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WTO: 2006 NEWS ITEMS

Dispute Settlement Body 17 March 2006

The DSB establishes panels for examining three different cases

The DSB, on 17 March 2006, established three panels to examine the Mexican anti-dumping duties on steel pipes and tubes brought by Guatemala (DS331); the Turkish measures affecting the US importation of rice (DS334) and; the US sunset reviews of anti-dumping measures on oil country tubular goods from Argentina (DS268).

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NOTE:
This summary has been prepared by the WTO Secretariat’s Information and Media Relations Division to help public understanding about developments in WTO disputes. It is not a legal interpretation of the issues, and it is not intended as a complete account of the issues. These can be found in the reports themselves and in the minutes of the Dispute Settlement Body’s meetings.

Request for panel establishment  back to top

These are cases that have completed the consultation phase, the first stage of a dispute. When consultations have failed, member governments are entitled to ask for a panel to be set up to examine the dispute. According to the rules, the respondent can reject the first request. At the second request, a panel is automatically established.

DS331: Mexico — Anti-Dumping Duties on Steel Pipes and Tubes from Guatemala

Guatemala requested for the second time a panel to examine the definitive anti-dumping measures imposed by Mexico on imports of certain steel pipes and tubes from Guatemala and the investigation leading to the imposition of these measures initiated by the Mexican investigating authority, the Secretaría de Economía.

Mexico expressed disappointment over the decision by Guatemala to request the establishment of the panel. It still hoped that a mutually satisfactory solution to the dispute could be found.

The DSB agreed to establish the Panel. The US, Honduras, Japan, the EC and China reserved their third-party rights.

DS334: Turkey — Measures Affecting the Importation of Rice

The US requested for the second time that the DSB establish a panel for considering Turkey restrictive import regime on the importation of rice. The US argued that Turkey required importers to purchase large quantities of domestic rice under tariff-rate quotas. It added that Turkey would not permit importation without an import licence, for which a domestic purchase is required.

Turkey regretted the US' decision to re-introduce the request for the establishment of a panel. Turkey asked the DSB to rule on DSU Article 12.10. While there were no preceding case law on the right of developing countries stemming from Article 12.10, Turkey believed that such request would be in line with the spirit of the current development round.

The Chairman indicated that he had been in consultations with the parties on the Turkish request under Article 12.10 but unfortunately there had been no mutually agreeable solution to this particular issue. As a consequence, the DSB is obliged to follow provisions of Article 6 which sets the panel.

China, Australia, Korea, Thailand and the EC reserved their third-party rights.

Request for compliance panel  back to top

At the end of the period given to a government to comply with a ruling, the parties to the dispute sometimes disagree on whether that government has fully complied. In such situation, the matter can be referred to the original panel who will decide whether the ruling has been applied properly.
  

DS268: United States — Sunset Reviews of Anti-Dumping Measures on Oil Country Tubular Goods from Argentina

Argentina requested the establishment of a compliance panel according to Article 21.5, considering that the US failed to comply with the DSB recommendations (the reasonable period of time for implementation expired on 17 December 2005).

The US was disappointed that Argentina was having recourse to a compliance panel. However, the US added that it would accept it, as agreed in the Understanding signed with Argentina (WT/DS268/14).

The DSB established the compliance panel. Mexico, Japan, the EC and China reserved their third-party rights.

Request for information-gathering process and facilitator under Annex V of the Subsidies Agreement  back to top

DS317: United States — Measures Affecting Trade in Large Civil Aircraft

According to Annex V, the process is initiated to obtain information necessary “to analyze the adverse effects caused by the subsidized product” (para 2), and “shall be completed within 60 days of the date on which the matter has been referred to the DSB” (para 5). The purpose of the facilitator is “to ensure the timely development of the information necessary to facilitate expeditious subsequent multilateral review of the dispute” (para 4).

Following the establishment of a panel to help to resolve a number of procedural matters in the dispute of large civil aircraft on 17 February 2006, the EC requested for the third time the DSB to initiate the procedures for developing information-gathering under Annex V of the SCM Agreement. Although the panel was established, the EC reiterated that the US' rejection of the resumption of the information-gathering in principle was not acceptable. The EC said it would therefore take action to preserve its rights and would request the facilitator to invite the US to reply to Annex V questions which the US refused to reply.

The US reiterated that the EC was seeking to reopen an information-gathering process that had already ended with regard to the initial EC allegations of subsidization of large civil aircraft. The US argued that in fact the rules which only required the submission of information on two occasions – 11 November 2005 for initial questions and 22 December 2005 for responses to follow-up questions - would not allow the resumption of the process. In doing so, the US believed that the EC would unilaterally extend the process beyond the 60 days provided by the SCM Agreement and the 90 days agreed upon with the US.

Brazil and Canada, as third parties, said that Annex V sets out no additional requirement for the establishment of the procedures but the request itself and the referral of the matter to the DSB. As a result the DSB should initiate the procedures and designate a facilitator.

The DSB took note of the statements made.

Implementation  back to top

DS217 & DS234: US — Continued Dumping and Subsidy Offset Act of 2000

Japan; Brazil; Canada; Chile; Indonesia; Hong Kong, China; India; China; Korea; Mexico; Thailand and the EC stressed on the importance of the US to fully comply with the DSB's rulings. In that regard, they disagreed with the US asserting at the last DSB meeting on 17 February 2006 that it brought its measures fully into conformity with the DSB's rulings. They argued that the transition clause in the proposed legislation would postpone the repeal of the CDSOA until October 2007 and allow duties collected before then to be disbursed subsequently. As a result, they also urged the US to continue providing status reports until it brought its measures into full conformity with the DSB's recommendations.

The US reported that on 1 February 2006, the US congress approved the Deficit Reduction Act of 2005, including a provision to repeal the the CDSOA - the so-called “Byrd Amendment” and on 8 February 2006, President Bush signed the Act into law. The US considered that it had taken all actions necessary to implement the rulings and failed to see the purpose of submitting status report.
 

DS212: United States — Countervailing Measures Concerning Certain Products from the European Communities

The EC deplored the fact that the US failed to provide a status report on the steps that it was taking to bring its measures into conformity with the DSB's rulings. It added that the EC would be interested in receiving clarifications and replies concerning the estimated timetable regarding the issuance of preliminary findings from the Department of Commerce. It recalled that the EC had informed the DSB that the US had started section 129 proceedings on 29 November 2005 and that EC companies had already received and replied to six questionnaires from US authorities. The exercise was expected to be completed in 180 days. The EC concluded by hoping that the US would implement fully the compliance panel findings and that it would provide regular status reports to the DSB.

The US confirmed that the US Department of Commerce was working on new determinations in the sunset reviews.

European Communities — Regime for the Importation, Sale and Distribution of Bananas DS27 and related subsequent WTO proceedings

Since the last DSB meeting, there had been no positive developments in this case. Honduras and Panama continued to argue that the new EC banana regime continued to discriminate against MFN suppliers. They considered that the EC had failed to explain to the MFN suppliers why this regime increased the tariff rate to €176, which was more than double the previous rate. They called on the DSB to keep the EC's non-compliant measures under surveillance and requested the EC to fulfil its WTO obligations. They indicated that until a satisfactory solution would be found to this dispute, they would continue to place this item on the DSB's agenda.

The EC took note of the statements by Honduras and Panama, but it expressed serious doubts as to whether the DSB was the appropriate forum to discuss the issues raised by them. The EC indicated that it was ready to hold further consultations with the complainants if they so wished.

Surveillance of implementation  back to top

After a ruling has been adopted, the DSB keeps under surveillance the implementation of the ruling until the issue is resolved.

Within 30 days after the date of adoption, the Member concerned must inform the DSB of its intentions in respect of implementation of the ruling.

Six months after the implementation time period has been fixed, the Member must start presenting at each DSB a status report of its implementation — until full implementation.
  

Implementation status reports

- The European Communities presented the following status report:

DS174 & DS290: European Communities — Protection of Trademarks and Geographical Indications for Agricultural Products and Foodstuffs

The EC reported that a new regulation on geographical indications (GI) was being discussed in the Council of the European Union and the European Parliament. The EC noted that the proposal would undergo a number of changes in the course of the on-going legislative procedure in order to address Members' concerns expressed at previous DSB meetings. The EC added that it was confident that the Commission's proposal would be adopted within the agreed reasonable period of time (3 April 2006).

Australia and the US expected that the EC will take the concerns on trademark rights and the treatment of non-EC geographical indications right holders into account. They concluded by saying that they would welcome the opportunity to discuss this matter further with the EC.
  

- The United States presented the following status reports:

DS285: United States — Measures Affecting the Cross-Border Supply of Gambling and Betting Services

The US reported that the US administration was working with the US Congress on the appropriate steps to resolve the matter.
Antigua and Barbuda recalled that the implementation deadline of 3 April 2006 was approaching. It added that it was its first experience with dispute resolution and it had perhaps naively expected the US would have engaged on devising an equitable resolution. It explained that legislation had been introduced in the US Congress, but it was about as directly contrary to the DSB rulings as could possibly be imagined. It concluded by believing that it was the time for the US to demonstrate whether it was willing to be a responsible stakeholder in the WTO.
 

DS176: United States — Section 211 Omnibus Appropriations Act of 1998

The US reported that US Administration was working with Congress to implement the DSB's rulings.
  

DS184: United States — Anti-Dumping Measures on Certain Hot-Rolled Steel Products from Japan

The US reported the Administration would continue to work with Congress to enact legislation to implement the DSB’s recommendations.
  

DS160: United States — Section 110(5) of US Copyright Act

The US said that US Administration continued to work closely with the US Congress and continued to confer with the EC.

Next meeting  back to top

The next meeting of the DSB will be on 24 March 2006.