Members hereby agree as follows:
(i) The purpose of the Trade Policy Review Mechanism (“TPRM”) is to contribute to improved adherence by all Members to rules, disciplines and commitments made under the Multilateral Trade Agreements and, where applicable, the Plurilateral Trade Agreements, and hence to the smoother functioning of the multilateral trading system, by achieving greater transparency in, and understanding of, the trade policies and practices of Members. Accordingly, the review mechanism enables the regular collective appreciation and evaluation of the full range of individual Members’ trade policies and practices and their impact on the functioning of the multilateral trading system. It is not, however, intended to serve as a basis for the enforcement of specific obligations under the Agreements or for dispute settlement procedures, or to impose new policy commitments on Members.
The assessment carried out under the review mechanism takes place,
to the extent relevant, against the background of the wider economic and
developmental needs, policies and objectives of the Member concerned, as
well as of its external environment. However, the function of the review
mechanism is to examine the impact of a Member’s trade policies and
practices on the multilateral trading system.
B. Domestic transparency
Members recognize the inherent value of domestic transparency of
government decision-making on trade policy matters for both Members’
economies and the multilateral trading system, and agree to encourage and
promote greater transparency within their own systems, acknowledging that
the implementation of domestic transparency must be on a voluntary basis
and take account of each Member’s legal and political systems.
C. Procedures for review
The Trade Policy Review Body (referred to herein as the “TPRB”)
is hereby established to carry out trade policy reviews.
The trade policies and practices of all Members shall be subject to
periodic review. The impact of individual Members on the functioning of
the multilateral trading system, defined in terms of their share of world
trade in a recent representative period, will be the determining factor in
deciding on the frequency of reviews. The first four trading entities so
identified (counting the European Communities as one) shall be subject to
review every two years. The next 16 shall be reviewed every four years.
Other Members shall be reviewed every six years, except that a longer
period may be fixed for least-developed country Members. It is understood
that the review of entities having a common external policy covering more
than one Member shall cover all components of policy affecting trade
including relevant policies and practices of the individual Members.
Exceptionally, in the event of changes in a Member’s trade policies or
practices that may have a significant impact on its trading partners, the
Member concerned may be requested by the TPRB, after consultation, to
bring forward its next review.
Discussions in the meetings of the TPRB shall be governed by the
objectives set forth in paragraph A. The focus of these discussions shall
be on the Member’s trade policies and practices, which are the subject
of the assessment under the review mechanism.
(iv) The TPRB shall establish a basic plan for the conduct of the reviews. It may also discuss and take note of update reports from Members. The TPRB shall establish a programme of reviews for each year in consultation with the Members directly concerned. In consultation with the Member or Members under review, the Chairman may choose discussants who, acting in their personal capacity, shall introduce the discussions in the TPRB.
The TPRB shall base its work on the following documentation:
a full report, referred to in paragraph D, supplied by the Member
or Members under review;
a report, to be drawn up by the Secretariat on its own
responsibility, based on the information available to it and that provided
by the Member or Members concerned. The Secretariat should seek
clarification from the Member or Members concerned of their trade policies
The reports by the Member under review and by the Secretariat,
together with the minutes of the respective meeting of the TPRB, shall be
published promptly after the review.
documents will be forwarded to the Ministerial Conference, which shall
take note of them.
In order to achieve the fullest possible degree of transparency,
each Member shall report regularly to the TPRB. Full reports shall
describe the trade policies and practices pursued by the Member or Members
concerned, based on an agreed format to be decided upon by the TPRB. This
format shall initially be based on the Outline Format for Country Reports
established by the Decision of 19 July 1989 (BISD 36S/406-409), amended as
necessary to extend the coverage of reports to all aspects of trade
policies covered by the Multilateral Trade Agreements in Annex 1 and,
where applicable, the Plurilateral Trade Agreements. This format may be
revised by the TPRB in the light of experience. Between reviews, Members
shall provide brief reports when there are any significant changes in
their trade policies; an annual update of statistical information will be
provided according to the agreed format. Particular account shall be taken
of difficulties presented to least-developed country Members in compiling
their reports. The Secretariat shall make available technical assistance
on request to developing country Members, and in particular to the
least-developed country Members. Information contained in reports should
to the greatest extent possible be coordinated with notifications made
under provisions of the Multilateral Trade Agreements and, where
applicable, the Plurilateral Trade Agreements.
Relationship with the balance-of-payments provisions of GATT 1994
Members recognize the need to minimize the burden for governments
also subject to full consultations under the balance-of-payments
provisions of GATT 1994 or GATS. To this end, the Chairman of the TPRB
shall, in consultation with the Member or Members concerned, and with the
Chairman of the Committee on Balance-of-Payments Restrictions, devise
administrative arrangements that harmonize the normal rhythm of the trade
policy reviews with the timetable for balance-of-payments consultations
but do not postpone the trade policy review by more than 12 months.
Appraisal of the Mechanism
The TPRB shall undertake an appraisal of the operation of the TPRM not more than five years after the entry into force of the Agreement Establishing the WTO. The results of the appraisal will be presented to the Ministerial Conference. It may subsequently undertake appraisals of the TPRM at intervals to be determined by it or as requested by the Ministerial Conference.
Overview of Developments in the International Trading Environment
An annual overview of developments in the international trading
environment which are having an impact on the multilateral trading system
shall also be undertaken by the TPRB. The overview is to be assisted by an
annual report by the Director-General setting out major activities of the
WTO and highlighting significant policy issues affecting the trading