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1 Mr. Ding Mou-shihRepresentativeCoordination Council forNorth American AffairsFebruary 22, 19944201 Wisconsin Avenue, N.W.Washington, DC 20016-2137Dear Representative Ding:This letter sets forth the AIT understanding of the results ofour tariff discussions of January 19 to 21, 1994. Your side willtake the following steps:1.The industrial products contained in Annex 1 (attached) willhave their customs duties reduced to the rates listed thereinby means of Article 47-1 of your Custom Law by no later thanMarch 31, 1994. These reductions will be maintained at the sp-ecified lower rates through legislation.2.The agricultural products (HS chapters 1-24) contained in Ann-ex 2 (attached) will have their customs duties reduced eitherto the rates listed therein (part 1) or to levels reflecting abilateral trade-weighted average depth of cut of 12.5% (part 2) by means of legislation. These duty reductions will be subm-itted by the Executive Yuan to the Legislative Yuan no laterthan May 15, 1994.3.The industrial products (HS chapters 25-97) contained in Annex3 (attached) will have their customs duties reduced either tothe rates listed therein (part 2) or to levels reflecting a b-ilateral trade-weighted average depth of cut of 17.5% (part 2)by means of legislation. These duty reductions will be submit-ted by the Executive Yuan to the Legislative Yuan no later th-an October 1, 1994.The United States side expects that for the products listed inAnnex 2, the Executive Yuan will exert best efforts to secure e-nactment by the Legislative Yuan no later than July 31, 1994, a-nd for the products listed in,4nnex 3, the Executive Yuan willexert best efforts to secure enactment by the Legislative Yuanno later than January 31, 1995.The tariff reductions that you have implemented will be taken i-nto account in your GATT accession. In addition, in all cases,the United States side reserves the right to seek further reduc-tions in these and other items, as specified in U.S. GATT acces-sion tariff requests of your side.This letter to you and your letter in reply to it constitute ourmutual understanding with respect to the steps to be taken by y-our side regarding the tariff reductions on certain products ofexport interest to the United States. This understanding will e-nable our two sides to expedite our bilateral consultations onthe GATT accession of the Separate Customs Territory of Taiwan,Penghu, Kinmen and Matsu.Sincerely, [Signed] Natale H. Bellocchi Chairman of the Board and Managing Director April 27,1994 Ambassador Natale H. BellocchiChairman of the Board and Managing DirectorAmerican Institute in Taiwan1700 N. Moore Street, #1700Arlington, VA 22209Dear Ambassador Bellocchi:This letter confirms our mutual understanding as conveyed in yo-ur letter of February 18, 1994 which sets forth the tariff redu-ctions on certain products of export interest to the United Sta-tes Pursuant to that understanding, we have taken or will takethe following steps:1.The industrial products contained in Annex 1 (attached) havehad their customs duties reduced to the rates listed thereinby means of Article 47-1 of our Customs Law on March 30, 1994.These reductions will be maintained at the specified, lower r-ates through legislation.2.The agricultural products (HS chapters 1-24) contained in Ann-ex 2 (attached) will have their customs duties reduced eitherto the rates listed therein (part 1) or to levels reflecting abilateral trade-weighted average depth of cut of 12.5% (part 2) by means of legislation. These duty reductions will be su- bmitted by the Executive Yuan to the Legislative Yuan no lat- er than May 15, 1994. 3.The industrial products (HS chapters 25-97)contained in Annex3 (attached) will have their customs duties reduced either tothe rates listed therein (part 1) or to levels reflecting a b-ilateral trade-weighted average depth of cut of 17.5% (part 2)by means of legislation. These duty reductions will be submit-ted by the Executive Yuan to the Legislative Yuan no later th-an October 1, 1994.While the Executive Branch will exert best efforts to securelegislative enactment as soon as possible, it cannot make com-mitments on behalf of the Legislative Yuan.We expect that the tariff reductions that we have implementedwill be taken into account in our GATT accession. In addition,we understand that the United States reserves the right to se-ek further reductions in these and other items, as specifiedin U.S. GA1YT accession tariff requests of our side. The mutu-al understandings expressed in our exchange of letters will e-nable our two sides to expedite our bilateral consultations onthe GATT accession of the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matzu.Sincerely, [Signed] Mou-Shih Ding Representative