[House Document 107-146]
[From the U.S. Government Publishing Office]


107th Congress, 1st Session - - - - - - - - - - - House Document 107-146

                         CHINA'S MEMBERSHIP IN







  November 13, 2001.--Message and accompanying papers referred to the 
         Committee on Ways and Means and ordered to be printed
To the Congress of the United States:
    In accordance with the requirements of Public Law 106-286, 
I hereby transmit the attached report certifying that the terms 
and conditions for the accession of the People's Republic of 
China to the World Trade Organization are at least equivalent 
to those agreed between the United States and the People's 
Republic of China on November 15, 1999.

                                                    George W. Bush.
    The White House, November 9, 2001.
 Report on Certification of the Terms and Conditions for the Accession 
   of the People's Republic of China to the World Trade Organization

    The People's Republic of China (China) is the world's 
largest economy that is not yet a member and full participant 
in the World Trade Organization (WTO), the international 
organization responsible for overseeing the negotiation and 
implementation of global trade rules. China is also the 
eleventh largest export market for U.S. goods and services. 
After nearly fifteen years of negotiation, China is now in a 
position to become a WTO member. Based on the outcome of 
China's WTO accession negotiations, I am pleased to certify 
that the terms and conditions for China's accession to the WTO 
are at least equivalent to those agreed between the United 
States and China on November 15, 1999.
    The United States welcomes China's membership in the WTO 
based on the terms and conditions that we and other WTO members 
endorsed in September. WTO members will meet in November and 
are expected to approve those terms and conditions for China's 
accession. At this same meeting, WTO members will also approve 
the terms and conditions for Taiwan's accession to the WTO.
    Beginning the negotiations on joining the international 
trade community was an important step for China as it embarked 
on a road toward economic reform, moving from a centrally-
planned economy to one with a vibrant and growing private 
sector based on entrepreneurism and competition. The conclusion 
of those negotiations, and the implementation of the 
commitments agreed to, will accelerate and reinforce China's 
reform process and create new opportunities for China's people 
and for American exporters and workers.
    China is reforming in many ways its laws and practices and 
WTO membership will require China to provide greater access to 
its economy and more openness in its society. Subjecting broad 
aspects of its economy to internationally agreed trade rules 
that are enforceable in the WTO will help build reliance on the 
rule of law in China and have a positive effect on broader 
aspects of China's society.
    China's membership in the WTO will benefit the United 
States through increased trade opportunities, more certainty 
and predictability in our trade relationship, and China's 
greater exposure to the principles of fairness and competition 
that guide our economy. For Americans to realize these 
benefits, however, we need to change the basis of our trade 
relationship with China.
    In 1980, the United States and China established normal 
trade relations (NTR--then called ``most favored nation'' 
status) status with each other based on a bilateral trade 
agreement negotiated and approved under provisions of U.S. 
trade law known as the ``Jackson-Vanik Amendment.'' Each year 
since then, the United States has renewed NTR status through an 
annual waiver process.
    On November 15, 1999, the United States and China agreed 
bilaterally on terms for China's accession to the WTO. These 
terms included commitments from China on market access for U.S. 
exports of industrial and agricultural goods and services, 
conditions under which companies could provide services in 
China, and rules that eliminate trade barriers in China and 
permit the United States to address imports from China that 
injure U.S. industry and workers.
    A strong bipartisan coalition in Congress recognized the 
merits of the 1999 agreement, and enacted legislation 
authorizing the President to terminate application of the 
Jackson-Vanik Amendment to China and to grant products from 
China permanent NTR status after he certifies that the terms 
and conditions for China's WTO accession are at least 
equivalent to those agreed between the United States and China 
on November 15, 1999.
    China has concluded bilateral agreements on its accession 
to the WTO with the more than 40 Members requesting 
negotiations. Multilateral negotiations on the terms and 
conditions for China's accession to the WTO, involving all 
interested WTO members, including the United States, concluded 
in September 2001. The consolidation of the results of these 
bilateral and multilateral negotiations has produced the final 
China accession package that WTO members will formally consider 
and approve.
    All of the commitments agreed between the United States and 
China in November 15, 1999 are in the terms and conditions for 
China's accession to the WTO. In several respects, China's 
negotiations with other WTO members and the results of the 
multilateral negotiations clarify and improve the 
enforceability of commitments made to the United States in 
1999, provide more or faster market access than China agreed 
with the United States and address important matters not 
included in the U.S.-China November 1999 bilateral agreement. 
China has also agreed that its central and local governments 
all will honor WTO obligationsand that it will invite public 
comments on its trade-related laws and regulations before they are 
enforced. These additional commitments lay a strong foundation for 
effective implementation of the terms for China's accession to the 
    \1\ A more extensive summary of the terms and conditions of China's 
accession to the WTO accompanies this certification report. In 
addition, pursuant to Section 122 of the Uruguay Round Agreements Act, 
the U.S. Trade Representative will transmit to Congress copies of 
China's WTO accession package.
    In the multilateral negotiations involving the United 
States and other WTO members, China has agreed to detailed 
rules on how it will implement provisions agreed to in November 
1999, such as phasing-out its quotas and providing access for 
agricultural products and fertilizers under tariff-rate quotas. 
When other WTO members reached agreement with China on more 
favorable terms for market access, the overall package 
improved. Under China's WTO accession terms, Americans will 
benefit from more favorable tariff cuts on products such as 
orange juice and auto parts, improved access under tariff-rate 
quotas, and fewer restrictions on providing legal, educational, 
and other services than those agreed to in November 1999.
    As a main participant in the multilateral negotiations from 
their beginning in 1987, the United States recognized the need 
for China to undertake systemic reforms and joined with other 
WTO members in achieving this objective. China has agreed to 
provide foreign governments and individuals access to its 
regulatory and decision making process. Other systemic reforms, 
including enhanced access to judicial review of regulatory 
decisions and uniform, nondiscriminatory administration of its 
laws, regulations, and other measures will help make China's 
commitments on market access for U.S. products and services 
more meaningful. WTO members also recognized the need to 
monitor China's implementation of its commitments. China has 
agreed in its accession package to a process of annual review 
of the implementation of commitments. The annual review process 
will supplement the dispute settlement process that will apply 
to China when it becomes a WTO member.
    China has undertaken important commitments requiring major 
changes that some in China will resist. We will look to China 
to implement all its commitments fully and are prepared to work 
with China in the WTO and bilaterally to assist China's 
officials in meeting those commitments. An interagency team, 
including representatives of the Office of the U.S. Trade 
Representative and the Departments of State, Commerce, and 
Agriculture, is already directing staff and other resources to 
the effort of monitoring China's implementation of its 
commitments. We will be working closely with Congress and the 
private sector as we use all bilateral and multilateral fora to 
raise and resolve issues. Moreover, we will enforce our rights 
under the WTO Agreement, including China's negotiated terms of 
accession, through our trade laws and through the WTO dispute 
settlement process, as necessary.
    China's accession to the WTO will bring the trade 
relationship between our two countries to a new level. China 
will now be a full participant in the international trading 
system with all the rights and responsibilities that membership