WTO Trade Policy Review of Mexico
——Written questions from China
1. Reservations by Mexico as contained in Section 17 and Annex 7 of the Protocol on the Accession of China
Section 17 of China’s Protocol of Accession of stipulated that “All prohibitions, quantitative restrictions and other measures maintained by WTO Members against imports from China in a manner inconsistent with the WTO Agreement are listed in Annex 7. All such prohibitions, quantitative restrictions and other measures shall be phased out or dealt with in accordance with the mutually agreed terms and timetables as specified in the said Annex.”
Annex 7 of the Protocol on the Accession of People’s Republic of China includes various anti-dumping measures by Mexico against exports from China which are not consistent with the WTO rules.
Would Mexico please provide detailed information on the current status of these measures breaking into tariff lines as done in Annex 7?
Could Mexico please clarify what actions it has taken to ensure the consistence of these measures with WTO rules?
If some measures are still maintained after the deadline as provided under Annex 7, could Mexico please explain with detailed information and examples on what parts of the original measures have been corrected and how they are now in conformity with WTO provisions?
If this is not the case, what action is Mexico going to take to bring such measures into conformity with WTO provisions and what is the timeframe to finish this process?
2. Anti-dumping Practice
Article 5.5 of the WTO Anti-dumping Agreement provides that “The authorities shall avoid, unless a decision has been made to initiate an investigation, any publicizing of the application for the initiation of investigation. However, after receipt of a properly documented application and before proceeding to initiate an investigation, the authorities shall notify the government of the exporting Member concerned.”
Would Mexico please clarify the following:
a. Are there any provisions in the Mexican antidumping legislation corresponding to Article 5.5 of the Anti-dumping Agreements, and how are the Mexican antidumping legislation consistent with Article 5.5 of the WTO Antidumping Agreement?
b. In actual practice, do Mexican authorities always notify the government of exporting Members after receipt of a properly documented application and before proceeding to initiate an investigation?
c. In actual practice, how do Mexican authorities notify the government of exporting Members after receipt of a properly documented application and before proceeding to initiate an investigation?
d. On September 1 2006, Mexico promulgated its decision to launch anti-dumping investigation on seamless steal tubing originated from China; on September 14 2006, Mexico promulgated its decision to launch anti-dumping investigation on brushes (Natural, synthetic or mixed hog bristle paint brushes with handles of wood and plastic, measuring 0.5 to 6 inches)originated from China; and on March 26 2007, Mexico promulgated its decision to launch anti-dumping investigation on steal plate in sheets originated from China. However, China got no notifications before the initiation of any of the three cases.
Could Mexico please explain the rational for this situation and what actions it would take to improve it?
3. Review of Anti-dumping Measures
a. Mexico still maintains anti-dumping duties on more than 900 items of Chinese exported products, and the current duty rates are the same as the rates of 1994 when the anti-dumping duties were first imposed.
Would Mexico please explain how it reviews these original measures in accordance with WTO rules?
Considering that the initiation of these measures was inconsistent with WTO rules, and the sunset reviews did not alter the original measures (the anti-dumping duty rates are the same).
Would Mexico please explain how it has brought these measures into conformity with WTO rules, given that the reviews were done on a basis of WTO inconsistency?
b. Since China’s entry in to WTO on 11 December 2001, Mexico initiated reviews on various anti-dumping cases including some against Chinese exports.
Could Mexico please clarify whether the authority check BIA according to relevant published information such as price lists, official import statistics in accordance with para. 7 of Appendix 2 of WTO Anti-dumping Agreement when the government uses BIA (including evidence provided by the applicants) ?
c. Since 2000, bicycles exported by China to Mexico falls under only 3 items: 87120001, 87120002 and 87120004. There were little exports under the other 2 items, 87120099 and 87120003. According to the notice for review issued in September 2005 by Mexican government, Mexico only investigated into the prices and possible damages of three items: 87120001, 87120002 and 87120004 in the review, but ruled that dumping existed in all the five items, and may cause damages. Mexico mentioned in the notice that “anti-dumping duties may not be imposed on certain types of products in normal cases, however, due to the minor export volume; anti-dumping duties on those products are still imposed.”
Would Mexico please explain how its practice is consistent with the provisions in WTO Anti-dumping Agreement regarding “like product” and “the volume of dumped imports is negligible?”
d. Also in the above mentioned cases, Mexican enterprises submitted the data regarding the prices of Chinese bicycles published in a magazine in Europe.
Would Mexico please explain how it verified these data to meet the requirement of para.7 of Annex 2 of the Anti-dumping Agreements, given that China did not export the products to Mexico at all?
4. Safeguard Measures
Secretariat Report Paragraph 105, page 50,
Could Mexico please specify the related provisions in the 2003 amendments to the safeguards provisions in the LCE on “the impossibility of considering factors other than the increase in imports as factors causing injury” and the consistency of such provisions with 4.2 (b) of WTO Agreement on Safeguards?
5. Tariff and Import Administration
a. Tariff Peaks
In 2006 Mexico adjusted its tariff rates substantially. According to the 2006 Mexico customs tariff schedule, the products with high tariff rates included: the shelled poultry eggs（fresh, salty or boiled）,with a tariff rate of 45％；passenger motor vehicles with more than 6 seats, cars, and cargo vehicles, with a tariff rate of 50％；poultries（chicken duck, goose, turkey and guinea fowl）, fresh, cold, or frozen meat and edible entrails, with a tariff rate as high as 234％；fructose and fructose syrup, with a high tariff rate of 210％.
China would like to know why Mexico maintains such high tariff rates on these products. Does Mexico have any plan to lower the rates.
b. Tariff Quotas
In 2006, tariff quotas were implemented on 0.5％ of the total Mexican imports. Among them, 5.2％ of the agricultural products were affected by tariff quotas, including poultry, animal fat, milk, cheese, beans, tomato, coffee, wheat, barley, corn and products rich in sugar. Moreover, the volume of tariff quotas, their implementation, the updating of timetables and the issuance of import licenses are not transparent enough.
China is concerned about the lack of sufficient transparency and would like to know if Mexico could provide the corresponding information for 2003 to 2007.
c. Customs valuation
The Mexican government sets reference prices or officially established evaluation prices for some 200 types of goods, including the categories of liquor, apparel, chemicals, footwear, steel, hand tools, appliances, plywood, apples, rice, poultry, etc. If the declared customs value is less than the established reference price, a guarantee must be posted to give the reason. The Mexican government has the right, within six months, to decide whether to start a formal investigation or to accept the guarantee. These measures do not specify the process of verification or determination regarding the customs value of the imported goods, and therefore lack the corresponding remedy measures, thus bringing about potential unfair treatment to parties concerned.
The above mentioned practice by the Mexican Customs is inconsistent with relevant stipulations of the WTO Agreement on Customs Evaluation and impedes low cost imports from entering into Mexican market. China hereby urges Mexico to abide by its obligation in WTO and bring its practice in line with WTO rules. Does Mexico have any plan to abide by its obligation in this regard? If yes, what is it? And if not, could the Mexican delegation provide reationale?
d. Discriminatory Taxes and Fees on Imported Goods
The Mexican government levies no tax on beverages made from Mexico produced cane sugar, but imposes a 20％ soft drink tax on imported beverages that use soft drinks and any sweetener other than cane sugar. The services related to those products, for example, consignment, agency, etc. shall be levied a 20％ distribution tax as well. In addition, the taxpayers of the above two taxes must also meet the bookkeeping requirements. Mexico’s practice of imposing soft drink tax and distribution tax on imported soft drinks and syrups（final products）, together with its bookkeeping requirements, was discriminatory and inconsistent with the national treatment in Article 3.2 and Article 3.4 of the GATT 1994.
Does Mexico agree with the assessment? If yes, would Mexico abolish the measure? If not, could Mexico provide the rationale for the measure?
e. According to the Secretariat Report, Mexico maintains very high bound tariff rates on imports, e.g. 35% on industrial goods and around 50% on agricultural products, much higher than respective applied rates, thereby resulting in significant uncertainty in Mexican trade policies.
Would Mexico provide the rationale for the high bound tariff?
----------------------- | 
