Special & Differential Treatment for Developing Countries by P. Brusick Head, Competition and Consumer Policies Branch UNCTAD

Historic Perspective of S & D: UNCTAD (1964) Special and Preferential Trade Concessions for Developing Countries General System of Preferences (GSP) GSTP among developing countries Special & Differential Treatment in GATT

Evolution of S&D in GATT/WTO Non-reciprocity Graduation: gradual phasing-out of concessions S&D in Uruguay Round Agreements: Focus on { -Technical cooperation -Transition phase (2 years for DCs/4 years for LDCs)

S & D in the Competition Policy Context at WTO Working Group: –Flexibility: possible exemptions –Progressivity (or Graduality): Competition laws could be phased in, from simple to more complete

Example of graduality in adoption or implementation of competition law: First period:mainly educational Second period:prohibition of cartels Third period:control of vertical restraints & abuse of dominance Fourth and final:introduction of merger controls

S & D in the Competition Policy Context Capacity building and technical assistance Transitional phase: learning process Flexibility: sectorial exemptions (with or without time limitations) Non-reciprocal undertakings by developed countries

What kinds of agreements could be subject to S & D? Bilateral cooperation agreements between a developed and a developing country Regional cooperation agreement Multilateral agreement on Competition Law and Policy: (ex: the UN Set contains a provision for preferential or differential treatment)

Possible outlook for SDT Cancun has stopped the WTO process on all the Singapore Issues, considered harmful There was no discussion on the merits of competition policy Together, developing countries had better chances of obtaining significant concessions on SDT

Possible outlook for SDT (cont.) Since Cancun, competition policy aspects are included in bilateral or regional FTAs or EPAs… Singly, in bilateral negotiations, developing countries almost invariably get weaker deals (Bagwati)

Once many developing countries have entered bilateral or regional free trade agreements, it might be more difficult for the remaining developing countries to have sufficient bargaining power to get significant SDT concessions at the multilateral level. Possible outlook for SDT (cont.)