The Rules On State Trading Enterprises In The Domains Of Goods Of GATT/WTO Laws

Little attention had been paid on the rules on state trading enterprises under the WTO laws during a long time. However, in recent years, along with so called "economies in transition" countries (for example: China, Russia) applying to accession to the WTO or successfully entering into the WTO and the negotiation of agriculture in Doha Round, these rules become common concerns of the WTO members. State trading enterprises are readily used as trade-policy instrument by the government for their relationship with the government and their pattern of operation. The rules on state trading enterprises were established and developed with the evolution of GATT/WTO. The rules discussed in this theme are restricted to the domains of goods. State trading enterprises are required to make any purchases or sales solely in accordance with commercial considerations and act in a manner consistent with the general principles of non-discriminatory treatment. Each member shall submit the notification on state trading enterprises to the council of Trade in Goods to ensure the transparency of the activities of state trading enterprises. Each member also should negotiate to limit or reduce the obstacles to the expansion of international trade and has the right to invoke dispute settlement procedures in instance where he perceives that a state trading enterprise has violated these rules. The rules on state trading enterprises, whose basic regulation is in GATT Article XVII, still remain a weak part of the whole WTO legal framework and should be strengthened through reformation. Some suggestions about the reformation are put forward. The difficulty of China to apply to accession to the WTO is discussed and China's commitments on state trading enterprises are introduced. The performance of these commitments and the impact of performance of system of foreign trade are analyzed.