Disclaimer - s-space.snu.ac.krs-space.snu.ac.kr/bitstream/10371/129259/1/000000018025.pdf · MATTEL’S TOY RECALL ... understanding supply chain issues in product recalls. Management

저 시-비 리- 경 지 20 한민

는 아래 조건 르는 경 에 한하여 게

l 저 물 복제 포 전송 전시 공연 송할 수 습니다

다 과 같 조건 라야 합니다

l 하는 저 물 나 포 경 저 물에 적 된 허락조건 명확하게 나타내어야 합니다

l 저 터 허가를 면 러한 조건들 적 되지 않습니다

저 에 른 리는 내 에 하여 향 지 않습니다

것 허락규약(Legal Code) 해하 쉽게 약한 것 니다

Disclaimer

저 시 하는 원저 를 시하여야 합니다

비 리 하는 저 물 리 목적 할 수 없습니다

경 지 하는 저 물 개 형 또는 가공할 수 없습니다

國際學碩士學位論文

Impacts of Technical Barriers to Trade and Technical Standards on Toy Industry of

Developing Country - A Case Study on the USrsquos Recall on Chinese Toy Imports -

무역상 기술장벽협정과 기술표준이 개발도상국의

완구용품 산업에 미치는 영향 - 미국의 중국산 장난감 회수조치 사례를 중심으로 -

2014年 2月

서울大學校國際大學院

國際學科國際通商專攻

金娟秀

A thesis presented

Yeonsoo Kim

Graduate Program in International Commerce In partial fulfillment of the requirements

For the degree of Master In the subject of International Studies

Graduate School of International Studies Seoul National University

Seoul Korea February 2014

13 iii

Impacts of Technical Barriers to Trade and Technical Standards on Toy Industry of Developing Country

- A Case Study on the USrsquos Recall on Chinese Toy Imports -

무역상 기술장벽협정과 기술표준이 개발도상국의 완구용품 산업에 미치는 영향

- 미국의 중국산 장난감 회수조치 사례를 중심으로 -

指導敎授安德根

이 論文을 國際學碩士學位論文으로 提出함

2014 年 2 月

金娟秀

金娟秀의 碩士學位論文을 認准함

2014 年 2 月

委員長李永燮 (인)

副委員長文輝昌 (인)

委員安德根 (인)

THESIS ACCEPTANCE CERTIFICATE

The undersigned appointed by

The Graduate School of International Studies

Seoul National University

Have examined the thesis entitled

A Case Study on the USrsquos Recall on Chinese Toy Imports -

Presented by Yeonsoo Kim

Candidate for the degree of Master of International Studies and hereby certify that the examined thesis is worthy of acceptance

Signature Committee Chair Rhee Yeongseop Signature Committee Member Moon Hwy-Chang Signature Committee Member Ahn Dukgeun

Date February 2014

ABSTRACT

As most of the industries are outsourcing their manufacturing process to

developing countries to form the global supply chain in the era of globalization

controversies due to different technology standards are being on the rise and

the case of USrsquos recall on Chinese toy imports is one of the examples Although

the reaction of the US was confined to temporary recall it seems possible that

similar disputes involving import restriction might develop into a legal dispute

case which will be judged by WTO panels In such case the main ruling would

be based on TBT Agreement This research paper treats the case study about

USrsquos toy recall case and the legitimacy of such measure under TBT Agreement

In addition several implications will be stated as well including discrepancy

between TBT Agreement and its application and standard harmonization issue

Key Words TBT Agreement WTO GATT toy recall toy industry

Student Number 2012-22086

TABLE OF CONTENTS 13 13 ABSTRACT vii

TABLE OF CONTENTS viii

LIST OF TABLES AND FIGURES ix

LIST OF ABBREVIATIONS ix

I INTRODUCTION 1

II APPLICABLE INTERNATIONAL RULES FOR TOY SAFETY REGULATION 4

1 GATT ARTICLE I amp III 4 2 GATT ARTICLE XX(B) amp CHAPEAU OF ARTICLE XX 8 3 TBT UNDER THE WTO SYSTEM amp TBT ARTICLE II 10 4 OTHER RELATED TECHNICAL STANDARDS 20

III CASE STUDY ON US-CHINA TOY TRADE DISPUTE 28 1 INDUSTRY ANALYSIS AND INDUSTRY TRENDS 28

11 Characteristics of toy industry 28 12 Global supply chain with China involved 31

2 MATTELrsquoS TOY RECALL 34 21 Event outline 37 22 Aftermath of toy recall and its damage degree to the toy industry 40 23 Reaction and regulation of the US government and background policy 44

3 LEGAL ISSUES OF TOY DISPUTE BASED ON TBT AGREEMENT 49 31 Preliminary findings under GATT Agreement 49 32 Legal analysis why USrsquos toy recall is legally controversial under TBT Agreement 51

IV FURTHER DISCUSSION AND CONCLUSION 54

REFERENCES 59

국문 초록 63 13

13 vii

LIST OF FIGURES

Figure 1 Toy Recalls Over Time (1988-2007)

Figure 2 Number of Lead-Contained Toy Recall (1998-2008)

LIST OF TABLES

Table 1 Lead in Paint Regulations by Country

Table 2 Toy Recalls (1988-2007)

Table 3 Number of Lead-Contained Toy Recall Announcements (1988-2008)

LIST OF ABBREVIATIONS

AQSIQ State General Administration for Quality Supervision and

Inspection and Quarantine

CPSC Consumer Product Safety Commission

CNCA China Certification Accreditation Association

13 viii

CPSIA Consumer Product Safety Improvement Act

CDC Centers for Disease Control

GATT General Agreement on Tariffs and Trade

IEC International Electrotechnical Commission

ISO International Organization for Standardization

ITO International Trade Organization

ITU International Telecommunication Union

MFN Most Favored Nation

MII Ministry of Information Industry

MOFCOM Ministry of Commerce Peoplersquos Republic of China

SAC Standardization Administration of China

SEPA State Environmental Protection Administration

TBT Technical Barrier to Trade

US United States

USTR United States Trade Representative

WHO World Health Organization of the United Nations

WTO World Trade Organization

I INTRODUCTION

From 2007 to 2008 the recall of an estimated twenty million Chinese-

made toys by Mattel which was the second biggest recall so far in toy industry

have shocked many North American parents and generated severe reactions

from them who have little children in their home It was due to lead paint

coverage on toys which was processed during manufacturing process in local

factories in China The recalls have shaken the toy industry in the US and China

which led to a surge in testing and prompted more stringent testing rules

Particularly it was the occasion of which a certain multinational corporationrsquos

overseas investment and outsourcing of its manufacturing process happen to be

expanded to the scale of national trade dispute due to consumer product safety

issue Moreover the string of recalls of Chinese-made toys heightened trade

tensions between the US and China two continents where the economies and

the trade surpluses were exponential

In the past product failures were often attributed to local or functional

errors in product design the manufacturing process or inadequate labeling with

limited impact Today a single product safety problem can have significant

repercussions on a global scale1 Globalization of most industries has sparked

heightened awareness of the various risks and vulnerabilities that products are

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 1 Marucheck A S (1987) On product liability and quality control IIE Transactions 19 355ndash360

exposed to as they move along the global supply chain continuum from design

and sourcing to manufacture transportation distribution and final sale to the

consumer Supply networks are long and complex Many entities including

outsourcers and subcontractors located in emerging economies such as China

handle the product as it moves across geographical and national borders

thereby creating many physical and temporal threats that pose a risk to product

safety and security 2 Therefore the impact of standards and technical

regulations on trade is at the forefront of global policy discussions This is

particularly true in relation to challenges confronting developing nations as they

seek to increase production for export markets In regard to voluntary standards

developing nations face constraints in absorbing best-practice information on

standards and mobilizing resources necessary to adopt appropriate process and

production methods3

Independent of the reaction and measure that the US took in the actual

case which was only confined to Mattelrsquos recall on toys manufactured in

Chinese factory similar cases involving import restriction due to health issue

being developed into a legal dispute case within the WTO seems highly

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 2 Lee M A Flynn B B and Frohlich MT (2008) All supply chains donrsquot flow through understanding supply chain issues in product recalls Management and Organization Review 4 167ndash182 3 Keith E M John S W and Tsunehiro O (2000) Quantifying the Impact of Technical Barriers to Trade A Framework for Analysis Policy Research Working Paper Development Research Group The World Bank13 13

possible when one considers the tendency that many industries are expanding

their supply chain globally In such cases underlying legal agreements might be

TBT Agreement or GATT Agreement In fact there is a preliminary research

about this toy recall case which is analyzed in legal aspect on the basis of

GATT Agreement particularly Article XX(b) and the chapeau of Article XX

According to its findings USrsquos recall on Chinese toy imports can be justified

under aforementioned GATT Agreement provisions Yet pre research about the

legal analysis based on TBT Agreement hardly exists Also it is hard to find

preliminary researches done about the other extent researches on toy recalls and

consumer safety issues

The main objective of this paper is to analyze the suitability and

legitimacy of USrsquos toy recall in light of TBT Agreement In addition the status

of China as manufacturer in the global supply chain of toy industry will be

discussed further The paper is structured as follows Section II introduces some

applicable international rules and legal agreements for toy safety regulation

including TBT Agreement Article II1 and II2 those are originated from GATT

Article I III XX(b) and the chapeau of Article XX Subsequently the event

outline overall about the toy recall case will be reviewed in section III including

the industry analysis and the focus on Chinarsquos involvement in global supply

chain Then the legal analysis of the case outcome based on TBT Agreement

will be followed subsequently Section IV combines the analysis results from

the previous section and proposes several implications on the application of

TBT Agreement and issues about the vicious cycle created within the global

supply chain of toy industry

II APPLICABLE INTERNATIONAL RULES FOR TOY SAFETY REGULATION 1 GATT ARTICLE I amp III

11 History of GATT

After the World War II has ended in 1945 the international society and

its members recognized the necessity to reconstruct and revitalize broken

worldrsquos economy The outcome of such recognition and efforts came out two

years later twenty-three countries signed General Agreement on Tariffs and

Trade (GATT) which was a multilateral agreement regulating international

trade Actually It was negotiated during the United Nations Conference on

Trade and Employment and was the outcome of the failure of negotiating

governments to create the International Trade Organization (ITO)

Based on its preamble the objective of GATT was to reduce trade

barriers substantially between countries through the reduction of tariffs the

reduction of subsidies the elimination of import quotas and discriminatory

trade policies and preferences on a reciprocal and mutually advantageous basis

To achieve such a liberalized trading regime contracting parties to GATT

underwent eight extensive rounds of negotiations including Kennedy Round

Tokyo Round Uruguay Round Doha Round and etc where countries would

agree to specific reductions to the barriers to trade between nations Most of all

the Uruguay Round has noteworthy significance in among the history of GATT

it was not only the first set of multilateral trade negotiations in which

developing countries had played an active role but also the most substantial

trade liberalization agreement in agricultural products in the history of trade

negotiations4 Finally the contracting parties to the GATT decided to establish

the World Trade Organization (WTO) at this very round which concluded in

12 GATT Article I

Article I of GATT specifies Most Favored Nation (MFN) Principle As

the paragraph 1 of this article states

ldquohellip any advantage favour privilege or immunity granted by any contracting party to any product originating in or destined for any other country shall be accorded

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 4 The GATT Uruguay Round ODI briefing paper Overseas Development Institute Retrieved November 22 2013 5 Elvira C (2007) Total Recall on Chinese Imports Pursuing an End to Unsafe Health and Safety Standards Through Article XX of GATT American University International Law Review 23 915

immediately and unconditionally to the like product originating in or destined for the territories of all other contracting partiesrdquo6

the MFN Principle extend the same privileges benefits or advantages to all

WTO members as long as the occasion is involving ldquolike productsrdquo from each

member nation Here ldquolikenessrdquo of imported product and domestic product

could be determined based on six criteria physical characteristics and uses of

the merchandise interchangeability channels of distribution common

manufacturing facilities production processes and employees customer and

producersrsquo perceptions and price7 Namely it precludes discrimination among

imported ldquolike productsrdquo requiring member-states to treat imported products of

a given nation no less favorably than similar products from other member-

states8 Such concept of ldquolike productsrdquo continuously appears throughout the

agreement including Article III which will be explained in the following

paragraph

13 GATT Article III

Article III of GATT stipulates National Treatment principle This

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 6 GATT Art I 7 The International Trade Administration website US Department of Commerce Retrieved November 22 2013 httpenforcementtradegovpetitioncounselingpcp-likeproducthtml13 8 Elvira C (2007) Total Recall on Chinese Imports Pursuing an End to Unsafe Health and Safety Standards Through Article XX of GATT American University International Law Review 23 915

principle minimizes incidents of unfair trade discrimination by requiring

member-states to refrain from treating foreign products less favorably than

domestic products The purpose of the National Treatment principle is to

prohibit hidden protectionism and circumvent measures that create trade

barriers Therefore under such principle contracting parties must treat

imported and domestic products equally Especially as Article III2 states in the

ldquoThe products of the territory of any contracting party imported into the territory of any other contracting party shall not be subject directly or indirectly to internal taxes or other internal charges of any kind in excess of those applied directly or indirectly

to like domestic productsrdquo9

the National Treatment principle prohibits contracting parties from imposing

internal taxes or charges either directly or indirectly on imported products in

order to afford protection to domestic products Contracting parties substantiate

an Article III2 violation by failing to tax two directly competitive or

substitutable products similarly Finally Article III4 requires that contracting

parties may not provide less favorable treatment to imported products than to

domestic products through following sentences

ldquoThe products of the territory of any contracting party imported into the territory of any other contracting party shall be accorded treatment no less favourable than that

accorded to like products of national origin in respect of all laws regulations and

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 9 GATT Art III2

requirement affecting their internal sale offering for sale purchase transportation distribution or userdquo10

In other words Article III2 and III4 violations occur when a member-state

applies a tax or creates a measure that treats like imported products less

favorably than like domestic products

2 GATT ARTICLE XX(b) amp CHAPEAU OF ARTICLE XX

Article XX is the General Exception clause to GATT provision This

exceptional clause allows member-states of the WTO to use otherwise illegal

trade measures by invoking an enumerated exception for valid public policy

purposes A member-state can only invoke an Article XX exception after a

WTO Panel concludes that the measure or some part thereof violates a GATT

provision Thereafter the WTO Panel must determine whether the measure falls

within one of the Article XX exceptions Throughout the proceedings the

member- state invoking the Article XX exception carries the burden of proof11

21 GATT Article XX(b)

Among ten cases of exceptions Article XX(b) allow a member nations to

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 10 GATT Art III413 11 Elvira C (2007) Total Recall on Chinese Imports Pursuing an End to Unsafe Health and Safety Standards Through Article XX of GATT American University International Law Review 23 915

adopt of enforce measures ldquonecessary to protect human animal or plant life or

healthrdquo12 through the use of measures those are inconsistent with GATT In this

phrase ldquonecessaryrdquo can be regarded as the main keyword when the panel

implements the analysis of a certain case under Article XX(b) the Panel must

determine that a trade measure is ldquonecessaryrdquo to achieve the objectives of that

member nationrsquos public health policy The necessity of such intrusive health

policy can be applied exclusively when the selected measure is the one and only

available measure and there are no less trade restrictive alternatives that would

be consistent with GATT in the occasion

22 Chapeau of GATT Article XX

Not only Article XX(b) but also the chapeau of GATT provides the

criteria that exceptional case must satisfy The chapeau presents as follows

ldquoSubject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between

countries where the same conditions prevail or a disguised restriction on international trade nothing in this Agreement shall be construed to prevent the adoption or

enforcement by any contracting party of measureshelliprdquo13

The purpose of this chapeau is to prevent discrimination and guard against

protectionist policies by prohibiting the application of arbitrarily or

unjustifiable discriminative measures between countries Therefore for a 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 12 GATT Art XX(b) 13 GATT Art XX

certain dispute case to be exceptional against GATT principles including MFN

and national treatment it must satisfy both Article XX(b) and the chapeau of

GATT These two preconditions ultimately become the basis of Technical

Barrier to Trade (TBT) Agreement under the WTO system

3 TBT UNDER WTO SYSTEM amp TBT ARTICLE II

31 Creation of the WTO

The international community created the WTO as a response to the

growing problems facing GATT as the world economy became more globalized

On January 1 1995 the international community established the WTO in order

to reduce trade barriers through multilateral negotiations With its creation the

WTO subsumed GATT and formed the first international trade organization In

this context the original GATT text (GATT 1947) is still in effect under the

WTO framework subject to the modifications of GATT 199414

Whilst GATT was a set of rules agreed upon by nations the WTO is an

institutional body The WTO expanded its scope from traded goods to include

trade within the service sector and intellectual property rights Although it was

designed to serve multilateral agreements during several rounds of GATT

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 14 Elvira C (2007) Total Recall on Chinese Imports Pursuing an End to Unsafe Health and Safety Standards Through Article XX of GATT American University International Law Review 23 91513

negotiations multilateral agreements created selective trading and caused

fragmentation among members WTO arrangements are generally a multilateral

agreement settlement mechanism of GATT15 As the purpose of the WTO is to

facilitate trade among nations through trade agreements as early as 1997 these

agreements governed over ninety percent of all international trade16

In terms of its organization mechanism the WTO consists of various

committees and councils that address novel trade issues and create stronger

international agreements Any WTO member may participate in any committee

or council However WTO members may not participate in the appellate body

dispute settlement panels or multilateral committees The WTO also provides

members with many benefits that facilitate the flow of international trade In

addition to providing an international trade framework the WTO provides its

members with a dispute resolution Panel to resolve disputes among member

states If a dispute arises among contracting parties they must first enter into

consultation After sixty days if the parties cannot agree then they may submit

their dispute to a WTO Panel for study Thereafter the Dispute Settlement Body

appoints a three- to five-member Panel of independent trade experts to review

the dispute The Panel evaluates the facts reviews GATT principles and 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 15 ldquoWhat is the WTOrdquo WTO official website Retrieved November 22 2013 httpwwwwtoorgenglishthewto_ewhatis_ewho_we_are_ehtm 16 Elvira C (2007) Total Recall on Chinese Imports Pursuing an End to Unsafe Health and Safety Standards Through Article XX of GATT American University International Law Review 23 915

submits a report with its decision The decision binds the parties unless within

sixty days the Dispute Settlement Body unanimously decides to reject the

report or either party appeals the decision17

The WTO has a number of fundamental principles that every WTO

member must follow These principles include transparency MFN National

Treatment and reciprocity subsuming basic principles of GATT as well

Transparency requires that member-states publish their trade policies and

regulations and apply them equitably Reciprocity requires that parties in trade

agreements meet their respective trade obligations MFN principle and national

treatment are identical with those under GATT18

32 TBT under the WTO system

The provisions of the GATT 1947 contained only a general reference to

technical regulations and standards in Articles III XI and XX a GATT

working group set up to evaluate the impact of non-tariff barriers in

international trade concluded that technical barriers were the largest category

of non-tariff measures faced by exporters After years of negotiations at the end

of the Tokyo Round in 1979 thirty-two GATT Contracting Parties signed the

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 17 Elvira C (2007) Total Recall on Chinese Imports Pursuing an End to Unsafe Health and Safety Standards Through Article XX of GATT American University International Law Review 23 915 18 Ibid

plurilateral Agreement on TBT The Standards Code as the Agreement was

called laid down the rules for preparation adoption and application of technical

regulations standards and conformity assessment procedures The new WTO

Agreement on Technical Barriers to Trade or TBT Agreement has

strengthened and clarified the provisions of the Tokyo Round Standards Code

The TBT Agreement negotiated during the Uruguay Round is an integral part

of the WTO Agreement19

Aforementioned GATT Article XX(b) and the chapeau of Article XX

may now explain the advent of the TBT Agreement under the WTO system

Just as GATT becomes an entity as the WTO and the WTO Agreement

succeeds the contents of GATT the TBT Agreement got developed based on

GATT Article XX(b) and the chapeau of Article XX as well Such

characteristics of TBT is based on the following evidence

ldquohellip Desiring to further the objectives of GATT 1994 hellip Desiring to ensure that technical regulations and standards including packaging marking and labeling

requirements and procedures for assessment of conformity with technical regulations and standards do not create unnecessary obstacles to international trade hellip

Recognizing that no country should be prevented from taking measures necessary to ensure the quality of its exports or for the protection of human animal or plant like or health of the environment or for the prevention of deceptive practices at the levels it

considers appropriate subject to the requirement that they are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between

countries where the same conditions prevail or a disguised restriction on international

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 19 Technical information on TBT Trade topics WTO official website Retrieved November 25 2013 httpwwwwtoorgenglishtratop_etbt_etbt_info_ehtm

trade and are otherwise in accordance with the provisions of this Agreement helliprdquo20

One of the WTO Panel Report which is about the lsquoEC - Asbestosrsquo case also

mentions about intertwined mechanism between TBT and GATT Article XX(b)

ldquoWe also note that the criteria on the preparation adoption or application of

technical regulations in Article 22 of the TBT Agreement are very similar to

those in Article XX of the GATT 1994 The preamble to the TBT Agreement in

fact repeats some of the wording of Article XX of the GATT In the Panelrsquos

view the TBT Agreement is a development of the GATTrdquo21

To give more detail about the relationship between the TBT Agreement

and GATT Agreement although the TBT Agreement according to its Preamble

in intended to ldquofurther the objectives of GATT 1994rdquo it does not contain any

explicit links to Article XX(b) or any equivalent exception clause Nevertheless

similar wording is found in Article II2 of TBT Unlike Article XX this

provision also mentions ldquohuman safetyrdquo and does not stipulate a closed list of

policies (ldquointer aliardquo) Therefore a wider variety of reasons (even moral ethic

and socio-economic considerations market transparency or consumer

preferences) could be ldquo legitimate objectivesrdquo22 Furthermore as in Article

XX(b) the term ldquonecessaryrdquo is contained in Article II2 of TBT as well 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 20 TBT The Preamble 21 WTO Panel Report lsquoEC mdash Asbestosrsquo (WTDS135R) para 855 22 Rudiger W Peter-Tobias S and Anja S (2007) Technical Barriers and SPS Measure Martinus Nijhoff Publishers

However this seems to contain an element of tautology the phrase ldquonot be

more trade-restrictiverdquo is reminiscent of the interpretation of ldquonecessaryrdquo in

Article XX(b) Yet the different balance of obligations in Article II2 TBT and

in Article XX suggests that ldquonecessaryrdquo need not have exactly the same

meaning in both provisions In lsquoEC ndash Asbestosrsquo case the Appellate Body stated

that ldquothe TBT Agreement imposes obligations on Members that seem to be

different from and additional to the obligations imposed on Members under

the GATT 1994rdquo Unlike Article XX where the burden rests on the defending

party to present a prima facie case that the measure is justified under Article

II2 TBT it is for the complaining party to make a prima facie case that the

measure creates an unnecessary barrier to trade23

There are three main concepts throughout the entire Agreement technical

regulations standards and conformity assessment procedures Technical

regulations and standards set out specific characteristics of a product such as its

size shape design functions and performance or the way it is labeled or

packaged before it is put on sale In certain cases the way a product is produced

can affect these characteristics and it may then prove more appropriate to draft

technical regulations and standards in terms of a products process and

production methods rather than its characteristics per se The TBT Agreement

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 23 Rudiger W Peter-Tobias S and Anja S (2007) Technical Barriers and SPS Measure Martinus Nijhoff Publishers13

makes allowance for both approaches in the way it defines technical regulations

and standards24 One another feature of these standards and regulations is that

they should not be imposed in a protectionistrsquos way In fact the TBT

Agreement accords to Members a high degree of flexibility in the preparation to

take into account the existence of legitimate divergences of taste income

geography and other factors between countries adoption and application of

their national technical regulations according to the abovementioned Preamble

However Members regulatory flexibility is limited by the requirement that

technical regulations ldquoare not prepared adopted or applied with a view to or

with the effect of creating unnecessary obstacles to traderdquo25 according to the

Article II2 Lastly conformity assessment procedures are technical procedures

mdash such as testing verification inspection and certification mdash which confirm

that products fulfill the requirements laid down in regulations and standards

Generally exporters bear the cost if any of these procedures Non-transparent

and discriminatory conformity assessment procedures can become effective

protectionist tools Costs for exporters usually include loss of economies of

scale which is the case that if a firm must adjust its production facilities to

comply with diverse technical requirements in individual markets production

costs per unit are likely to increase This imposes handicap particularly on small

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 24 TBT Annex I 25 TBT Art II2

and medium enterprises Information costs which include the costs of

evaluating the technical impact of foreign regulations translating and

disseminating product information and training of experts is also a part of

exporterrsquos burdens Conformity assessment costs confirming the compliance

with technical regulations through testing certification or inspection by

laboratories or certification bodies are usually at the companys expense as

well26

The TBT Agreement applies when a country applies aforementioned

technical regulations standards or procedures for assessing conformity with

these standards in such a way as to impose an unnecessary restriction on

international trade It is subject to review every three years to reflect the trend

The TBT Agreement covers a broad range of products including consumer

product such as toys for children which also implies that the largest number of

technical regulations and standards are adopted to aim at protecting human

safety or health27 In recent years the number of technical regulations and

standards adopted by countries has grown significantly Increased regulatory

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 26 Technical information on TBT Trade topics WTO official website Retrieved November 25 2013 httpwwwwtoorgenglishtratop_etbt_etbt_info_ehtm 27 Uche U O (2009) Import (toy) safety consumer protection and the WTO Agreement on Technical Barriers to Trade prospects progress and problems International Journal of Private Law Vol 2 No 2

policy can be seen as the result of higher standards of living worldwide which

have boosted consumers demand for safe and high-quality products28

The impact of the TBT on international trade is still being researched and

discussed which makes the issue ambiguous A study by Fontagneacute Mimouni

and Pasteels states that an insignificant or even positive impact of the TBT on

international trade of manufactured consumer products was observed29 On the

other hand researches on the WTO official website specifies that although it is

difficult to give a precise estimate of the impact on international trade of the

need to comply with different foreign technical regulations and standards it

certainly involves significant costs for producers and exporters that could be

huge burden to trade In general these costs arise from the translation of foreign

regulations hiring of technical experts to explain foreign regulations and

adjustment of production facilities to comply with the requirements In addition

there is the need to prove that the exported product meets the foreign

regulations The high costs involved may discourage manufacturers from trying

to sell abroad In the absence of international disciplines a risk exists that

technical regulations and standards could be adopted and applied solely to

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 28 Europe M S (2010) Technical Barriers to Trade Retrieved November 22 2013 httpwebarchivenationalarchivesgovuk+httpwwwberrgovukwhatwedoeuropeandtradekey-trade-issuestechnical-barriers-to-tradepage22741html 29 Lionel F Mondher M and Jean-Michel P (2005) Estimating the impact of environmental SPS and TBT on international trade Forthcoming in Integration and Trade Journal

protect domestic industries30

33 TBT ARTICLE II

Article II of the TBT Agreement is the major part in terms of its

succession of GATT Article XX Especially Article II1 states

ldquoMembers shall ensure that in respect of technical regulations products imported from the territory of any Member shall be accorded treatment no less favourable than

that accorded to like products of national origin and to like products originating in any other countryrdquo

which stipulates that member states of the WTO must offer indiscriminative

treatment and environment to their trading partners within the WTO system

and between domestic goods and imported goods Moreover Article II2

presents

ldquoMembers shall ensure that technical regulations are not prepared adopted or applied with a view to or with the effect of creating unnecessary obstacles to

international trade For this purpose technical regulations shall not be more trade-restrictive than necessary to fulfil a legitimate objective taking account of the risks

non-fulfilment would create Such legitimate objectives are inter alia national security requirements the prevention of deceptive practices protection of human

health or safety animal or plant life or health or the environment In assessing such risks relevant elements of consideration are inter alia available scientific and

technical information related processing technology or intended end-uses of productsrdquo

Preceding article is composed of general obligation and specific obligation the

part that states ldquoMembers shall ensure that technical regulations are not

prepared adopted or applied with a view to or with the effect of creating

unnecessary obstacles to international traderdquo is general obligation while the rest

represents specific obligation One can witness that such paragraph prohibits

trade-restrictive characteristic to fulfill a legitimate objective being consistent

with the purpose of the WTO Particularly following case study will be

analyzed based on these articles

4 OTHER RELATED TECHNICAL STANDARDS

41 Lead regulation

Lead in paint can be divided into soluble lead and insoluble lead soluble

lead is the lead likely to be available for absorption if a child mouths or

swallows31 Any exposure to both kinds of lead is potentially harmful for a

child as there is no known ldquosaferdquo level In May 2012 the US Centers for

Disease Control (CDC) announced it would change its policy on Childhood

Lead Poisoning to eliminate the terminology ldquolevel of concernrdquo that was

previously defined as a blood lead level of 10 ugdl and which had been widely

adopted by other health agencies This change acknowledges that all exposures

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 31 Brief Guide to Analytical Methods for Measuring Lead in Paint Inter-Organization Program for the Sound Management of Chemicals World Health Organization Retrieved January 18 2014 httpwwwwhointipcsassessmentpublic_healthlead_paintpdf

to lead are potentially harmful to a child and therefore public health policy

should focus on preventing exposures before they cause harm The CDC will

now recommend follow up for the most highly exposed children with elevated

blood lead levels above a reference value representing the top 25 of all

children in the US That level is currently 5 microgdl but this will be updated

every four years based on current surveillance testing data This is the first

substantive change in the agencyrsquos guidance on blood lead levels since 1991

While developed countries have implemented standards to regulate the use of

lead in paint much of the paint currently sold for residential use in most

countries contains high levels of lead A recent study examining lead

concentrations in the paint of 10 developing countries demonstrates that 68

of the new paints tested exceed the US standard of 90 ppm (effective August

2009) Published studies conducted in India China and other counties have had

similar findings32

Moreover most countries do not have regulatory limitations on lead

content in paint or only have voluntary standards in place In countries with

regulations the permissible lead levels are often inconsistent with a range of

excluded applications Standards between countries vary greatly and some

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 32 Occupational Knowledge International Retrieved December 3 2013 httpwwwokinternationalorglead-paintBackground

regulations reference soluble lead and others total lead (percent by weight)33

The lead level regulation in paint of the US and China is not an exception when

referring to the following table although both countries have same figure in

terms of the ppm the standard is slightly different since China measures the

soluble paint only while the US includes the total paint both soluble and

insoluble paint

Table 1 Lead in Paint Regulations by Country34

Such fact implies that regarding the lead level regulation China is less strict

then the US with 90 ppm maximum while the US requires less than 90 ppm

when considering the added amount of insoluble lead as well In fact acute

exposure to lead by chewing on a lead toy for example or repetitive exposure 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 33 Occupational Knowledge International Retrieved December 3 2013 httpwwwokinternationalorglead-paintBackground13 34 ibid 13

to lead by handling toys that contain it can lead to severe neurological

behavioral problems and damage brain cells especially in children35

42 Chinarsquos technical standard system and commitment to the WTO and TBT Agreement There are four levels of technical standards in China national trade

local and enterprise standards Under the Regulations for the Implementation of

the Standardization Law in formulating national standards the competent

standardization administration department under the State Council is

responsible for making plans organizing drafting examining and approving

numbering and issuing national standards If there are no national standards for

technical requirements that need to be standardized for certain trades

throughout the country trade standards may be formulated Trade standards

become null and void automatically after the corresponding national standards

enter into effect In the absence of national standards or trade standards local

standards may be formulated on safety and sanitation requirements for

industrial goods that need to be unified in the provinces autonomous regions

and municipalities directly under the Central Government Local standards

or trade standards enter into effect In the absence of national standards trade 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 35 ldquo550000 More Chinese Toys Recalled for Leadrdquo The New York Times September 27 2007

standards or local standards for certain products the enterprises producing such

products may formulate their own standards as the basis for organizing

production Where there are already national trade or local standards

enterprises are encouraged to formulate and apply enterprise standards that are

stricter than the corresponding standards36

Furthermore China continues to be an active member of the WTO

Committee on Technical Barriers to Trade According to the authorities in the

period 1 January 2009 to end-October 2011 China made a total of 350

notifications to the Committee on Technical Barriers to Trade (including

revisions addenda supplements and corrigenda) Chinas notifications cover a

wide variety of products and concerns with particular emphasis on human

health and safety China has used the TBT Committee to raise concerns about

measures or proposed measures in its export markets on products ranging from

toys to herbal medicines In China the WTO enquiry point for technical

barriers to trade is the International Inspection and Quarantine Standards and

Technical Regulations Research Center under the State General Administration

for Quality Supervision and Inspection and Quarantine (AQSIQ) Also the

WTO Notification and Enquiry Center of Ministry of Commerce Peoplersquos

Republic of China (MOFCOM) is responsible for Chinas notifications to the

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 36 Trade Policy Review (2012) World Trade Organization

WTO TBT Committee It has been notifying proposed technical regulations and

conformity assessment procedures to the TBT Committee so that interested

parties in WTO members are able to comment on them as required by the TBT

Agreement37

China is a member of the International Organization for Standardization

(ISO) the International Electrotechnical Commission (IEC) and the

International Telecommunication Union (ITU) the World Health Organization

of the United Nations (WHO) and Codex Alimentarius Commission as well as

several regional standards organizations such as the Pacific Area Standards

Congress Meanwhile the Standardization Administration of China (SAC) was

established in April 2001 It is the competent department authorized by the

State Council to implement administrative functions and to exercise unified

administration over the standardization work throughout the country Its main

responsibilities include taking part in drafting and amending laws and

regulations on national standardization drafting and implementing policies

concerning national standardization representing China in ISO IEC and other

international or regional standardization organizations and so on38

According to Chinarsquos Accession Protocol written by the WTO China

also has made commitments such as complying with obligations under TBT

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 37 Trade Policy Review (2012) World Trade Organization 38 ibid13

Agreement including the adoption and application of standards technical

regulations and the conformity assessment procedures (such as testing or

certification) to both imported and domestic goods and these procedures done

in a transparent manner China consented to speed up its process of reviewing

existing technical regulations standards and conformity assessment procedures

to determine their continuing relevance and consistency with international

standards and to harmonize with them as well Periodical reports on the status

of this review process and the number of standards and technical regulations

that have been nullified are one of Chinarsquos tangible commitments39

43 Concern of the US on Chinarsquos technical standards

Despite aforementioned changes National Trade Estimate Report of the

United States Trade Representative (USTR) states some problems and

limitations of Chinarsquos technical standard implementation Especially it still has

concerns about significant conformity assessment and testing-related issues in

China US exporters still continue to report that Chinarsquos regulatory

requirements are not enforced as strictly or uniformly against domestic

producers as compared to foreign producers In addition in some cases Chinarsquos

regulations provide only that products will be inspected or tested upon entry

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 39 Accession Protocol of The Peoplersquos Republic of China World Trade Organization

into Chinarsquos customs territory without any indication as to whether or how the

regulations will be applied to domestic producers However in 2007 as in prior

years almost all of the notified measures have emanated from AQSIQ SAC or

China Certification Accreditation Association (CNCA) and have rarely

included measures from other agencies that appear to require notification such

as the Ministry of Health the Ministry of Information Industry (MII) and the

State Environmental Protection Administration (SEPA) Four years ago in part

to address this problem China had reportedly formed a new inter-agency

committee with representatives from approximately 20 ministries and agencies

and chaired by AQSIQ to achieve better coordination on TBT matters but

progress has been inconsistent in this area As a result some of Chinarsquos TBT

measures continue to enter into force without having first been notified to the

TBT Committee and without foreign companies having had the opportunity to

comment on them or even being given a transition period during which to make

necessary adjustments In other cases some written comments submitted by

US and other foreign interested parties seemed to be wholly disregarded

Sometimes there was insufficient time for China to consider about these

issues40

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 40 National Report Trade Estimate Report to Congress on Chinarsquos WTO Compliance (2007) United States Trade Representative13

III CASE STUDY ON US-CHINA TOY TRADE DISPUTE 1 INDUSTRY ANALYSIS AND INDUSTRY TRENDS

11 Characteristics of toy industry

Baby product manufacturing industry worldwide caters to around four

million babies on a yearly basis generating retail revenue of nearly seven

billion dollars Demand in this industry has grown due to a rising number of

babies to be catered to partly because people are starting families later Product

innovation and development has allowed retailers and manufactures to widen

the market using new technologies and advanced marketing approaches The

market encompasses different segments which can be divided into toys

feeding accessories wipes disposable diapers body care products and

soothers41

Especially toy industry is one of the worldrsquos oldest creative industries

For centuries toys have helped children to have fun and to transform to creator

masters emulators nurturers friends collectors story lovers and experience

seekers42 Toy industry also produces products which meet lsquocritical needs as

defined by Nagurney et al (2001) which specifies that toy products along with

other products are necessary to sustain and prolong human life and well-being

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 41 Baby Products Industry Market Research Reports Statistics and Analysis Retrieved Oct 20 2013 httpwwwreportlinkercomci02137Baby-Productshtml 42 Del Vecchio G (2003) The Blockbuster Toy How to Invent the Next Big Thing Pelican Publishing Company Gretna LA

Moreover consumer products such as toys while not necessary to sustain

human life have certainly contributed to the quality of life and improved living

standards enjoyed by much of the population43

However creative business such as toys is extremely volatile and seasonal

in nature Volatility in the toy industry is caused by variable and unpredictable

demands very short and specific selling-windows and short product-life-cycles

Therefore investors and practitioners know very well that the toy industry is far

from tranquil44 Along with its volatile characteristics the toy industry also has

incurred relatively higher costs on obsolete inventory lost sales and markdown

as compared to other industries45 Therefore to survive these industries face a

very unique challenge that is to provide the right toys at the right quantity at the

right stores during the very short selling-windows and to frequently provide

creative and yet price-competitive toys46 Also within toy industry increasingly

educated parents with higher levels of disposable incomes and growing

awareness regarding safety and health issues accompanies strong demands on

international safety standards according to the recent international trends Such 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 43 Ann M Noel G Carlos M and Linning C (2011) Product safety and security in the global supply chain Issues challenges and research opportunities Journal of Operations Management Vol 29 pp 707-720 44 Johnson ME (2001a) Learning from toys Lessons in managing supply chain risk from the toy industry California Management Review Vol 43 No 3 pp 106-24 45 Christopher M Lowson R and Peck H (2004) Creating agile supply chains in the fashion industry International Journal of Retail amp Distribution Management Vol 32 No 8 pp 367-376 46 Chee Y W Jan S A and John J (2005) Supply chain management practices in toy supply chains Supply Chain Management

elements of toy industry ultimately lead and motivate toy companies to focus

not only on sales and marketing but also on product quality control and

technology innovation Toy industry has globalized with much sourcing of

components and ingredients from low-cost global suppliers increased

outsourcing of production to foreign production facilities and transportation

and distribution within global markets Recent safety problems can be also

traced back to changes in global supply chain systems47 Also the industry

must continue increasing marketing budgets and intensify its safety standard to

combat bad publicity which can put a dent in product sales such as the blow to

the formula market caused by reports of lead in the paint used to color toys

Such scares damage consumer confidence and company credibility

necessitating strong publicity campaigning as a remedy Government

involvement in manufacturing practices is also likely to increase meaning that

companies will have to comply with standards set in place to help protect

consumers48

In terms of the major market of the toy industry the US the EU and

Asia-Pacific combine to represent over 80 percent of the overall market

Among them developed countries such as the US and EU are responsible for 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 47 Ann M Noel G Carlos M and Linning C (2011) Product safety and security in the global supply chain Issues challenges and research opportunities Journal of Operations Management Vol 29 pp 707-720 48 Baby Products Industry Market Research Reports Statistics and Analysis Retrieved Oct 20 2013 httpwwwreportlinkercomci02137Baby-Productshtml

capital and technology-intensive sector including design and marketing while

developing countries like China are in charge of labor-intensive process such

as manufacturing This implies that when it comes to product recall such

distinction between design and manufacturing is important particularly in the

context of the toy industry because toy companies such as Mattel perform the

design of toys whereas unnamed overseas manufacturers do manufacturing

Therefore when a certain company recalls its products the rationale for recall

must be clarified whether it is due to design flaw such as sharp edges or small

detachable parts or some manufacturing defects including excess lead in

surface paint or any other harmful chemicals contained in the toy 49

12 Global supply chain with China involved

It is important that management practices be improved to handle the

complexity of global supply chains Companies offshoring their manufacturing

to China (and similar countries) cannot simply rely on intermediaries and

agents in Hong Kong or Singapore to coordinate production and ensure quality

Such an approach was good enough in the initial stages of offshoring but

clearly falls short a decade after offshoring became a common business practice

The offshoring companies need to develop capabilities and systems to engage

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 49 Hari B and Paul W B (2007) Toy recalls ndash Is china really the problem Canada-Asia Commentary No 45

more directly and closely with China and similar overseas manufacturing

locations Toy companies need to develop robust systems for quality control

and testing of the toys manufactured at their suppliersrsquo factories Unless

companies learn to manage these complexities it is difficult to ensure product

quality and safety50

When taking a closer look into the toy-manufacturing sector in China

Chinarsquos domestic manufacturers are mostly small and medium-sized firms

which may have to make costly technology upgrades before exports Although

many foreign brands have entered the growing Chinese market and established

their own factories and distribution networks they could not improve the

working environment of Chinese local manufacturers rather continuous

scandals caused by their recalls involving made-in-China products resulted in

stiffer working environment safety concern and manufacturing standards To

be worse additional tests and certificates required of businesses drove up costs

while the frequent production line adjustments lowers efficiency of

manufacturing process According to the New York Times interview director

for toy making company explained their sufferings that When orders from

Germany were cancelled Lin had to adjust the program of machines that were

producing German orders to meet US requirements as the safety criteria

differed for both nations51

Not only external factors but also internal factors within China are

prevalent which contribute to the poor safety of Chinese imported toys Berman

and Swani assert that five factors among others mainly cause such tendency

cost pressures and quality fade multiple levels of outsourcing often involving

small local producers the existence of a large number of counterfeit goods

made in China Chinese cleverness at evading detection for safety-related

infractions and poor product safety surveillance by the Chinese and US

government These elements coalesce to create an environment where there is a

need to cut corners to meet suppliersrsquo price expectations where unsafe

alternatives are readily available and where the chance of detection of unsafe

goods is very low52

Just as mentioned in the previous section toy industry is facing the era of

global supply chain by much sourcing of components and ingredients from low-

cost global suppliers increased outsourcing of production to foreign production

facilities and transportation and distribution within global markets In this

context many toy recalls that occurred around 2007 and 2008 could be traced

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 51 ldquoScandal and Suicide in China A Dark Side of Toysrdquo The New York Times August 23 2007 52 Berry B and Kunal S (2010) Managing product safety of imported Chinese goods Business Horizons Vol 53 pp 39-48

back to changes in global supply chain systems53 In the model of offshore

production manufacturers can prevent defects with careful production It is also

known that the toy companies can prevent most of these types of defects with

efficient quality control and inspection mechanisms54

2 MATTELrsquoS TOY RECALL

Abovementioned global supply chain and Chinarsquos involvement in the toy

industry as a major manufacturer has provoked numerous controversies among

Western customers including Mattelrsquos huge toy recalls These issues had even

more crucial impacts on Chinese local manufacturing sectors since they were

the biggest toy makers in international toy market and certainly toy is enjoyed

by much of the population worldwide just as other consumer products possess

enormous pool of consumers On top of that safety problem of the toy covered

with leaded paint as such also have led some young consumers to physical and

mental health problems or even death

Chinese toy recalls involved the Consumer Product Safety Commission

(CPSC) in the US In the historical perspective the earliest instance of toy

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 53 Ann M Noel G Carlos M and Linning C (2011) Product safety and security in the global supply chain Issues challenges and research opportunities Journal of Operations Management Vol 29 pp 707-720 54 Hari B and Paul W B (2007) Toy recalls ndash Is China really the problem Canada-Asia Commentary No 45 13

recalls from the records of the CPSC was in 1974 when toy chests were recalled

following the death of a child Recalling toys and other products in large

numbers in an infrequent but not an unprecedented event Since 1974 over 680

toy products have been recalled Of these 550 recalls were made in the last 20

years Each year toys were recalled on an average of 28 occasions The number

of recalls remained roughly stable until 2006 but appears to have been on the

rise since then In 2007 CPSC had recalled 56 recalls which would be the

highest number of recalls in the history of the toy industry In other words

there has been a definite increase in the number of recalls in 2007 as Table 2

and Figure 1 display

Table 2 Toy Recalls (1988-2007)55

Figure 1 Toy Recalls Over Time (1988-2007)56

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 55 Hari B and Paul W B (2007) Toy recalls ndash Is China really the problem Canada-Asia Commentary No 45 13 56 Paul W B and Hari B (2008) Toy recalls and China Emotion vs Evidence Management and Organization Review 42 pp 197-209

The number of recalls involving Chinese-made toys also appears to be on the

rise over the last few years Toy companies started moving the production of

toys in China in the early 1990s This trend has continued and accelerated in

recent years Recalls involving Chinese-made toys was hovering around 50 of

the total until 2002 so recalls did not increase for well over a decade after

manufacturing moved to China However since 2003 this figure had hovered

around 80 and reached 95 this year which is a dramatic rise57 In this

regard real cases regarding the US and EUrsquos recall against toys manufactured

in China will be the main focus hereafter incident outline the point at issue

comparison between the USrsquos response against the issue and that of EU and

legal analysis based on TBT Agreement under WTO system will be the

following contents

21 Event outline

The recall was because of the lead paint coverage which was processed

in Chinese factories Lead was banned in paint on toys and other childrenrsquos

products in the United States in the 1970s but the problem has arisen again as

more toys are imported from China Of roughly 39 lead-related recalls in a

certain year 38 were of Chinese-made goods according to the CPSC In fact

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 57 Hari B and Paul W B (2007) Toy recalls ndash Is China really the problem Canada-Asia Commentary No 45

about fifty percent of Mattelrsquos revenue comes from toys made in eleven

factories it owns and operates That is a high share for the toy industry But the

other half comes from toys that it outsources to up to fifty manufacturers in

China Those toys tend to be short-term products that feature characters from

movies and television shows rather than Barbie dolls or other Mattel brands58

In early July in 2007 one of the European retailers that sell Mattel toys

discovered the lead on some products On July 6 Mattel stopped operations at

the factory that produced the toys and initiated an investigation and then on

July 18 Mattel took a reporter for The New York Times on a tour of a factory

in Guanyao China and of Mattelrsquos toy safety lab in Shenzhen to show its

sophisticated testing and inspection facilities including equipment that could

detect lead paint on incoming products or supplies At that time Mattel

executives say it was unclear whether Mattel was facing a widespread lead

paint problem or if the European case was an anomaly When the companyrsquos

executives received conclusive data that persuaded them to recall the eighty-

three products the company contacted retailers who stocked the toys

Originally Mattel requires the factories it contracts with to use paint and other

materials provided by certified suppliers Mattel executives said they did not

know if the contract manufacturer substituted paint from a noncertified supplier

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 58 ldquoLead Paint Prompts Mattel to Recall 967000 Toysrdquo The New York Times August 2 2007

or if a certified supplier caused the problem59 Later it was found that even

though the company had developed a certification program and rigorous testing

rules to make sure that its Chinese contractors adhered to standards for the

allowable levels of lead in paint yet some subcontractors were careless while

others intentionally violated the rules by substituting paint from a noncertified

supplier who provided the lead paint60

The string of lead paint cases has drawn the most attention from toy

product related association and consumer watchdogs In light of the recalls

Nickelodeon - which owns the characters Dora the Explorer and Diego - has

decided to introduce a third-party monitor to check up on all of the companies

that make toys under its brands including Mattel61 Combined with the recent

scares in the United States of Chinese-made pet food and globally of Chinese-

made pharmaceuticals and toothpaste the string of toy recalls is inspiring new

demands for stepped-up enforcement of safety by United States regulators and

importers as well as by the government and industry in China This summer

the Toy Industry Association has been working with the federal Consumer

Product Safety Commission on new regulations to require more stringent safety

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 59 ldquoLead Paint Prompts Mattel to Recall 967000 Toysrdquo The New York Times August 2 2007 60 Ann M Noel G Carlos M and Linning C (2011) Product safety and security in the global supply chain Issues challenges and research opportunities Journal of Operations Management Vol 29 pp 707-720 61 ldquoLead Paint Prompts Mattel to Recall 967000 Toysrdquo The New York Times August 2 2007

checks The Toy Industry Association urges its members to routinely test

products it is importing to make sure they comply with federal safety standards

which prohibit for example surface paint that contains lead in toys or items

that could cause a choking hazard62 Meanwhile Mattel agreed to pay $23

million to the CPSC for violating a federal lead paint ban and marketing

importing and selling non-compliant toys in civil penalties The CPSC said the

fine against the No 1 toymaker and its Fisher-Price pre-school division was the

highest ever for the agencys regulated product violations and the third largest

in its history63

22 Aftermath of toy recall and its damage degree to the toy industry

Such an unprecedented toy recall of the US against China was also

proven through numbers and figures As Table 2 and Figure 2 display the

number of both Chinese toy recall and lead-contained toy recall tend to increase

as years pass by especially from the year 2000 To make these table and figure

Laplume and Bapuji complied a database of toy recalls based on the recall

notices posted on the website of the US CPSC They presented the data on toy

recalls in Table 2 with special attention given to those involving toys made in

China and those recalled for excessive lead Authors also presented the data

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 62 ldquoAs More Toys Are Recalled Trail Ends in Chinardquo The New York Times June 19 2007 63 Mattel Fined $23 million Over Lead in Toysrdquo CNN Money June 5 2009

pictorially in Figure 2 to allow a visual interpretation of trends and

developments64

Table 2 Number of Lead-Contained Toy Recall Announcements (1988-2008)65

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 64 Andre L and Hari B (2008) Toy recalls and China One year later Asia Pacific Foundation of Canada Research Reports13 65 Ibid

Figure 2 Number of Lead-Contained Toy Recall (1998-2008)66

Apparently the reason why Chinese factory used lead-contained paint was due

to cheaper price Multinational Corporation such as Mattel kept on requiring

low cost and price to their suppliers while suppliers including Chinese

manufacturers were facing serious difficulties regarding the fact that their

export prices were rising due to continuous appreciation of the Yuan and

escalating labor cost Consequently for Chinese factory owners who are often

under intense pressure to lower production costs tend to cut corners in making

products and regularly use cheap and illegal substitutes such as leaded paint to

their toys to survive as Mattelrsquos suppliers Namely Chinese local manufacturers

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 66 Andre L and Hari B (2008) Toy recalls and China One year later Asia Pacific Foundation of Canada Research Reports

got pressure not only from Western companiesrsquo appetite for cheaper toys but

also from the fierce local competition to satisfy such appetite Furthermore

numerous toy recalls from the US worsen the situation repeated scandals

involving Chinese products resulted in stringent environmental safety and

manufacturing standards Additional tests and certificates required of

businesses drove up costs even more67 Long supply chain involving multiple

contractors and subcontractors which are common in China were also

nominated as the major contributor Every link in the chain was susceptible to

fraud or contaminated goods Such uncertainty usually contributes to supply

chain breakdown since the larger the chain the more people get involved and

the greater the difficulty in controlling the quality of the product68

Aftermath of toy recall also included remarkable changes after the US

Congress passed the new federal childrenrsquos product laws in August 2008

setting higher standards for toy safety product line adjustments must be done

more frequently and comprehensively to satisfy requirements and standards of

Mattel and policies of US Congress Changes like these affect the factorys

working efficiency and increases costs For instance it takes about a weeks

time to make the machines adapt to new procedures and also involves huge

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 67 ldquoSmall World After All for Toy-making Hubrdquo China Daily December 23 2008 68 ldquoScandal and Suicide in China A Dark Side of Toysrdquo The New York Times August 23 2007

expenditure on purchase of substitute materials when required69 The nightmare

had continued after regulators in Beijing revoked the export licenses of two toy

manufacturers one of the heads of those Chinese company that made toys for

Mattel for fifteen years and was behind the recall this month of about a million

Mattel toys committed suicide in a company warehouse in southern China The

death was the latest development in a year filled with prominent recalls and

product safety scandals involving goods made in China According to the

briefing of Chinese government one of the paint suppliers for Chinese

manufacturer had shipped the company a fake lead-free paint pigment that

could be used in producing paint70

23 Reaction and regulation of the US government and background policy

In the US responsibility for the safety of consumer products with the

exception of food pharmaceuticals and automobiles falls within the

jurisdiction of the US CPSC which regulates the sale and manufacture of more

than 15000 different consumer product The CPSC collects information about

product safety issues from sources such as hospitals doctors newspaper reports

industry reports consumer complaints investigations conducted by its staff and

reports from companies When a company becomes aware of hazards

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 69 ldquoTrouble in Chinarsquos Toy Industryrdquo China Daily December 22 2008 70 ldquoMattel Issues New Recall of Toys Made in Chinardquo The New York Times August 14 2007

associated with the products it sold it is required by law to inform the CPSC

immediately within 24 hours Based on the information it received the CPSC

works in coordination with the companies involved to recall the hazardous

products from the market The recall notices are publicly available on the

CPSCrsquos website The CPSCrsquos recall notices contain information about the

product being recalled the company recalling the product where the product

was recalled the hazard associated with the usage of the recalled product sale

details such as the number of units sold sales locations sale period and sale

price the procedure to return the product and the remedy offered by the

company71

Authority for the CPSC is provided in the 2008 Consumer Product Safety

Improvement Act (CPSIA) passed by the US Congress which gave makers and

sellers of childrens products such as toys clothing and books have until

February 10 2009 to comply with stricter standards for permissible lead

phthalate content limits and other mandatory safety requirements72 Following

considerable pushback from toymakers who said the deadline was unrealistic

and also applied to products that had already been shipped the CPSC agreed to

delay the deadline for the new testing and certification requirements by a year

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 71 Paul W B and Hari B (2008) Toy recalls and China Emotion vs Evidence Management and Organization Review 42 pp 197-209 72 Flaherty E (2008) Safety first the consumer product safety improvement act of 2008 Loyola Consumer Law Review Vol 21 pp 372-384

to Feb 10 201073 Apparently this act is the result of a spike of 473 consumer

products recalled in 2007 in what is referred to as the ldquoYear of the Recallrdquo74 It

became effective Aug 14 2009 in the US and imposes tough standards for lead

and chemicals called phthalates in products intended for children age 12 and

under It requires that all childrenrsquos products comply with all applicable

childrenrsquos product safety rules are tested for compliance by a CPSC-accepted

laboratory have a written Childrenrsquos Product Certificate issued by the

manufacturer or importer that provides evidence of the productrsquos compliance

and have permanent tracking information affixed to the product and its

packaging75 In fact the law increased the budget of CPSC imposed new

testing and documentation requirements and set new acceptable levels of

several substances It imposed new requirements on manufacturers of toys and

other consumer products for children The Act also increased fines and

specified jail time for some violations The law became to have more wide-

sweeping nature comparing to a previous bill the Lead-Free Toys Act This

earlier bill was incorporated into this act which was apparently prompted by

various scandals over high lead content in toys in 2007

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 73 ldquoMattel Fined $23 million Over Lead in Toysrdquo CNN Money June 5 200913 74 Ann M Noel G Carlos M and Linning C (2011) Product safety and security in the global supply chain Issues challenges and research opportunities Journal of Operations Management Vol 29 pp 707-720 75 The Consumer Product Safety Improvement Act (CPSIA) Retrieved November 20 2013 httpwwwcpscgovenRegulations-Laws--StandardsCPSIAThe-Consumer-Product-Safety-Improvement-Act

The Act contained three main standards including exposure levels of lead

phthalate and mandatory testing Especially regarding the exposure level of

lead the legislation reduced the limit of lead allowed in surface coatings or

paint to 90 ppm from then-current limit of 600 ppm effective on 14 August

2009 The legislation reduces the amount of total lead content in childrens

product substrates to 600 ppm by 10 February 2009 300 ppm by 14 August

2009 and 100 ppm by 14 August 2011 On the other hand the legislation

required for mandatory testing that every manufacturer of a product subject to a

consumer product safety rule will provide a General Conformity Certificate to

certify based on unit testing or a reasonable testing program that the product

complies with all safety rules76 These certificates must accompany the product

through the distribution chain through the retailer They must be available to the

CPSC during any inspection The third party testing requirement for lead

content was originally set by the CPSIA at 600 ppm but dropped to 300 ppm in

August 2009 However these lead content testing requirements were stayed by

the CPSC in January 2009 until February 10 2010 In December 2009 this stay

of enforcement was further extended until February 10 2011 In both cases the

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 76 Sample General Certification of Conformity Consumer Product Safety Commission Retrieved November 20 2013 httpwwwcpscgovPageFiles113732elecertfaqpdf

CPSC cited a need to implement further rulemaking and to give manufacturers

more time to comply77

US regulators also announced plans to set up a Beijing office to help

ensure Chinese exports are safe for Americans following a slew of recalls

involving childrenrsquos toys Particularly the US CSPC sought to establish a

permanent presence overseas for the first time to better cooperate with Chinese

regulators and companies so the countryrsquos products are up to US standards It

also planned to have commission staff working in the embassy in Beijing to

work with manufacturers and Chinese regulators One major task of Beijing

office was to educate Chinese manufacturers about the new requirements under

the CPSIA Considering some mutual economic interests between the US and

China Chinese manufacturers are expected to comply with this law since the

large retailers in the US require them to meet such standard78

Amid growing concerns over the safety of Chinese products the US

launched negotiations towards a common safety standard for toys on November

17 in Brussels with the EU as well The talks were formally opened during a

trilateral high-level meeting between EU Consumer Affairs Commissioner

Meglena Kuneva the US Chairman of the Consumer Product Safety

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 77 Michael B and Friedrich (2011) Third-Party Testing of Childrenrsquos Toys Required by CPSC The National Law Review 78 ldquoUS seeks China office to ensure export safetyrdquo China Daily July 31 2009

Commission Nancy Nord and the Chinese Vice-Minister of AQSIQ Wei

Chuanzhong The three sides have decided to bring their joint efforts to a new

level by aligning their standards Toys will be the first targets since around 75

percent of toys sold around the world are made in China Common standards

and policy consistence are very crucial for Chinese manufacturers to do their

business in a fair and transparent arena points out Liang Mei deputy chairman

of China Toy Association Another comment was added that the companys

strong focus on research and development would help it to overcome the new

technological barriers and avoid safety disputes79 A certain kind of special

team that is engaged in investigating and studying technology standards of

various nations and international trends and managing onersquos own safety

standards higher than the general or keep it ahead of the criteria of the exporting

marketplaces were also suggested as solution by industry experts80

3 LEGAL ISSUES OF TOY DISPUTE BASED ON TBT AGREEMENT

31 Preliminary findings under GATT Agreement

A preliminary research about the legitimacy of USrsquos recall on Chinese

toys under GATT Agreement insists that by placing a temporary ban on

Chinese toy products the United States would violate Article III which is

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 79 ldquoMattel Issues New Recall of Toys Made in Chinardquo The New York Times August 14 2007 80 ldquoTrouble in Toy Industryrdquo China Daily December 22 2008

National Treatment Despite violating GATT Article III4 the author insists

that a Panel would likely find the temporary ban on Chinese toy products valid

under Article XX(b) based on following rationales most of all the temporary

ban on Chinese toys is within the policies designated to protect the human life

and health of American children Just as the Panel in lsquoThailand ndash Cigarettersquo

case has recognized the negative human health effects of smoking a Panel

would likely conclude that the use of lead in childrenrsquos toys creates a negative

health effect It would likely then find that the United States sufficiently sets

forth a prima facie case for an Article XX(b) exception81 Moreover the author

writes no alternative measure could adequately diminish the high risk of lead

contamination of Chinese toys and therefore hold the strict measure valid

Authorrsquos opinion that the temporary ban on Chinese toy does not arbitrarily or

unjustifiably discriminate against Chinese toy imports also leads to justification

of US toy recall The logic behind is that the ban targets Chinese toy imports

because previous US measures failed to curtail the significant volume of

contaminated Chinese toys entering the US markets Since there are no

ulterior ldquoprotectionist objectivesrdquo the measure is not a ldquodisguised restrictionrdquo

under Article XXrsquos chapeau Therefore the author argues that since the

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 8113 Uche U O (2009) Import (toy) safety consumer protection and the WTO Agreement on Technical Barriers to Trade prospects progress and problems International Journal of Private Law Vol 2 No 213

temporary ban satisfies all the requirements of Article XX(b) a Panel would

likely rule that it does not violate GATT principles82

32 Legal analysis why USrsquos toy recall is legally controversial under TBT Agreement When based on TBT Agreement one of the articles related to the USrsquos

recall on Chinese toy imports include Article II1 which states ldquoimported

product shall be accorded treatment no less favourable than that accorded to

domestic like productsrdquo representing MFN principle and NT 83 The other one

is Article II2 that regulates member statesrsquo measures not to be trade-restrictive

by stipulating that ldquotechnical regulations shall not be more trade-restrictive than

necessary to fulfill a legitimate objective taking account of the risks non-

fulfilment would createrdquo84

First of all Article II1 of TBT Agreement is highly likely to be violated

because it would treat Chinese toy imports less favorably than US domestic

toys To put in more detail since the essential factor that needs to be considered

is ldquolikenessrdquo between exports and imports determining whether US toys and

Chinese toys are like products under the meaning of Article II1 must be the

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 8213 Uche U O (2009) Import (toy) safety consumer protection and the WTO Agreement on Technical Barriers to Trade prospects progress and problems International Journal of Private Law Vol 2 No 213 83 TBT Art II1 84 TBT Art II2

prior analysis to reach such likely conclusion Just as Uche wrote in the legal

analysis under GATT Agreement Chinese toy imports are like products with

respect to US toys under the definition promulgated by GATT Article III4

because the ban would affect the ldquointernal sale offering for sale purchase

transportation distribution or userdquo of the Chinese toys85 According to Uche

ldquoin determining whether imported and domestic products are like products not

only the properties nature and quality of the product but also the end use of the

product must be consideredrdquo86 In fact Chinese toys and American toys share

similar nature which is to entertain children and manufacturers do not affect

such nature whether they are Americans or Chinese Also since manufacturing

factories in China are managed and controlled by Mattel with its same

operation policy the quality of Chinese-made toys and American-made toys

within Mattelrsquos manufacturing chain seems to be quite identical as well On top

of that regardless of their manufacturers toys generally have the same end-

users children When compared to customers in other age groups they seem to

share relatively similar tastes and consumer habits

On the other hand USrsquos recall on its Chinese imports can be analyzed

consistent with Article II2 of TBT Agreement According to the Panel Report

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 85 Uche U O (2009) Import (toy) safety consumer protection and the WTO Agreement on Technical Barriers to Trade prospects progress and problems International Journal of Private Law Vol 2 No 213 8613 Ibid13

of lsquoUS ndash Tunarsquo case the analysis of Article II2 of the TBT Agreement may be

conducted in two steps first to determine whether a certain action is taken to

fulfill a legitimate objective which include ldquoprotection of human health or

safetyrdquo and second if that is the case to determine whether that measure is

less trade-restrictive than necessary to fulfill such objective taking account of

the risks non-fulfillment would create87 Based on such criteria USrsquos recall was

due to protect American children from the exposure to the lead paint which can

be interpreted as the ldquolegitimate objectiverdquo On top of that the measure done by

the US can be regarded as less trade-restrictive than necessary to fulfill such

objective with the consideration about risks non-fulfillment would create since

the measure was merely a temporary recall on Mattelrsquos defects rather than

unilateral and arbitrary import restriction against the entire Chinese imports to

the US Also such measure may be originated from the risk-assessment of the

case when the legitimate objective protection of human health or safety has

failed to be fulfilled which might trigger serious physical and mental problems

to American children Therefore it can be concluded that USrsquos toy recall is not

inconsistent with TBT Article II2 when considering aforementioned facts

However although Article II2 is satisfied the recall measure taken by the US

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 8713 WTO Panel Report lsquoUS mdash Tunarsquo (WTDS381R)

is still questionable because Article II1 and II2 of TBT Agreement are

obligations of WTO member nations which implies that both articles must be

satisfied to acquire legitimacy unlike the preliminary analysis based on GATT

Agreement Thus when the case similar to this occasion is brought to the

international court under the WTO there would be high probability that the

respondentrsquos recall measure might trigger legal controversy under the TBT

Agreement

IV FURTHER DISCUSSION AND CONCLUSION

This paper overall has implemented the case study of which the US has

recalled on Chinese toy imports concerning the lead paint and has analyzed the

suitability and legitimacy of such measure in light of TBT Agreement Prior to

the case study some applicable international rules were introduced GATT

Article I III XX(b) and the chapeau of Article XX which are MFN Principle

NT and General Exceptions to GATT provision respectively formulated the

basis of TBT Agreement In terms of TBT Agreement Article II1 and II2

were the main provision those are applicable to this specific case

Following such applicable international agreements toy industry trend

and the event outline of USrsquos recall on Chinese toy imports were displayed

Along with its volatile and seasonal characteristics the toy industry usually

incurs relatively higher costs on obsolete inventory lost sales and markdown

Also it is important strategy to survive that providing creative yet price-

competitive toys at the right quantity at the right stores during the very short

selling-windows At this point toy recall case done by the US on Chinese

imports in 2007 was one of the empirical evidence that shows aforementioned

drawback that toy industry and China as manufacturer is suffering from

Particularly this case of Mattelrsquos toy recall against Chinese toy products had

noteworthy significance as the occasion of which a certain multinational

corporationrsquos manufacture outsourcing got expanded to the scale of national

trade dispute concerning consumer product safety issue

Applying abovementioned articles from the TBT Agreement as an

analysis framework some legal controversies were presented regarding the US

toy recall case in the following section As the preliminary finding proved

based on GATT Agreement the recall measure itself violates MFN principle

and NT Nonetheless unlike GATT Agreement which contains exception

clause that justifies such violation TBT does not include any kind of

justification mechanism Therefore although the recall measure done by the US

satisfies Article II2 violation of Article II1 of TBT may cause legal

controversy when the similar case is brought to WTO

On the basis of such occasion and its legal issues several important

implications in the practical aspect can be drawn for the further discussion It

seems that although China is already well aware of the necessity to adopt and

apply international standards and to make their domestic ones harmonizing with

international norms through remarkable efforts as shown in some international

trade reports China is rather suffering from the disjunction between

continuously improving international standards and Chinarsquos lack of strict and

uniform enforcement of standards This may imply that efforts to make

international agreement and its application consistent must be done by both

international organization and local governments for effective connection

between the public and private sector Particularly the WTO should not stop at

establishing provisions but focus more on implementation with consideration

on each member nationrsquos industry environment and condition especially

regarding those of developing countries Consequently not only technical

standards and certificate management but also education and training program

for the industry fields ought to be provided in the scale of international

organizations

The Chinese government and industry groups also need to address this by

ensuring that Chinese exporters adhere to the standards of the importing

country Companies must invest time and effort in developing not only

standards and principles of safety for their suppliers but must also invest in

education and training to build the skills and abilities within the supplier

network to assure product safety88 At the same time the governments of

importing countries need to encourage Chinese authorities to develop global

standards on consumables then legislate and monitor them The difference in

standards across the world is clearly an issue These differences need to be

addressed with high priority so that consumers can benefit from globalization of

manufacturing and consumption The issue of global standards is contentious

because different countries have different trajectories of development The

standards of developing countries may not be acceptable to a developed country

On the other hand developing countries will sometimes argue that they cannot

adopt the standards of the developed world because of the high costs associated

with these standards Nevertheless exports from developing countries should

adhere to the standards of the export markets Accordingly all those involved

in the global supply chain such as suppliers manufacturers and marketers need

to develop systems to ensure the standards are applied89

This issue with toy recalls takes on another dimension of concern in more

local level which is the cost issue caused by the vicious cycle in global supply

chain of toy industry Despite the awareness of Chinese manufacturers 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 8813 Ann M Noel G Carlos M and Linning C (2011) Product safety and security in the global supply chain Issues challenges and research opportunities Journal of Operations Management Vol 29 pp 707-72013 89 Hari B and Paul W B (2007) Toy recalls ndash Is china really the problem Canada-Asia Commentary No 45

regarding international technical standards it may be hard for them to ignore

cheaper leaded-paint when squeezed between harsh demands on lower cost

from the US importers and domestic problems such as increasing labor cost and

RMB appreciation At this point the vicious cycle can be formed in toy

industryrsquos global supply chain in spite of the information and knowledge about

the current international standards local manufacturers use cheaper leaded paint

for lower cost Detecting excessive lead level from the paint demands on

technical standard becomes harsher within importing countries As a result

such higher standards require more cost for locals to be satisfied which

ultimately completes the vicious cycle Consequently it seems that further

discussion and researches about constructive measures including policy

changes may be essential and important to resolve such crisis more

fundamentally

REFERENCES

Andre L and Hari B (2008) Toy recalls and China One year later Asia Pacific Foundation of Canada Research Reports Ann M Noel G Carlos M and Linning C (2011) Product safety and security in the global supply chain Issues challenges and research opportunities Journal of Operations Management Berry B and Kunal S (2010) Managing product safety of imported Chinese goods Business Horizons Vol 53 pp 39-48 Chee Y W Jan S A and John J (2005) Supply chain management practices in toy supply chains Supply Chain Management Christopher M Lowson R and Peck H (2004) Creating agile supply chains in the fashion industry International Journal of Retail amp Distribution Management Vol 32 No 8 pp 367-376 Del V G (2003) The Blockbuster Toy How to Invent the Next Big Thing Pelican Publishing Company Gretna LA Elvira C (2007) Total Recall on Chinese Imports Pursuing an End to Unsafe Health and Safety Standards Through Article XX of GATT American University International Law Review 23 915 Flaherty E (2008) Safety first the consumer product safety improvement act of 2008 Loyola Consumer Law Review Vol 21 pp 372-384 Hari B and Paul W B (2007) Toy recalls ndash Is china really the problem Canada-Asia Commentary No 45 Jiacheng Z and Lu Hongjie (2013) Analyzing China Harmonization of Technical Barriers to Trade in the EU and US Markets The Twelfth Wuhan International Conference on E-Business ndash Emerging Operations amp Services Management Track Johnson M E (2001a) Learning from toys Lessons in managing supply chain

risk from the toy industry California Management Review Vol 43 No 3 pp 106-24 Keith13 E13 M13 John13 S13 W13 and13 Tsunehiro13 O13 (2000)13 Quantifying13 the13 Impact13 of13 13 13 13 13 13 13 Technical13 Barriers13 to13 Trade13 A13 Framework13 for13 Analysis13 Policy13 Research13 13 13 13 13 13 13 Working13 Paper13 Development13 Research13 Group13 The13 World13 Bank Lee M A Flynn B B and Frohlich M T (2008) All supply chains donrsquot flow through understanding supply chain issues in product recalls Management and Organization Review 4 167ndash182 Lionel F Mondher M and Jean-Michel P (2005) Estimating the impact of environmental SPS and TBT on international trade Forthcoming in Integration and Trade Journal Marucheck A S (1987) On product liability and quality control IIE Transactions 19 355ndash360 Michael B and Friedrich (2011) Third-Party Testing of Childrenrsquos Toys Required by CPSC The National Law Review Paul W B and Hari B (2008) Toy Recalls and China Emotion vs Evidence Management and Organization Review 42 Rudiger W Peter-Tobias S and Anja S (2007) Technical Barriers and SPS Measure Martinus Nijhoff Publishers Uche U O (2009) Import (toy) safety consumer protection and the WTO Agreement on Technical Barriers to Trade prospects progress and problems International Journal of Private Law Reports and Reviews (Online documents included) Baby Products Industry Market Research Reports Statistics and Analysis Retrieved Oct 20 2013 httpwwwreportlinkercomci02137Baby- Productshtml

Brief Guide to Analytical Methods for Measuring Lead in Paint Inter- Organization Program for the Sound Management of Chemicals World Health Organization Retrieved January 18 2014 httpwwwwhointipcsassessmentpublic_healthlead_paintpdf Europe M S (2010) Technical Barriers to Trade Retrieved November 22 2013 httpwebarchivenationalarchivesgovuk+httpwwwberrgovukwhatwedoeuropeandtradekey-trade-issuestechnical-barriers-to-tradepage22741html National Report Trade Estimate Report to Congress on Chinarsquos WTO Compliance (2007) United States Trade Representative Occupational Knowledge International Retrieved December 3 2013 httpwwwokinternationalorglead-paintBackground Report on Technical Barriers to Trade (2013) United States Trade Representative Sample General Certification of Conformity Consumer Product Safety Commission Retrieved November 20 2013 httpwwwcpscgovPageFiles113732elecertfaqpdf The Impact of the TBT and SPS Agreements on Food Labeling and Safety Regulations httpcspinetorgreportscodexwtospsbthtm The Consumer Product Safety Improvement Act (CPSIA) Retrieved November 20 2013 httpwwwcpscgovenRegulations-Laws-- StandardsCPSIAThe-Consumer-Product-Safety-Improvement-Act The GATT Uruguay Round ODI briefing paper Overseas Development Institute Retrieved November 22 2013 The International Trade Administration website US Department of Commerce Retrieved November 22 2013 httpenforcementtradegovpetitioncounselingpcp-likeproducthtml

GATTWTO Documents The Technical Barriers to Trade Agreement The General Agreement on Tariffs and Trade 1994 WTO Accession Protocol of The Peoplersquos Republic of China WTO Concerns on Indiarsquos Import Restriction on Chinese Toys WTO Technical information on TBT Trade topics Retrieved November 25 2013 httpwwwwtoorgenglishtratop_etbt_etbt_info_ehtm WTO Trade Policy Review (2012) WTO ldquoWhat is the WTOrdquo Retrieved November 22 2013 httpwwwwtoorgenglishthewto_ewhatis_ewho_we_are_ehtm WTO European Communities ndash Measures Affecting Asbestos and Asbestos- Containing Products WTDS135R

국문 초록

세계경제에 있어서 각 국가 경제의 연계성이 심화됨에 따라 많은

제조업들의 생산 라인과 공급 사슬 역시 세계화 되면서 주로 디자인이나

브랜드 관리를 담당하는 선진국과 생산과 제조를 담당하는 개발도상국

간의 기술 표준 차이에서 오는 문제점들이 발견되고 있다

세계무역기구(WTO) 체제하에서 무역에 관련된 기술표준들은 무역상

기술장벽 조항(TBT)에 따라 관리되어지나 WTO의 회원국들의 논의 하에

알맞은 조항을 명시하는 것과 조항의 효용성 또는 실제 각국의

기술표준들과 조항의 합치성은 별개의 문제인 것이 사실이다

본 논문은 미국 Mattel 사의 중국산 장난감 회수조치가 WTO

체제하에서 어떠한 법적 의미를 지니는지 살펴보았다 사건 당시 실제로

중국이 미국을 상대로 WTO에 제소하지는 않았지만 오늘날 대두되는

TBT의 중요성과 점점 더 심화되어가는 제조산업의 세계화 현상을

보았을 때 향후 비슷한 사건들이 발생할 가능성이 높기 때문에 이러한

분석은 유의미할 수 있으며 추후 시사하는 바 역시 클 것으로 예상된다

따라서 본 연구에서는 미국의 중국산 장난감 회수조치의 통상법적

사례분석을 통해 TBT가 기술표준문제에서 지니는 법적 의미를

분석하였다

키워드 세계무역기구 무역상 기술장벽협정 기술표준 Mattel사

장난감 회수조치 중국산 장난감

학번 2012-22086

I INTRODUCTION

II APPLICABLE INTERNATIONAL RULES FOR TOY SAFETY REGULATION

1 GATT ARTICLE I amp III

2 GATT ARTICLE XX(B) amp CHAPEAU OF ARTICLE XX

3 TBT UNDER THE WTO SYSTEM amp TBT ARTICLE II


III CASE STUDY ON US-CHINA TOY TRADE DISPUTE

1 INDUSTRY ANALYSIS AND INDUSTRY TRENDS




21 Event outline





32 Legal analysis why USrsquos toy recall is legally controversial under TBT Agreement


REFERENCES

국문 초록

ltstartpagegt10I INTRODUCTION 1II APPLICABLE INTERNATIONAL RULES FOR TOY SAFETY REGULATION 4 1 GATT ARTICLE I amp III 4 2 GATT ARTICLE XX(B) amp CHAPEAU OF ARTICLE XX 8 3 TBT UNDER THE WTO SYSTEM amp TBT ARTICLE II 10 4 OTHER RELATED TECHNICAL STANDARDS 20III CASE STUDY ON US-CHINA TOY TRADE DISPUTE 28 1 INDUSTRY ANALYSIS AND INDUSTRY TRENDS 28 11 Characteristics of toy industry 28 12 Global supply chain with China involved 31 2 MATTELiexclmacrS TOY RECALL 34 21 Event outline 37 22 Aftermath of toy recall and its damage degree to the toy industry 40 23 Reaction and regulation of the US government and background policy 44 3 LEGAL ISSUES OF TOY DISPUTE BASED ON TBT AGREEMENT 49 31 Preliminary findings under GATT Agreement 49 32 Legal analysis why USiexclmacrs toy recall is legally controversial under TBT Agreement 51IV FURTHER DISCUSSION AND CONCLUSION 54REFERENCES 59plusmnsup1sup1reg AtildeEcircmiddotIuml 63ltbodygt

國際學碩士學位論文

2014年 2月

金娟秀

A thesis presented

Yeonsoo Kim

13 iii

2014 年 2 月

金娟秀

2014 年 2 月

Date February 2014

ABSTRACT

I INTRODUCTION 1

REFERENCES 59

국문 초록 63 13

13 vii

LIST OF FIGURES

LIST OF TABLES

13 viii

US United States

I INTRODUCTION

production methods3

11 History of GATT

12 GATT Article I

paragraph

13 GATT Article III

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 9 GATT Art III2

well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


A thesis presented

Yeonsoo Kim

13 iii

2014 年 2 月

金娟秀

2014 年 2 月

Date February 2014

ABSTRACT

I INTRODUCTION 1

REFERENCES 59

국문 초록 63 13

13 vii

LIST OF FIGURES

LIST OF TABLES

13 viii

US United States

I INTRODUCTION

production methods3

11 History of GATT

12 GATT Article I

paragraph

13 GATT Article III

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 9 GATT Art III2

well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


13 iii

2014 年 2 月

金娟秀

2014 年 2 月

Date February 2014

ABSTRACT

I INTRODUCTION 1

REFERENCES 59

국문 초록 63 13

13 vii

LIST OF FIGURES

LIST OF TABLES

13 viii

US United States

I INTRODUCTION

production methods3

11 History of GATT

12 GATT Article I

paragraph

13 GATT Article III

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 9 GATT Art III2

well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


Date February 2014

ABSTRACT

I INTRODUCTION 1

REFERENCES 59

국문 초록 63 13

13 vii

LIST OF FIGURES

LIST OF TABLES

13 viii

US United States

I INTRODUCTION

production methods3

11 History of GATT

12 GATT Article I

paragraph

13 GATT Article III

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 9 GATT Art III2

well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


ABSTRACT

I INTRODUCTION 1

REFERENCES 59

국문 초록 63 13

13 vii

LIST OF FIGURES

LIST OF TABLES

13 viii

US United States

I INTRODUCTION

production methods3

11 History of GATT

12 GATT Article I

paragraph

13 GATT Article III

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 9 GATT Art III2

well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


I INTRODUCTION 1

REFERENCES 59

국문 초록 63 13

13 vii

LIST OF FIGURES

LIST OF TABLES

13 viii

US United States

I INTRODUCTION

production methods3

11 History of GATT

12 GATT Article I

paragraph

13 GATT Article III

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 9 GATT Art III2

well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


13 vii

LIST OF FIGURES

LIST OF TABLES

13 viii

US United States

I INTRODUCTION

production methods3

11 History of GATT

12 GATT Article I

paragraph

13 GATT Article III

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 9 GATT Art III2

well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


13 viii

US United States

I INTRODUCTION

production methods3

11 History of GATT

12 GATT Article I

paragraph

13 GATT Article III

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 9 GATT Art III2

well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


I INTRODUCTION

production methods3

11 History of GATT

12 GATT Article I

paragraph

13 GATT Article III

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 9 GATT Art III2

well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


production methods3

11 History of GATT

12 GATT Article I

paragraph

13 GATT Article III

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 9 GATT Art III2

well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


11 History of GATT

12 GATT Article I

paragraph

13 GATT Article III

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 9 GATT Art III2

well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


11 History of GATT

12 GATT Article I

paragraph

13 GATT Article III

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 9 GATT Art III2

well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


12 GATT Article I

paragraph

13 GATT Article III

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 9 GATT Art III2

well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


paragraph

13 GATT Article III

13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 9 GATT Art III2

well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 13 9 GATT Art III2

well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


well26

33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


33 TBT ARTICLE II

presents

41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


41 Lead regulation

similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


similar findings32

insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


insoluble paint

Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


Agreement37

issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


issues40

soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


soothers41

consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










21 Event outline







REFERENCES

국문 초록


consumers48

goods is very low52

following contents

21 Event outline

in its history63

developments64

company71

Agreement

organizations

fundamentally

REFERENCES

국문 초록

분석하였다

학번 2012-22086

I INTRODUCTION










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