WTO: 2014 NEWS ITEMS

DISPUTE SETTLEMENT

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NOTE:
This summary has been prepared by the WTO Secretariat’s Information and External 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.

DS468: Ukraine — Definitive safeguard measures on certain passenger cars

Japan requested the Dispute Settlement Body (DSB), for the second time, to establish a panel to examine this matter. Ukraine was of the view that its measure was in full compliance with its obligations. The DSB established a panel. The European Union, India, Korea, Russia and Turkey reserved their third-party rights to participate in the panel’s proceedings.

DS471: US — Certain methodologies and their application to anti-dumping proceedings involving China

China, for the second time, requested the DSB to establish a panel to examine a number of US anti-dumping measures which it believed were inconsistent with the Anti-Dumping Agreement and the General Agreement on Tariffs and Trade (GATT) 1994. The United States reiterated its view that its measures were fully consistent with its WTO obligations. The DSB established a panel. Brazil, Canada, the European Union, India, Japan, Korea, Russia, Saudi Arabia and Ukraine reserved their third-party rights to participate in the panel’s proceedings.

DS467: Australia — Certain measures concerning trademarks, geographical indications and other plain packaging requirements applicable to tobacco products and packaging

Indonesia requested the DSB to establish a panel to examine this dispute. Indonesia was of the view that Australia’s measures applicable to the retail sale of cigarettes, cigars and other products appeared to be inconsistent with Australia’s obligations under the Trade-related Aspects of Intellectual Property Rights (TRIPS) Agreement, the Technical Barriers to Trade (TBT) Agreement and the GATT 1994. The measures established comprehensive and restrictive requirements regarding the appearance and form of the packaging of tobacco products.

Australia reiterated its view that its measures were consistent with the fundamental right of all WTO members to implement measures necessary to achieve a legitimate objective, in this case the protection of public health. However, in the interests of ensuring a harmonized panel process and to avoid contributing any further delay in the multiple disputes relating to its tobacco plain packaging measures and to ensure the overall efficiency and effectiveness of the dispute settlement system, Australia accepted Indonesia’s first request for the establishment of a panel. The DSB established a panel. Brazil, Canada, China, Cuba, the European Union, Guatemala, Honduras, India, Japan, Korea, Malaysia, Mexico, New Zealand, Nicaragua, Nigeria, Norway, Oman, the Philippines, Russia, Thailand, Turkey, Ukraine, Chinese Taipei, United States and Uruguay reserved their third-party rights to participate in the panel’s proceedings.

DS473: EU — Anti-dumping measures on biodiesel from Argentina

In Argentina’s view, EU anti-dumping measures imposed on biodiesel originating from Argentina were inconsistent with various provisions of the Anti-Dumping Agreement and the GATT 1994. The European Union was of the view that Argentina’s request for the establishment of a panel was premature and was therefore not in a position to agree to panel establishment. Following the EU’s objection, the DSB deferred the establishment of a panel.

 

Australia — tobacco plain packaging

Australia made a long statement regarding the proceedings initiated with respect to its plain packaging measure which had also been discussed extensively in the TBT Committee and the TRIPS Council. Australia’s statement highlighted certain procedural issues that had arisen:

  • between April 2012 and October 2013, Australia participated in separate WTO dispute consultations with each of the five complainants — Ukraine, Honduras, Dominican Republic, Cuba and Indonesia;
  • nearly two years on, panel proceedings are yet to commence in any of the complaints brought against tobacco plain packaging;
  • on 24 March 2014, Ukraine requested the Director-General to compose the panel in its complaint against Australia. Australia would, on 26 March 2014, request the DG to compose the panel in relation to Honduras’s complaint to ensure harmonization of the two disputes, consistent with Article 9.3 of the Dispute Settlement Understanding (DSU);
  • since its first request for the establishment of a panel in December 2012, the Dominican Republic has not made a further request;
  • following its first request for panel establishment, ten months elapsed before Honduras again requested the establishment of a panel in September 2013;
  • consultations had been held with Cuba in June 2013 but Cuba is yet to request panel establishment;
  • until the complaints about Australia’s measure are resolved, there will be uncertainty about tobacco plain packaging and the application of relevant provisions of the GATT, the TBT Agreement and the TRIPS Agreement to it and that uncertainty would cost all members; 
  • prolonging dispute settlement procedures had resource implications for the parties and the WTO Secretariat;
  • a member should not request consultations or a panel and only afterwards start considering whether it has a case that is capable of succeeding.

A number of delegations commented on Australia’s statement. Ukraine said that it had always acted in a manner that sought to achieve its own objective for a prompt resolution of the dispute, while respecting the systemic objectives. New Zealand shared Australia’s concerns regarding time taken for this matter to go through the dispute settlement process. In its view, it was reasonable to expect the complainants in these disputes to progress their complaints as promptly as possible, particularly if those complainants were also requesting that New Zealand and other members delay their consideration or development of tobacco plain packaging legislation pending resolution of the disputes.

Honduras said that it did not agree with Australia’s assessment. Every member was entitled to decide freely and independently the timing for proceedings and that each member had the freedom to choose not to submit requests for panel establishment subsequently. Cuba said that this was testimony of the difficulties faced by developing countries in using the dispute settlement system. Cuba had followed the established legal procedures and was still assessing the situation. Indonesia said that bringing a dispute was not taken lightly and that members should not be forced to proceed to a panel when they were not ready. Delays may provide the respondent more time to seek a mutually agreed solution or to prepare its case.

The European Union, Brazil, Uruguay, Norway, Canada, Hong Kong (China) and Japan shared Australia’s concerns on delays and the importance of security and predictability as well as the prompt settlement of disputes. The European Union and Japan emphasized the importance of Article 9 of the DSU regarding multiple complainants. Zimbabwe was of the view that Australia’s measures were inconsistent with the TRIPS Agreement and the TBT Agreement.

 

Appellate Body selection process

Mexico’s ambassador, Fernando de Mateo, who took the chair of the DSB, replacing the outgoing chair, Canada’s ambassador Jonathan Fried, said that to find a replacement for the vacant seat at the Appellate Body after the departure of David Unterhalter (South Africa) is the most urgent matter on the agenda of the DSB and needs to be solved as quickly as possible. He asked for time to consult with members on how to proceed and he will propose a way forward by the next DSB meeting at the end of April or before.

 

Other business

Under “Other Business”, Panama made a statement showing concern regarding Venezuela’s recent decision to suspend economic and trade relations with Panama. Venezuela, Bolivia, Cuba, Nicaragua and Ecuador said that political matters should not be discussed in the DSB.

 

Status reports

Several members (United States, European Union, Thailand and Canada) submitted status reports on their implementation of the recommendations and rulings adopted by the DSB.

 

Next meeting

The next regular meeting of the DSB is scheduled for 25 April 2014.

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