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WTO Reviews Trade Policies In Switzerland, Liechtenstein

by Ulrika Lomas, Tax-news.com, Brussels

27 May 2017


The WTO has published its fifth review of the trade policies and practices of Switzerland and Liechtenstein, in which it noted that the trade regimes in both countries remain generally open.

Juan Carlos Gonzalez, Chairman of the WTO's Trade Policy Review Body, commented: "On the positive side, the trade and investment regimes were generally open and liberal for goods as well as for services. Tariffs on non-agricultural goods were as a general rule zero or very low on a most-favored nation (MFN) basis. Some Members [of the review team] highlighted that Switzerland had never resorted to trade defensive measures to remedy perceived imbalances, nor were they involved in dispute settlement cases inside or outside the WTO."

The 1923 Swiss-Liechtenstein Customs Union Treaty created a common regime for goods, while the European Free Trade Area (EFTA) Convention regulates the bilateral relationship in services, government procurement, consumer protection, investment, and certain intellectual property rights. Liechtenstein is a member of the European Economic Area, and Switzerland's trade relations with the EU are governed by a number of bilateral agreements.

The WTO said that the tariff regime in Switzerland and Liechtenstein is unique in its reliance on specific duties based on gross weight. Several delegations to the review recommended that the countries consider a more transparent ad valorem regime.

In addition, Gonzalez said that the WTO remains concerned that the agricultural sector is a weak point, "both in terms of high domestic support and border protection in the form of high tariffs."

The WTO observed that Switzerland has an extensive preferential network of agreements, including bilateral agreements with the EU and regional trade agreements (RTAs) conducted through the EFTA. The WTO said that since its last review of Switzerland and Liechtenstein, in 2013, three new EFTA RTAs have entered into force, with several agreements signed but not yet in force.

The WTO also noted that, in addition to its membership of the EEA, Liechtenstein participates in RTAs through the EFTA. Switzerland's bilateral FTAs with the Faeroe Islands, Japan, and China apply to Liechtenstein for trade in goods.

The WTO said that Swiss customs procedures have remained largely unchanged since 2013, although Switzerland did introduce a "registered exporter system" on January 1, 2017. There have been no new developments regarding taxes affecting imports.

The report stated that Switzerland and Liechtenstein accepted the WTO's Trade Facilitation Agreement in September 2015, and that the tariff reductions resulting from the expansion of the Information Technology Agreement are being implemented on a provisional basis with effect from January 1, 2017. Switzerland intends to ratify the revised plurilateral Agreement on Government Procurement; Liechtenstein ratified the agreement in 2013.

TAGS: tax | investment | free trade agreement (FTA) | export duty | law | intellectual property | tariffs | World Trade Organisation (WTO) | trade treaty | China | Liechtenstein | offshore | agreements | Switzerland | import duty | trade | European Union (EU) | Japan | services | Europe

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