Report on the WTO Inconsistency of Trade Policies by Major Trading Partners

On May 8, METI published "2008 Report on the WTO Inconsistency of Trade Policies by Major Trading Partners". (English translation is not available yet.)
http://www.meti.go.jp/report/data/g80508a01j.html

For export control issues, METI mentioned China encryption control issue, and US extra-territorial re-export regulation, they are as WTO Inconsistency.

1) China encryption issue (Page 47 in China chapter)
License for encryption is required in China for commercial telecoms activity, however the definition of encryption is not clearly mentioned, administration is inconsistent, and the procedures are very vague. Commercial License for encryption have never been granted so far to foreign companies. This is potential threat to foreign company.

2) US extra-territorial re-export control (page 116 in US chapter)
Japan have already established and maintained solid export control strictly according to world wide regime such as Wassenar Arrangement. US EAR force Japanese companies to follow US re-export regulation for US origin products and technology. This is additional operational burden for Japanese business. Japanese government request US to exclude Japan as its extra-territorial export control. If it is difficult for the time being, Japan request US companies to notice correct ECCN for business partners in Japan, and make it mandatory requirement.