A Legal Person and the Past of WTO (2)

2021 05/05


The restoration of seats was a standard action taken by the Chinese government to return to international organizations in the 1960s and 1970s. As a legal person, it is not difficult to understand this. In 1949, there was a change of government in China, but as a country, the main body of international law has not changed. What has changed is the government that acts on behalf of China internationally. The new government will inherit and continue the former government's actions and rights and obligations in the international community, and its seat in international organizations will naturally be inherited by the new government.

 

China is one of the founding countries of the United Nations established after World War II. At the same time as the establishment of the United Nations, major powers deliberated and negotiated between 1945 and 1947, and established the General Agreement on Tariffs and Trade in 1948. On behalf of the Chinese government, Dr. Jin Wensi, a career diplomat who was then the Chinese Ambassador to Belgium, participated throughout the process and ultimately signed the document, making China one of the founding countries of the General Agreement. After the establishment of the new Chinese government in October 1949, the former government represented by Dr. Kim, the Taiwan authorities, withdrew from their seats in the General Agreement on their own eight months later.

 

This withdrawal has raised legal issues in the General Agreement, namely, whether the Taiwan authorities have the right to withdraw from the General Agreement on behalf of China. The old empire, Britain, has made reservations about this and added a note to its published legal text of the General Agreement, which reads, "The Chinese Kuomintang government announced its withdrawal from the General Agreement on May 5, 1950; the Chinese Central People's Government has not yet determined its position on the General Agreement.". It should be said that this approach only indicates the facts, but does not announce the British position on the withdrawal. Czechoslovakia also disagrees with the legality and validity of the withdrawal, and recommends that the General Agreement consult Beijing's attitude towards the General Agreement. "Some important documents of the General Agreement originally listed the names of each contracting party country in the preamble, but after the above legal issues arose, they were no longer continued and were replaced by" existing contracting parties ".".

 

In 1965, the Taiwan authorities applied for an observer seat in the General Agreement, which once again triggered a debate on this legal issue. The positions of the Parties differ as to whether to admit observers. France and Cuba oppose it, while the United States and other countries support it. Most countries hesitate. The United Kingdom, the Netherlands, the Nordic countries, and Indonesia, Poland, Egypt and other countries have stated that their governments recognize the People's Republic of China as the only legitimate government of China. The General Agreement Secretariat compromised, saying that accepting observer status did not prejudice the decision of the contracting parties to recognize a government. In the end, the parties accepted the observer's application.

 

The essence of the above legal issues is the issue of the legal capacity to act internationally on behalf of China, the subject of international law, that is, which government has the international authority to act on behalf of China. In 1971, the United Nations adopted resolution 2758, recognizing the Government of the People's Republic of China as the only legitimate government representing China, and restoring its seat in the United Nations. At this point, the legal issue has gradually become a non issue. The following year, the General Agreement "invited" representatives of the Taiwan authorities from the observer seat.

 

The actions of the General Agreement in the face of the above-mentioned withdrawal, consent to be an observer, and cancellation of observer seats are actually the result of the unwritten tradition of the General Agreement, which means avoiding political issues as much as possible but following United Nations resolutions.





Ambassador Jin Wensi signed the General Agreement on behalf of the Chinese government in 1948, making China a founding contracting party.



It is not difficult to understand China's proposal to restore seats in the General Agreement in 1986. However, this recovery requirement has encountered new challenges.

 

 

Unlike other international organizations, the General Agreement is a hypermarket where parties exchange markets. Each member should present a list of hundreds, even tens, of thousands of goods, promising to reduce their import tariffs to a certain percentage and not to arbitrarily change them. This list is specifically referred to as the "Tariff Schedule" in the General Agreement, including today's WTO, and promises not to arbitrarily change tariffs, known as "binding tariffs.". There is a detailed set of rules that have been in place for over half a century to regulate how this schedule is negotiated, introduced, updated, benefited all parties, modified, and resolved. Fulfilling this schedule is a legal obligation of each member in the General Agreement, and it is also a "entry fee" that new members must pay. One important reason for the withdrawal of the Taiwan authorities from the General Agreement that year was that they were unable to comply with other contracting parties. The former Chinese government had 1067 tariffs, of which 245 were negotiated and promised to be binding tariffs, as set out in the Chinese government's schedule of concessions under the General Agreement (the number in the General Agreement is Schedule VIII). For example, the binding tariff on imported cotton is 10%, and that on waste wool is 5%. However, after losing the mainland market of 40000 compatriots at that time, they were in a corner of Taiwan with a population of only 7 million at that time. How can we import these goods with low tariffs. Similarly, at that time, the Taiwan authorities were not able to enjoy the benefits of tariff concessions in the schedules of other members. As the saying goes, the absence of skin, the absence of hair. For this reason, when the Taiwan authorities withdrew from the General Assembly in 1950, the United States took the lead in canceling the schedule negotiated with the former Chinese government, followed by European countries, Canada, Australia, and India.

 

 

After more than 30 years, the Chinese government proposed to restore seats in the General Agreement, which is unprecedented in the history of the General Agreement. China, the parties to the General Agreement, and the Secretariat of the General Agreement have conducted intensive discussions on the way and procedure for China to enter the General Agreement. Some members believe that China is re joining and should follow the procedures for acceding to the General Agreement. China firmly opposes this, as it has legally severed the continuity of China's main body of international law and is politically inconsistent with the resolutions of the General Assembly. However, with regard to the position of restoring seats, various parties have raised various puzzles and doubts: If it is to restore seats, what is the account from the withdrawal of the predecessor in 1950 to the present? What are the benefits of tariff concessions between China and its members during this period? Should China make up for the unpaid membership fees during this period?

 

 

When a big country acts, it will make waves and make history. After negotiation, the parties finally achieved a tacit understanding. Without prejudice to the restoration of its seat position, China is prepared to negotiate a new schedule with all member states as a "threshold fee" in accordance with the accession process in fact, in order to fulfill the rights and obligations of the General Agreement. On the premise that China has in fact entered the General Agreement through negotiations in accordance with the accession procedure, the parties and the General Agreement have no objection to China's restoration of its position. Accordingly, restoration is not a restoration of the original breakpoint, but rather a resumption of negotiations at the time point of the conclusion of future negotiations. As a result, the account for the former's withdrawal to the current restored seat is written off.

 

 

Playing with words and phrases in documents to meet the concerns of all parties is an inherent skill of international organizations. In the entire negotiations on China's resumption of the GATT seat, any document derived from the tone of the GATT, including the name of the working group established to negotiate China's resumption of the seat, has avoided the use of the term "restoration" in the GATT and replaced it with "China's Status as a Contracting Party.". It's a mouthful, but it's the biggest common divisor for all parties. After all, solving problems pragmatically is what all parties seek.

 

 

Next, we need to form a team to start negotiations.

 

 

To be continued.


(This article is translated by software translator for reference only.)