HISTORICAL ACCOUNT OF THE WTO TEXTILES AGREEMENT

HISTORICAL ACCOUNT OF THE WTO TEXTILES AGREEMENT <!--[if gte mso 10]> HISTORICAL ACCOUNT OF THE WTO TEXTILES AGREEMENT By Muhammad Anum Saleem, Advocate, Islamabad An important feature of the Uruguay Round was the agreement by the developed countries to abolish the Multifibre Arrangement quotas that (with their predecessors) have restricted exports of textile and clothing products from developing countries for almost forty years. This iniquitous system of quotas violated all the fundamental principles of the multilateral trading system, and discriminated against the poorest countries seeking to move up from reliance on commodity trade towards an emphasis on manufactures. However, the prospective abolition of theses quotas will not necessarily generate automatic benefits for individual countries. It will create opportunities but will also expose them to additional competition from other, formerly restrained, exporters. The outcome for any individual country will depend heavily on its policy response. This thesis studies the case of Pakistan and makes suggestions to help Pakistan streamline its policies for increasing its gains from quota abolition in the post ATC scenario. History of Trade Regulation In 1944, the United States ("US") and United Kingdom ("UK") proposed a comprehensive economic and financial plan for post WWII reconstruction and development at Bretton Woods, New Hampshire. Three international institutions were envisioned in the Bretton Woods system i.e. the World Bank ("WB"), the International Monetary Fund ("IMF") and the International Trade Organization ["ITO"]1. In order to expedite the start of international negotiations on tariff reductions and their implementation pending approval of the Havana Charter2 by national legislatures, the General Agreement on Tariffs and Trade3 ("GATT") was provisionally approved and hence became effective on January 1, 1948. The GATT was a provisional agreement designed to cover the period prior to the entry into force of the Havana Charter. The GATT codified the results of an initial negotiation on the reduction of tariffs. 1. While the WB and IMF were created to stimulate direct and indirect foreign investment and address monetary issues, the ITO was proposed to liberalize trade by eliminating all trade barriers on imports. 2. Havana Charter for an International Trade Organization, U.N. Doc. E/Conf. 2178 (Mar. 24, 1948). The text of the Havana Charter has been published in many doctrinal works, including Clair Wilcox: A Charter for World Trade (1949). The Havana Charter provided for the establishment of the International Trade Organization and an elaborate dispute settlement procedure. 3. Signed at Geneva in 1947. Due to the US' failure to ratify the Havana Charter4, the Charter never entered into force, and the GATT, by force of circumstances, remained in force5. The GATT was the forum for many multilateral rounds of tariff negotiation during the 1950s, 1960s and 1970s. The most important of these, the Kennedy Round in the 1960s, resulted in the reduction of customs duties of the contracting parties by an average of 35%6. Tokyo Round achieved similar tariff reductions in the late 1970s. The tariff negotiations succeeded in reducing the effect of both customs duties and tariff reductions on trade. In any case, in the 1970s trade was more influenced by the fluctuations in exchange rates than by tariff concessions. 4. See Paul Demaret: The Metamorphoses of the GATT. From the Havana Charter to the World Trade Organization, 34 Columbia Jour. Of Transnational Law 123 at Pg. 127. 5. On the ambiguous status of the GATT under American law, see John H. Jackson: The General Agreement on Tariffs and Trade in United States Domestic Law, 66 Mich. Law Rev. 249 (1967). 6. On the Kennedy Round, see John B. Rehm: Developments in the Law and Institutions of International Economic Relations. The Kennedy Round of Trade Negotiations, 62 Am. Jour. of Int'1 Law 403 (1968). The history of GATT was also undermined by the fact that the developed countries refrained from lowering trade barriers in the sectors that were of particular interest to the developing countries especially Agriculture, Textiles and Clothing. The significance of Textiles and Clothing ("T&C") sector for the developing countries could be gauged by the fact that in 1992, T&C accounted for 20 to 30% of many less developed countries' total merchandise exports. Of total exports, T&C exports represented 67%, 69%, and 55% in Bangladesh, Pakistan, and Sri Lanka, respectively7 in 1992. 7. See Kitty G. Dickerson: Textile, Trade: The GATT Exception, 11 St. John's J. Legal Comment, 1996, Note 1 at Pg. 422. A Short Account of Agreements governing T&C Trade The remarkable growth in T&C exports from developing countries was achieved despite extensive quantitative restrictions discriminating against developing countries and high tariffs in developed countries. For nearly half a century, world trade in T&C has been subject to quantitative restrictions under derogation from GATT rules, beginning with Japan's voluntary export restrictions on cotton textiles and ten groups of manufactured goods between 1957 and 1961 to the US8 9, which evolved into the multilateral Short‑Term Arrangement regarding International Trade in Cotton Textiles ("STA") in 1961, the Long‑Term Arrangement ("LTA") in 1962, and eventually the Multi‑fiber Arrangement ("MFA") in 197410. The MFA expanded quantitative restrictions beyond cotton products to wool and man‑made fiber products and was extended several times until the Uruguay Round Agreement on Textiles and Clothing ("ATC") took effect at the beginning of 1995. The T&C sector witnessed persistent political rent seeking and. a complete institutionalization of protectionist policies, completely ignoring the main purpose of GATT. 8. Japan actually preferred voluntary export restraints ("VERs") over restraints under GATT Article XIX, which permits global nondiscriminatory trade restraints when domestic import‑competing industries are seriously injured by fair import competition. See GATT, supra Note 5, Art. XIX. One advantage that VERs had over restraints under Article XIX of GATT was "the additional measure of flexibility and control they offered the exporter in determining export ceilings." See Gary H. Perlow: The Multilateral Supervision of International Trade: Has the Textiles Experiment Worked?, 75 Amer. Jour. of Intl Law 93, (1981), Note 2, at Pg. 96. 9. See Perlow, supra Note 2, at Pg. 95 (noting that this resort to a VER was effectively a reintroduction of a protectionist instrument from the 1930's Depression era that was to be widely applied in ensuing decades to restrict a variety of imports from Japan and developing countries); Jared L. Landaw, Note, Textile and Apparel Trade Liberalization: The Need for a Strategic Change in Free Trade Arguments, 1989 Colurri. Bus. Law Rev. 205, Note 1 at p.207. Significantly, the VERs on Japanese exports to the US "set the pattern of pressure by strong import‑competing industries for action by their governments, which, in turn, pressure the exporting countries' governments (or even industries) into "voluntarily' restraining imports." Perlow, supra Note 2 at p.95. The term voluntary export restraint may be regarded as "something of a misnomer as the thinly veiled threat of harsher, unilateral action underlies most negotiations for such restraints." 10. The Short‑Term Arrangement, involving US and other cotton importing and exporting countries, prohibited voluntary restraints. The aim of this series of articles is to study the existing state of implementation of ATC, its possible impact on developing countries especially the South Asian Countries and the state of preparedness of Pakistan for the post 2005 challenges in the T&C sector. The series are structured as follows. Article I traces the history of regulation of international trade in the T&C Sector discussing, inter alia, the Multifibre Arrangements. Article II deals with possible impact of ATC on South Asian countries and problems with the ATC. Article III builds on one of the problems with the ATC i‑e. Safeguard actions under the ATC. Article IV deals with Pakistan, its textile sector and its textile performance in the context of MFA and ATC. Article V will attempt to provide possible solutions for Pakistan's textile sector to increase its gains once ATC is fully implemented in 2005. INTERNATIONAL ARRANGEMENTS IN T&C SECTOR US and the Agricultural Act Trade in textiles was governed by bilateral voluntary restraining agreements before 1956, when US formalized its protection against low‑cost textile imports from developing countries by enacting Section 204 of the Agricultural Act. The provision authorized the President to negotiate agreements limiting textile imports into the US, whenever he determined such action appropriate, in order to provide "relief' to domestic producers.11 Section 204 was drafted to refer to "textiles" or "textiles products," and covered all textiles, regardless of the fiber12. Section 204 thus became a critical legal mechanism for US to impose restraints on all textile imports not only of cotton, but also of other fibers that had not previously been restricted in any agreement with an importing country13. 11. See Alice J. H. Wohn: Towards GATT Integration: Circumventing Quantitative Restrictions on Textiles and Apparel Trade Under the Multifiber Arrangement, [hereinafter "Towards GATT Integration"] 22 U. Pa. J. Int'I Econ. L. 22. No. 2, 2001 p. 380‑381. 12. Cotton, the main fiber used earlier in producing textiles, was being substituted by developing countries. 13. See Dickerson supra note 1 at p.403. Short Term Arrangement In 1961, the STA was negotiated between sixteen countries, including the US, Hong Kong, Japan, countries of the EEC, Pakistan, and India. It was designed to be a one‑year program during which the parties could negotiate a more formal agreement. The STA provided that in cases where a participating country believed that the exports were threatening to cause "market disruption," it could request the exporting nation to restrain exports at a level not lower than the level prevailing for a twelve month period ending June 30, 196114. Long‑Term Arrangement In 1962, the STA was replaced by the LTA, whose twenty two signatory countries included US, Mexico, Hong Kong, Japan, countries of the EEC, India, Korea, and China. Like the STA, the LTA imposed quantitative restrictions on trade, specifying product‑by‑product and country‑by‑country import restrictions for a period of five years. The LTA was renewed several times during the course of twelve years, until the unceasing pressure to widen its scope, in order to meet all new forms of developing‑country competition" eventually resulted in the creation of the MFA15. The Multi‑Fiber Arrangement Under the MFA, textiles trade was subjected to a complex system of unilateral and bilateral quotas, on a product -by‑product and country‑by‑country basis. The stated objectives of the MFA were to achieve expansion and liberalization of world trade in textiles, while ensuring the orderly and equitable development of textiles trade and the avoidance, of market disruption in importing and exporting countries16. Since its inception, MFA governed most of the $248 billion a year trade in T&C17. Another `temporary' arrangement but ironically having been renegotiated time and again at the insistence of the developed importing countries, MFA will remain in force until 2005. 14. See Landaw, supra Note 1, at p.208. `Market Disruption' includes a sharp and substantial increase of particular products from particular sources, where (i) the products in question are offered at prices substantially below those prevailing for similar goods of comparable, quality in the market of the importing country and (ii) there is serious injury to domestic producers or threat thereof 15. See Alice J. H. Wohn: Towards GATT Integration supra at p.375 16. See Alice H. Wohn: Towards GATT Integration, supra at p.394‑395. 17. See John Zarocostas, EU blocks Compromise on Textile‑Quota Phaseout, J. Commerce, Jan. 12, 1995 at 1A. The MFA, however, does not establish import restrictions by itself. Instead, it provides a framework of rules and procedures under which member countries can impose quota restrictions. Quotas are usually negotiated bilaterally, but unilateral quotas are permitted if the import of a particular product from a specific country is disrupting, or might potentially disrupt, the domestic market. MFA I18 MFA I covered manufactured fibers and wool, in addition to cotton and the cotton blends covered in previous agreements. In its original conception, the MFA was to take into account the interests of both the exporting and the importing countries and to contribute to the economic growth of developing countries19. Its stated objective was "to achieve the expansion of trade, the reduction of barriers to such trade and the progressive liberalization of world trade in textile products, while at the same time ensuring the orderly and equitable development of this trade and the avoidance of disruptive effects in individual markets and on individual lines of production in both importing and exporting countries". In addition, the MFA was a general, multilateral agreement governing the bilateral agreements that could be reached between participating countries20. However, bilateral agreements permitted under MFA took trade further away from liberalization since it became possible to single out exporting countries considered to be a problem contrary to the non‑discrimination principle and negotiate varying agreements among textile trading countries21. 18. See Arrangement Regarding International Trade in Textiles, done at Geneva, December 20, 1973, 930 U.N.T.S. 166. Entered into force on January 1, 1974 and extended by Protocol Extending the Arrangement Regarding International Trade in Textiles, December 14, 1977 [hereinafter "Arrangement"]. 19. See Kitty G. Dickerson: Textile Trade: The GATT Exception, 11 St. John's J. of Legal Comment, 1996 Note 1 at p. 393. 20. See Dickerson, supra, Note 1 at p. 414. 21. See Dickerson, supra, Note 1 at p. 413. Nonetheless, MFA took some steps forward towards trade liberalization as it: (i) established a multilateral surveillance institution, the Textiles Surveillance Body, to supervise the implementation of the MFA; (ii) established a committee to manage the MFA comprising of all signatory members; (iii) imposed stricter rules for determining `market disruption'; (iv) permitted the quota allowances to increase by no less than 6% per year, rather than the 5% minimum allowed under the LTA; and (v) implemented new provisions, such as `swing,' `carry forward,' and `carryover' enhancing the quota flexibility. MFA II22 While MFA I was intended to last only four years, from 1974 through 1977, the developed exporting countries pushed for extensions, arguing that they needed more time to `adjust23.' A larger part of the MFA II owed its existence to the EU that faced increased pressure from its domestic producers due to the diversion of Asian exports to Europe in the face of strenuous protection of T&C sector in the US. In addition, with a serious recession in Europe, European negotiators to the MFA were ready to take a tougher position against imports than the one they had taken in negotiating the original MFA24. The European Community's specific concerns were the 6% growth rates authorized under MFA I and the need to prove `market disruption' in order to negotiate bilateral agreements with a growth rate of less than 6%. The 1977 Negotiations and the Protocol of Extension In July, 1977 the debate in the Textiles Committee25 on the extension and modification of the MFA began to take shape. The tone and direction of the talks were set by the EEC's announcement of its stabilization plan, which sought global ceilings on products based on their market penetration26. The most sensitive products vctere to be stabilized (that is, cut back) at 1976 import levels, annual import growth rates were to vary in inverse proportion to the rate of import penetration from all sources27. In other words, the EEC sought to legitimize concepts alien to the MFA and impose restraints in a manner inconsistent with the Arrangement. 22. See Protocol Extending the Arrangement, December 22, 1981. 23. See Dickerson, supra, Note 1 at p. 414. 24. See Dickerson, supra, Note 1 at p. 414‑415. 25. The plenary Textiles Committee and the eight‑man Textiles Surveillance Body constitute the novel supervisory structure established by the MFA. 26. On June 21, 1977, the EEC Council of Ministers directed the Commission to commence negotiations on the renewal of the MFA in accordance with guidelines that left little room for maneuver. See EC Bulletin, No. 6, at 2.2.30 (1977). The thrust of these guidelines was to secure maximum protection prior to any extension of the MFA by negotiating bilateral restraint agreements with roughly 30 exporting countries. This approach was justified by the assertion that the large and growing number of relatively small‑volume suppliers made it necessary to account for the cumulative impact of their imports. Accordingly, restrictions could be placed on trade with new or small exporters that were not individually causing market disruption but were contributing to such a situation. This concept of "cumulative market disruption" was not only incompatible with Article 6(3)'s protection of small‑volume suppliers, but stretched the notions of market disruption and selectivity beyond recognition, without at all returning to the most‑favoured‑nation standard. 27. As explained by the EEC spokesman, the stabilization plan meant that for a "limited number" of products, growth would not exceed the growth rate of consumption; whereas for other products, a higher growth rate would be permitted. The growth rate of less sensitive products could reach or even exceed the 6% rate stipulated in MFA, Annex B. COM.TEX/10, para. 15 (1978). The products the EEC wished to subject to restraint were divided into five categories according to their import "sensitivity" including such common items as T‑shirts, knitted shirts, knitted jerseys, men's and women's woven trousers women's blouses, and men's shirts. Growth rates were low: import of cotton yarn, for instance, was negotiated to increase at an annual rate of 0.3%. See UNCTAD Report, UN Doc. TD/B/C.2/192, (1978) Note 75, at para. 45. The EEC argued that formal changes in the MFA would not be necessary so long as it was permitted to pursue its objectives through a coordinated series of bilateral agreements. Failing this, the Textiles Committee was ominously warned, `the Community would be obliged to take appropriate measures to ensure the attainment of its stabilization objectives28. Needless t0 say, this prospect aroused little enthusiasm and provoked considerable consternation on the part of developing countries. An attempt to renew the MFA without modifications failed because of the special changes necessitated by the EEC's rigid negotiating mandate. Yet it became, apparent that any attempt to amend the Arrangement would result in protracted negotiations running well beyond the expiration date. The, dilemma was skirted by the introduction of a compromise paper29 that proffered a legal justification for the stabilization plan; the EEC's bilateral negotiations would be conducted under Articles 3 or 4, "which does include the possibility of jointly agreed reasonable departures from particular elements in particular cases30 Several countries objected to this passage as a highly restrictive amendment introduced "through the back door".31 Nevertheless, the compromise paper was adopted in December, and the `reasonable departures' exception was legitimized by the Protocol extending the MFA32. 28. COM.TEX/ 10, para. 16 (1978). 29. COM.TEX/W/44 (1977). The paper was circulated by the US and received the support of the EEC as well as Hong Kong, South Korea, and the ASEAN countries. 30. Ibid. In the U.S. view this merely restated the existing exceptions to the rules already written into the MFA. The majority of countries thought otherwise. 31. Pakistan, Egypt, India and Brazil (the main cotton exporters) were among the objectors. The latter two submitted a paper based on the US proposal, but without a "reasonable departures" clause. It received scant support. 32. TC Conclusions, Note 79, at para. 5.3: "The Committee agreed that, within the framework of the MFA, [bilateral] consultations and negotiations should be conducted in a spirit of equity and flexibility with a view to reaching a mutually acceptable solution . . . which does include the possibility of jointly agreed reasonable departures from particular elements in particular cases" as quoted in Perlow supra at p.113. The European Community, therefore, achieved its goal for jointly agreed reasonable departures' from MFA I, including reduced quota levels, denials or reduction of the flexibility provisions, and growth rates reduced to under 6%33. MFA II permitted even more restrictive bilateral agreements and, therefore, took the T&C sector further away from the GATT principles. MFA III34 Under MFA III, the US restricted more sources and more products than before by applying new restrictions or by imposing unilateral measures. However, these heightened restrictions did not prevent US imports from increasing rapidly35. Between 1971 and 1979, the percentage market share of T&C imports from Hong Kong, Taiwan, and South Korea increased from approximately 30% to 42%36. In addition, the US apparel trade deficit increased due to the emphasis on apparel production by developing countries. 33. See Dickerson, supra, Note 1 at p. 415‑16. 34.See Protocol Extending the Arrangement, July 31, 1986. 35. See Landaw, supra Note 1, at p. 212. 36. See Landaw, supra Note 1, at p. 211. As a result, domestic producers in the US again demanded greater protection from exporting countries. In February 1979, President Carter issued the White Paper37. In addition, the White Paper sought to link import growth in import‑sensitive categories to increases in US domestic consumption. The first countries to which the new policy applied were Hong Kong, Taiwan, and South Korea38. 37. Its purpose was to reduce the aggregate import growth and volume, and to expand measures to control the 'import surges that cause market disruption.' 38. See Alice H. Wohn: Towards GATT Integration, supra at p. 401‑402. For developing countries, the primary objective of MFA III was to seek greater discipline and to eliminate the clause permitting "reasonable departures" from the norms on export restraints. While the developing exporting countries were ultimately able to have the `reasonable departures' clause removed from MFA III, other provisions, such as the `anti‑surge mechanism' and a limitation on imports from major suppliers, were added39 providing little relief to the developing countries. As the GATT Secretariat stated, `restraints under MFA III were not only more extensive but were in many cases more restrictive40.' 39. See Alice H. Wohn: Towards GATT Integration, supra at p. 402. 40. See Dickerson, supra, Note 1 at p. 418 MFA IV41 Despite the protection granted to the domestic producers of US, the textile exports from various Asian countries were increasing. One of the factors was the establishment of textile company units in tariff free areas especially the Caribbean Basin and Latin America that restrained the US from blocking import of textiles since the US could not impose any tariffs on the imports originating in tariff free areas. For example, by the late 1980s, more than 70 Korean textile companies had production facilities abroad, with an estimated investment of $56 million, and sought to expand further42. Thus, MFA IV came into being, renewing the MFA for an additional. five years till 31 July, 1991. As with previous MFA renewals, the text of the MFA remained unchanged, but significant modifications were incorporated through the Protocol of Extension. 41. See Protocol Extending the Arrangement, July 31, 1991. 42. See Alice H. Wohn: Towards GATT Integration, supra at p. 402 (citing P.T. Bangsberg, Korean Pursuit of Textile Sites Includes US. J: Commerce, Mar. 21, 1989 at 1A. MFA IV had 54 signatories and it covered additional fibers. The expansion of fiber coverage was of particular concern to India and China, which traded significant amounts of the fibers that were now covered43. Quotas were generally increased as a percentage based on the previous year, thereby providing little opportunity for quota expansion for the smaller or poorer exporting countries since the base on which the percentage increase was calculated was small. Furthermore, no cutbacks or tightening of quotas were permitted; instead, exporting countries were mandated to accept lower rates of growth and flexibility. In addition, the importing countries `committed themselves to making improvements in the bilateral agreements for increased access44.' Although the MFA was scheduled to expire in July 1991, due to the Uruguay Round negotiations, the MFA was extended for three years, from 1991 to 199345. From the outset of the Uruguay Round, the developing nations demanded the demise of the MFA, and pressed for the liberalization of T&C trade under GATT rules46. In a noncommittal response, however, the ministers at the Uruguay talks referred only to the `eventual integration of this sector into GATT.' Exporting countries such as India and Pakistan took the position that importing nations were putting T&C sector `on the back burner,' while some Western officials pushed to extend the MFA until January, 1994, `on the pretext that they needed more time to amend all the necessary national legislation47.' 43. See Dickerson, supra, Note 1 at p.420. 44. See Alice H. Wohn: Towards GATT Integration, supra at p.404. 45. See Protocol Extending the Arrangement, December 9, 1992; and Protocol Extending the Arrangement, December 9, 1993. 46. See Dickerson, supra, Note 1 at p.420. 47. See Dickerson, supra, Ibid. The Uruguay Round Agreement on Textiles and Clothing ("ATC") During the Uruguay Round, which went into effect on January 1, 1995, members negotiated the ATC, which established rules governing the integration of T&C sector into GATT during a 10 year transition period. As per the agreement, the 10 year period cannot be extended. In the first stage, which began on January 1, 1995, WTO Members were required to integrate products representing not less than 16% in volume terms of their 1990 imports of T&C products. In stage 2, starting January 1998, not less than a further 17% was to be integrated, and in stage 3, from January 2002, a further 18%. Finally, on January 1, 2005, all remaining products (amounting to a maximum 49%) are to be automatically integrated. Products not yet integrated are subject to a special transitional safeguard mechanism, whereby an importing country can apply quantitative restrictions for up to 3 years on imports from a particular source of supply which causes or threatens to cause serious damage to the domestic industry. After integration, regular GATT safeguards apply. In addition to this integration process, the ATC accelerated the growth rates for remaining quotas. The annual growth rates of quota volumes were increased by a factor of 16% for the first stage of the Agreement, by a further 25% for the second stage, and another 27% for the last stage. LDCs enjoy one‑stage advancement in the acceleration of quota growth. In addition, for monitoring purposes, the ATC established a quasi‑judicial body called Textiles Monitoring Body ("TMB") to supervise the implementation of the ATC and to adjudicate disputes among members during the MFA phase‑out period. The TMB has, however, been criticized by both developed and developing countries for its lack of transparency48 though the appellate procedure under the ATC allows a member recourse to the WTO's Dispute Settlement Body ("DSB") 48. See K. Kristine Dunn, Note, The Textiles Monitoring Body: Can it Bring Textile Trade into GATT? 7 Minn. J. Global Trade ps. 123‑124 (1988). The TMB has suffered harsh criticisms from both the exporting and importing countries in its adjudicatory role. Representatives of US T&C industries have asserted that the TMB is rigged against them, while exporting countries claim that the officials who are appointed by the importing countries are biased and lack credibility in resolving disputes. See also John M. Jennings, Comment, In Search of a Standard: "Serious Damage" in the Agreement on Textiles and Clothing, North. Jour. of Int. Law & Business, Fall 1996, p.272. Disputes under the ATC are thus governed by a set of rules that are distinct from those under the GATT regime. However, the appellate procedure is almost similar, as although member countries must `endeavour to accept in full the recommendations of the TMB,' a country can reject the TMB's recommendations and can have its claim heard before the WTO's Dispute Settlement Body ("DSB") pursuant to provisions under GATT. The members came to an agreement over the composition of the TMB only after much controversy. While electing the chairman and ten representatives making up the TMB, the importing and exporting countries fiercely argued for majority representation. The result: half of the representatives are from importing countries and the other half from exporting countries. As one author commented, this controversy could indicate that representatives acknowledge the possibility that TMB members would make politically biased decisions49, even though the ATC provides that representatives must take a neutral position, rather than performing duties for their governments. The role of the TMB and some safeguard measures that have been taken by the developed countries will be discussed in the later articles. 49. See Alice H. Wohn: Towards GATT Integration, supra at p.402 (citing K Dunn supra) at p.407. See also generally Jennings supra.