result from negotiations thereunder. Accordingly, the Organization should only determine that a contracting party has a principal supplying interest if that contracting party has had, over a reasonable period of time prior to the negotiations, a larger share in the market of the applicant contracting party than a contracting party with which the concession was initially negotiated or would, in the judgment of the Organization, have had such a share in the absence of discriminatory quantitative restrictions maintained by the applicant contracting party. It would therefore not be appropriate for the Organization to determine that more than one contracting party, or in those exceptional cases where there is near equality more than two contracting parties, had a principal supplying interest.

5. Notwithstanding the definition of a principal supplying interest in note 4 to paragraph 1, the Organization may exceptionally determine that a contracting party has a principal supplying interest if the concession in question affects trade which constitutes a major part of the total exports of such contracting party.

6. It is not intended that provision for participation in the negotiations of any contracting party with a principal supplying interest, and for consultation with any contracting party having a substantial interest in the concession which the applicant contracting party is seeking to modify or withdraw, should have the effect that it should have to pay compensation or suffer retaliation greater than the withdrawal or modification sought, judged in the light of the conditions of trade at the time of the proposed withdrawal or modification, making allowance for any discriminatory quantitative restrictions maintained by the applicant contracting party.

7. The expression "substantial interest" is not capable of a precise definition and accordingly may present difficulties for the Organization. It is, however, intended to be construed to cover only those contracting parties which have, or in the absence of discriminatory quantitative restrictions affecting their exports could reasonably be expected to have, a significant share in the market of the contracting party seeking to modify or withdraw the concession.

Paragraph 4.

1. Any request for authorization to enter into negotiations shall be accompanied by all relevant statistical and other data. A decision on such request shall be made within thirty days of its submission.

2. It is recognized that to permit certain contracting parties, depending in large measure on a relatively small number of primary commodities and relying on the tariff as an important aid for furthering diversification of their economies or as an important source of revenue, normally to negotiate for the modification or withdrawal of concessions only under paragraph 1 of Article XXVIII, might cause them at such a time to make modifications or withdrawals which in the long run would prove unnecessary. To avoid such a situation the Organization shall authorize any such contracting party, under paragraph 4, to enter into negotiations unless they consider this would result in, or

contribute substantially towards, such an increase in tariff levels as to threaten the stability of the Schedules to this Agreement or lead to undue disturbance of international trade.

3. It is expected that negotiations authorized under paragraph 4 for modification or withdrawal of a single item, or a very small group of items, could normally be brought to a conclusion in sixty days. It is recognized, however, that such a period will be inadequate for cases involving negotiations for the modification or withdrawal of a larger number of items and in such cases, therefore, it would be appropriate for the Organization to prescribe a longer period.

4. The determination referred to in paragraph 4 (d) shall be made by the Organization within thirty days of the submission of the matter to it, unless the applicant contracting party agrees to a longer period.

5. In determining under paragraph 4 (d) whether an applicant contracting party has unreasonably failed to offer adequate compensation, it is understood that the Organization will take due account of the special position of a contracting party which has bound a high proportion of its tariffs at very low rates of duty and to this extent has less scope than other contracting parties to make compensatory adjustment.

Paragraph 3.

Ad Article XXIX

It is understood that the reference to fiscal needs would include the revenue aspect of duties and particularly duties imposed primarily for revenue purposes or duties imposed on products which can be substituted for products subject to revenue duties to prevent the avoidance of such duties.

Ad Article XXX

The acceptance of amendments pursuant to this paragraph shall be in such form as may be determined by the Organization.

Ad Article XXXIII

Similarly, a government, acting on behalf of a separate customs territory possessing full autonomy in the conduct of its external commercial relations and of other matters provided for in this Agreement, may accede to this Agreement on behalf of that territory on terms applicable thereto.

8. ORGANIZATION FOR TRADE COOPERATION (OTC): Agreement Between the Contracting Parties to the General Agreement on Tariffs and Trade, March 10, 1955 1

PART I

GENERAL

Article 1-Establishment.

The Organization for Trade Cooperation (hereinafter referred to as "the Organization") is hereby established to further, as provided for in the General Agreement and herein, the achievement of the purposes and objectives set forth in the General Agreement on Tariffs and Trade (herein referred to as "the General Agreement").

2

Article 2-Membership.

The Members of the Organization shall be the contracting parties to the General Agreement. Governments which become or cease to be contracting parties to the General Agreement shall become or cease to be Members of the Organization. The Organization may, by a two-thirds majority of the votes cast, invite governments which are not or which cease to be contracting parties to the General Agreement to participate in such activities of the Organization and on such terms as it shall decide; Provided that in no case shall such participation involve the right to vote or to be counted in determining the fulfilment of the relevant voting requirements when the Organization is exercising any function relating directly to the General Agreement. Article 3-Functions.

(a) The Organization shall administer the General Agreement and generally facilitate the operation of that Agreement.

(b) In addition, the Organization shall have the following functions:

(i) to facilitate intergovernmental consultations on questions relating to international trade;

(ii) to sponsor international trade negotiations;

1 General Agreement on Tariffs and Trade: Basic Instruments and Selected Documents, vol. I (Revised), Texts of the General Agreement as Amended, and of the Agreement on the Organization for Trade Cooperation (Geneva, the Contracting Parties to the General Agreement on Tariffs and Trade, Apr. 1955), pp. 75–84; Department of State Bulletin, Apr. 4, 1955, pp. 579–582; H. Rept. No. 2007, 84th Cong., 2d sess., pp. 93–107. On the basis of the Randall Report (see supra, doc. 3), the President in his message to Congress of Mar. 30, 1954 (supra, doc. 4) called for the renegotiation of the organizational and operational provisions of GATT. His message of Jan. 10, 1955 (supra, doc. 6) was in the same vein. On Apr. 14, 1955, the President requested legislation authorizing U.S. membership in the Organization for Trade Cooperation; Department of State Bulletin, Apr. 25, 1955, pp. 678-680. He repeated this request or recommendation in the State of the Union Message of Jan. 5, 1956 (supra, pp. 129–133), and in a letter of Jan. 24, 1956, transmitting to Congress the Economic Report of the President; H. Doc. 280, 84th Cong., 2d sess. The agreement, however, has not entered into force (as of June 15, 1956).

2 Agreement of Oct. 30, 1947, as amended Mar. 10, 1955; supra.

(iii) to study questions of international trade and commercial policy and, where appropriate, make recommendations thereon; (iv) to collect, analyze and publish information and statistical data relating to international trade and commercial policy, due regard being paid to the activities in this field of other international bodies.

(c) The Organization shall, in carrying out these functions, endeavour to give full effect to the provisions of Article 1 of this Agreement.

(d) The Organization shall have no authority to amend the provisions of the General Agreement; no decision or other action of the Assembly or any subsidiary body of the Organization shall have the effect of imposing on a Member any new obligation which the Member has not specifically agreed to undertake.

PART II

STRUCTURE AND ADMINISTRATION OF THE ORGANIZATION

Article 4-Structure in General.

The Organization shall have an Assembly, an Executive Committee and a Secretariat.

Article 5-The Assembly.

(a) The Assembly shall consist of all the Members of the Organization.

(b) It shall be the responsibility of the Assembly to carry out the functions of the Organization.

(c) The Assembly shall determine the seat of the Organization. (d) The Assembly shall meet in regular annual session and in such special sessions as may be convened in accordance with the rules of procedure.

(e) The Assembly shall establish its own rules of procedure and shall approve the rules of procedure of the Executive Committee and of any other subsidiary body.

Article 6-The Executive Committee.

(a) The Executive Committee shall consist of seventeen Members of the Organization elected periodically by the Assembly. Each election shall be for a single term and each Member shall be eligible for re-election. In such elections, the Assembly shall be guided by the following criteria:

(i) the Executive Committee shall include the five Members of chief economic importance, in the determination of which particular regard shall be paid to their shares in international trade;

(ii) the Executive Committee shall be representative of the broad geographical areas to which the Members belong;

(iii) the Executive Committee shall be representative of different degrees of economic development, different types of economies and different economic interests.

(b) The Executive Committee shall exercise the powers and perform the duties assigned to it by the Assembly by a majority of two-thirds of the votes cast. Decisions or recommendations of the Executive Committee shall be subject to a right of appeal to the Assembly by any Member in accordance with rules to be prescribed by the Assembly.

(c) Any Member of the Organization which is not a member of the Executive Committee shall be entitled to participate, without the right to vote, in the discussion by the Executive Committee of any matter of concern to it.

Article 7-The Secretariat.

(a) The Assembly shall appoint a Director-General as chief administrative officer of the Organization. The powers, duties, conditions of service and term of office of the Director-General shall conform to regulations approved by the Assembly.

(b) The Director-General or his representative shall be entitled to participate, without the right to vote, in all meetings of the Assembly and subsidiary bodies of the Organization.

(c) The Director-General shall appoint the members of the staff, and shall fix their duties and conditions of service in accordance with regulations approved by the Assembly.

(d) The selection of the members of the staff shall as far as possible be made on a wide geographical basis and with due regard to the various types of economy represented by Member countries. The paramount consideration in the selection of candidates and in determining the conditions of service of the staff shall be the necessity of securing the highest standards of efficiency, competence, impartiality and integrity.

(e) The responsibilities of the Director-General and of the members of the staff shall be exclusively international in character. In the discharge of their duties, they shall not seek or receive instructions from any government or from any other authority external to the Organization. They shall refrain from any action which might reflect on their position as international officials. The Members shall respect the international character of the responsibilities of these persons and shall not seek to influence them in the discharge of their duties. Article 8-Voting.

(a) At meetings of the Assembly each Member of the Organization shall be entitled to have one vote and, except as otherwise provided for in the General Agreement or in this Agreement, decisions of the Assembly shall be taken by a majority of the votes cast.

(b) Each member of the Executive Committee and of other subsidiary bodies shall have one vote therein; Provided that the rules of procedure may require that parties to a dispute shall abstain from voting.