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THE ASIA PACIFIC ECONOMIC COOPERATION (APEC)

1.         What is APEC?

            APEC is an association of economies that share the boundaries of the Pacific Ocean.  Under APEC, member economies work together to reduce barriers to trade, ease the exchange of goods, services, resources and technical know-how, and strengthen economic and technical cooperation between and among themselves. These concerted efforts, ultimately, would result in a greatly improved global economy and the forging of stronger ties between the developing and the major economies of the world.

 2.         When was APEC created?

 APEC was created in 1989 through the initiative of Australia.  Its first Ministerial Meeting was held on November 6-7, 1989 in Canberra, Australia.

 3.         Who are its members?

 When APEC was established, there were twelve (12) founding member-countries:  Australia, Brunei Darussalam, Canada, Indonesia, Japan, Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand, and the United States.  In 1991,  the People's Republic of China, Hong Kong, and Chinese Taipei  were accepted as members. Mexico and Papua New Guinea were accepted in 1993 and Chile became a full member in 1994.  The latest members are Peru, Vietnam and Russia whose formal memberships were acknowledged in November 1998.

 4.         How significant is APEC to world trade economy?

 ·APEC groups together three (3) of the world's most dynamic economies (U.S., Japan, and Canada) and the Asian "tiger" economies.

 ·                    Collectively, the APEC members are considered the growth engine of the whole world economy.

 ·                    APEC member-economies represent around two billion people or 42% of the world’s total population,.

 ·                    APEC occupies 43% of the world's land area.

 ·                    In 1997, total Gross Domestic Product of APEC member-economies was US$23,680 billion.

 ·                    APEC accounted for almost half of the world's total merchandise exports in 1997.

 ·                    APEC is characterized by cultural diversity and varied levels of scientific and technological development.

5.         What  are the goals of APEC?

 APEC member-economies have outlined four (4) main objectives:

 ·                 to sustain the growth and development of the region for the common good of its people thus contributing to the growth of world economy;

·                 to enhance the gains of both regional and world economy by encouraging the flow of goods, services, capital and technology;

·                 to develop and strengthen the open multilateral trading system in the interest of Asia-Pacific member economies and all other economies; and

·                 to reduce barriers to trade in goods and services,  and  minimize hindrance to investment among its participants in a manner consistent with GATT/WTO principles, where applicable, and without detriment to other economies.

         APEC envisions full trade and investment liberalization and facilitation by 2010 for industrialized economies and 2020 for developing members.  With respect to tariffs, the goal is zero tariffs in 2010 and 2020 for developed and developing countries, respectively.   

 6.         How can these objectives be attained?

 The objectives of APEC can be achieved by a balanced program of:

 ·         liberalization to dismantle those obstacles to international economic transactions which are imposed as customs barriers;

·        facilitation of trade and investment to reduce needless divergences in approaches to domestic policies influencing international commerce;

·        technical cooperation to share the information and expertise needed to implement proposals for facilitation and to enhance the availability and efficiency of regional infrastructure; and

·         economic policy coordination to reduce uncertainties that add to the costs of international economic transactions.

 7.         What benefits can accrue to the Philippines as a member of APEC ?

 The benefits from Philippine participation in APEC are as follows:

 §        As APEC seeks to create a more open trade environment, business  transactions and exchange of goods, services and technology will be greatly relaxed.

 ·        Investments will flow freely to and from developing economies.  The transfer of professional skills and consultancy will be simpler and more manageable.

 ·        There will be easier access to resources made available to industrialized member-economies giving a better chance for local industries to improve and compete in the global market.

 ·        Improvements in the energy, transportation, and telecommunication infrastructures are expected to be the immediate results of a strengthened cooperation among the APEC member-economies.

 ·        Agriculture is vital to APEC's continued growth.  Technical cooperation in this crucial sector will raise productivity and hasten the rural area growth of developing APEC members like the Philippines.

 ·        APEC includes Japan, Chinese Taipei, Hong Kong, People’s Republic of China, and the Republic of Korea which are major sources of foreign investments.

·         Small and Medium Enterprises (SME’s) are critical factors in a country's development and 90% of all firms in APEC are SME’s.

·         Industrial science and technology could be developed through the flow of APEC regional information on technology, the research exchanges in science and technology, and joint research projects.

8.         What are the major results of the APEC leaders’ annual summit meetings?

             A.       The Blake Island Economic Vision

1993 marked a positive year for APEC with the holding of the first APEC Economic Leaders Meeting on November 20 in Blake Island, Seattle.  Hosted by then U.S. President then Bill Clinton, all APEC members reaffirmed their support for APEC and the ideals it stood for.

 APEC members envisioned an Asia-Pacific region of stronger cooperation, of more open trade, deeper partnership, continuous growth, a stable economy, prosperous constituents, and a secure future.  The  leaders also pledged to deepen the spirit of the APEC community based on a shared vision of achieving stability, security and prosperity for the people of  Asia-Pacific.

B.        The Bogor Declaration of Common Resolve

 A more substantial direction for APEC was the fruit of the APEC Leaders Summit held in Indonesia on November 15, 1994 with President Suharto as host.

         The Bogor Declaration of Common Resolve identified the timeframe for the attainment of more open trade.  Industrialized economies were envisioned to achieve this goal not later than 2010 and developing economies not later than 2020.  This laid down the foundation for “APEC 2020” - economic growth through open trade, equal partnership, shared responsibility, and mutual respect.

 C.        The Osaka Action Agenda

 Given the target dates of 2010 and 2020 for full trade and investment liberalization and facilitation, the Osaka Action Agenda served as a roadway towards achieving APEC’s goals.

 Adopted during the APEC Economic Leaders Meeting on November 19, 1995 in Japan hosted by Prime Minister Tomiichi Murayama, the Action Agenda translated the Seattle vision and Bogor goals into reality.  It reflected the voluntary commitment and the political determination of each member to attain the set objectives of APEC.  The Agenda provided focused on the integrated implementation of activities relating to full trade and investment liberalization/facilitation and stronger economic-technical cooperation.  All these factors were aimed at maximizing the economic well-being of the Asia-Pacific region.

 D.                The Manila Action Plan

 With the adoption of the Manila Action Plan (MAPA) during the 4th APEC Leaders’ Summit held in the Philippines with former President Fidel V. Ramos as host, APEC entered into the implementation phase of its work program towards the realization of the Seattle Vision and the attainment of the Bogor objectives.

The Action Plan represented a giant step forward in six areas:  (a) greater market access through progressive reductions in tariffs and non-tariff  barriers  to  trade;   (b) enhancement of market access in services;    (c) provision of an open investment regime; (d) reduction of the cost of engaging business; (e) enhancement of an open and efficient infrastructure sector; and (f) intensification of economic and technical cooperation.  All these have energized the community spirit in the Asia-Pacific region and stimulated APEC’s commitment to sustainable growth and equitable development.

E.        The Vancouver Summit

 The Asian financial crisis shifted the focus of the APEC Leaders Summit hosted by Prime Minister Jean Chrétien in Vancouver in November 1997 from the area of  trade liberalization.

Major decisions taken included:  (a) the restoration of financial stability through increased efforts in trade and investment liberalization, and the further liberalization of regional financial markets;  (b) the adoption of the Vancouver Framework for enhanced public-private partnerships in infrastructure development; (c) the admission of Peru, Russia and Vietnam as new members;  (d) greater concentration on capacity building in human resource development; and (e) maximum utilization of advanced technologies to enable all members of the APEC region to benefit fully from trade liberalization.

F.   The Kuala Lumpur Summit   

 At the 1998 Summit held in Kuala Lumpur, the APEC Leaders renewed their resolve towards creating a prosperous Asia-Pacific community where economic disparity among nations would be bridged by strengthening the foundations of economic growth, providing the environment necessary for the efficient flow of trade, investment and technology, and enhancing the capacities of members to participate in, and benefit fully from, trade liberalization.

To meet the challenges posed by the Asian financial crisis, the Leaders pledged to pursue a cooperative growth strategy with the following dimensions:

 ·     growth-oriented, prudent macroeconomic policies appropriate to the specific requirements of each member-economy;

·      an expanded financial assistance from the international community to generate employment and to build and strengthen social safety nets to protect the poor and vulnerable;

·       a comprehensive program of support for efforts to strengthen financial systems, restore trade finance, and accelerate corporate sector restructuring;

·       new approaches to catalyze the return of stable and sustainable private capital flows into the region;

·       a renewed commitment to the Bogor goals of achieving free and open trade and investment within APEC; and

·       urgent work within APEC and  with other economies and institutions to develop and implement measures to strengthen the international financial system.

 G.                The Auckland Summit

 There  were  three  (3)  themes of APEC ‘99 which served as focus of   the   agenda  and  decisions  of   the  11th   Ministerial   Meeting    in Auckland: 1) expanding  opportunities  for  business  around  the  region; 2) strengthening the functioning of markets; and  3) expanding support for APEC. 

With respect to the first theme, Ministers reaffirmed the central role of Individual Action Plans in delivering liberalization, facilitation and reform under the APEC process; endorsed key trade facilitation achievements; and declared a continuing commitment to open regionalism and to the multilateral trading system, particularly the importance of the WTO negotiations in liberalizing trade and investment within the region and encouraging growth in the global economy.  The Ministers also welcomed the submission by the Philippines and four (4) other economies – Australia, Brunei, Japan and the United States – of their Individual Actions Plans to voluntary peer review.

 For the second theme, the Ministers agreed to a “road map” setting out future work by APEC to strengthen markets. They also accorded high priority to the target of achieving paperless trading, where possible, by 2005 for developed economies and 2010 for developing economies.  Finally, in support of the third theme, Ministers committed to expand their efforts to build community understanding of APEC’s goals and the benefits of a more open and integrated regional economy as well as the capacity of members to provide social safety nets to alleviate the negative social impact of the Asian financial crisis.

H.                The Brunei Summit

 At the summit in Brunei, the Ministers laid out APEC’s vision to capture the full economic and social benefits of the emerging new global economy.  Actions already taken by APEC to move forward include e-commerce readiness assessment, paperless trading, electronic Individual Action Plans, and capacity-building of institutions and human capital in areas related to e-commerce.  In addition, an action agenda was directed towards the following areas: strengthening of market structures and institutions to enable new and existing forms of trade and investment in goods and services to flourish in the new environment; development of a conducive policy environment for investment in infrastructure and the development of technology; active inducement of innovation and entrepreneurship; and intensive human capacity building through comprehensive and high-quality education and training and skills development programs.

The guidelines contained in the 1995 Osaka Action Agenda (OAA) provide critical guidance to APEC economies on how they can voluntarily comply with the Bogor goals in each of the fifteen (15) substantive areas.  However, the world economy has changed since the OAA was completed in 1995 and APEC itself has changed and developed as an institution.  Thus, Ministers also decided to review and build upon the OAA guidelines.

I.                    The Shanghai Accord

             To strengthen commitments in achieving the Bogor Goals, APEC        adopts the Shanghai Accord in 2001. The Accord focuses on:

 ·                    Pursuing trade policies on services, intellectual property, and tariffs that will encourage development of the New Economy.

·                    Adopting a pathfinder approach in advancing selected APEC initiatives towards achieving the Bogor Goals. Use of so-called pathfinder approach enables a group of countries to pilot initiatives that encourage other members to participate later.

·                    Commitment to develop and implement transparency principles for investment rules, regulations, and standards, and for government procurement procedures to ensure good governance. A five percent reduction in transaction costs over the next five years through the elimination of red tape is targeted.

·                    The e-APEC strategy is adopted. It sets out an agenda to strengthen market structures and institutions, facilitate infrastructure investment and technology for on-line transactions and promote entrepreneurship and human capacity building.

APEC member-countries reaffirm support to the Multilateral Trading System and issue the first Counter-Terrorism Statement.

 J.                  The Los Cabos Summit

     The 2002 Summit in Los Cabos, Mexico is set to strengthen the multilateral trading system fundamentals and the fight against all forms of terrorism.

To promote stability in the region’s financial system, APEC Leaders discussed measures that promote prudent and transparent fiscal management, competitiveness and efficient savings allocation. APEC adopts a Trade Facilitation Plan, Policies on Trade and the Digital Economy and Transparency Standards.

 APEC adopts the Secure Trade in APEC Region (STAR) Initiative, which highlights the importance of private-public partnership in advancing trade and human security.

 K.                The Bangkok Summit

In 2003 Bangkok Summit, APEC pushed for renewed negotiations on WTO Doha Development Agenda. Actions are agreed to curb terrorist threats posed by Man Portable Air Defense Systems, to better coordinate counter-terrorism activities and to implement the APEC Action Plan on SARS and Health Security Initiative. Stepping up efforts to build Knowledge-Based economies, strengthening efforts to promote sound and efficient financial systems and accelerating regional structural are also agreed.

 L.               The Santiago  Summit

 Under the APEC’s 2004 theme, "One Community, Our Future", APEC Leaders reaffirm commitment to achieve sustainable and equitable growth and reduce economic disparities.

APEC issues a strong statement of support for progress in the WTO Doha Development Agenda and sets a target for achieving a breakthrough in negotiations: December 2005, convening of the Sixth WTO Ministerial conference. APEC adopts Best Practices for RTAs and FTAs, the Santiago Initiative for Expanded Trade and Data Privacy Framework.  Member economies express determination to confront the threat of terrorism, make a political commitment to fight corruption and ensure transparency, and endorse a specific Course of Action towards this end.

 M.    The Busan Roadmap

The Busan Roadmap is the heart of the 2005 Summit in South Korea. It endeavors to ensure a transparent and secure business environment in the region. APEC completes the Mid-Term Stocktake  which has found that APEC is well on its way to meeting the Bogor Goals.

Leaders issue a statement in support of a successful conclusion to the WTO’s Sixth Ministerial Conference. They commit to confront pandemic health threats and continue to fight against terrorism which could cause deep economic insecurity for the region.

N.       The Ha Noi Declaration

APEC Economic Leaders endorse the Ha Noi Action Plan which identifies specific actions and milestones to implement the Bogor Goals and support capacity-building measures to help APEC economies. The 2006 APEC theme promotes the role of sustainable development as a means to achieve the common goal of prosperity in the region.

The Leaders call for balance outcomes on the WTO Doha Development Agenda. APEC takes a strategic approach to reform working groups and strengthen the Secretariat to prioritize its agenda.

O.        The Sydney Summit

 Issues on climate change, energy security and clean development are the highlights of the recently concluded 2007 Summit in Sydney, Australia.

APEC member economies agree to accelerate efforts towards deeper economic integration in the Asia-Pacific Region by further reducing barriers to trade and investment including free trade agreements and regional trading arrangements, improving economic efficiency and the regional business environment, including capital markets, and facilitating integration in sectors such as transportation, telecommunications, mining and energy.

 8.    What were the operational targets set by the APEC leaders in Osaka  to achieve the goal of free and open trade and investment in the Asia-Pacific region by 2020?

Trade in goods

 ·                    Zero tariffs for all goods and the removal of all quantitative restrictions.

Trade in services

 ·             Unlimited on rights of establishment, national treatment or travel related to the provision of services for visits of up to two (2) years.

International investment

·                    National treatment of all firms and unrestricted rights of establishment in all sectors of production, including national treatment of international investors in terms of fiscal policy (taxation and/or subsidies).

·                    Accession of all APEC governments to existing international conventions for the settlement of disputes relating to international investment.

Transport

·                    Full harmonization of air traffic control procedures and safety standards.

·                    Uninhibited (other than for safety reasons) landing rights for carriers with majority of shares owned by an APEC national, or by nationals of economies which impose no restrictions on landing rights to APEC-based carriers (i.e., "open skies" in the Asia Pacific).

·                    Accession of all APEC governments to international legal conventions for the carriage of goods by air, sea and land.

Tourism

·                    Introduction of "smart card" passports and electronic processing of international passengers.

·                    Visa-free travel by residents of APEC economies within the region for visits of up to six (6) months.

Telecommunications

 ·                    Mutual recognition of all technical telecommunications standards.

·                    Unhampered trans-border transmissions.

 ·                    National treatment for connections to local telecommunications networks.

Dispute settlement

 ·                    Adoption of an APEC Code of Practice for the settlement of disputes relating to trade policy or international investments based on mediation and the reinforcement of existing multilateral mechanisms.

Competition policy

 ·                    Rejection of anti-dumping measures by APEC governments against imports from any other APEC participant, following the adoption of an agreed code of minimum standards for competition policy.

Administrative procedures

 ·                    Full compatibility and Electronic Data Interchange (EDI) of customs documentation and clearance procedures.

·                    Full documentation and on-line access to texts of all significant commercial legislations, regulations, tariffs or quantitative restrictions influencing international economic transactions of all participants, including patents, standards and testing procedures.

9.       In the implementation of the Osaka Action Agenda, what is the proposed Philippine Action Plan for the Trade and Investment Liberalization and Facilitation (TILF) areas?

During the Senior Officials Meeting (SOM 1) held in February 1996 in Manila, the member economies were enjoined to prepare their indicative Individual Action Plans (IAP’s) for the TILF areas.

On tariffs, the Philippine Action Plan consisted of the following:

 a.                  reduce tariffs progressively

As part of its overall liberalization program, the Philippines will gradually phase down its MFN tariffs and move towards a more uniform level of protection across sectors.  By  January 1, 2003, a 2-tiered tariff structure consisting of 3% for raw materials/intermediate products and 10% for finished products will apply.  By January 1,  2004, the above will converge to a rate of 0-5%.

One-hundred-forty-four (144) tariff lines classified as “sensitive agricultural products” are excluded from the above.

 b.                 ensure transparency of tariff regime

 The Philippines will participate actively in the APEC Tariff Database. Accordingly, it will update its tariff data notifications as may be necessary.

On non-tariff measures, the country's IAP include the following:

 a.                  reduce non-tariff measures (NTM’S) progressively

 For the period covering 1997-2020, NTM’s allowed to remain are those imposed for reasons of public security, health and safety. The Philippines will periodically review residual NTM’s to assess the need for continued application.

b.                 ensure transparency of non-tariff measures

             The Philippines will exchange information with APEC on residual NTM’s.

 10.    What liberalization measures have been adopted by the Philippine government in its best effort commitment to accelerate the unilateral pursuit of APEC trade and investment liberalization?

 The following Executive Orders have been issued:

 ·                    Executive Order No. 264 (July 22, 1995) implemented the tariff reduction program on industrial products under Chapters 25 to 97 of the Tariff Code.

§                     Executive Order No. 288 (December 12, 1995) put in place the tariff reduction on non-sensitive agricultural products (those not covered by QR’s) falling under Chapters 1 to 24 of the Tariff Code.

§                     Republic Act No. 8178 (March 28, 1996), or the Agricultural Tariffication Act, provided for the replacement of quantitative import restrictions on agricultural products, except rice, with tariffs.

§                     Executive Order No. 313 (May 7, 1996) provided interim tariff protection and set the maximum bound tariff rates for sensitive agricultural products (i.e., those whose QR’s were lifted).

§                     Executive Order No. 465 (January 22, 1998) implemented the re-calibration of tariff rates for deserving industries and corrected remaining distortions in the tariff structure.

§                     Executive Order No. 486 (July 10, 1998) implemented the re-calibrated tariff schedules for residual items not covered under Executive Order 465 to achieve a coordinated phased tariff reduction program.

§                     Executive Order No. 163 (January 1, 2000) eliminated tariffs on certain Information Technology (IT) products as part of the Philippine commitment to the WTO-IT  Agreement.

§                     Executive Order No. 334 (January 1, 2001) set the reduction of tariff levels across all sectors towards 0-5% by 2004, excluding sensitive agricultural products.

 

INDIVIDUAL ACTION PLANS ON TARIFFS

 1.                  What  are Individual Action Plans?

 APEC Individual Action Plans (IAP’s) are annual reports that record unilateral steps taken by members to meet the Bogor objectives of free and open trade by 2010 for developed economies and 2020 for developing economies.  IAP’s are prepared for each of the fifteen (15) policy action areas of the Osaka Action Agenda.

 The IAP’s serve the following interrelated purposes: (1) improve the transparency of trade and investment regimes, providing valuable information to business and thereby facilitating intra-APEC trade and investment; (2) through annual reporting and peer review process, encourage members to focus on policy issues which need to be addressed to achieve the Bogor goals; (3) maintain and demonstrate the momentum of APEC trade and investment efforts, thereby encouraging liberalization in non-APEC economies, in particular through WTO processes; and (4) enable members to learn from the liberalization and facilitation experiences of others, thus aiding the policy-making process.

2.        Have there been changes to the format of the IAP’s?

 Yes.  The 2000 APEC IAP format guidelines were approved by the Second Senior Officials Meeting in Bandar Seri Begawan in June 2000.  The so-called “next generation IAP’s” intend to achieve greater transparency, specificity and comprehensiveness; improve accessibility and functionality for users; and streamline the preparation process.  Unlike the previous format, the new IAP’s consist of three (3) component parts: an overview or summary statement; an annual report; and a record of cumulative improvements since 1996.

An electronic version of the IAP’s, called “e-IAP’s,” are posted in the APEC website (www.apecsec.org.sg/iap/iap.html). The new system allows users to easily find relevant policy information on-line; enhances the usefulness, specificity, consistency and transparency of IAP’s; streamlines the annual IAP preparation process; and communicates the benefits that APEC and trade and investment liberalization has brought and continue to bring to economies in the region.

3.       Is there a legal obligation to abide by these tariff commitments?

 None.  Unlike in the WTO where commitments on tariffs are bound, APEC member economies have no legal obligation insofar as tariff liberalization measures they commit to undertake are concerned.  This is because trade liberalization/facilitation measures committed under the IAP are unilateral and voluntary and subject to “best-endeavor”  implementation.

 4.      Are the tariff commitments under APEC over and above the concessions granted by the Philippines under the WTO and ASEAN?

 No.  The Philippines did not commit anything new in APEC outside of what is already being unilaterally implemented under the Tariff Reform Program.

 5.       Does the Philippines intend to include in its revised IAP a commitment to reduce tariff rates to zero by 2020?

 The Philippines intends to establish free and open trade through progressive reduction of tariffs and make its tariff regime transparent in year 2020.  At present,  there is no definite commitment to reduce tariffs to zero across-the-board by 2020.  The minimum tariff policy is still 3% with certain exceptions.

 6.      What are the transparency obligations and how is the work on tariffs progressing?

 A computerized tariff database called the APEC Tariff Database is now available on the Internet and is accessible to all interested parties.  Each economy is required to keep this database current by providing both regular updates of tariff information as changes occur and annual updates of trade and other agreed upon data.  To support WTO, member economies are required to provide tariff and trade data annually in accordance with WTO obligations.  Non-WTO members may provide the information required as a voluntary measure.

 INDIVIDUAL ACTION PLAN ON COMPETITION POLICY

1.        What is the objective of APEC on Competition Policy?

             In November 1994, APEC Ministers agreed that the Committee on Trade and Investment (CTI) would develop an understanding of competition issues, in particular, competition laws and policies of economies in the region.  The CTI should learn how competition laws and policies affect trade and investment in the APEC region and identify potential areas of technical cooperation among member economies.  

 APEC’s objective in this work area is for APEC economies to enhance the competitive environment in the Asia-Pacific region by introducing or maintaining effective and adequate competition policy and/or laws and associated enforcement policies, ensuring the transparency of the above, and promoting cooperation among APEC economies, thereby maximizing, inter-alia, the efficient operation of markets, competition among producers and traders, and consumer benefits.

 2.       What is the Philippines’ Approach to Competition Policy?

 The Philippines, through constitutional and statutory provisions, encourages competition for a healthier business environment.  The Philippine Constitution mandates that the State must protect Philippine enterprises against unfair foreign competition and trade practices.  The Constitution also prohibits monopolies and combinations in restraint of trade.

 The basic statute which prohibits unfair trade practices, monopolies and combinations in restraint of trade is the Law on Monopolies and Combinations under RA 3247, as amended and the Revised Penal Code, as amended by RA 1956.  The law deters any person, firm or entity from monopolizing or attempting to monopolize, or from taking part in any conspiracy or combination in the form of trust in restraint of trade or commerce or from restraining free market competition.  The objective is to promote efficiency by effectively promoting desirable competition resulting in increased output, faster economic growth and lower prices of goods and services.

 Other competition-related laws/ statutes include provisions in, among others, the Civil Code, Corporation Code, Securities Regulation Code, Intellectual Property Code, Price Act and Consumer Act.

 The authority to enforce competition-related laws/statutes and, consequently, the regulation or monitoring of unfair trade practices and anti-competitive behavior is vested on numerous agencies.  

 3.       What is the role played by the Tariff Commission in the promotion of Competition Policy?

           The Tariff Commission does advocacy work in promoting the establishment of competition culture in the Philippines.  It assists in the formulation of a fair trade and competition policy framework leading to the enactment of a competition legislation.  The advocacy program consists of seminars/workshops to enlighten various stakeholders, generate public awareness and build up support for the adoption of a national competition policy. 

 4.        Does the Philippines have a central body dealing with anti-competitive activities?

 The Philippines has no central body dealing with anti-competitive activities. The enforcement of laws and the regulation or monitoring of unfair trade practices and anti-competitive activities, are performed by numerous agencies.  The Department of Justice undertakes criminal prosecution of these anti-competitive activities.

 

 5.     What is the Philippine Action Plan on Competition Policy under APEC?

 The Philippines committed itself to enact an anti-trust law and establish a Fair Trade Commission to enforce a comprehensive national competition law and policy.   

  

 THE EARLY VOLUNTARY SECTORAL LIBERALIZATION (EVSL)

 1.       What is the Early Voluntary Sectoral Liberalization (EVSL) Scheme?

Early voluntary sectoral liberalization means liberalization before 2010 for industrialized economies and 2020 for developing economies.

The Osaka Action Agenda (OAA) calls for collective actions to identify industries where progressive reduction of tariffs and non-tariff measures would have a positive impact on trade and economic growth in the Asia-Pacific region or for which there is regional industry support for early liberalization.  Work on the identification of sectors was mandated at the APEC Economic Leaders’ Meeting in Subic in 1996.

           The EVSL initiative envisions a three-track approach to liberalization consisting of market opening measures, trade facilitation activities, and economic and technical cooperation initiatives.   

 2.        What is the product coverage of the Scheme?

 At the Vancouver Summit in 1997, Ministers agreed to early voluntary sectoral liberalization in fifteen (15) areas.  These are:  environmental goods and services; fish and fish products; toys; forest products; gems and jewelry; chemicals; telecommunications mutual recognition agreement (MRA); energy; medical equipment and instruments; oilseeds and oilseed products; food; natural and synthetic rubber; fertilizers; automotive goods; and civil aircraft.        

          Nine (9) sectors were identified for fast-tracking, namely, environmental goods and services; fish and fish products; forest products; medical equipment and instruments; energy; toys; gems and jewelry; chemicals; and telecommunications MRA. 

3.       Is there a flexibility option available to APEC members?

While recognizing the need for a balanced and mutually beneficial package, the APEC Ministers acknowledge that the early liberalization process is to be conducted on the basis of the APEC principle of voluntarism whereby each economy is free to determine the sectoral initiatives in which it will participate.  In order to facilitate maximum participation of all economies in all sectors, some forms of flexibility, e.g., longer time frames for implementation of tariff liberalization targets, are allowed to accommodate specific concerns of economies.  Ministers also acknowledge that flexibilities should take into account the broader goal of maximizing mutual benefits and maintaining the balance of interests; thus, member economies are allowed to submit their reservations.

 4.       What is the Accelerated Tariff Liberalization (ATL) Initiative?

 APEC participating member economies have decided that the tariff elements of the EVSL exercise should be negotiated within the WTO.  The process to be carried out in the WTO is called the "Accelerated Tariff Liberalization (ATL) Initiative."

The objective of bringing the tariff negotiations on the EVSL fast track sectors to the WTO is to improve and build on the work already achieved in APEC on said sectors by:

(i)     broadening the participation in the tariff element beyond APEC to maximize the benefit of liberalization; and

(ii)   working constructively to achieve critical mass in the WTO necessary for concluding agreements in all sectors.

5.   What are the current developments in the Scheme?

 With the decision to transfer the tariff component of the EVSL to the WTO, work has focused on non-tariff measures, trade facilitation, and the economic and technical components of the sectoral initiatives.

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