FOREIGN ECONOMIC AND COMMERCIAL POLICY                  751

publication which was satisfactory to US objectives and consistent
with the instructions of the Delegation.2
  One problem was raised during discussion in the working party
and in plenary session that is likely to recur in later sessions. Several
countries raised the question of the degree of consistency existing be-
tween the OEEC liberalization program and the GATT. The Cey-
lonese delegate stated that a full discussion will be demanded at the
next session.

12. Arrangements for Regular reporting in Accordance with para. 2
     of Annex J and for Reporting in Accordance with Article XVI.
  The Delegation's instructions with respect to reporting under the
provisions of Annex J were contained in the Department's telegram
Tagg 75 3 and listed detailed points which should be included in any
questionnaire prepared to implement the requirements of para. 2 of
Annex J. The position paper with respect to Article XVI reporting
stated that the Delegation should 'attempt to 'assure the submission
of the reports" called for, with as little 'appearance of initiative
on
the part of the United States as possible.
  The Delegation's instructions with respect to Article XVI reports
were fully met when a resolution sponsored by the Canadian Delegate
was approved. This resolution recommended that all contracting
parties applying subsidies affected by the provisions of Article XVI
should submit a report by August 1, 1950, and that any measures
instituted after that date should be notified to the Contracting Parties
as soon as possible.

  The. Working Party concerned incorporated into Doc. GATT/CP.4/37,
3O March 1950. (Lot 57D284, Box 111) an examination in depth of the question
,of the discriminatory application of import restrictions under the transitional
period arrangements of Article XIV. Most of the 20 countries taking action
under Articles XII and XIV belonged "to one or other of two groups which
have cooperative arrangements either for the inter-convertibility of their
currencies or in respect of payments for their mutual trade .... The first
group
is the sterling area and the second comprises the members of the Organization
for European Economic Cooperation." A very specific effect of import
restric-
tions was described at the end of the analysis:
    - . It is evident . . . from a review of the information supplied in
response
to the Secretariat's enquiry that the action taken under the provisions of
Article XIV and Annex J hashad the effect, as far as trade among the contract-
ing parties is concerned, that the twenty countries applying restrictions
have
encouraged thegexpansion of trade among tthemselves while reducing purchases
in convertible currencies notably in United States dollars and Swiss francs
and
in other relatively 'hard currenciesn such as Canadian dollars and Belgian
francs, and avoiding unfavorable trade balances that would require settlement
in these currencies or in gold."
  On April 1 the Contracting Parties incorporated the findings of this report
into their First Report on the Discriminatory Application Of Import Restric-
tions. (Information GATT No. 22, April 1, 1950 (Geneva))
  3Not printed.