Administration of the tariff rate quota regime

The Agreement on Agriculture provides that WTO members must offer minimum market access opportunities for agricultural products, which entails the application of a tariff rate quota regime. The amount of the tariff quota is just a market access opportunity but not an import obligation; the volume of imports is determined by the actual demand in the importing country. The amount of the tariff quota should be not less than the average import volume in the base period 1986 “1988. If the import volume is less than 3 per cent of domestic consumption in the base period, it should extend to 3 per cent and, in addition, members should also be committed to certain increments of annual growth. For the applicants , the base period should be the latest three-year data available.

After the WTO accession , China will implement tariff quotas on agricultural products such as wheat, corn, rice, cotton, sugar, bean oil, palm oil, colza oil, wool and industrial products such as fertilizer, and wool top. The amount of the tariff quota for industrial products will be calculated against the base period 1995 “1997. Specific commitments such as the tariff rate quotas quantities , in-quota and out-quota tariff rates, non-state-trading enterprises and implementation periods have been listed in Annex 8 of the protocol “China's Schedule of Concessions and Commitments on Goods.

The administration of tariff rate quotas has also been defined in the Report of the Working Party and Annex 8. China will ensure that tariff rate quotas (TRQs) are administered on a transparent, predictable, uniform, fair and non-discriminatory basis using clearly specified timeframes for announcement, application and issuance; it will reflect consumer preferences and end- user demand, and will not inhibit the filling of each TRQ and will provide the opportunity for reallocation.

In addition to administration of the state-trading regime, China will also grant trading rights to non-state trading entities to import the TRQ allocations set aside for importation by such entities.

In February 2002 China's State Planning Development Commission (SPDC) promulgated and implemented the Regulations on Administration of Import Tariff Quota for Agricultural Products, Provisional Regulations on Administration of Import Tariff Quota for Important Agricultural Products in 2002 and the Detailed Rules of Implementation on the Administration of Import Tariff Quota for Wool and Wool Tops in 2002 . Regulations on Administration of Import Tariff Quota for Fertilizer and Proclamation on Fertilizer Application in 2002 have also been promulgated.