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September 30, 1999

1. The Governments of Brunei Darussalam, the Kingdom of Cambodia, the Republic of Indonesia, Lao People's Democratic Republic, Malaysia, Union of Myanmar, the Republic of the Philippines, the Republic of Singapore, the Kingdom of Thailand and the Socialist Republic of Viet Nam, Member States of the Association of Southeast Asian Nations (hereinafter referred to as "ASEAN");

2. MINDFUL of the. Agreement on the Common Effective Preferential Tariff (CEPT) Scheme for the ASEAN Free Trade Area (AFTA) signed on 28 January 1992 in Singapore as amended by the Protocol to Amend the Agreement on the Common Effective Preferential Tariff Scheme for the ASEAN Free Trade Area signed on 15 December 1995 in Bangkok;

3. HAVING REGARD to the need to arrive at commitments to liberalise trade in unprocessed agricultural products and accordingly expand the product coverage under the CEPT Scheme;

4. RECALLING the decision of the 26th ASEAN Economic Ministers Meeting held on 22-23 September 1994 to phase in Unprocessed Agricultural products into the CEPT Scheme;

5. HAVE AGREED AS FOLLOWS:

Article I
Definition

1. "CEPT Agreement" means the Agreement on the Common Effective Preferential Tariff Scheme for the ASEAN Free Trade Area signed on 28 January 1992 in Singapore as amended by the Protocol to Amend the Agreement on the Common Effective Preferential Tariff Scheme for the ASEAN Free Trade Area signed on 15 December 1995 in Bangkok.

2. "Highly sensitive products" shall consist of the products listed in Annex 1.

3. "Interpretative Notes" means the Interpretative Notes to the CEPT Agreement.

4. "Non-tariff barriers" mean measures other than tariffs which effectively prohibit or restrict import or export of products with Member States.

5. "Sensitive products" shall consist of the products listed in Annex 2.

6. "Quantitative restriction" means prohibitions or restrictions on trade with other Member States, whether made effective through quotas, licenses, or other measures with equivalent effect, including administrative measures and requirements which restrict trade.

Article II
Time Frame

1. Member States, with the exception of Cambodia, Lao PDR, Myanmar and Viet Nam, shall phase in sensitive products to the CEPT Scheme beginning on 1 January 2001 with flexibility but no later than 1 January 2003 and shall complete their phasing in by 1 January 2010.

2. Viet Nam shall phase in sensitive products to the CEPT Scheme beginning on 1 January 2004 but no later than 1 January 2006 and shall complete the process by 1 January 2013. In the case of sugar, Viet Nam shall complete the phasing in by 1 January 2010.

3. Lao PDR and Myanmar shall phase in sensitive products to the CEPT Scheme beginning on 1 January 2006 but no later than 1 January 2008 and shall complete the process by 1 January 2015.

4. Cambodia shall phase in sensitive products to the CEPT Scheme beginning on 1 January 2008 but no later than 1 January 2010 and shall complete the process by 1 January 2017.

5. Member States shall phase in highly sensitive products to the CEPT Scheme beginning on 1 January 2001 but no later than 1 January 2005 and shall complete their phasing in by 1 January 2010.

Article III
Tariff Reduction

1. The applied tariff rates shall be used as the beginning rate for the tariff reduction of sensitive products.

2. Member States shall use the following guidelines in determining the tariff reduction for sensitive products:

a. The same tariff rate shall not be applied for more than three consecutive years.

b. Tariffs shall be reduced at a minimum quantum of 10 percentage points.

3. All sensitive products shall have ending tariff rates of 0-5%.

4. Member States shall have flexibility, in accordance with Annex 3 of this Protocol, in determining the ending tariff rates for highly sensitive products. Tariff reduction for highly sensitive products shall be in accordance with the said Annex 3.

Article IV
Quantitative Restrictions

1. Member States, except Cambodia, Lao PDR, Myanmar and Viet Nam, shall eliminate all quantitative restrictions on sensitive and highly sensitive products by 1 January 2010.

2. Viet Nam shall eliminate all quantitative restrictions on sensitive products by 1 January 2013.

3. Lao PDR and Myanmar shall eliminate all quantitative restrictions on sensitive products by 1 January 2015.

4. Cambodia shall eliminate all quantitative restrictions on sensitive products by 1 January 2017.

Article V
Other Non-Tariff Barriers

1. Member States, except Cambodia, Lao PDR, Myanmar and Viet Nam, shall eliminate all other non-tariff barriers on sensitive and highly sensitive products by 1 January 2010.

2. Viet Nam shall eliminate all other non-tariff barriers on sensitive products by 1 January 2013.

3. Lao PDR and Myanmar shall eliminate all other non-tariff barriers on sensitive products by 1 January 2015.

4. Cambodia shall eliminate all other non-tariff barriers on sensitive products by 1 January 2017.

Article VI
Preferential Treatment by State Trading Enterprises

Member States shall take measures to encourage State-Trading Enterprise to accord preferential treatment to ASEAN suppliers.

Article VII
Safeguards

1. Any emergency measures applied to sensitive products shall be subject to the provisions of Article 6 of the CEPT Agreement and its Interpretative Notes.

2. In addition, flexibility shall be accorded to highly sensitive products. The provisions on flexibility appear in Annex 4 of this Protocol.

Article VIII
Reciprocity

Sensitive products shall enjoy CEPT concessions subject to the provision of Article 4, Section B of the CEPT Agreement.

Article IX
Final Provisions

1. This Protocol shall enter into force upon the deposit of instruments of ratification or acceptance by all signatory governments with the Secretary-General of ASEAN.

2. New Members of ASEAN shall accede to this Protocol on terms and conditions which have been agreed between them and the existing Members of ASEAN.

3. This Protocol shall be deposited with the Secretary-General of ASEAN who shall promptly furnish a certified copy thereof to each Member State. The Secretary-General of ASEAN shall also promptly furnish notifications of ratifications and acceptances made pursuant to paragraph 1 to each Member State.

6. IN WITNESS WHEREOF, the undersigned, being duly authorised thereto by their respective Governments, have signed the Protocol on the Special Arrangement for Sensitive and Highly Sensitive Products.

7. DONE at Singapore on the 30th day of September in the year One Thousand Nine Hundred and Ninety-Nine, in a single copy in the English language.

For the Government of Brunei Darussalam

(Sgd.) ABDUL RAHMAN TAIB
Minister of Industry and Primary Resources

For the Royal Government of Cambodia

(Sgd.) CHAM PRASIDH
Ministry of Commerce

For the Government of the Republic of Indonesia

(Sgd.) RAHARDI RAMELAN
Minister of Industry and Trade

For the Government of the Lao People's Democratic Republic

(Sgd.) PROF. DR. BOUNTIEM PHISSAMAY
Minister to the Prime Minister's Office

For the Government of Malaysia

(Sgd.) DATO' SERI RAFIDAH AZIZ
Minister of International Trade and Industry

For the Government of the Union of Myanmar

(Sgd.) BRIGADIER GENERAL DAVID O. ABEL
Minister at the Office of the Chainman of the
State Peace and Development Council

For the Government of the Republic of the Philippines

(Sgd.) JOSE TRINIDAD PARDO
Secretary of Trade and Industry

For the Government of the Republic of Singapore

(Sgd.) BG (NS) GEORGE YONG-BOON YEO
Minister for Trade and Industry

For the Government of the Kingdom of Thailand

(Sgd.) DR. SUPACHAI PANITCHPAKDI
Deputy Prime Minister and Minister of Commerce

For the Government of the Socialist Republic of Viet Nam

(Sgd.) TRUONG DINH TUYEN
Minister of Trade

 

ANNEX I

LIST OF HIGHLY SENSITIVE PRODUCTS

 

Indonesia
No.	HS Code	Description
1	1006.10.000	-Rice in the husk (paddy or rough)
2	1006.20.000	-Husked (brown) rice
3	1006.30.000	-Semi-milled or wholly milled rice, whether or not polished or glazed
4	1006.40.000	-Broken rice

 

Malaysia
No.,	HS Code	Description
1 2	1006.10 1006.10.100 1006.10.900	-Rice in the husk (paddy or rough); Pulut (glutinous rice) Other
3 4	1006.20 1006.20.100 1006.20.900	-Husked (brown) rice: Pulut (glutinous rice) Other
5 6	1006.30 1006.30.100 1006.30.900	-Semi-milled or wholly milled rice, whether or not polished or glazed: Pulut (glutinous rice) Other
7 8	1006.40 1006.40.100 1006.40.900	-Broken rice: For animal feeding Other

 

Philippines
No.	HS Code	Description
1	1006.10.000	-Rice in the husk (paddy or rough);
2	1006.20.000	-Husked (brown) rice:
3	1006.30.000	-Semi-milled or wholly milled rice, whether or not polished or glazed:
4	1006.40.000	-Broken rice

 

ANNEX 2

LIST OF SENSITIVE PRODUCTS
(see original copy pages 9-25 )

 

ANNEX 3
TARIFF REDUCTION FOR HIGHLY SENSITIVE PRODUCTS

1. The beginning tariff rates for highly sensitive products shall be the applied rates in the year of phasing in.

2. The commitment on beginning rates shall not prejudice the right of the Member States in paragraph 1 of this Annex to maintain quantitative estrictions and other non-tariff barriers until 1 January 2010, when they are to be eliminated as stipulated by Article 4 paragraph 1 and Article 5 paragraph of this Protocol.

3. The ending tariff rates for highly sensitive products shall be:

Indonesia : 20%;

Malaysia: 20%; and

Philippines: to be determined within the CEPT framework.

ANNEX 4
ADDITIONAL FLEXIBILITY ON SAFEGUARDS

1. An ASEAN Member Country may raise the ASEAN applicable tariffs to the MFN levels when imports from ASEAN sources of highly sensitive commodities subject to the CEPT special concession reach a trigger level. In effect, the ASEAN concession shall be suspended when an import surge threatens domestic producers of the product.

2. The trigger level will be based on the following formula:

V = A3(1+ASG)(1+DG)

where:

V = trigger volume;

A3 = average level of imports from ASEAN in the 3 years immediately preceding the last year, expressed in metric tons;

ASG = growth rate of the share of imports from ASEAN to total imports, a number agreed upon in ASEAN is 10% per year; and

DG = growth rate of domestic consumption, a number agreed upon in ASEAN is 2% per year.

3. The other elements of the special safeguards such as its duration and notification should be consistent with the WTO and that the safeguard action would be to raise the ASEAN applicable tariffs to the MFN level upon the suspension of the concession.