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B.3.1 General. See also Legislation as such vs. Specific
Application (L.1) back to top
B.3.1.1 US — Wool Shirts and Blouses, p. 14, DSR 1997:I, p. 323
at 335
(WT/DS33/AB/R, WT/DS33/AB/R/Corr.1)
… we find it difficult, indeed, to see how any
system of judicial settlement could work if it incorporated the
proposition that the mere assertion of a claim might amount to proof. It
is, thus, hardly surprising that various international tribunals,
including the International Court of Justice, have generally and
consistently accepted and applied the rule that the party who asserts a
fact, whether the claimant or the respondent, is responsible for
providing proof thereof. Also, it is a generally accepted canon of
evidence in civil law, common law and, in fact, most jurisdictions, that
the burden of proof rests upon the party, whether complaining or
defending, who asserts the affirmative of a particular claim or defence.
If that party adduces evidence sufficient to raise a presumption that
what is claimed is true, the burden then shifts to the other party, who
will fail unless it adduces sufficient evidence to rebut the
presumption.
B.3.1.2 US — Wool Shirts and Blouses, p. 16, DSR 1997:I, p. 323
at 337
(WT/DS33/AB/R, WT/DS33/AB/R/Corr.1)
The transitional safeguard mechanism provided in Article 6 of the ATC
is a fundamental part of the rights and obligations of WTO Members
concerning non-integrated textile and clothing products covered by the ATC
during the transitional period. Consequently, a party claiming a
violation of a provision of the WTO Agreement by another Member
must assert and prove its claim. …
B.3.1.3 EC — Hormones, para. 98
(WT/DS26/AB/R, WT/DS48/AB/R)
… The initial burden lies on the complaining party, which must
establish a prima facie case of inconsistency with a particular
provision of the SPS Agreement on the part of the defending
party, or more precisely, of its SPS measure or measures complained
about. When that prima facie case is made, the burden of proof
moves to the defending party, which must in turn counter or refute the
claimed inconsistency. …
B.3.1.4 Japan — Apples, para. 154
(WT/DS245/AB/R)
… the Appellate Body’s statement in EC — Hormones [Appellate
Body Report, para. 98] does not imply that the complaining party is
responsible for providing proof of all facts raised in relation to the
issue of determining whether a measure is consistent with a given
provision of a covered agreement. In other words, although the
complaining party bears the burden of proving its case, the responding
party must prove the case it seeks to make in response. …
B.3.1.5 India — Patents (US), para. 74
(WT/DS50/AB/R)
… it is not sufficient for a panel to enunciate the correct
approach to burden of proof; a panel must also apply the burden of proof
correctly. …
B.3.1.6 Japan — Agricultural Products II, para. 129
(WT/DS76/AB/R)
Article 13 of the DSU and Article 11.2 of the SPS Agreement suggest
that panels have a significant investigative authority. However, this
authority cannot be used by a panel to rule in favour of a complaining
party which has not established a prima facie case of
inconsistency based on specific legal claims asserted by it. A panel is
entitled to seek information and advice from experts and from any other
relevant source it chooses, pursuant to Article 13 of the DSU and, in an
SPS case, Article 11.2 of the SPS Agreement, to help it to
understand and evaluate the evidence submitted and the arguments made by
the parties, but not to make the case for a complaining party.
B.3.1.7 Japan — Apples, para. 135 and footnote 230
(WT/DS245/AB/R)
The Panel determined that it was “legitimate to consider” the
arguments and allegations of fact regarding apples other than mature,
symptomless apples put forward by Japan in response to the claim pursued
by the United States under Article 2.2. We agree with the Panel. A panel
has the authority to make findings and draw conclusions on arguments and
allegations of fact that are made by the respondent and relevant to
a claim pursued by the complainant. The Panel’s findings and
conclusions with respect to apples other than mature, symptomless apples
were in response to the arguments and allegations of fact that were “legitimately”
raised by Japan. Therefore, when the Panel made findings and drew
conclusions on apples other than mature, symptomless apple fruit, it
duly acted within the limits of its authority.230
B.3.1.8 Canada — Aircraft, para. 167
(WT/DS70/AB/R)
… There is a difference, however, in what evidence may be
employed to prove that a subsidy is export contingent. De jure export
contingency is demonstrated on the basis of the words of the relevant
legislation, regulation or other legal instrument. Proving de facto export
contingency is a much more difficult task. There is no single legal
document which will demonstrate, on its face, that a subsidy is “contingent
… in fact … upon export performance”. Instead, the
existence of this relationship of contingency, between the subsidy and
export performance, must be inferred from the total configuration
of the facts constituting and surrounding the granting of the subsidy,
none of which on its own is likely to be decisive in any given case.
B.3.1.9 India — Quantitative Restrictions, para. 137
(WT/DS90/AB/R)
… The Panel thus appears to have considered that the burden of
proof in respect of the Ad Note was on the United States. This is
confirmed by the structure of the Panel’s analysis in paragraphs 5.202
to 5.215 of its Report, in which the Panel begins its reasoning by
considering the arguments advanced by the United States. … we
do not consider that a panel is required to state expressly which
party bears the burden of proof in respect of every claim made.
B.3.1.10 Thailand — H-Beams, para. 134
(WT/DS122/AB/R)
Thailand does not suggest that the Panel erred in its allocation and
application of the burden of proof; it merely argues that the Panel did
not make specific and explicit findings at every stage of its
examination of Poland’s claims under Article 3. In our view, a panel
is not required to make a separate and specific finding, in each and
every instance, that a party has met its burden of proof in respect of a
particular claim, or that a party has rebutted a prima facie case.
Thus, the Panel did not err to the extent that it made no specific
findings on whether Poland had met its burden of proof.
B.3.1.11 EC — Sardines, para. 275
(WT/DS231/AB/R)
Given the conceptual similarities between, on the one hand, Articles
3.1 and 3.3 of the SPS Agreement and, on the other hand, Article
2.4 of the TBT Agreement, we see no reason why the Panel should
not have relied on the principle we articulated in EC — Hormones to
determine the allocation of the burden of proof under Article 2.4 of the
TBT Agreement. In EC — Hormones, we found that a “general
rule-exception” relationship between Articles 3.1 and 3.3 of the SPS
Agreement does not exist, with the consequence that the complainant
had to establish a case of inconsistency with both Articles 3.1
and 3.3. We reached this conclusion as a consequence of our finding
there that “Article 3.1 of the SPS Agreement simply excludes
from its scope of application the kinds of situations covered by Article
3.3 of that Agreement” [Appellate Body Report, EC — Hormones,
para. 104]. Similarly, the circumstances envisaged in the second part of
Article 2.4 are excluded from the scope of application of the first part
of Article 2.4. Accordingly, as with Articles 3.1 and 3.3 of the SPS
Agreement, there is no “general rule-exception” relationship
between the first and the second parts of Article 2.4. Hence, in this
case, it is for Peru — as the complaining Member seeking a ruling on
the inconsistency with Article 2.4 of the TBT Agreement of the
measure applied by the European Communities — to bear the burden of
proving its claim. This burden includes establishing that Codex Stan 94
has not been used “as a basis for” the EC Regulation, as well as
establishing that Codex Stan 94 is effective and appropriate to fulfil
the “legitimate objectives” pursued by the European Communities
through the EC Regulation.
B.3.1.12 EC — Sardines, para. 281
(WT/DS231/AB/R)
… There is nothing in the WTO dispute settlement system to
support the notion that the allocation of the burden of proof should be
decided on the basis of a comparison between the respective difficulties
that may possibly be encountered by the complainant and the respondent
in collecting information to prove a case.
B.3.1.13 US — Carbon Steel,
paras. 156-157
(WT/DS213/AB/R,
WT/DS213/AB/R/Corr.1)
… in dispute settlement proceedings, Members may challenge the
consistency with the covered agreements of another Member’s laws, as
such, as distinguished from any specific application of those laws. In
both cases, the complaining Member bears the burden of proving its claim. …
Thus, a responding Member’s law will be treated as WTO-consistent
until proven otherwise. The party asserting that another party’s
municipal law, as such, is inconsistent with relevant treaty obligations
bears the burden of introducing evidence as to the scope and meaning of
such law to substantiate that assertion. Such evidence will typically be
produced in the form of the text of the relevant legislation or legal
instruments, which may be supported, as appropriate, by evidence of the
consistent application of such laws, the pronouncements of domestic
courts on the meaning of such laws, the opinions of legal experts and
the writings of recognized scholars. The nature and extent of the
evidence required to satisfy the burden of proof will vary from case to
case.
B.3.1.14 Canada — Dairy (Article 21.5 — New Zealand and US II),
para. 66
(WT/DS103/AB/RW2, WT/DS113/AB/RW2)
… we have consistently held that, as a general matter, the burden
of proof rests upon the complaining Member. That Member must make out a prima
facie case by presenting sufficient evidence to raise a presumption
in favour of its claim. If the complaining Member succeeds, the
responding Member may then seek to rebut this presumption. Therefore,
under the usual allocation of the burden of proof, a responding Member’s
measure will be treated as WTO-consistent, until sufficient
evidence is presented to prove the contrary. We will not readily find
that the usual rules on burden of proof do not apply, as they reflect a
“canon of evidence” accepted and applied in international
proceedings.
B.3.1.15 EC — Tariff Preferences, para. 98
(WT/DS246/AB/R)
… The status and relative importance of a given provision does
not depend on whether it is characterized, for the purpose of allocating
the burden of proof, as a claim to be proven by the complaining party,
or as a defence to be established by the responding party. Whatever its
characterization, a provision of the covered agreements must be
interpreted in accordance with the “customary rules of interpretation
of public international law”, as required by Article 3.2 of the Understanding
on Rules and Procedures Governing the Settlement of Disputes (the
“DSU”). …
B.3.1.16 Canada — Wheat Exports and Grain Imports, para. 191
(WT/DS276/AB/R)
In our view, it is incumbent upon a party to identify in its
submissions the relevance of the provisions of legislation — the
evidence — on which it relies to support its arguments. It is not
sufficient merely to file an entire piece of legislation and expect a
panel to discover, on its own, what relevance the various provisions may
or may not have for a party’s legal position. We are not satisfied
that the United States argued the relevance before the Panel of the
various provisions of the Canadian Wheat Board Act on which it
now relies. … Therefore, we do not agree with the United
States that the Panel disregarded facts relevant to the independence of
the CWB and we see no failure by the Panel in this respect to comply
with its duty under Article 11 of the DSU.
B.3.1.17 US — Upland Cotton, para. 747
(WT/DS267/AB/R)
In this case, Brazil’s claim on appeal is limited to the Panel’s
application of the burden of proof. Brazil has expressly stated that it
is not requesting us to complete the analysis. In view of Brazil’s
request, our ruling would not result in recommendations or rulings by
the DSB in respect of the ETI Act of 2000. In these circumstances, we
fail to see how our examination of Brazil’s claim would contribute to
the “prompt” or “satisfactory settlement” of this matter or
would contribute to “secure a positive solution” to this dispute.
Even if we were to disagree with the manner in which the Panel applied
the burden of proof, we would not make any findings in respect of the
WTO-consistency of the ETI Act of 2000. We recognize that there may be
cases in which it would be useful for us to make a finding on an issue,
despite the fact that our decision would not result in rulings and
recommendations by the DSB. In this case, however, we find no compelling
reason for doing so on this particular issue.
B.3.1.18 Chile — Price Band System (Article 21.5 — Argentina),
paras. 134-136
(WT/DS207/AB/RW)
We first recall that, in WTO dispute settlement, as in most legal
systems and international tribunals, the burden of proof rests on the
party that asserts the affirmative of a claim or defence. A complaining
party will satisfy its burden when it establishes a prima facie case
by putting forward adequate legal arguments and evidence. The nature and
scope of arguments and evidence required “will necessarily vary from
measure to measure, provision to provision, and case to case”. When a
claim is brought against a WTO Member’s legislation or regulation, a
panel may, in some circumstances, consider that the text of the relevant
legal instrument is sufficiently clear to establish the scope and
meaning of the law. However, in other cases, a panel may consider that
additional evidence is necessary to do so. Once the complaining party
has established a prima facie case, it is then for the responding
party to rebut it.
A panel errs when it sustains a claim for which the complaining party
has failed to make out a prima facie case. Nevertheless, a panel
does not commit legal error merely by omitting to specify which party
bears the burden of proof in respect of each claim or defence. Moreover,
a panel is not obliged, in every instance, to make an explicit finding
that a complaining party has met its burden to establish a prima
facie case in respect of each element of a particular claim, or that
the responding party has effectively rebutted a prima facie case. Thus, a
panel is not required to make an explicit ruling that a complaining
party has established a prima facie case of inconsistency before
examining the responding party’s defence and evidence. At the same
time, the mere articulation by a panel of the correct rules as to the
burden of proof is not sufficient if the panel does not, in fact,
properly allocate that burden in the case before it.
Neither Chile nor Argentina suggests that the general rules on burden
of proof, which imply that a responding party’s measure will be
treated as WTO-consistent unless proven otherwise, do not apply in
proceedings under Article 21.5 of the DSU. We observe, in this regard,
that Article 21.5 proceedings do not occur in isolation from the
original proceedings, but that both proceedings form part of a continuum
of events. The text of Article 21.5 expressly links the “measures
taken to comply” with the recommendations and rulings of the DSB
concerning the original measure. A panel’s examination of a measure
taken to comply cannot, therefore, be undertaken in abstraction from the
findings by the original panel and the Appellate Body adopted by the DSB.
Such findings identify the WTO-inconsistency with respect to the
original measure, and a panel’s examination of a measure taken to
comply must be conducted with due cognizance of this background. Thus,
the adopted findings from the original proceedings may well figure
prominently in proceedings under Article 21.5, especially where the
measure taken to comply is alleged to be inconsistent with WTO law in
ways similar to the original measure. In our view, these considerations
may influence the way in which the complaining party presents its case,
and they may also be relevant to the manner in which an Article 21.5
panel determines whether that party has discharged its burden of proof
and established a prima facie case.
B.3.1.19 Chile — Price Band System (Article 21.5 — Argentina),
para. 143
(WT/DS207/AB/RW)
We nevertheless wish to express reservations regarding certain
statements made by the Panel. For example, at the outset of its
analysis, … the Panel immediately stated that the “main
issue for the Panel to decide … is whether [Chile’s]
amendments … are such as to make the measure [at issue]
consistent with Article 4.2” of the Agreement on Agriculture.
Given that the Panel did not specifically articulate its allocation of
the burden of proof, such a statement, read in isolation, could be
construed to imply that the Panel might have proceeded to consider
whether Chile had proven the WTO-consistency of the measure at issue
without analysing whether Argentina had established a prima facie case
of inconsistency. In our view, the Panel could have made it more
discernible, in its reasoning, that it was mindful of the burden on
Argentina.
B.3.1.20 US — Upland Cotton (Article 21.5 — Brazil), para.
301
(WT/DS267/AB/RW)
Thus, the quantitative evidence submitted by Brazil and the United
States supports two plausible conclusions that one could draw regarding
the profitability of the revised GSM 102 programme: (i) the CCC’s
Financial Statements indicate that the programme is making losses; and
(ii) the re-estimates data indicate that the pro-gramme is making
profits. Therefore, the critical quantitative data before the Panel give
rise to conflicting conclusions. The data also give rise to similar
probabilities that point to opposite conclusions as to the binary
outcome in item (j), that is, whether a programme is making a loss or
not. We recall, however, that the Panel also examined other evidence
adduced by Brazil, “which further convince[d]” the Panel that the
premiums under the revised GSM 102 programme are inadequate to cover its
long-term operating costs and losses, within the meaning of item (j).
This evidence includes a comparison between fees under the revised GSM
102 programme and the OECD MPRs, and various elements relating to the
structure, design, and operation of the programme. We now turn to
examine the United States’ arguments regarding the Panel’s
consideration of this evidence in order to determine whether the
evidence as assessed by the Panel makes one of the two probable outcomes
that emerge from the quantitative evidence more likely than not.
B.3.1.21 US — Upland Cotton (Article 21.5 — Brazil), para.
321
(WT/DS267/AB/RW)
… we stated our view that the analysis under item (j) should
proceed primarily on the basis of quantitative evidence, where such
evidence is available. We have recognized, however, that evidence
relating to the structure, design, and operation has a supplementary
role to play in an assessment conducted under item (j). The Panel, in
this case, relied on several elements relating to the structure, design,
and operation of the revised GSM 102 programme, and we have not found
flaws in the Panel’s analysis of this evidence. The Panel recognized
that these elements are not in and of themselves dispositive.
Nonetheless, according to the Panel, the evidence on the structure,
design, and operation supports the proposition that the revised GSM 102
programme operates at a loss. We recall that we have found that the
quantitative data give rise to opposite conclusions with similar
probabilities as to the binary outcome in item (j). The Panel’s
finding on the structure, design, and operation, in the light of the two
plausible outcomes with similar probabilities that emerge from the
quantitative evidence, provides a sufficient evidentiary basis for the
conclusion that it is more likely than not that the revised GSM 102
programme operates at a loss. Therefore, we consider that Brazil has
succeeded in establishing that the revised GSM 102 programme is provided
at premiums that are inadequate to cover its long-term operating costs
and losses.
B.3.2 Presumption — prima facie case.
See also Defences
and exceptions (B.3.3) back to top
B.3.2.1 US — Wool Shirts and Blouses, p. 14, DSR 1997:I, p. 323
at 335
(WT/DS33/AB/R, WT/DS33/AB/R/Corr.1)
… precisely how much and precisely what kind of evidence will be
required to establish such a presumption will necessarily vary from
measure to measure, provision to provision, and case to case.
B.3.2.2 EC — Hormones, para. 104
(WT/DS26/AB/R, WT/DS48/AB/R)
… It is also well to remember that a prima facie case is
one which, in the absence of effective refutation by the defending
party, requires a panel, as a matter of law, to rule in favour of the
complaining party presenting the prima facie case.
B.3.2.3 Japan — Agricultural Products II, para. 129
(WT/DS76/AB/R)
Article 13 of the DSU and Article 11.2 of the SPS Agreement suggest
that panels have a significant investigative authority. However, this
authority cannot be used by a panel to rule in favour of a complaining
party which has not established a prima facie case of
inconsistency based on specific legal claims asserted by it. A panel is
entitled to seek information and advice from experts and from any other
relevant source it chooses, pursuant to Article 13 of the DSU and, in an
SPS case, Article 11.2 of the SPS Agreement, to help it to
understand and evaluate the evidence submitted and the arguments made by
the parties, but not to make the case for a complaining party.
B.3.2.4 Canada — Aircraft, para. 192
(WT/DS70/AB/R)
… A prima facie case, it is well to remember, is a case
which, in the absence of effective refutation by the defending party
(that is, in the present appeal, the Member requested to provide the
information), requires a panel, as a matter of law, to rule in favour of
the complaining party presenting the prima facie case. … a
panel is vested with ample and extensive discretionary authority to
determine when it needs information to resolve a dispute and what
information it needs. A panel may need such information before or
after a complaining or a responding Member has established its complaint
or defence on a prima facie basis. A panel may, in fact, need the
information sought in order to evaluate evidence already before it in
the course of determining whether the claiming or the responding Member,
as the case may be, has established a prima facie case or defence.
Furthermore, a refusal to provide information requested on the basis
that a prima facie case has not been made implies that the Member
concerned believes that it is able to judge for itself whether the other
party has made a prima facie case. However, no Member is free to
determine for itself whether a prima facie case or defence has
been established by the other party. That competence is necessarily
vested in the panel under the DSU, and not in the Members that are
parties to the dispute. …
B.3.2.5 India — Quantitative Restrictions, para. 142
(WT/DS90/AB/R)
We do not interpret the above statement as requiring a panel to
conclude that a prima facie case is made before it considers the
views of the IMF or any other experts that it consults. Such
consideration may be useful in order to determine whether a prima
facie case has been made. Moreover, we do not find it objectionable
that the Panel took into account, in assessing whether the United States
had made a prima facie case, the responses of India to the
arguments of the United States. This way of proceeding does not imply,
in our view, that the Panel shifted the burden of proof to India. We,
therefore, are not of the opinion that the Panel erred in law in
proceeding as it did.
B.3.2.6 Korea — Dairy, para. 145
(WT/DS98/AB/R)
We find no provision in the DSU or in the Agreement on Safeguards that
requires a panel to make an explicit ruling on whether the complainant
has established a prima facie case of violation before a panel
may proceed to examine the respondent’s defence and evidence. …
B.3.2.7 US — Certain EC Products, para. 114
(WT/DS165/AB/R)
… As the European Communities did not make a specific claim of
inconsistency with Article 23.2(a), it did not adduce any evidence or
arguments to demonstrate that the United States made a “determination
as to the effect that a violation has occurred” in breach of Article
23.2(a) of the DSU. And, as the European Communities did not adduce any
evidence or arguments in support of a claim of violation of Article
23.2(a) of the DSU, the European Communities could not have established,
and did not establish, a prima facie case of violation of Article
23.2(a) of the DSU.
B.3.2.8 Japan — Apples, para. 157
(WT/DS245/AB/R)
It is important to distinguish, on the one hand, the principle that
the complainant must establish a prima facie case of
inconsistency with a provision of a covered agreement from, on the other
hand, the principle that the party that asserts a fact is responsible
for providing proof thereof. In fact, the two principles are distinct.
In the present case, the burden of demonstrating a prima facie case
that Japan’s measure is maintained without sufficient scientific
evidence rested on the United States. Japan sought to counter the case
put forward by the United States by putting arguments in respect of
apples other than mature, symptomless apples being exported to Japan as
a result of errors of handling or illegal actions. It was thus for Japan
to substantiate those allegations; it was not for the United States to
provide proof of the facts asserted by Japan. …
B.3.2.9 Japan — Apples,
para. 159
(WT/DS245/AB/R)
Japan also submits that, “in order to establish a prima facie case
of insufficient scientific evidence under Article 2.2 of the SPS
Agreement, the complaining party must establish that there is not
sufficient scientific evidence for any of the perceived risks
underlying the measure”. According to Japan, the Panel should not have
concluded that this prima facie case had been established unless
the United States had first addressed all the possible hypotheses
— including those for which the likelihood of occurrence is low or
rests upon theoretical reasonings — and had shown for each of them
that the risk of transmission of fire blight is negligible. We find no
basis for the approach advocated by Japan. As the Appellate Body stated
in EC — Hormones [Appellate Body Report, para. 104], “a prima
facie case is one which, in the absence of effective refutation by
the defending party, requires a panel, as a matter of law, to rule in
favour of the complaining party presenting the prima facie case”.
In US — Wool Shirts and Blouses [Appellate Body Report, p. 14,
DSR1997:I, p. 323 at 335], the Appellate Body stated that the nature and
scope of evidence required to establish a prima facie case “will
necessarily vary from measure to measure, provision to provision, and
case to case”. In the present case, the Panel appears to have
concluded that in order to demonstrate a prima facie case that
Japan’s measure is maintained without sufficient scientific evidence,
it sufficed for the United States to address only the question of
whether mature, symptomless apples could serve as a pathway for fire
blight.
B.3.2.10 Japan — Apples, para. 160
(WT/DS245/AB/R)
The Panel’s conclusion seems appropriate to us for the following
reasons. First, the claim pursued by the United States was that Japan’s
measure is maintained without sufficient scientific evidence to the
extent that it applies to mature, symptomless apples exported from the
United States to Japan. What is required to demonstrate a prima facie
case is necessarily influenced by the nature and the scope of the
claim pursued by the complainant. A complainant should not be required
to prove a claim it does not seek to make. Secondly, the Panel found
that mature, symptomless apple fruit is the commodity “normally
exported” by the United States to Japan. The Panel indicated that the
risk that apple fruit other than mature, symptomless apples may actually
be imported into Japan would seem to arise primarily as a result of
human or technical error, or illegal actions, and noted that the experts
characterized errors of handling and illegal actions as “small” or
“debatable” risks. Given the characterization of these risks, in our
opinion it was legitimate for the Panel to consider that the United
States could demonstrate a prima facie case of inconsistency with
Article 2.2 of the SPS Agreement through argument based solely on
mature, symptomless apples. Thirdly, the record contains no evidence to
suggest that apples other than mature, symptomless ones have ever been
exported to Japan from the United States as a result of errors of
handling or illegal actions. Thus, we find no error in the Panel’s
approach that the United States could establish a prima facie case
of inconsistency with Article 2.2 of the SPS Agreement in
relation to apples exported from the United States to Japan, even though
the United States confined its arguments to mature, symptomless apples.
B.3.2.11 Japan — Apples, para. 215
(WT/DS245/AB/R)
As Japan failed to establish that the Panel utilized subsequent
scientific evidence in evaluating the risk assessment at issue, it is
not necessary for us to express views on the question whether the
conformity of a risk assessment with Article 5.1 should be evaluated
solely against the scientific evidence available at the time of the risk
assessment, to the exclusion of subsequent information. Resolution of
such hypothetical claims would not serve “to secure a positive
solution” to this dispute.
B.3.2.12 US — Oil Country Tubular Goods Sunset Reviews, para.
263
(WT/DS268/AB/R)
… As the Appellate Body indicated in US — Carbon Steel,
the obligation to make out a prima facie case may be satisfied in
certain cases simply by submitting the text of the measure or,
particularly where the text may be unclear, with supporting materials. …
B.3.2.13 US — Gambling,
paras. 138-140
(WT/DS285/AB/R, WT/DS285/AB/R/Corr.1)
The complaining party bears the burden of proving an inconsistency
with specific provisions of the covered agreements. …
Where the complaining party has established its prima facie case,
it is then for the responding party to rebut it. A panel errs when it
rules on a claim for which the complaining party has failed to make a prima
facie case.
A prima facie case must be based on “evidence and legal
argument” put forward by the complaining party in relation to each of
the elements of the claim. A complaining party may not simply submit
evidence and expect the panel to divine from it a claim of WTO-inconsistency.
Nor may a complaining party simply allege facts without relating them to
its legal arguments.
B.3.2.14 US — Gambling,
para. 141
(WT/DS285/AB/R, WT/DS336/AB/R/Corr.1)
… Given that … a requirement [to plainly connect the
challenged measure(s) with the provision(s) of the covered agreements
claimed to have been infringed, so that the respondent party is aware of
the basis for the alleged nullification or impairment of the complaining
party’s benefits] applies to panel requests at the outset of a panel
proceeding, we are of the view that a prima facie case — made
in the course of submissions to the panel — demands no less of the
complaining party. The evidence and arguments underlying a prima
facie case, therefore, must be sufficient to identify the challenged
measure and its basic import, identify the relevant WTO provision and
obligation contained therein, and explain the basis for the claimed
inconsistency of the measure with that provision.
B.3.2.15 US — Gambling,
paras. 143-144
(WT/DS285/AB/R, WT/DS285/AB/R/Corr.1)
… Antigua was required to make its prima facie case by
first alleging that the United States had undertaken a market access
commitment in its GATS Schedule; and, secondly, by identifying, with
supporting evidence, how the challenged laws constitute impermissible
“limitations” falling within Article XVI:2(a) or XVI:2(c).
… Antigua was required to make its prima facie case with
respect to specific federal and state laws identified in its
panel request.
B.3.2.16 US — Gambling,
para. 149
(WT/DS285/AB/R, WT/DS285/AB/R/Corr.1)
As to the eight state laws reviewed by the Panel, we note that
Antigua made no mention of them in the course of its argument that the
United States acts inconsistently with Article XVI of the GATS. In none
of Antigua’s submissions to the Panel was the way in which these
measures operate explained in a manner that would have made it apparent
to the Panel and to the United States that an inconsistency with Article
XVI was being alleged with respect to these measures. Thus, we see no
basis on which we can conclude that Antigua sufficiently connected the
eight state laws with Article XVI and thereby established a prima
facie case of inconsistency with that provision.
B.3.2.17 US — Gambling,
paras. 153, 155
(WT/DS285/AB/R, WT/DS285/AB/R/Corr.1)
… with respect to the state laws … Antigua failed to
identify how these laws operated and how they were relevant to
its claim of inconsistency with Article XVI:2.
…
… the Panel erred in ruling on claims relating to these state
laws, where no prima facie case of inconsistency had been made
out by Antigua …
B.3.2.18 Mexico — Anti-Dumping Measures on Rice, paras. 268-269
(WT/DS295/AB/R)
One element of a prima facie case that a complaining Member
must present with respect to a measure challenged “as such” consists
of evidence and arguments “sufficient to identify the challenged
measure and its basic import”. The evidentiary requirement of this
element may be met by the text of the challenged measure alone.
In this case, the United States submitted the text of each challenged
provision of the FTA in support of its claims and argued in its
submissions how it understood those provisions to operate. A review of
the challenged provisions indicates to us that the United States’
proffered interpretation was adequately supported by the text so as to
satisfy the requirement for a prima facie case. In our view, the
fact that the challenged provisions of the FTA may support multiple
interpretations, and that Mexico considers the United States’
interpretation “incorrect”, does not render insufficient the prima
facie case put forward by the United States based on the language of
the provisions.
B.3.2.19 Mexico — Anti-Dumping Measures on Rice, para. 334
(WT/DS295/AB/R)
… An appeal based on a complaining Member’s failure to make out
a prima facie case need not be raised exclusively under Article
11 of the DSU. …
B.3.2.20 Mexico — Anti-Dumping Measures on Rice, para. 338
(WT/DS295/AB/R)
… We are therefore of the view that the United States
sufficiently identified the challenged measures as Articles 68 and 97 of
the FTA, when read together; set out its understanding of the relevant
legal obligations in Articles 9.3.2 and 11.2 of the Anti-Dumping
Agreement and Article 21.2 of the SCM Agreement; and
explained how, in its view, those measures fail to comply with these
obligations. Thus, the Panel did not err in considering that the United
States had met the standard for a prima facie case, as that
standard was set out [at paragraph 141] in US — Gambling. …
B.3.2.21 US — Zeroing (EC),
paras. 260-261
(WT/DS294/AB/R, WT/DS294/AB/R/Corr.1)
… The “ample and extensive” nature of a panel’s authority
“to undertake and control the process” by which it informs itself of
the relevant facts of the dispute and of the legal norms and principles
applicable to a case, would appear to suggest that a panel also has
broad authority to pose such questions to the parties as it deems
relevant for purposes of considering the issues that are before it. The
asking of questions is, after all, part and parcel of the investigative
function and duty of panels.
We note, moreover, that, when referring, in Japan — Agricultural
Products II, to “making the case” for the complaining party, the
Appellate Body was speaking to a situation in which a panel makes a
ruling “in favour of a complaining party which has not established a prima
facie case of inconsistency based on specific legal claims asserted
by it”. In contrast, asking questions to clarify the meaning of an
argument does not, in our view, amount to “making the case”.
B.3.2.22 Chile — Price Band System (Article 21.5 — Argentina),
paras. 137-141
(WT/DS207/AB/RW)
We note that the Panel in these Article 21.5 proceedings did not make
any express statement regarding the allocation of the burden of proof in
its Report. Chile points to various statements in the Panel Report
purportedly indicating that … the Panel misallocated the
burden of proof. …
These statements must, however, be understood in the context of these
Article 21.5 proceedings, which include the recommendations and rulings
of the DSB in the original proceedings and the measure taken to comply
with them. In the original proceedings, Chile’s original price band
system was found to be similar to a variable import levy and to a
minimum import price, and thus inconsistent with Article 4.2 of the Agreement
on Agriculture. In these Article 21.5 proceedings, the task of the
Panel was to examine Argentina’s claim that the measure taken to
comply was similar to a variable import levy and to a minimum import
price and, therefore, inconsistent with Article 4.2. The panel and the
Appellate Body reports in the original proceedings contain detailed
interpretations of this provision, and provide a reasoned analysis
applying these interpretations to the various features of the original
price band system and explaining why it was inconsistent with Article
4.2. The Panel’s examination of the measure at issue in these Article
21.5 proceedings was conducted against this background and in the light
of the parameters set out in the original reports.
… before the Panel, both Argentina and Chile made claims and
arguments that referred extensively to the original price band system as
well as to the interpretations, reasonings, and findings of the panel
and the Appellate Body in the original proceedings. … Their
disagreement focused, to a large degree, on whether the measure at issue
has the same characteristics that were found by the original
panel and the Appellate Body to have rendered the original price band
system inconsistent with Article 4.2 of the Agreement on Agriculture.
Read in this context, the statements in the Panel Report quoted by
Chile do not indicate a misallocation of the burden of proof. Rather,
they reflect the Panel’s approach in analysing the measure at issue in
the light of the interpretation of the requirements of Article 4.2 in
the original proceedings and the parties’ claims and arguments in
these Article 21.5 proceedings. In these circumstances, it was
appropriate for the Panel to make comparisons between the measure at
issue and the original price band system, especially with regard to the
specific aspects that had been modified. …
Moreover, a careful reading of the Panel Report suggests that the
Panel conducted its analysis on the basis of Argentina’s arguments and
evidence presented in order to establish a prima facie case, as
it proceeded to consider Chile’s arguments and evidence submitted in
rebuttal. … That the Panel did not expressly specify the
moment at which it determined that Argentina had established a prima
facie case and announce when it would turn to Chile’s rebuttal
does not constitute an error in the allocation of the burden of proof.
B.3.2.23 Japan — DRAMs (Korea), paras. 156-157 and footnote
328
(WT/DS336/AB/R, WT/DS336/AB/R/Corr.1)
Japan further submits that the Panel erred by making a finding on the
relevance of a consultancy contract, although “Korea did not submit
necessary evidence and argument to establish a prima facie case”
in this regard. …
Contrary to what Japan appears to suggest, the relevant consultancy
contract was not submitted to the Panel for the first time at the end of
the Panel proceedings.328
Instead, Japan had included it as an exhibit
to its first written submission to the Panel. We agree with Korea in
this respect that “[t]he Panel’s consideration of a contract that
Japan itself submitted in support of its initial arguments obviously
does not constitute a denial of Japan’s due process rights.” Japan’s
reference to Korea’s failure to establish a prima facie case is
also misguided. In this case, the Panel rightly conducted its own
assessment of the relevance of the consultancy contract.
B.3.3 Defences and exceptions.
See also Request for the
Establishment of a Panel, Article 6.2 of the DSU — Claims and legal
basis of the complaint (R.2.2); SCM Agreement, Article 27 — Special
and differential treatment for developing country Members (S.2.35); SPS
Agreement, Article 3.2 — “measures which conform to international
standards” (S.6.7) back to top
B.3.3.1 US — Gasoline, pp. 22-23, DSR 1996:I, p. 3 at 21
(WT/DS2/AB/R)
The burden of demonstrating that a measure provisionally justified as
being within one of the exceptions set out in the individual paragraphs
of Article XX does not, in its application, constitute abuse of such
exception under the chapeau, rests on the party invoking the exception. …
B.3.3.2 US — Wool Shirts and Blouses, pp. 15-16, DSR 1997:I,
p. 323 at 337
(WT/DS33/AB/R, WT/DS33/AB/R/Corr.1)
… We acknowledge that several GATT 1947 and WTO panels have
required such proof of a party invoking a defence, such as those found
in Article XX or Article XI:2(c)(i), to a claim of violation of a GATT
obligation, such as those found in Articles I:1, II:1, III or XI:1.
Articles XX and XI:(2)(c)(i) are limited exceptions from obligations
under certain other provisions of the GATT 1994, not positive rules
establishing obligations in themselves. They are in the nature of
affirmative defences. It is only reasonable that the burden of
establishing such a defence should rest on the party asserting it.
B.3.3.3 EC — Hormones, para. 104
(WT/DS26/AB/R, WT/DS48/AB/R)
… The general rule in a dispute settlement proceeding requiring a
complaining party to establish a prima facie case of
inconsistency with a provision of the SPS Agreement before the
burden of showing consistency with that provision is taken on by the
defending party, is not avoided by simply describing [Article
3.3] as an “exception”. …
B.3.3.4 Brazil — Aircraft, paras. 140-141
(WT/DS46/AB/R)
… On reading paragraphs 2(b) and 4 of Article 27 together, it is
clear that the conditions set forth in paragraph 4 are positive
obligations for developing country Members, not affirmative
defences. If a developing country Member complies with the obligations
in Article 27.4, the prohibition on export subsidies in Article 3.1(a)
simply does not apply. However, if that developing country Member does not
comply with those obligations, Article 3.1(a) does apply.
For these reasons, we agree with the Panel that the burden is on the
complaining party … to demonstrate that the developing
country Member … is not in compliance with at least one of
the elements set forth in Article 27.4. …
B.3.3.5 India — Quantitative Restrictions, para. 136
(WT/DS90/AB/R)
… Assuming that the complaining party has successfully
established a prima facie case of inconsistency with Article
XVIII:11 and the Ad Note, the responding party may, in its
defence, either rebut the evidence adduced in support of the
inconsistency or invoke the proviso. In the latter case, it would have
to demonstrate that the complaining party violated its obligation not to
require the responding party to change its development policy. This is
an assertion with respect to which the responding party must bear the
burden of proof. …
B.3.3.6 Brazil — Aircraft (Article 21.5 — Canada), para. 66
(WT/DS46/AB/RW)
… In our view, the fact that the measure at issue was “taken to
comply” with the “recommendations and rulings” of the DSB does not
alter the allocation of the burden of proving Brazil’s “defence”
under item (k). In this respect, we note that Brazil concedes that the
revised PROEX measure is, in principle, prohibited under Article 3.1(a)
of the SCM Agreement; yet Brazil asserts nonetheless that the
PROEX measure is justified, under the first paragraph of item (k). Thus,
in our view, Brazil is, clearly, using item (k) to make an affirmative
claim in its defence. In United States — Measure Affecting Imports
of Woven Wool Shirts and Blouses from India, we said: “It is only
reasonable that the burden of establishing [an affirmative] defence
should rest on the party asserting it.” As it is Brazil that is
asserting this “defence” using item (k) in these proceedings, we
agree with the Article 21.5 Panel that Brazil has the burden of proving
that the revised PROEX is justified under the first paragraph of item
(k), including the burden of proving that payments under the revised
PROEX are not “used to secure a material advantage in the field
of export credit terms.”
B.3.3.7 US — FSC (Article 21.5 — EC), para. 133
(WT/DS108/AB/RW)
Accordingly, as we indicated in US — FSC, the fifth
sentence of footnote 59 constitutes an affirmative defence that
justifies a prohibited export subsidy when the measure in question is
taken “to avoid the double taxation of foreign-source income”. In
such a situation, the burden of proving that a measure is justified by
falling within the scope of the fifth sentence of footnote 59 rests upon
the responding party.
B.3.3.8 EC — Tariff Preferences, para. 88
(WT/DS246/AB/R)
… In cases where one provision permits, in certain circumstances,
behaviour that would otherwise be inconsistent with an obligation in
another provision, and one of the two provisions refers to the other
provision, the Appellate Body has found that the complaining party bears
the burden of establishing that a challenged measure is inconsistent
with the provision permitting particular behaviour only where one
of the provisions suggests that the obligation is not applicable to the
said measure. Otherwise, the permissive provision has been characterized
as an exception, or defence, and the onus of invoking it and proving the
consistency of the measure with its requirements has been placed on the
responding party. However, this distinction may not always be evident or
readily applicable.
B.3.3.9 EC — Tariff Preferences, para. 90
(WT/DS246/AB/R)
… By using the word “notwithstanding”, paragraph 1 of the
Enabling Clause permits Members to provide “differential and more
favourable treatment” to developing countries “in spite of” the
MFN obligation of Article I:1. Such treatment would otherwise be
inconsistent with Article I:1 because that treatment is not extended to
all Members of the WTO “immediately and unconditionally”. Paragraph
1 thus excepts Members from complying with the obligation contained in
Article I:1 for the purpose of providing differential and more
favourable treatment to developing countries, provided that such
treatment is in accordance with the conditions set out in the Enabling
Clause. As such, the Enabling Clause operates as an “exception” to
Article I:1.
B.3.3.10 EC — Tariff Preferences, para. 97
(WT/DS246/AB/R)
We do not consider it relevant, for the purposes of determining
whether a provision is or is not in the nature of an exception, that the
provision governs “trade measures” rather than measures of a
primarily “non-trade” nature. …
B.3.3.11 EC — Tariff Preferences, para. 98
(WT/DS246/AB/R)
… The status and relative importance of a given provision does
not depend on whether it is characterized, for the purpose of allocating
the burden of proof, as a claim to be proven by the complaining party,
or as a defence to be established by the responding party. Whatever its
characterization, a provision of the covered agreements must be
interpreted in accordance with the “customary rules of interpretation of public international law”, as required by Article 3.2 of the Understanding
on Rules and Procedures Governing the Settlement of Disputes (the
“DSU”). …
B.3.3.12 EC — Tariff Preferences,
paras. 104-105
(WT/DS246/AB/R)
… it is normally for the respondent, first, to raise the
defence and, second, to prove that the challenged measure meets
the requirements of the defence provision.
We are therefore of the view that the European Communities must prove
that the Drug Arrangements satisfy the conditions set out in the
Enabling Clause. Consistent with the principle of jura novit curia,
it is not the responsibility of the European Communities to provide us
with the legal interpretation to be given to a particular provision in
the Enabling Clause; instead, the burden of the European Communities is
to adduce sufficient evidence to substantiate its assertion that the
Drug Arrangements comply with the requirements of the Enabling Clause.
B.3.3.13 EC — Tariff Preferences, para. 110
(WT/DS246/AB/R)
… we are of the view that a complaining party challenging a
measure taken pursuant to the Enabling Clause must allege more than mere
inconsistency with Article I:1 of the GATT 1994, for to do only that
would not convey the “legal basis of the complaint sufficient to
present the problem clearly”. In other words, it is insufficient in
WTO dispute settlement for a complainant to allege inconsistency with
Article I:1 of the GATT 1994 if the complainant seeks also to argue that
the measure is not justified under the Enabling Clause. …
B.3.3.14 EC — Tariff Preferences, para. 118
(WT/DS246/AB/R)
… In the light of the above considerations, we are of the view
that India was required to (i) identify, in its request for the
establishment of a panel, which obligations in the Enabling Clause the
Drug Arrangements are alleged to have contravened, and (ii) make written
submissions in support of this allegation. The requirement to make such
an argument, however, does not mean that India must prove inconsistency
with a provision of the Enabling Clause, because the ultimate burden of
establishing the consistency of the Drug Arrangements with the Enabling
Clause lies with the European Communities.
B.3.3.15 US — Gambling, paras. 270-272
(WT/DS285/AB/R, WT/DS285/AB/R/Corr.1)
At the same time, the opportunity afforded to a Member to respond to
claims and defences made against it is also a “fundamental tenet of
due process”. A party must not merely be given an opportunity
to respond, but that opportunity must be meaningful in terms of that
party’s ability to defend itself adequately. A party that considers it
was not afforded such an opportunity will often raise a due process objection before the panel. The Appellate Body has recognized in
numerous cases that a Member’s right to raise a claim or objection, as
well as a panel’s exercise of discretion, are circumscribed by the due
process rights of other parties to a dispute. Those due process rights
similarly serve to limit a responding party’s right to set out its
defence at any point during the panel proceedings.
Due process may be of particular concern in cases where a party
raises new facts at a late stage of the panel proceedings. The
Appellate Body has observed that, under the standard working procedures
of panels, complaining parties should put forward their cases — with
“a full presentation of the facts on the basis of submission of
supporting evidence” — during the first stage of panel
proceedings. We see no reason why this expectation would not apply
equally to responding parties, which, once they have received the first
written submission of a complaining party, are likely to be aware of the
defences they might invoke and the evidence needed to support them.
It follows that the principles of good faith and due process oblige a
responding party to articulate its defence promptly and clearly. This
will enable the complaining party to understand that a specific defence
has been made, “be aware of its dimensions, and have an adequate
opportunity to address and respond to it”. …
B.3.3.16 US — Gambling,
para. 282
(WT/DS285/AB/R, WT/DS285/AB/R/Corr.1)
In the context of affirmative defences, then, a responding party must
invoke a defence and put forward evidence and arguments in support of
its assertion that the challenged measure satisfies the requirements of
the defence. When a responding party fulfils this obligation, a panel
may rule on whether the challenged measure is justified under the
relevant defence, relying on arguments advanced by the parties or
developing its own reasoning. The same applies to rebuttals. A panel may
not take upon itself to rebut the claim (or defence) where the
responding party (or complaining party) itself has not done so.
B.3.3.17 US — Gambling,
paras. 309-310
(WT/DS285/AB/R, WT/DS285/AB/R/Corr.1)
It is well established that a responding party invoking an
affirmative defence bears the burden of demonstrating that its measure,
found to be WTO-inconsistent, satisfies the requirements of the invoked
defence. In the context of Article XIV(a), this means that the
responding party must show that its measure is “necessary” to
achieve objectives relating to public morals or public order. In our
view, however, it is not the responding party’s burden to show, in the
first instance, that there are no reasonably available
alternatives to achieve its objectives. In particular, a responding
party need not identify the universe of less trade-restrictive
alternative measures and then show that none of those measures achieves
the desired objective. The WTO agreements do not contemplate such an
impracticable and, indeed, often impossible burden.
Rather, it is for a responding party to make a prima facie case
that its measure is “necessary” by putting forward evidence and
arguments that enable a panel to assess the challenged measure in the
light of the relevant factors to be “weighed and balanced” in a
given case. The responding party may, in so doing, point out why
alternative measures would not achieve the same objectives as the
challenged measure, but it is under no obligation to do so in order to
establish, in the first instance, that its measure is “necessary”.
If the panel concludes that the respondent has made a prima facie case
that the challenged measure is “necessary” — that is, “significantly
closer to the pole of ‘indispensable’ than to the opposite pole of
simply ‘making a contribution to’ ” — then a panel should find
that challenged measure “necessary” within the terms of Article
XIV(a) of the GATS.
B.3.3.18 US — Gambling,
para. 311
(WT/DS285/AB/R, WT/DS285/AB/R/Corr.1)
If, however, the complaining party raises a WTO-consistent
alternative measure that, in its view, the responding party should have
taken, the responding party will be required to demonstrate why its
challenged measure nevertheless remains “necessary” in the light of
that alternative or, in other words, why the proposed alternative is
not, in fact, “reasonably available”. If a responding party
demonstrates that the alternative is not “reasonably available”, in
the light of the interests or values being pursued and the party’s
desired level of protection, it follows that the challenged measure must
be “necessary” within the terms of Article XIV(a) of the GATS.
B.3.3.19 US — Gambling,
para. 323
(WT/DS285/AB/R, WT/DS285/AB/R/Corr.1)
… a responding party must make a prima facie case that its
challenged measure is “necessary”. A Panel determines whether this
case is made through the identification, and weighing and balancing, of
relevant factors, such as those in Korea — Various Measures on Beef,
with respect to the measure challenged. …
B.3.3.20 US — Shrimp (Thailand) / US — Customs Bond Directive,
paras. 300-303
(WT/DS343/AB/R, WT/DS345/AB/R)
It is well established that the party asserting the affirmative of a
claim or defence bears the burden of establishing both the legal and
factual elements of that claim or defence. It is also well accepted that
a panel cannot make a prima facie case for a party who bears that
burden. …
Before the Panel, all of the parties …
referred to laws
and regulations with which they considered the [enhanced continuous bond
requirement] was designed to secure compliance. Whilst the United States
cited Section 1673e(a)(1) of the Tariff Act, governing the assessment of
anti-dumping duties, as well as, more generally, Section 113.13(c) of
the United States Regulations, Thailand and India argued that the
provisions cited by the United States do not exclusively govern the
obligation to require payment of duties owed to the United States
Treasury; rather, Thailand and India referred to additional provisions
which they alleged constitute the laws and regulations governing the
collection of anti-dumping duties. The Panel took all of these laws and
regulations cited by the parties into account. …
In our view, the Panel was free to use the arguments made and
provisions cited by all the parties — including Thailand and India —
in order to assess objectively which laws and regulations were relevant
to the United States’ defence. We do not believe that, in doing so,
the Panel exceeded its jurisdiction.
We do not, therefore, consider that the Panel made a prima facie case
for the United States by including certain laws and regulations other
than those specifically cited by the United States for assessing the
Article XX(d) defence. …
B.3.3.21 India — Additional Import Duties,
paras. 190-194
(WT/DS360/AB/R)
Not every challenge under Article II:1(b) will require a showing with
respect to Article II:2(a). In the circumstances of this dispute,
however, where the potential for application of Article II:2(a) is clear
from the face of the challenged measures, and in the light of our
conclusions above concerning the need to read Articles II:1(b) and
II:2(a) together as closely inter-related provisions, we consider that,
in order to establish a prima facie case of a violation of
Article II:1(b), the United States was also required to present
arguments and evidence that the Additional Duty and the Extra-Additional
Duty are not justified under Article II:2(a).
… India responded in its first written submission to the Panel
that the Additional Duty and Extra-Additional Duty are not in violation
of Article II:1(b) because they are charges justified under Article
II:2(a). Consequently, India was required to adduce arguments and
evidence in support of that assertion. Once the responding party seeks
to rebut arguments and evidence offered by the complaining party, the
complaining party, depending on the nature and content of the rebuttal
submission, may need to present additional arguments and evidence in
order to prevail on its claim. In this case, following India’s
rebuttal submission, the United States presented further argumentation
concerning the issue of whether the Additional Duty and Extra-Additional
Duty are justified under Article II:2(a). At that point, it was for the
Panel to decide the issues before it based on the arguments and evidence
of the parties. …
… We do not consider that a complaining party alleging a
violation of Article II:1(b) must also disprove in all cases that the
challenged charge is justified under Article II:2, much less some other
hypothetical category of charges. We do consider, however, that if, due
to the characteristics of the measures at issue or the arguments
presented by the responding party, there is a reasonable basis to
understand that the challenged measure may not result in a violation of
Article II:1(b) because it satisfies the requirements of Article
II:2(a), then the complaining party bears some burden in establishing
that the conditions of Article II:2(a) are not met.
We do not find unduly burdensome the complaining party’s
responsibility to establish a prima facie showing by adducing
evidence and arguments also with respect to Article II:2(a). Consistent
with what we have said above, the showing required by the complaining
party that the conditions for the application of Article II:2(a) are not
met will to some extent vary, depending upon the particular substance of
the challenged measure and the extent to which a relationship between
the border charge and the corresponding internal taxes is identifiable.
In the circumstances of this case, both parties had a responsibility, in
our view, to adduce relevant evidence at their disposal, both with
respect to Article II:1(b) and Article II:2(a). Failure of a party to
prove the facts it asserts leaves that party at risk of losing the case.
We further note, in this regard, that the DSU calls on parties to
cooperate with panels in dispute settlement proceedings. In the
particular circumstances of this case, where the challenged measures
refer to certain internal taxes but do not specifically indicate how the
border charges and the corresponding internal taxes are equivalent, it
was particularly important that both parties respond fully and promptly
to requests from the Panel concerning its enquiry as to whether or not
the Additional Duty and Extra-Additional Duty are justified under
Article II:2(a).
B.3.4 Reversal of burden of proof.
See also Agreement on
Agriculture, Article 10.3 — Reversal of burden of proof (A.1.34)
back to top
B.3.4.1 Canada — Dairy (Article 21.5 —
New Zealand and US),
para. 98
(WT/DS103/AB/RW, WT/DS113/AB/RW)
As we have reversed the Panel’s findings regarding the standard for
determining the existence of “payments” and have, instead,
identified the appropriate standard for these proceedings, namely, the
average total cost of production, we now consider whether we can resolve
this aspect of the dispute by completing the analysis. The Panel found
that, in these proceedings, Article 10.3 of the Agreement on
Agriculture reverses the burden of proof so that Canada must
establish “that no export subsidy … has been granted”.
Although the burden of proof is on Canada, we must nonetheless complete
the analysis solely on the basis of factual findings made by the Panel
and uncontested facts in the Panel record.
B.3.4.2 Canada — Dairy (Article 21.5 — New Zealand and US II),
para. 71
(WT/DS103/AB/RW2, WT/DS113/AB/RW2)
Under the usual rules on burden of proof, the complaining Member
would bear the burden of proving both parts of the claim. However,
Article 10.3 of the Agreement on Agriculture partially alters the
usual rules. The provision cleaves the complaining Member’s claim in
two, allocating to different parties the burden of proof with respect to
the two parts of the claim we have described.
B.3.4.3 US — Upland Cotton,
paras. 647-648
(WT/DS267/AB/R)
We agree with the United States that Article 10.3 of the Agreement
on Agriculture does not apply to claims brought under the SCM
Agreement. However, the Panel did not make the error attributed to
it by the United States. The Panel made the statement relied on by the
United States in the context of its assessment of the United States’
export credit guarantee programme under the Agreement on Agriculture.
Although the Panel made use of the criteria set out in item (j) of the
Illustrative List of Export Subsidies annexed to the SCM Agreement (providing
these programmes at premium rates inadequate to cover long-term
operating costs and losses) it did so as contextual guidance for its
analysis under the Agreement on Agriculture, and both the United
States and Brazil appear to have agreed with the appropriateness of this
approach. Thus, the Panel’s reference to Article 10.3 did not relate
to its assessment of the United States’ export credit guarantee
programmes under the SCM Agreement.
… It is clear from this paragraph that the Panel placed the
burden of proof on Brazil and determined that Brazil met its burden of
proving that the United States’ export credit guarantees are provided
at premium rates that are inadequate to cover long-term operating costs
and losses. … The reference to Article 10.3 does not, by
itself, change the fact that the Panel ultimately placed the burden of
proof on Brazil.
B.3.4.4 US — Upland Cotton, para. 652
(WT/DS267/AB/R)
We disagree with the Panel’s view that Article 10.3 applies to unscheduled
products. Under the Panel’s approach, the only thing a complainant
would have to do to meet its burden of proof when bringing a claim
against an unscheduled product is to demonstrate that the
respondent has exported that product. Once that has been established,
the respondent would have to demonstrate that it has not provided an
export subsidy. This seems to us an extreme result. In effect, it would
mean that any export of an unscheduled product is presumed to be
subsidized. In our view, the presumption of subsidization when exported
quantities exceed the reduction commitments makes sense in respect of a scheduled
product because, by including it in its schedule, a WTO Member is
reserving for itself the right to apply export subsidies to that
product, within the limits in its schedule. In the case of unscheduled
products, however, such a presumption appears inappropriate. Export
subsidies for both unscheduled agricultural products and industrial
products are completely prohibited under the Agreement on Agriculture
and under the SCM Agreement, respectively. The Panel’s
interpretation implies that the burden of proof with regard to the same
issue would apply differently, however, under each Agreement: it would
be on the respondent under the Agreement on Agriculture, while it
would be on the complainant under the SCM Agreement.
B.3.4.5 US — Upland Cotton, para. 656
(WT/DS267/AB/R)
In our view, none of these statements demonstrates that the Panel
improperly applied the rules on burden of proof. The United States is
selecting statements made by the Panel within its broader analysis of
how the United States’ export credit guarantee programmes operate,
reading them in isolation, and disregarding the context in which they
were made. As indicated earlier, it is clear that the Panel imposed on
Brazil the overall burden of proving that the premiums charged under the
United States’ export credit guarantee programmes are inadequate to
cover long-term operating costs and losses. This approach is consistent
with the usual rules on the allocation of the burden of proof whereby
the complaining party is responsible for proving its claim. …
B.3.5 “Post suspension of concessions”
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B.3.5.1 US — Continued Suspension / Canada — Continued Suspension,
paras. 580-583
(WT/DS320/AB/R, WT/DS321/AB/R)
… we explained that this case involves a disagreement as to the
consistency of a measure taken to comply and, therefore, should have
properly been brought under Article 21.5 of the DSU. We also explained
how the burden of proof should have been allocated had the dispute been
brought under Article 21.5. Although these proceedings were not brought
under Article 21.5, the Panel said that it “perform[ed] functions
similar to those of an Article 21.5 panel”. The European Communities
had to provide a clear description of its implementing measure, and an
adequate explanation regarding how this measure rectifies the
inconsistencies found in the original proceedings, so as to have placed
the Panel in a position to make an objective assessment of the matter
and, in the absence of rebuttal, to rule in favour of the original
respondent. Therefore, to the extent the Panel did not allocate the
burden of proof in its analysis of whether Directive 2003/74/EC met the
requirements of Article 5.1 of the SPS Agreement according to the
principles outlined above, we find that the Panel has erred.
We have, moreover, several additional concerns with the Panel’s
analysis. First, as we indicated in section IV, we do not believe that
it was sufficient for the European Communities to have based its case
under Article 22.8 on a presumption of good faith. The European
Communities may be presumed to have acted in good faith in adopting
Directive 2003/74/EC, but this does not respond to the question as to
whether Directive 2003/74/EC achieved substantive compliance. Thus, it
was incorrect for the Panel to have relied on a presumption of good
faith compliance for purposes of determining the allocation of the
burden of proof and finding that the European Communities established a prima
facie case.
… we have difficulty following the reasoning behind the Panel’s
conclusion that the presumptions of good faith enjoyed by each party “eventually
‘neutralized’ each other” and that “[u]ltimately, each party had
to prove its specific allegations in response to the evidence submitted
by the other party.” The statement is ambiguous about which party made
which allegation and how the burden of proof was allocated. … Thus,
it is difficult to understand which party had the burden of proving
which allegation.
… we note the Panel’s statement that the United States and
Canada “sufficiently refuted the [European Communities’] allegation
of compliance in [their] first written submission through positive
evidence of breach of the SPS Agreement by the European
Communities”. This statement is made before the Panel has undertaken
any analysis of the conformity of Directive 2003/74/EC with Article 5.1
of the SPS Agreement. In its appellant’s submission, the
European Communities takes issue with this statement and argues that the
Panel should have first examined “provision by provision …
whether
the arguments of the United States and Canada had sufficient merits to
shift the burden of proof back to the European Communities”. We agree
that it was premature for the Panel to have stated that the United
States and Canada had succeeded in refuting the European Communities’
allegation of compliance before the Panel had addressed the consistency
of Directive 2003/74/EC with the SPS Agreement.
B.3.5.2 US — Continued Suspension / Canada — Continued Suspension,
para. 716
(WT/DS320/AB/R, WT/DS321/AB/R)
… we explained how we see the allocation of the burden of proof
in a post-suspension situation in which the parties disagree as to
whether an implementing measure brings about substantive compliance. The
European Communities had to provide a clear description of its
implementing measure, and an adequate explanation regarding how this
measure rectifies the inconsistencies found in the original proceedings.
We recall that the definitive import ban that was the subject of EC — Hormones and found to be inconsistent with Article 5.1 has been
replaced, under Directive 2003/74/EC, by a provisional ban relating to
the five other hormones. The import ban applies to the same products:
meat from cattle treated with progesterone, testosterone, trenbolone
acetate, zeranol and MGA. The European Communities replaced the original
definitive ban with a provisional ban and invoked Article 5.7 as an
alternative justification to Article 5.1. Thus, the European Communities
had to provide an adequate explanation of how the provisional ban taken
under Article 5.7 rectifies the inconsistencies found in EC —
Hormones. Such explanation had to include, inter alia, an
identification of the insufficiencies in the relevant scientific
evidence that precluded the European Communities from performing a
sufficiently objective risk assessment. Accordingly, we do not consider
that the Panel erred by limiting its review to the insufficiencies
identified by the European Communities.
230. In support of the argument that the Panel had no authority to
make findings and draw conclusions with respect to immature apples, the
United States relies on the finding of the Appellate Body in Japan
— Agricultural Products II that a panel should not use its
investigative authority “to rule in favour of a complaining party
which has not established a prima facie case of inconsistency
based on specific legal claims asserted by it” (Appellate Body Report,
para. 129). The United States’ reliance on Japan — Agricultural
Products II is misplaced, for the facts and circumstances that led
to the Appellate Body’s finding are not the same as those present
here. In Japan — Agricultural Products II, the Appellate Body
found fault with the panel’s reliance on expert evidence to rule in
favour of the complainant in the absence of a case established by the
complainant itself. The circumstances in the present case differ from
those present in Japan — Agricultural Products II. Indeed, in
the present case, the Panel made findings and drew conclusions on apples
other than mature, symptomless apples in response to Japan’s case.
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328. Japan acknowledged this in response to questioning at the oral
hearing. back to text
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