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WTO NEWS: 1999 NEWS ITEMS
Banana panel recalled to examine EC's implementing measures

WTO's Dispute Settlement Body (DSB), at a special meeting held on 12 January, agreed to separate requests from Ecuador and the European Communities to refer to the original panel in the dispute over the EC's implementation of DSB recommendations concerning its banana trade regime.

These requests were made in the context of Article 21.5 of the Dispute Settlement Understanding (DSU), which provides that:

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"Where there is disagreement as to the existence or consistency with a covered agreement of measures taken to comply with the recommendations and rulings such dispute shall be decided through recourse to these dispute settlement procedures, including wherever possible resort to the original panel. The panel shall circulate its report within 90 days after the date of referral of the matter to it. When the panel considers that it cannot provide its report within this time-frame, it shall inform the DSB in writing of the reasons for the delay together with an estimate of the period within which it will submit its report."

Ecuador's panel request Back to top

Ecuador requested the referral to the panel that originally examined the case against the EC to consider and verify whether the DSB recommendations have been effectively implemented by the EC. It claimed that the new EC measures continued to violate provisions of the GATT 1994, the General Agreement on Trade in Services and the Import Licensing Agreement. Ecuador also considered it necessary for the reconvened panel to suggest, pursuant to DSU Article 19, to the EC how to implement its findings.

The EC supported Ecuador's request, adding that it saw no difference between this request and its own.

Mexico, one of the original complainants against the EC, reserved the right to request its own Article 21.5 procedure.

The DSB agreed to refer to the original panel the matter raised by Ecuador. The panel will have standard terms of reference.

The following indicated their interest to participate as third parties in the panel proceedings: Colombia, Costa Rica, Côte d'Ivoire, Dominican Republic, Dominica, Jamaica, Mauritius, Nicaragua, St. Lucia, and Saint Vincent and the Grenadines.
> Go to Ecuador's panel request

EC's panel request Back to top

The EC said it was reiterating its request for a panel to look into the regulations it had adopted to implement the DSB recommendations regarding its banana regime. It sought standard terms of referenc. But the EC also submitted that measures taken by WTO members should be presumed to be in conformity with the WTO unless they have been challenged under the appropriate DSU procedures and proven not to conform.

The United States said that with the establishment of the panel requested by Ecuador, there was no longer any need for the EC request, which, in its view, was based on a situation where none of the original complainants had challenged formally the EC's implementing measures. It claimed that the EC request did not meet the requirements of the DSU, and that the DSB meeting held on 21 December 1998 did not constitute the first consideration of the EC request. The United States asked how the EC could request a panel against its own measures.

Panama, Guatemala and Honduras also objected to the EC request while St. Lucia expressed support.

The EC said one aim of its request was to induce a challenge to its implementing measures, and expressed satisfaction that this had been achieved with Ecuador's request. It said it was maintaining its panel request, and hoped that with the establishment of the two panels, a proper examination under Article 21.5 would be carried out.

The United States said that it would make a timely request to the DSB for authorization to suspend concessions against the EC. It called on the EC to sit and negotiate a resolution to this dispute.

The EC said it was open to negotiations but not under a threat of US retaliation.

The Chairman said that his objective was to keep discussions on this dispute within the DSU procedures. He ruled that this meeting was the second consideration by the DSB of panel requests by Ecuador and the EC. (Note: the DSU provides for the automatic establishment of a panel the second time the request is presented to it.)

India said a member should not be denied the opportunity to seek a ruling on the WTO legality of its own measure. It expressed concern about a winning party in a dispute going to the retaliation phase automatically to the detriment of the losing party.

The DSB agreed to refer to the original panel pursuant to Article 21.5 the matter raised by the EC in its panel request.

The following indicated their interest to participate as third parties in the panel proceedings: Colombia, Costa Rica, Côte d'Ivoire, Dominican Republic, Dominica, India, Jamaica, Mauritius, Nicaragua, St. Lucia, and Saint Vincent and the Grenadines.