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Complaint by the European
On 3 April 1998, the EC
requested consultations with Argentina in respect of provisional and
definitive safeguard measures imposed by Argentina on imports of footwear.
The EC asserted that by Resolution 226/97 of 24 February 1997, Argentina
imposed a provisional safeguard measure in the form of specific duties on
imports of footwear effective from 25 February 1997, which was followed by
Resolution 987/97, which imposed a definitive safeguard measure on these
imports effective from 13 September 1997. The EC alleged that the above
measures violate Articles 2, 4, 5, 6 and 12 of the Agreement on
Safeguards, and Article XIX of GATT 1994.
On 10 June 1998, the EC
requested the establishment of a panel. At its meeting on 22 June 1998,
the DSB deferred the establishment of a panel.
Panel and Appellate Body proceedings
Further to a second request
to establish a panel, the DSB established a panel at its meeting on 23
July 1998. Brazil, Indonesia, Paraguay, the US and Uruguay reserved their
third-parties rights. On 15 September 1998, the Panel was composed. The
report of the panel was circulated on 25 June 1999. The panel found that
Argentina’s measure is inconsistent with Articles 2 and 4 of the
Agreement on Safeguards.
On 15 September 1999, Argentina
notified its intention to appeal certain issues of law and legal
interpretations developed by the Panel. The report of the Appellate Body
was circulated to Members on 14 December 1999. The Appellate Body upheld
the panel’s finding that Argentina’s measure is inconsistent with
Articles 2 and 4 of the Agreement on Safeguards, but reversed certain
findings and conclusions of the panel in respect of the relationship
between the Agreement on Safeguards and Article XIX of GATT 1994 and the
justification of imposing safeguard measures only on non-MERCOSUR third
country sources of supply.
The DSB adopted the Appellate
Body Report and the Panel Report, as modified by the Appellate Body
Report, on 12 January 2000.
Implementation of adopted reports
Pursuant to Article 21.3 of the DSU, Argentina
informed the DSB on 11 February 2000 that the safeguard measure would
remain in force until 25 February 2000 and, by that date, the measures
aimed at complying with the DSB’s recommendations and ruling would be
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