AGREEMENT ON SAFEGUARDS

Members,
Having in mind the overall objective of the Members to improve and strengthen the international trading system based on GATT 1994;
Recognizing the need to clarify and reinforce the disciplines of GATT 1994, and specifically those of its Article XIX (Emergency Action on Imports of Particular Products), to re-establish multilateral control over safeguards and eliminate measures that escape such control;
Recognizing the importance of structural adjustment and the need to enhance rather than limit competition in international markets; and
Recognizing further that, for these purposes, a comprehensive agreement,applicable to all Members and based on the basic principles of GATT 1994, is called for;
Hereby agree as follows:

Article 1 - General Provision
This Agreement establishes rules for the application of safeguard measures 
which shall be understood to mean those measures provided for in Article XIX of GATT 1994.
Article 2 - Conditions
1. A Member[1] may apply a safeguard measure to a product only if that 
Member has determined, pursuant to the provisions set out below, that such 
product is being imported into its territory in such increased quantities, 
absolute or relative to domestic production, and under such conditions as 
to cause or threaten to cause serious injury to the domestic industry that 
produces like or directly competitive products.
2. Safeguard measures shall be applied to a product being imported 
irrespective of its source.
Article 3 - Investigation
1. A Member may apply a safeguard measure only following an investigation 
by the competent authorities of that Member pursuant to procedures 
previously established and made public in consonance with Article X of 
GATT 1994. This investigation shall include reasonable public notice to 
all interested parties and public hearings or other appropriate means in 
which importers, exporters and other interested parties could present 
evidence and their views, including the opportunity to respond to the 
presentations of other parties and to submit their views, inter alia, as 
to whether or not the application of a safeguard measure would be in the 
public interest. The competent authorities shall publish a report setting 
forth their findings and reasoned conclusions reached on all pertinent 
issues of fact and law.
2. Any information which is by nature confidential or which is provided on 
a confidential basis shall, upon cause being shown, be treated as such by 
the competent authorities. Such information shall not be disclosed without 
permission of the party submitting it. Parties providing confidential 
information may be requested to furnish non-confidential summaries thereof 
or, if such parties indicate that such information cannot be summarized, 
the reasons why a summary cannot be provided. However, if the competent 
authorities find that a request for confidentiality is not warranted and 
if the party concerned is either unwilling to make the information public 
or to authorize its disclosure in generalized or summary form, the 
authorities may disregard such information unless it can be demonstrated 
to their satisfaction from appropriate sources that the information is 
correct.
Article 4 - Determination of Serious Injury or Threat Thereof
1. For the purposes of this Agreement:
(a) "serious injury" shall be understood to mean a significant overall 
impairment in the position of a domestic industry;
(b) "threat of serious injury" shall be understood to mean serious injury 
that is clearly imminent, in accordance with the provisions of paragraph 
2. A determination of the existence of a threat of serious injury shall be 
based on facts and not merely on allegation, conjecture or remote 
possibility; and
(c) in determining injury or threat thereof, a "domestic industry" shall 
be understood to mean the producers as a whole of the like or directly 
competitive products operating within the territory of a Member, or those 
whose collective output of the like or directly competitive products 
constitutes a major proportion of the total domestic production of those 
products.
2. (a) In the investigation to determine whether increased imports have 
caused or are threatening to cause serious injury to a domestic industry 
under the terms of this Agreement, the competent authorities shall 
evaluate all relevant factors of an objective and quantifiable nature 
having a bearing on the situation of that industry, in particular, the 
rate and amount of the increase in imports of the product concerned in 
absolute and relative terms, the share of the domestic market taken by 
increased imports, changes in the level of sales, production, 
productivity, capacity utilization, profits and losses, and employment.
(b) The determination referred to in subparagraph (a) shall not be made 
unless this investigation demonstrates, on the basis of objective 
evidence, the existence of the causal link between increased imports of 
the product concerned and serious injury or threat thereof. When factors 
other than increased imports are causing injury to the domestic industry 
at the same time, such injury shall not be attributed to increased 
imports.
(c) The competent authorities shall publish promptly, in accordance with 
the provisions of Article 3, a detailed analysis of the case under 
investigation as well as a demonstration of the relevance of the factors 
examined.
Article 5 - Application of Safeguard Measures
1. A Member shall apply safeguard measures only to the extent necessary to 
prevent or remedy serious injury and to facilitate adjustment. If a 
quantitative restriction is used, such a measure shall not reduce the 
quantity of imports below the level of a recent period which shall be the 
average of imports in the last three representative years for which 
statistics are available, unless clear justification is given that a 
different level is necessary to prevent or remedy serious injury. Members 
should choose measures most suitable for the achievement of these 
objectives.
2. (a) In cases in which a quota is allocated among supplying countries, 
the Member applying the restrictions may seek agreement with respect to 
the allocation of shares in the quota with all other Members having a 
substantial interest in supplying the product concerned. In cases in which 
this method is not reasonably practicable, the Member concerned shall 
allot to Members having a substantial interest in supplying the product 
shares based upon the proportions, supplied by such Members during a 
previous representative period, of the total quantity or value of imports 
of the product, due account being taken of any special factors which may 
have affected or may be affecting the trade in the product.
(b) A Member may depart from the provisions in subparagraph (a) provided 
that consultations under paragraph 3 of Article 12 are conducted under the 
auspices of the Committee on Safeguards provided for in paragraph 1 of 
Article 13 and that clear demonstration is provided to the Committee that 
(i) imports from certain Members have increased in disproportionate 
percentage in relation to the total increase of imports of the product 
concerned in the representative period, (ii) the reasons for the departure 
from the provisions in subparagraph (a) are justified, and (iii) the 
conditions of such departure are equitable to all suppliers of the product 
concerned. The duration of any such measure shall not be extended beyond 
the initial period under paragraph 1 of Article 7. The departure referred 
to above shall not be permitted in the case of threat of serious injury.
Article 6 - Provisional Safeguard Measures
In critical circumstances where delay would cause damage which it would be 
difficult to repair, a Member may take a provisional safeguard measure 
pursuant to a preliminary determination that there is clear evidence that 
increased imports have caused or are threatening to cause serious injury. 
The duration of the provisional measure shall not exceed 200 days, during 
which period the pertinent requirements of Articles 2 through 7 and 12 
shall be met. Such measures should take the form of tariff increases to be 
promptly refunded if the subsequent investigation referred to in paragraph 
2 of Article 4 does not determine that increased imports have caused or 
threatened to cause serious injury to a domestic industry. The duration of 
any such provisional measure shall be counted as a part of the initial 
period and any extension referred to in paragraphs 1, 2 and 3 of Article 
7.
Article 7 - Duration and Review of Safeguard Measures
1. A Member shall apply safeguard measures only for such period of time as 
may be necessary to prevent or remedy serious injury and to facilitate 
adjustment. The period shall not exceed four years, unless it is extended 
under paragraph 2.
2. The period mentioned in paragraph 1 may be extended provided that the 
competent authorities of the importing Member have determined, in 
conformity with the procedures set out in Articles 2, 3, 4 and 5, that the 
safeguard measure continues to be necessary to prevent or remedy serious 
injury and that there is evidence that the industry is adjusting, and 
provided that the pertinent provisions of Articles 8 and 12 are observed.
3. The total period of application of a safeguard measure including the 
period of application of any provisional measure, the period of initial 
application and any extension thereof, shall not exceed eight years.
4. In order to facilitate adjustment in a situation where the expected 
duration of a safeguard measure as notified under the provisions of 
paragraph 1 of Article 12 is over one year, the Member applying the 
measure shall progressively liberalize it at regular intervals during the 
period of application. If the duration of the measure exceeds three years, 
the Member applying such a measure shall review the situation not later 
than the mid-term of the measure and, if appropriate, withdraw it or 
increase the pace of liberalization. A measure extended under paragraph 2 
shall not be more restrictive than it was at the end of the initial 
period, and should continue to be liberalized.
5. No safeguard measure shall be applied again to the import of a product 
which has been subject to such a measure, taken after the date of entry 
into force of the WTO Agreement, for a period of time equal to that during 
which such measure had been previously applied, provided that the period 
of non-application is at least two years.
6. Notwithstanding the provisions of paragraph 5, a safeguard measure with 
a duration of 180 days or less may be applied again to the import of a 
product if:
(a) at least one year has elapsed since the date of introduction of a 
safeguard measure on the import of that product; and
(b) such a safeguard measure has not been applied on the same product more 
than twice in the five-year period immediately preceding the date of 
introduction of the measure.
Article 8 - Level of Concessions and Other Obligations
1. A Member proposing to apply a safeguard measure or seeking an extension 
of a safeguard measure shall endeavour to maintain a substantially 
equivalent level of concessions and other obligations to that existing 
under GATT 1994 between it and the exporting Members which would be 
affected by such a measure, in accordance with the provisions of paragraph 
3 of Article 12. To achieve this objective, the Members concerned may 
agree on any adequate means of trade compensation for the adverse effects 
of the measure on their trade.
2. If no agreement is reached within 30 days in the consultations under 
paragraph 3 of Article 12, then the affected exporting Members shall be 
free, not later than 90 days after the measure is applied, to suspend, 
upon the expiration of 30 days from the day on which written notice of 
such suspension is received by the Council for Trade in Goods, the 
application of substantially equivalent concessions or other obligations 
under GATT 1994, to the trade of the Member applying the safeguard 
measure, the suspension of which the Council for Trade in Goods does not 
disapprove.
3. The right of suspension referred to in paragraph 2 shall not be 
exercised for the first three years that a safeguard measure is in effect, 
provided that the safeguard measure has been taken as a result of an 
absolute increase in imports and that such a measure conforms to the 
provisions of this Agreement.
Article 9 - Developing Country Members
1. Safeguard measures shall not be applied against a product originating 
in a developing country Member as long as its share of imports of the 
product concerned in the importing Member does not exceed 3 per cent, 
provided that developing country Members with less than 3 per cent import 
share collectively account for not more than 9 per cent of total imports 
of the product concerned.[2]
2. A developing country Member shall have the right to extend the period 
of application of a safeguard measure for a period of up to two years 
beyond the maximum period provided for in paragraph 3 of Article 7. 
Notwithstanding the provisions of paragraph 5 of Article 7, a developing 
country Member shall have the right to apply a safeguard measure again to 
the import of a product which has been subject to such a measure, taken 
after the date of entry into force of the WTO Agreement, after a period of 
time equal to half that during which such a measure has been previously 
applied, provided that the period of non-application is at least two 
years.
Article 10 - Pre-existing Article XIX Measures
Members shall terminate all safeguard measures taken pursuant to Article 
XIX of GATT 1947 that were in existence on the date of entry into force of 
the WTO Agreement not later than eight years after the date on which they 
were first applied or five years after the date of entry into force of the 
WTO Agreement, whichever comes later.
Article 11 - Prohibition and Elimination of Certain Measures
1. (a) A Member shall not take or seek any emergency action on imports of 
particular products as set forth in Article XIX of GATT 1994 unless such 
action conforms with the provisions of that Article applied in accordance 
with this Agreement. 
(b) Furthermore, a Member shall not seek, take or maintain any voluntary 
export restraints, orderly marketing arrangements or any other similar 
measures on the export or the import side.[3],[4] These include actions 
taken by a single Member as well as actions under agreements, arrangements 
and understandings entered into by two or more Members. Any such measure 
in effect on the date of entry into force of the WTO Agreement shall be 
brought into conformity with this Agreement or phased out in accordance 
with paragraph 2.
(c) This Agreement does not apply to measures sought, taken or maintained 
by a Member pursuant to provisions of GATT 1994 other than Article XIX, 
and Multilateral Trade Agreements in Annex 1A other than this Agreement, 
or pursuant to protocols and agreements or arrangements concluded within 
the framework of GATT 1994.
2. The phasing out of measures referred to in paragraph 1(b) shall be 
carried out according to timetables to be presented to the Committee on 
Safeguards by the Members concerned not later than 180 days after the date 
of entry into force of the WTO Agreement. These timetables shall provide 
for all measures referred to in paragraph 1 to be phased out or brought 
into conformity with this Agreement within a period not exceeding four 
years after the date of entry into force of the WTO Agreement, subject to 
not more than one specific measure per importing Member[5], the duration 
of which shall not extend beyond 31 December 1999. Any such exception must 
be mutually agreed between the Members directly concerned and notified to 
the Committee on Safeguards for its review and acceptance within 90 days 
of the entry into force of the WTO Agreement. The Annex to this Agreement 
indicates a measure which has been agreed as falling under this exception.
3. Members shall not encourage or support the adoption or maintenance by 
public and private enterprises of non-governmental measures equivalent to 
those referred to in paragraph 1.
Article 12 - Notification and Consultation
1. A Member shall immediately notify the Committee on Safeguards upon:
(a) initiating an investigatory process relating to serious injury or 
threat thereof and the reasons for it;
(b) making a finding of serious injury or threat thereof caused by 
increased imports; and
(c) taking a decision to apply or extend a safeguard measure.
2. In making the notifications referred to in paragraphs 1(b) and 1(c), 
the Member proposing to apply or extend a safeguard measure shall provide 
the Committee on Safeguards with all pertinent information, which shall 
include evidence of serious injury or threat thereof caused by increased 
imports, precise description of the product involved and the proposed 
measure, proposed date of introduction, expected duration and timetable 
for progressive liberalization. In the case of an extension of a measure, 
evidence that the industry concerned is adjusting shall also be provided. 
The Council for Trade in Goods or the Committee on Safeguards may request 
such additional information as they may consider necessary from the Member 
proposing to apply or extend the measure.
3. A Member proposing to apply or extend a safeguard measure shall provide 
adequate opportunity for prior consultations with those Members having a 
substantial interest as exporters of the product concerned, with a view 
to, inter alia, reviewing the information provided under paragraph 2, 
exchanging views on the measure and reaching an understanding on ways to 
achieve the objective set out in paragraph 1 of Article 8.
4. A Member shall make a notification to the Committee on Safeguards 
before taking a provisional safeguard measure referred to in Article 6. 
Consultations shall be initiated immediately after the measure is taken.
5. The results of the consultations referred to in this Article, as well 
as the results of mid-term reviews referred to in paragraph 4 of Article 
7, any form of compensation referred to in paragraph 1 of Article 8, and 
proposed suspensions of concessions and other obligations referred to in 
paragraph 2 of Article 8, shall be notified immediately to the Council for 
Trade in Goods by the Members concerned.
6. Members shall notify promptly the Committee on Safeguards of their 
laws, regulations and administrative procedures relating to safeguard 
measures as well as any modifications made to them.
7. Members maintaining measures described in Article 10 and paragraph 1 of 
Article 11 which exist on the date of entry into force of the WTO 
Agreement shall notify such measures to the Committee on Safeguards not 
later than 60 days after the date of entry into force of the WTO 
Agreement.
8. Any Member may notify the Committee on Safeguards of all laws, 
regulations, administrative procedures and any measures or actions dealt 
with in this Agreement that have not been notified by other Members that 
are required by this Agreement to make such notifications.
9. Any Member may notify the Committee on Safeguards of any 
non-governmental measures referred to in paragraph 3 of Article 11.
10. All notifications to the Council for Trade in Goods referred to in 
this Agreement shall normally be made through the Committee on Safeguards.
11. The provisions on notification in this Agreement shall not require any 
Member to disclose confidential information the disclosure of which would 
impede law enforcement or otherwise be contrary to the public interest or 
would prejudice the legitimate commercial interests of particular 
enterprises, public or private.
Article 13 - Surveillance
1. A Committee on Safeguards is hereby established, under the authority of 
the Council for Trade in Goods, which shall be open to the participation 
of any Member indicating its wish to serve on it. The Committee will have 
the following functions:
(a) to monitor, and report annually to the Council for Trade in Goods on, 
the general implementation of this Agreement and make recommendations 
towards its improvement;
(b) to find, upon request of an affected Member, whether or not the 
procedural requirements of this Agreement have been complied with in 
connection with a safeguard measure, and report its findings to the 
Council for Trade in Goods;
(c) to assist Members, if they so request, in their consultations under 
the provisions of this Agreement;
(d) to examine measures covered by Article 10 and paragraph 1 of Article 
11, monitor the phase-out of such measures and report as appropriate to 
the Council for Trade in Goods;
(e) to review, at the request of the Member taking a safeguard measure, 
whether proposals to suspend concessions or other obligations are 
"substantially equivalent", and report as appropriate to the Council for 
Trade in Goods;
(f) to receive and review all notifications provided for in this Agreement 
and report as appropriate to the Council for Trade in Goods; and
(g) to perform any other function connected with this Agreement that the 
Council for Trade in Goods may determine.
2. To assist the Committee in carrying out its surveillance function, the 
Secretariat shall prepare annually a factual report on the operation of 
this Agreement based on notifications and other reliable information 
available to it.
Article 14 - Dispute Settlement
The provisions of Articles XXII and XXIII of GATT 1994 as elaborated and 
applied by the Dispute Settlement Understanding shall apply to 
consultations and the settlement of disputes arising under this Agreement.
ANNEX - EXCEPTION REFERRED TO IN PARAGRAPH 2 OF ARTICLE 11
Members concernedProductTermination
EC/JapanPassenger cars, off road vehicles, light commercial 
vehicles, light trucks (up to 5 tonnes), and the same vehicles in 
wholly knocked-down form (CKD sets).31 December 1999




[1] A customs union may apply a safeguard measure as a single unit or on behalf of a member State. When a customs union applies a safeguard measure as a single unit, all the requirements for the determination of serious injury or threat thereof under this Agreement shall be based on the conditions existing in the customs union as a whole. When a safeguard measure is applied on behalf of a member State, all the requirements for the determination of serious injury or threat thereof shall be based on the conditions existing in that member State and the measure shall be limited to that member State. Nothing in this Agreement prejudges the 
interpretation of the relationship between Article XIX and paragraph 8 of Article XXIV of GATT 1994.
[2] A Member shall immediately notify an action taken under paragraph 1 of Article 9 to the Committee on Safeguards.
[3] An import quota applied as a safeguard measure in conformity with the relevant provisions of GATT 1994 and this Agreement may, by mutual agreement, beadministered by the exporting Member.
[4] Examples of similar measures include export moderation, export-price or import-price monitoring systems, export or import surveillance, compulsory import cartels and discretionary export or import licensing schemes, any of which afford protection.
[5] The only such exception to which the European Communities is entitled is indicated in the Annex to this Agreement.