non-tariff barriers, as well as other measures with equivalent effects, which restrict trade between participating countries. b) All tariffs will be subject to negotiation. c) Different trade liberalization timetables may be negotiated. d) To facilitate the integration of smaller economies and their full participation in the FTAA negotiations. AGRICULTURE a) The objectives of the negotiating group on market access shall apply to trade in agricultural products. Rules of origin, customs procedures and technical barriers to trade issues will be addressed in the market access negotiating group. b) To ensure that sanitary and phytosanitary measures are not applied in a manner that would constitute a means of arbitrary or unjustifiable discrimination between countries or a disguised restriction to international trade, in order to prevent protectionist trade practices and facilitate trade in the hemisphere. Consistent with the WTO Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement), the said measures will only be applied to achieve the appropriate level of protection for human, animal or plant life or health, will be based on scientific principles, and will not be maintained without sufficient scientific evidence. c) Negotiations in this area involve identifying and developing measures needed to facilitate trade, following and examining in depth the provisions set down in the WTO/SPS Agreement. d) To eliminate agricultural export subsidies affecting trade in the Hemisphere. e) To identify other trade-distorting practices for agricultural products, including those that have an effect equivalent to agriculture export subsidies, and bring them under greater discipline. f) Agricultural products covered are the goods referred to in Annex I of the WTO Agriculture Agreement. g) Incorporate progress made in the multilateral negotiations on agriculture to be held according to Article 20 of the Agreement on Agriculture, as well as the results of the review of the SPS Agreement. Rules of Origin To develop an efficient and transparent system of rules of origin, including nomenclature and certificates of origin, in order to facilitate the exchange of goods, without creating unnecessary obstacles to trade. Customs Procedures a) To simplify customs procedures, in order to facilitate trade and reduce administrative costs. b) To create and implement mechanisms to exchange information in customs issues among FTAA countries. c) To design effective systems to detect and combat fraud and other illicit customs activities, without creating unnecessary obstacles to foreign trade. d) To promote customs mechanisms and measures that ensure operations be conducted with transparency, efficiency, integrity and responsibility. Investment To establish a fair and transparent legal framework to promote investment through the creation of a stable and predictable environment that protects the investor, his/her investment and related flows, without creating obstacles to investments from outside the hemisphere. Standards and Technical Barriers to Trade To eliminate and prevent unnecessary technical barriers to trade in the FTAA, based on the proposals contained in the Common Objectives Paper approved by the Working Group. Subsidies, Antidumping and Countervailing Duties a) To examine ways to deepen, if appropriate, existing disciplines provided in the WTO Agreement on Subsidies and Countervailing Measures and enhance compliance with the terms of the WTO Agreement on Subsidies and Countervailing Measures. b) To achieve a common understanding with a view to improving, where possible, the rules and procedures regarding the operation and application of trade remedy laws in order not to create unjustified barriers to trade in the Hemisphere. Government Procurement The broad objective of negotiations in government procurement is to expand access to the government procurement markets of the FTAA countries. More specifically, the objectives are: a) To achieve a normative framework that ensures openness and transparency of government procurement processes, without necessarily implying the establishment of identical government procurement systems in all countries; b) To ensure non-discrimination in government procurement within a scope to be negotiated; c) To ensure impartial and fair review for the resolution of procurement complaints and appeals by suppliers and the effective implementation of such resolutions. Intellectual Property Rights To reduce distortions in trade in the Hemisphere and promote and ensure adequate and effective protection to intellectual property rights. Changes in technology must be considered. Services a) Establish disciplines to progressively liberalize trade in services, so as to permit the achievement of a hemispheric free trade area under conditions of certainty and transparency; b) Ensure the integration of smaller economies into the FTAA process. Competition Policy The objectives of the negotiations are: a) General objectives: To guarantee that the benefits of the FTAA liberalization process not be undermined by anticompetitive business practices. b) Specific objectives: To advance toward the establishment of juridical and institutional coverage at the national, subregional or regional level, that proscribes the carrying out of anticompetitive business practices; To develop mechanisms that facilitate and promote the development of competition policy and guarantee the enforcement of regulations on free competition among and within countries of the Hemisphere. Dispute Settlement a) To establish a fair, transparent and effective mechanism for dispute settlement among FTAA countries, taking into account inter alia the WTO Understanding on Rules and Procedures Governing the Settlement of Disputes. b) To design ways to facilitate and promote the use of arbitration and other alternative dispute settlement mechanisms, to solve private trade controversies in the framework of the FTAA. </body> </html>

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