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| 7th Report of Market Access Ombudsman Council (March 18, 2002) |
1. Complainant: Tokyo Chamber of Commerce and Industry
2. Ministry concerned: Ministry of Economy, Trade and Industry
3. Complaint:
Japan restricts the import volume of some marine products under the Import Quota System, with the aim of protecting Japanese fishermen. (Article 9 of the Cabinet Order Concerning Control of Import Trade)
Of the non-liberalized items, import quotas for herring, mackerel, sardine, and horse mackerel are set at amounts far larger than can be handled by individual importers. Therefore, restricting imports of the above items by the Import Quota System is in effect meaningless.
Moreover, despite the meaninglessness of the import restriction on the above non-liberalized items, importers are required to carry out cumbersome procedures, such as applying for import quota and submitting monthly customs clearance reports.
Procedures for import quota, not only for the above items but also for other products, involve the following problems:
1] When applying for import quota, the importer is required to submit documents that seem to be unnecessary, such as a copy of the withholding slip of the person in charge of the clerical work.
2] Since the application date, time, and place are unilaterally designated, there is no grace period. Moreover, since the order of screening of applications is determined by the drawing of lots, importers are tied down for long hours. In addition, since the only application place is the head office of the Ministry of Economy, Trade and Industry (in the case of quota allotment for first timers or on a first-come, first-served basis, it is too heavy a burden on the applicants.
3] After obtaining an import quota (IQ), the importer is required to apply for a switch from IQ to import license (I/L) every time it concludes a contract and therefore has to go to a designated place for the application. Amid the moves to computerize various applications, it is too heavy a burden for an importer to submit applications in person. Although importers state their import volume in the import license, they are also required to submit a report on the amount of customs-cleared imports every month.
Therefore, we would like the Ministry of Economy, Trade and Industry to take the following measures:
(1) Liberalize the above items and abolish import restrictions
(2) Simplify and rationalize procedures for import quota not only for the above items but also for other items.
1) With regard to import quota application, study the necessity of attaching documents and simplifying and rationalizing such documents.
2) With regard to the application date, give the applicants some time to spare, for example, by setting several days as an application acceptance period and conducting a drawing of lots on a later day. As to the place of application, measures should be taken to ease the burden on local importers, such as by allowing application at a regional Bureau of Economy, Trade and Industry or computerized application.
3) As to a switch from import quota (IQ) to import license (I/L), methods other than submitting the application in person should be approved, such as on-line submission and submission by fax.
With regard to import volume, since importers state the volume when receiving an import license, the redundant "report on customs-cleared imports" should be abolished.
4. Corresponding Policy of the Ministries concerned:
(1) As to the complainant's request for liberalizing the import of herring, mackerel, sardine and horse mackerel and abolishing import restrictions on them:
The marine product IQ (import quota) system covers horse mackerel, mackerel, etc. the main catches of Japanese fishermen engaged in coastal or deep-sea fishing, and Japan shares fishing grounds/resources with its neighboring countries. It is impossible to effectively conserve and manage the shared resources by regulating the fishing of Japanese fishermen alone. The IQ system plays an important role of supplementing resource management setups such as the TAC system and the license system, which are enforced on Japanese fishermen. Since these functions remain necessary for the future, we cannot abolish the import restrictions on the above kinds of fish.
As to the complainant's request for simplifying and rationalizing procedures for import quota not only for the above items but also for other items and studying the necessity of attaching documents and simplifying and rationalizing such documents:
The documents required for first-come, first-served import quotas and their necessity are as follows. Since minimum documents are required, it is difficult to review the documents to be submitted.
1] Import quota application in duplicate
This is a document that an importer under Article 2-1-1-b of the Regulations for Control of Import (Ordinance of the Ministry of International Trade and Industry of 1949, No. 77) is required to submit for being allocated an import quota. The original will be issued to the importer and the copy will be kept by the Ministry of Economy, Trade and Industry as a memorandum.
2] The original and a copy of the import contract
This is to certify the importer's intention to import. The original will be returned to the importer immediately after confirmation and the copy will be kept by the Ministry of Economy, Trade and Industry.
3] A document certifying that the importer undergoes import clearance in his own name and at his own risk, and the following two documents.
These documents are necessary in order to examine if a corporation or an individual has the intention and ability to import and if the same company is not making double application.
3]-1 Accompanying document 1
(In the case of a listed company)
*Securities report of the last one year
(In the case of other corporations)
*Certified copy of the commercial register of the corporation
*Certified copy of the real estate register or a copy of lease contract
(In the case of individual)
*Certificate of residence, national health insurance card, driving license, etc.
The above document is to certify that the corporation is actually in existence and engaged in business.
3]-2 Accompanying document 2
(In the case of corporations)
*A copy of the attached list 1 of the final income tax return submitted to the tax office
(stamped with the seal of the tax office or certified by the tax office) (In the case of individuals)
*Final income tax return, etc.
(Or a withholding slip, etc. in the case of an individual who quit the company this year and started business as a proprietor)
When a person, who was allotted an import quota, imports the goods for which the quota was allotted, he has to pay for the goods. The above document is to certify that the person has the ability to pay.
As to the complainant's requests for 1] giving applicants some time to spare, for example, by setting several days as the application acceptance period and doing a drawing of lots on a later day, and 2] concerning application place, taking measures to ease the burden on local importers, for example, by allowing application at a regional Bureau of Economy, Trade and Industry or computerized application:
1] Even if several days are set as the application acceptance period and is the drawing of lots is held on a later day, applicants in local areas still have to come to Tokyo twice - at the time of application and at the time of the drawing of lots - as they are required to submit application in person in order to avoid double application. Since this will considerably infringe on the interest of the applicants, it is difficult for us to adopt this method.
2] As to the place of application, it is difficult to allow application at a regional Bureau of Economy, Trade and Industry or computerized application for the following reasons:
(i) Implementation of fair drawing of lots in response to requests from applicants
We have adopted the lot method for application for first-come, first-served quota allotments, as there are a large number of applicants. The drawing of lots is held before the eyes of all applicants in order to prevent duplicate applications and ensure fair, prompt screening. Applicants who draw winning numbers are declared successful applicants. Of them, those who pass the screening of papers will be allotted a quota. We have decided to hold the drawing of lots in front of the applicants because a large majority of the applicants strongly request that it be held in front of them
We do not accept electronic application because it does not allow us to hold a drawing of lots in front of the applicants.
(ii) Securing prompt screening
If we accepted electronic application, application by mail, or application at a regional Bureau of Economy, Trade and Industry, the applicants might not need to come to Tokyo. But, they would still have to come to Tokyo to take part in the drawing of lots when they undergo paper screening. Therefore, even if we adopted this method, it would only prolong the time required from the application to the issuance of an import quota certificate and would rather infringe on the interest of the applicants.
As to the complainant's request 1] concerning a switch from import quota (IQ) to import license (I/L) that methods other than submitting the application in person should be approved, such as on-line submission and submission by fax and 2] concerning import volume that since importers state the volume when receiving an import license, the redundant "report on customs-cleared imports" should be abolished:
Since we need to do a lot in front of all applicants, we do not accept on-line application for quota allotment on a first-come, first-served basis. Even if we accepted on-line application for the switch, it would not save the applicants' time and effort, as they are required to submit the original.
When switching from the IQ to the I/L, the applicant has to write down the necessary information in the IQ original. Therefore, it is difficult to approve the application by fax.
2] The import volume that is required to be submitted at the time import quota allocation is an application volume and is different in nature and purpose from the report on customs-cleared imports that certifies that the import has actually been carried out. Therefore, it is difficult to abolish it. (IQ recipients are in principle required to import the full amount stated in the application in order to meet domestic demand.)
5. Remarks
The complainant accepted this policy.