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T.6.1 General back to top
T.6.1.1 Brazil — Desiccated Coconut, p. 22, DSR 1997:I, p. 167 at
186
(WT/DS22/AB/R)
A panel’s terms of reference are important for two reasons. First,
terms of reference fulfil an important due process objective — they give
the parties and third parties sufficient information concerning the claims
at issue in the dispute in order to allow them an opportunity to respond
to the complainant’s case. Second, they establish the jurisdiction of
the panel by defining the precise claims at issue in the dispute.
T.6.1.2 Brazil — Desiccated Coconut, p. 22, DSR 1997:I, p. 167 at
186
(WT/DS22/AB/R)
… the “matter” referred to a panel for consideration consists of
the specific claims stated by the parties to the dispute in the relevant
documents specified in the terms of reference. We agree with the approach
taken in previous adopted panel reports that a matter, which includes the
claims composing that matter, does not fall within a panel’s terms of
reference unless the claims are identified in the documents referred to or
contained in the terms of reference.
T.6.1.3 EC — Bananas III, para. 142
(WT/DS27/AB/R)
We recognize that a panel request will usually be approved
automatically at the DSB meeting following the meeting at which the
request first appears on the DSB’s agenda. As a panel request is
normally not subjected to detailed scrutiny by the DSB, it is incumbent
upon a panel to examine the request for the establishment of the panel
very carefully to ensure its compliance with both the letter and the
spirit of Article 6.2 of the DSU. It is important that a panel request be
sufficiently precise for two reasons: first, it often forms the basis for
the terms of reference of the panel pursuant to Article 7 of the DSU; and,
second, it informs the defending party and the third parties of the legal
basis of the complaint.
T.6.1.4 India — Patents (US), para. 94
(WT/DS50/AB/R)
All parties engaged in dispute settlement under the DSU must be fully
forthcoming from the very beginning both as to the claims involved in a
dispute and as to the facts relating to those claims. Claims must be
stated clearly. Facts must be disclosed freely. This must be so in
consultations as well as in the more formal setting of panel proceedings.
In fact, the demands of due process that are implicit in the DSU make this
especially necessary during consultations. For the claims that are made
and the facts that are established during consultations do much to shape
the substance and the scope of subsequent panel proceedings. If, in the
aftermath of consultations, any party believes that all the pertinent
facts relating to a claim are, for any reason, not before the panel, then
that party should ask the panel in that case to engage in additional
fact-finding. But this additional fact-finding cannot alter the claims
that are before the panel — because it cannot alter the panel’s terms
of reference. And, in the absence of the inclusion of a claim in the terms
of reference, a panel must neither be expected nor permitted to modify
rules in the DSU.
T.6.1.5 Guatemala — Cement I, para. 72
(WT/DS60/AB/R)
… Thus, “the matter referred to the DSB” for the purposes of
Article 7 of the DSU and Article 17.4 of the Anti-Dumping Agreement must
be the “matter” identified in the request for the establishment of a
panel under Article 6.2 of the DSU. That provision requires the
complaining Member, in a panel request, to “identify the specific
measures at issue and provide a brief summary of the legal basis of
the complaint sufficient to present the problem clearly” (emphasis
added). The “matter referred to the DSB”, therefore, consists
of two elements: the specific measures at issue and the legal
basis of the complaint (or the claims).
T.6.1.6 Guatemala — Cement I, para. 76
(WT/DS60/AB/R)
… the word “matter” has the same meaning in Article 17 of the Anti-Dumping
Agreement as it has in Article 7 of the DSU. It consists of two
elements: the specific “measure” and the “claims” relating to it,
both of which must be properly identified in a panel request as required
by Article 6.2 of the DSU.
T.6.1.7 Korea — Dairy, para. 120
(WT/DS98/AB/R)
… When parsed into its constituent parts, Article 6.2 may be seen to
impose the following requirements. The request must: (i) be in writing;
(ii) indicate whether consultations were held; (ii) identify the specific
measures at issue; and (iii) provide a brief summary of the legal basis of
the complaint sufficient to present the problem clearly. In its fourth
requirement, Article 6.2 demands only a summary — and it may be a brief
one — of the legal basis of the complaint; but the summary must, in any
event, be one that is “sufficient to present the problem clearly”. It
is not enough, in other words, that “the legal basis of the complaint”
is summarily identified; the identification must “present the problem
clearly”.
T.6.1.8 US — Carbon Steel, para. 123
(WT/DS213/AB/R, WT/DS213/AB/R/Corr.1)
… we have consistently held that, in the interests of due process,
parties should bring alleged procedural deficiencies to the attention of a
panel at the earliest possible opportunity. In this case, we see no reason
to disagree with the Panel’s view that the United States’ objection
was not raised in a timely manner. At the same time, however, as we have
observed previously, certain issues going to the jurisdiction of a
panel are so fundamental that they may be considered at any stage in a
proceeding. In our view, the Panel was correct, therefore, in turning to
consider its terms of reference and in satisfying itself as to its
jurisdiction with respect to this matter.
T.6.1.9 US — Carbon Steel,
paras. 124-125
(WT/DS213/AB/R, WT/DS213/AB/R/Corr.1)
… pursuant to Article 7 of the DSU, a panel’s terms of reference are
governed by the request for establishment of a panel. Article 6.2 of the
DSU sets forth the requirements applicable to such requests. … There are
… two distinct requirements, namely identification of the specific
measures at issue, and the provision of a brief summary of the
legal basis of the complaint (or the claims). Together, they
comprise the “matter referred to the DSB”, which forms the basis for a
panel’s terms of reference under Article 7.1 of the DSU.
T.6.1.10 US — Carbon Steel, para. 126
(WT/DS213/AB/R, WT/DS213/AB/R/Corr.1)
The requirements of precision in the request for the establishment of a
panel flow from the two essential purposes of the terms of reference.
First, the terms of reference define the scope of the dispute. Secondly,
the terms of reference, and the request for the establishment of a panel
on which they are based, serve the due process objective of
notifying the parties and third parties of the nature of a complainant’s
case. When faced with an issue relating to the scope of its terms of
reference, a panel must scrutinize carefully the request for establishment
of a panel “to ensure its compliance with both the letter and the spirit
of Article 6.2 of the DSU.”
T.6.1.11 US — Offset Act (Byrd Amendment), para. 208
(WT/DS217/AB/R, WT/DS234/AB/R)
… “[a]n objection to jurisdiction should be raised as early as
possible” and it would be preferable, in the interests of due process,
for the appellant to raise such issues in the Notice of Appeal, so that
appellees will be aware that this claim will be advanced on appeal.
However, in our view, the issue of a panel’s jurisdiction is so
fundamental that it is appropriate to consider claims that a panel has
exceeded its jurisdiction even if such claims were not raised in the
Notice of Appeal.
T.6.1.12 Mexico — Taxes on Soft Drinks, paras. 44-46
(WT/DS308/AB/R)
…the issue before us in this appeal is not whether the Panel was
legally precluded from ruling on the United States’ claims that were
before it, but, rather, whether the Panel could decline, and should have
declined, to exercise jurisdiction with respect to the United States’
claims under Article III of the GATT 1994 that were before it. … We agree
with Mexico that WTO panels have certain powers that are inherent in their
adjudicative function. Notably, panels have the right to determine whether
they have jurisdiction in a given case, as well as to determine the scope
of their jurisdiction. …
In our view, it does not necessarily follow, however, from the
existence of these inherent adjudicative powers that, once jurisdiction
has been validly established, WTO panels would have the authority to
decline to rule on the entirety of the claims that are before them in a
dispute. To the contrary, we note that, while recognizing WTO panels’
inherent powers, the Appellate Body has previously emphasized that:
Although panels enjoy some discretion in establishing their own working
procedures, this discretion does not extend to modifying the
substantive provisions of the DSU. … Nothing in the DSU gives a panel the
authority either to disregard or to modify … explicit provisions of the
DSU. (emphasis added) [Appellate Body Report, India — Patents
(US), para. 92]
T.6.1.13 Mexico — Taxes on Soft Drinks, para. 52
(WT/DS308/AB/R)
… The fact that a Member may initiate a WTO dispute whenever it
considers that “any benefits accruing to [that Member] are being
impaired by measures taken by another Member” implies that that Member
is entitled to a ruling by a WTO panel.
T.6.1.14 Mexico — Taxes on Soft Drinks, para. 53
(WT/DS308/AB/R)
A decision by a panel to decline to exercise validly established
jurisdiction would seem to “diminish” the right of a complaining
Member to “seek the redress of a violation of obligations” within the
meaning of Article 23 of the DSU, and to bring a dispute pursuant to
Article 3.3 of the DSU. This would not be consistent with a panel’s
obligations under Articles 3.2 and 19.2 of the DSU. We see no reason,
therefore, to disagree with the Panel’s statement that a WTO panel “would
seem … not to be in a position to choose freely whether or not to
exercise its jurisdiction”.
T.6.1.15 Mexico — Taxes on Soft Drinks, para. 54
(WT/DS308/AB/R)
Mindful of the precise scope of Mexico’s appeal, we express no view
as to whether there may be other circumstances in which legal impediments
could exist that would preclude a panel from ruling on the merits of the
claims that are before it. In the present case, Mexico argues that the
United States’ claims under Article III of the GATT 1994 are
inextricably linked to a broader dispute, and that only a NAFTA panel
could resolve the dispute as a whole. Nevertheless, Mexico does not take
issue with the Panel’s finding that “neither the subject matter nor
the respective positions of the parties are identical in the dispute under
the NAFTA… and the dispute before us”. Mexico also stated that it could
not identify a legal basis that would allow it to raise, in a WTO dispute
settlement proceeding, the market access claims it is pursuing under the
NAFTA. It is furthermore undisputed that no NAFTA panel as yet has decided
the “broader dispute” to which Mexico has alluded. Finally, we note
that Mexico has expressly stated that the so-called “exclusion clause”
of Article 2005.6 of the NAFTA had not been “exercised”. We do not
express any view on whether a legal impediment to the exercise of a panel’s
jurisdiction would exist in the event that features such as those
mentioned above were present. In any event, we see no legal impediments
applicable in this case.
T.6.1.16 Mexico — Taxes on Soft Drinks, para. 57
(WT/DS308/AB/R)
For all these reasons, we uphold the Panel’s conclusion, in
paragraphs 7.1, 7.18, and 9.1 of the Panel Report, that “under the DSU,
it ha[d] no discretion to decline to exercise its jurisdiction in the case
that ha[d] been brought before it”. Having upheld this conclusion, we find
it unnecessary to rule in the circumstances of this appeal on the
propriety of exercising such discretion.
T.6.1.17 EC — Selected Customs Matters,
paras. 129-130
(WT/DS315/AB/R)
Article 6.2 sets forth the requirements applicable to a request for the
establishment of a panel. As the Appellate Body stated [at paragraph 125]
in US — Carbon Steel, there are two distinct requirements,
namely:
…identification of the specific measures at issue, and the
provision of a brief summary of the legal basis of the complaint (or
the claims). (original emphasis)
These two requirements relate to different aspects of the complainant’s
challenge to measures taken by another Member. The “specific measure”
to be identified in a panel request is the object of the challenge,
namely, the measure that is alleged to be causing the violation of an
obligation contained in a covered agreement. In other words, the measure
at issue is what is being challenged by the complaining Member. In
contrast, the legal basis of the complaint, namely, the “claim”
pertains to the specific provision of the covered agreement that contains
the obligation alleged to be violated. A brief summary of the legal basis
of the complaint required by Article 6.2 of the DSU aims to explain
succinctly how or why the measure at issue is considered by
the complaining Member to be violating the WTO obligation in question.
This brief summary must be sufficient to present the problem clearly.
Taken together, these different aspects of a panel request serve not only
to define the scope of a dispute, but also to meet the due process
requirements.
T.6.1.18 EC — Selected Customs Matters, para. 153
(WT/DS315/AB/R)
We turn… to the question whether the panel request confines the
measure at issue to areas of customs administration. We read the third
paragraph of the panel request as an illustrative list of areas where the
United States considers European Communities customs law is not
administered in a uniform way. Thus, the substance of the third paragraph
of the panel request should be viewed as an anticipation of the United
States’ arguments. In this paragraph, the United States explains — briefly and in general terms
— why it considers that the legal
instruments listed in the first paragraph of the panel request are
administered in a manner that is inconsistent with the uniformity
requirement in Article X:3(a). Article 6.2 of the DSU requires that the claims
— not the arguments — be set out in a panel request in a
way that is sufficient to present the problem clearly. Nothing in Article
6.2 prevents a complainant from making statements in the panel request
that foreshadow its arguments in substantiating the claim. If the
complainant chooses to do so, these arguments should not be interpreted to
narrow the scope of the measures or the claims. Accordingly, we are of the
opinion that the Panel erred when it found that the list of areas of
customs administration in the third paragraph of the panel request limits
the scope of the “specific measures at issue”.
T.6.1.19 US — Shrimp (Thailand) / US
— Customs Bond Directive,
paras. 292-295
(WT/DS343/AB/R, WT/DS345/AB/R)
It is well settled that the terms of reference of a panel define the
scope of the dispute and that the claims and measures identified in the
request for the establishment of a panel together constitute the matter
within the panel’s terms of reference under Article 7 of the DSU. At the
same time, Article 4.4 of the DSU provides that any request for
consultations must provide “identification of the measures at
issue” (emphasis added). However, as the Panel has highlighted, there is
no clarification as to what degree the measures identified in the panel
request must correspond to the measures identified in the consultations
request.
The Appellate Body has recognized the important role that consultations
play in defining the scope of a dispute. Not only are they “a
prerequisite to panel proceedings”, they also serve the purpose of, inter
alia, allowing parties to reach a mutually agreed solution, and where
no solution is reached, providing the parties an opportunity to “define
and delimit” the scope of the dispute between them. Further, “Articles
4 and 6 of the DSU … set forth a process by which a complaining party must
request consultations, and consultations must be held, before a matter may
be referred to the DSB for the establishment of a panel.” The Appellate
Body has also explained that “[a]s long as the complaining party does
not expand the scope of the dispute, [it would] hesitate to impose too
rigid a standard for the ‘precise and exact identity’ between the
scope of the consultations and the request for the establishment of a
panel, as this would substitute the request for consultations for the
panel request”. The Appellate Body has also held that a “precise and
exact identity” of measures between the two requests is not necessary,
“provided that the ‘essence’ of the challenged measures had not
changed”. In our view, whether a complaining party has “expand[ed] the
scope of the dispute” or changed the “essence” of the dispute
through the inclusion of a measure in its panel request that was not part
of its consultations request must be determined on a case-by-case basis.
In the circumstances of this case, the Panel, in accordance with the
guidance provided by the Appellate Body referred to above, was required to
compare the respective parameters of the consultations request and the
panel request to determine whether an expansion of the scope or change in
the essence of the dispute occurred through the addition of instruments in
the panel request that were not identified in the consultations request. …
… We do not see an error in the Panel’s approach in this case. The
Panel assessed the differing scope, as well as the legal bases, of the two
sets of instruments and came to the conclusion that they were separate and
legally distinct. …
T.6.1.20 US — Continued Zeroing, paras. 207, 210
(WT/DS350/AB/R)
… the European Communities listed among the 52 specific proceedings
three preliminary results in sunset reviews and one preliminary result in
a periodic review. These reviews were conducted by the USDOC, subsequent
to the imposition of duties pursuant to the original anti-dumping
investigations, to assess the duty liabilities and cash deposit rates (in
the case of periodic review), and to determine whether a duty should be
revoked or continued (in the case of sunset reviews). In contrast, a
provisional measure, within the meaning of Article 7 of the Anti-Dumping Agreement, is an interim measure taken by an investigating
authority in the context of an original investigation to prevent further
injury to the domestic industry, pending the final outcome of the original
investigation. Therefore, we fail to see the Panel’s rationale in
excluding these measures from its terms of reference on the grounds that
the European Communities did not bring any claims under Article 7.1
concerning the conditions for imposing provisional measures. As a result,
the Panel’s finding that the four preliminary determinations were
outside its terms of reference, which was made on the basis of the
European Communities’ failure to bring claims under Article 7.1, cannot
stand.
…
… we consider the European Communities’ challenge in relation to
these two preliminary results to be premature. Specifically, given that
these preliminary results could be modified by the final results, we fail
to see how the European Communities could establish that final
anti-dumping dut[ies]were assessed in excess of the margin of dumping or
that the USDOC would have relied on the margin calculated with zeroing in
deciding to continue the duty.
T.6.1.21 US — Continued Zeroing, para. 228
(WT/DS350/AB/R)
We recall that the Appellate Body has cautioned against a standard that
is too “rigid” in terms of requiring the “precise and exact identity”
between the scope of the request for consultations and the panel request,
as long as the complaining party does not “expand the scope of the
dispute”. Here, the 14 additional measures identified in the panel
request pertain to the same anti-dumping duties that are included in the
consultations request. Among the 14 additional measures are the sunset
review proceedings concerning the continuation of 10 anti-dumping duties,
in relation to which the successive periodic reviews are identified in the
consultations request. The remaining four additional measures are more
recent periodic reviews to the ones listed in the consultations request,
including two final results issued subsequent to the preliminary results
that were listed in the consultations request. The proceedings listed in
the consultations request and the panel request are therefore successive
stages subsequent to the issuance of the same anti-dumping duty orders.
More specifically, as regards the periodic reviews, the subsequent
measures assessed actual duty liabilities and updated cash deposit rates
that were imposed on the same products from the same countries as those
listed in the consultations request. With respect to the sunset reviews,
the subsequent measures related to the continued application of duties on
the same products from the same countries as those listed in the
consultations request. Moreover, in both its consultations request and
panel request, the European Communities made clear that it was challenging
the specific administrative review and sunset review proceedings because
of the use of the zeroing methodology. … In sum, these 14
additional measures relate to the same duties identified in the
consultations request, and the legal basis of the claims raised is the
same.
T.6.2 Claims and legal basis of the complaint. See also Burden of Proof, General
(B.3.1); Claims and Arguments (C.1); Enabling Clause
(E.1); Judicial Economy (J.1); Jurisdiction
(J.2); Request for the
Establishment of a Panel, Article 6.2 of the DSU — Claims and legal
basis of the complaint (R.2.2)
back to top
T.6.2.1 EC — Bananas III, para. 141
(WT/DS27/AB/R)
… We accept the Panel’s view that it was sufficient for the
Complaining Parties to list the provisions of the specific agreements
alleged to have been violated without setting out detailed arguments as to
which specific aspects of the measures at issue relate to which specific
provisions of those agreements. In our view, there is a significant
difference between the claims identified in the request for the
establishment of a panel, which establish the panel’s terms of reference
under Article 7 of the DSU, and the arguments supporting those
claims, which are set out and progressively clarified in the first written
submissions, the rebuttal submissions and the first and second panel
meetings with the parties.
T.6.2.2 EC — Bananas III, para. 143
(WT/DS27/AB/R)
… Article 6.2 of the DSU requires that the claims, but not the arguments,
must all be specified sufficiently in the request for the establishment of
a panel in order to allow the defending party and any third parties to
know the legal basis of the complaint. If a claim is not specified
in the request for the establishment of a panel, then a faulty request
cannot be subsequently “cured” by a complaining party’s
argumentation in its first written submission to the panel or in any other
submission or statement made later in the panel proceeding.
T.6.2.3 EC — Bananas III, paras. 145, 147
(WT/DS27/AB/R)
… There is no requirement in the DSU or in GATT practice for arguments
on all claims relating to the matter referred to the DSB to be set out in
a complaining party’s first written submission to the panel. It is the
panel’s terms of reference, governed by Article 7 of the DSU, which set
out the claims of the complaining parties relating to the matter referred
to the DSB. …
… We do not agree with the Panel’s statement that a “failure to
make a claim in the first written submission cannot be remedied by later
submissions or by incorporating the claims and arguments of other
complainants”. …
T.6.2.4 US — Carbon Steel, para. 127
(WT/DS213/AB/R, WT/DS213/AB/R/Corr.1)
As we have said previously, compliance with the requirements of Article
6.2 must be demonstrated on the face of the request for the establishment
of a panel. Defects in the request for the establishment of a panel cannot
be “cured” in the subsequent submissions of the parties during the
panel proceedings. Nevertheless, in considering the sufficiency of a panel
request, submissions and statements made during the course of the panel
proceedings, in particular the first written submission of the complaining
party, may be consulted in order to confirm the meaning of the words used
in the panel request and as part of the assessment of whether the ability
of the respondent to defend itself was prejudiced. Moreover, compliance
with the requirements of Article 6.2 must be determined on the merits of
each case, having considered the panel request as a whole, and in the
light of attendant circumstances.
T.6.2.5 US — Carbon Steel, para. 130
(WT/DS213/AB/R, WT/DS213/AB/R/Corr.1)
… As we have observed, although the listing of the treaty provisions
allegedly violated is always a necessary “minimum prerequisite”
for compliance with Article 6.2, whether such a listing is sufficient to
constitute a “brief summary of the legal basis of the complaint
sufficient to present the problem clearly” within the meaning of Article
6.2 will depend on the circumstances of each case, and in particular on
the extent to which mere reference to a treaty provision sheds light on
the nature of the obligation at issue. …
T.6.2.6 India — Patents (US),
paras. 89-90
(WT/DS50/AB/R)
… a claim must be included in the request for establishment of
a panel in order to come within a panel’s terms of reference in a given
case. …
… the convenient phrase, “including but not necessarily limited to”,
is simply not adequate to “identify the specific measures at issue and
provide a brief summary of the legal basis of the complaint sufficient to
present the problem clearly” as required by Article 6.2 of the DSU. If
this phrase incorporates Article 63, what article of the TRIPS
Agreement does it not incorporate? Therefore, this phrase is not
sufficient to bring a claim relating to Article 63 within the terms of
reference of the Panel.
T.6.2.7 Korea — Dairy, para. 124
(WT/DS98/AB/R)
Identification of the treaty provisions claimed to have been violated
by the respondent is always necessary both for purposes of defining the
terms of reference of a panel and for informing the respondent and the
third parties of the claims made by the complainant; such identification
is a minimum prerequisite if the legal basis of the complaint is to be
presented at all. But it may not always be enough. There may be situations
where the simple listing of the articles of the agreement or agreements
involved may, in the light of attendant circumstances, suffice to meet the
standard of clarity in the statement of the legal basis of the
complaint. However, there may also be situations in which the
circumstances are such that the mere listing of treaty articles would not
satisfy the standard of Article 6.2. This may be the case, for instance,
where the articles listed establish not one single, distinct obligation,
but rather multiple obligations. In such a situation, the listing of
articles of an agreement, in and of itself, may fall short of the standard
of Article 6.2.
T.6.2.8 Korea — Dairy, para. 127
(WT/DS98/AB/R)
Along the same lines, we consider that whether the mere listing of the
articles claimed to have been violated meets the standard of Article 6.2
must be examined on a case-by-case basis. In resolving that question, we
take into account whether the ability of the respondent to defend itself
was prejudiced, given the actual course of the panel proceedings, by the
fact that the panel request simply listed the provisions claimed to have
been violated.
T.6.2.9 Thailand — H-Beams, para. 88
(WT/DS122/AB/R)
Article 6.2 of the DSU calls for sufficient clarity with respect to the
legal basis of the complaint, that is, with respect to the “claims”
that are being asserted by the complaining party. A defending party is
entitled to know what case it has to answer, and what violations have been
alleged so that it can begin preparing its defence. Likewise, those
Members of the WTO who intend to participate as third parties in panel
proceedings must be informed of the legal basis of the complaint. This
requirement of due process is fundamental to ensuring a fair and orderly
conduct of dispute settlement proceedings.
T.6.2.10 Thailand — H-Beams, para. 92
(WT/DS122/AB/R)
In the facts and circumstances of this case, therefore, we consider
that the reference in Poland’s panel request to the “[calculation of]
an alleged dumping margin” was sufficient to bring Poland’s claims
under Article 2 within the panel’s terms of reference, and to inform
Thailand of the nature of Poland’s claims. Thus, with respect to the
claims relating to Article 2 of the Anti-Dumping Agreement, Poland’s
panel request was sufficient to meet the requirements of Article 6.2 of
the DSU.
T.6.2.11 Korea — Various Measures on Beef, para. 87
(WT/DS161/AB/R, WT/DS169/AB/R)
… Although the “commitment levels” in Korea’s Schedule and “Annex
3” of the Agreement on Agriculture were not explicitly referred
to in the panel requests in this dispute, it is clear that Articles 3 and
6 of the Agreement on Agriculture, which were referred to in
the panel requests, incorporate those terms, either directly through
Articles 3.2 and 6.3, in the case of the “commitment levels”, or
indirectly through Article 1(a)(i), in the case of “Annex 3”. In our
view, the commitment levels in Korea’s Schedule and the provisions of
Annex 3 were in effect referred to in the complaining parties’ panel
requests, and were, therefore, within the Panel’s terms of reference.
T.6.2.12 US — Certain EC Products, para. 111
(WT/DS165/AB/R)
Article 23.1 of the DSU imposes a general obligation of Members to
redress a violation of obligations or other nullification or impairment of
benefits under the covered agreements only by recourse to the rules and
procedures of the DSU, and not through unilateral action. Subparagraphs
(a), (b) and (c) of Article 23.2 articulate specific and clearly defined
forms of prohibited unilateral action contrary to Article 23.1 of the DSU.
There is a close relationship between the obligations set out in
paragraphs 1 and 2 of Article 23. They all concern the obligation
of Members of the WTO not to have recourse to unilateral action. We
therefore consider that, as the request for the establishment of a panel
of the European Communities included a claim of inconsistency with Article
23, a claim of inconsistency with Article 23.2(a) is within the Panel’s
terms of reference.
T.6.2.13 US — Certain EC Products, para. 112
(WT/DS165/AB/R)
However, the fact that a claim of inconsistency with Article 23.2(a) of
the DSU can be considered to be within the Panel’s terms of reference
does not mean that the European Communities actually made such a claim. An
analysis of the Panel record shows that, with the exception of two
instances during the Panel proceedings, the European Communities did not
refer specifically to Article 23.2(a) of the DSU. Furthermore, in
response to a request from the United States to clarify the scope of its
claim under Article 23, the European Communities asserted only claims of
violation of Articles 23.1 and 23.2(c) of the DSU; no mention was made of
Article 23.2(a). Our reading of the Panel record shows us that, throughout
the Panel proceedings in this case, the European Communities made
arguments relating only to its claims that the United States acted
inconsistently with Article 23.1 and Article 23.2(c) of the DSU.
T.6.2.14 US — Certain EC Products, para. 113
(WT/DS165/AB/R)
The Panel record does show that the European Communities made several
references to what it termed the “unilateral determination” of the
United States. However, in those references, the European Communities did
not specifically link the alleged “unilateral determination” to a
claim of violation of Article 23.2(a) per se. The European
Communities’ arguments relating to the alleged “unilateral
determination” of the United States were made with reference to the
alleged failure on the part of the United States to redress a perceived
WTO violation through recourse to the DSU as required by Article 23.1 of
the DSU. At no point did the European Communities link the notion of a “unilateral
determination” on the part of the United States with a violation of
Article 23.2(a).
T.6.2.15 US — Certain EC Products, para. 114
(WT/DS165/AB/R)
On the basis of our review of the European Communities’ submissions
and statements to the Panel, we conclude that the European Communities did
not specifically claim before the Panel that, by adopting the 3 March
Measure, the United States acted inconsistently with Article 23.2(a) of
the DSU. 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.
T.6.2.16 Chile — Price Band System,
paras. 150-151
(WT/DS207/AB/R, WT/DS207/AB/R/Corr.1)
The Panel request refers to Article II of the GATT 1994 in general
terms. No specific reference is made to any of the seven paragraphs or
eight subparagraphs of Article II of the GATT 1994. Argentina’s request
clearly does not limit the scope of Argentina’s claims to the first sentence
of Article II:1(b). Therefore, we find that Article II in its entirety —
including the second sentence of Article II:1(b) — is within the Panel’s
terms of reference.
This, however, is not the end of our inquiry on this issue. Chile does
not dispute that Argentina included Article II:1(b) in the request for the
establishment of a panel. However, Chile submits that making a general
reference to Article II in the Panel request is not dispositive of whether
Argentina has actually made a claim under the second sentence
of Article II:1(b), and, thus, of whether the Panel was entitled to make a
finding under that provision.
T.6.2.17 Chile — Price Band System, para. 164
(WT/DS207/AB/R, WT/DS207/AB/R/Corr.1)
… Argentina appears to suggest that a claim may be made implicitly,
and need not be made explicitly. We do not agree. The requirements of due
process and orderly procedure dictate that claims must be made explicitly
in WTO dispute settlement. Only in this way will the panel, other parties,
and third parties understand that a specific claim has been made, be aware
of its dimensions, and have an adequate opportunity to address and respond
to it. WTO Members must not be left to wonder what specific claims have
been made against them in dispute settlement. …
T.6.2.18 US — Offset Act (Byrd Amendment), para. 212
(WT/DS217/AB/R, WT/DS234/AB/R)
In our view, these statements do not constitute a finding by the Panel
that was outside its terms of reference. The Panel was merely reflecting
in its reasoning the fact that the CDSOA does not operate in a vacuum but,
rather, operates in a context that includes other laws and regulations.
The Panel’s view was that the combination of anti-dumping duties (or
countervailing duties) and CDSOA offset payments distorts the competitive
relationship between dumped (subsidized) and domestic products, to the
detriment of dumped (subsidized) products. This led the Panel to find that
the CDSOA — alone — has an adverse bearing on dumping (subsidization)
and, therefore, operates “against” dumping (subsidies) within the
meaning of Article 18.1 of the Anti-Dumping Agreement (and Article
32.1 of the SCM Agreement). Therefore, we dismiss the claim of the
United States that the Panel exceeded its terms of reference by examining
claims concerning the CDSOA “in combination” with other United States
laws and regulations.
T.6.2.19 EC — Tariff Preferences, para. 113
(WT/DS246/AB/R)
In the light of the extensive requirements set forth in the Enabling
Clause, we are of the view that, when a complaining party considers that a
preference scheme of another Member does not meet one or more of those
requirements, the specific provisions of the Enabling Clause with which
the scheme allegedly falls afoul, form critical components of the “legal
basis of the complaint” and, therefore, of the “matter” in dispute.
Accordingly, a complaining party cannot, in good faith, ignore those
provisions and must, in its request for the establishment of a panel,
identify them and thereby “notif[y] the parties and third parties of the
nature of [its] case”. For the failure of such a complaining party to
raise the relevant provisions of the Enabling Clause would place an
unwarranted burden on the responding party. This due process consideration
applies equally to the elaboration of a complaining party’s case in its
written submissions, which must “explicitly” articulate a claim so
that the panel and all parties to a dispute “understand that a specific
claim has been made, [are] aware of its dimensions, and have an adequate
opportunity to address and respond to it”.
T.6.2.20 US — Countervailing Duty Investigation on DRAMS,
paras.
99-100
(WT/DS296/AB/R)
… Korea’s initial request for consultations did not refer to the
CVD order, which was not in existence at the time the request was made. In
the Addendum to its request for consultations, Korea sought “further
consultations” with regard to the USITC’s final injury determination
and the USDOC’s CVD order. … The United States considers that
this language does not permit a conclusion that the claims asserted in the
initial request for consultations apply also to the CVD order .…
We disagree. The Addendum expressly refers to the initial request for
consultations. It is clear that the Addendum was intended to be read
together with the original request for consultations; indeed, that is the
very nature of an addendum. Moreover, we recall that Korea explains that,
under United States law, “the [CVD] order is wholly dependent on the
administrative determinations and is effectively a ministerial function
without discretion”. According to Korea, “it follows that the legal
claims of the underlying determinations are identical to the legal claims
with respect to the [CVD] order”.… In these circumstances, it should
have been apparent that the allegations of inconsistency, set forth by
Korea in the original request for consultations and in the Addendum in
relation to the USDOC’s subsidy determination and the USITC’s injury
determination, applied also to the CVD order. Nor can it be said that the
United States was expected “to guess which provision(s) applied to the [CVD]
order”. Accordingly, we find that it was reasonable for the Panel to
conclude that the “totality” of the provisions in Korea’s initial
request for consultations and in the Addendum provides, with respect to
the USDOC’s CVD order, a sufficient indication of the legal basis for
the complaint within the meaning of Article 4.4.
T.6.2.21 Mexico — Taxes on Soft Drinks, para. 49
(WT/DS308/AB/R)
… The use of the words “shall address” in Article 7.2 indicates,
in our view, that panels are required to address the relevant provisions
in any covered agreement or agreements cited by the parties to the
dispute.
T.6.2.22 EC — Selected Customs Matters, para. 166
(WT/DS315/AB/R)
We agree with the Panel that “there is nothing in the DSU nor in the
other WTO agreements that would prevent a complaining Member from
challenging a responding Member’s system as a whole or overall”. We
also agree with the Panel that a challenge that a system “as a whole or
overall” is WTO-inconsistent must be presented in a manner that meets
the two distinct requirements in Article 6.2 of the DSU. …
T.6.2.23 EC — Selected Customs Matters, para. 168
(WT/DS315/AB/R)
The United States’ appeal requires us to examine the wording and
content of the panel request. Determining the scope of the claims that are
set out in a panel request requires that the panel request be construed as
a whole. We will be able to conclude that the panel request included a
challenge to the European Communities’ system of customs administration
as a whole or overall only if we are convinced that the panel request,
read as a whole, states this claim in a way that is “sufficient to
present the problem clearly”.
T.6.3 Specific measure at issue. See also Burden of Proof
(B.3); Jurisdiction (J.2); Legislation as such vs. Specific Application
(L.1); Mandatory and Discretionary Legislation
(M.1); Request for the
Establishment of a Panel — Specific measures at issue (R.2.3)
back to top
T.6.3.1 Japan — Alcoholic Beverages II, p. 26, DSR 1996:I, p. 97
at 117-118
(WT/DS8/AB/R, WT/DS10/AB/R, WT/DS11/AB/R)
We note that the Panel’s conclusions on “like products” and on
“directly competitive or substitutable products” … fail to address
the full range of alcoholic beverages included in the Panel’s Terms of
Reference. … We consider this failure to incorporate into its
conclusions all the products referred to in the Terms of Reference,
consistent with the matters referred to the DSB in WT/DS8/5, WT/DS10/5 and
WT/DS11/2, to be an error of law by the Panel.
T.6.3.2 Australia — Salmon, para. 103
(WT/DS18/AB/R)
… In our view, the … measure at issue can only be the measure which
is actually applied to the product at issue. …
T.6.3.3 US — Certain EC Products, para. 70
(WT/DS165/AB/R)
… in our Report in Brazil — Export Financing Programme for
Aircraft, we stated that:
Articles 4 and 6 of the DSU … set forth a process by which a
complaining party must request consultations, and consultations must be
held, before a matter may be referred to the DSB for the establishment of
a panel.
The European Communities’ request for consultations of 4 March 1999
did not, of course, refer to the action taken by the United States on 19
April 1999, because that action had not yet been taken at the time. At the
oral hearing in this appeal, in response to questioning by the Division,
the European Communities acknowledged that the 19 April action, as such,
was not formally the subject of the consultations held on 21 April
1999. We, therefore, consider that the 19 April action is also, for that
reason, not a measure at issue in this dispute and does not fall within
the Panel’s terms of reference.
T.6.3.4 US — Carbon Steel, para. 171
(WT/DS213/AB/R, WT/DS213/AB/R/Corr.1)
… the references in the panel request to “certain aspects of the
sunset review procedure”, to the United States statutory provisions
governing sunset reviews, to related regulatory provisions, and to the
Sunset Policy Bulletin, can be read to refer, generally, to United States
law regarding the determination to be made in a sunset review. However, we
do not believe they can be read to refer to distinct measures,
consisting of United States law, as such, and as applied, relating to the
submission of evidence. Accordingly, we agree with the Panel that the
matters relating to the submission of evidence in a sunset review were not
within its terms of reference because the specific measures at issue
were not adequately identified in the request for the establishment of
the panel, as required by Article 6.2 of the DSU.
T.6.3.5 Chile — Price Band System, para. 139
(WT/DS207/AB/R, WT/DS207/AB/R/Corr.1)
… Chile’s price band system remains essentially the same after the
enactment of Law 19.772. The measure is not, in its essence, any different
because of that Amendment. Therefore, we conclude that the measure before
us in this appeal includes Law 19.772, because that law amends Chile’s
price band system without changing its essence.
T.6.3.6 Chile — Price Band System, para. 144
(WT/DS207/AB/R, WT/DS207/AB/R/Corr.1)
We emphasize that we do not mean to condone a practice of amending
measures during dispute settlement proceedings if such changes are made
with a view to shielding a measure from scrutiny by a panel or by us. We
do not suggest that this occurred in this case. However, generally
speaking, the demands of due process are such that a complaining party
should not have to adjust its pleadings throughout dispute settlement
proceedings in order to deal with a disputed measure as a “moving target”.
If the terms of reference in a dispute are broad enough to include
amendments to a measure — as they are in this case — and if it is
necessary to consider an amendment in order to secure a positive solution
to the dispute — as it is here — then it is appropriate to consider
the measure as amended in coming to a decision in a dispute.
T.6.3.7 US — Oil Country Tubular Goods Sunset Reviews, para. 173
(WT/DS268/AB/R)
We also expect that measures subject to “as such” challenges would
normally have undergone, under municipal law, thorough scrutiny through
various deliberative processes to ensure consistency with the Member’s
international obligations, including those found in the covered
agreements, and that the enactment of such a measure would implicitly
reflect the conclusion of that Member that the measure is not inconsistent
with those obligations. The presumption that WTO Members act in good faith
in the implementation of their WTO commitments is particularly apt in the
context of measures challenged “as such”. We would therefore urge
complaining parties to be especially diligent in setting out “as
such” claims in their panel requests as clearly as possible. In
particular, we would expect that “as such” claims state unambiguously
the specific measures of municipal law challenged by the complaining party
and the legal basis for the allegation that those measures are not
consistent with particular provisions of the covered agreements. Through
such straightforward presentations of “as such” claims, panel requests
should leave respondent parties in little doubt that, notwithstanding
their own considered views on the WTO-consistency of their measures,
another Member intends to challenge those measures, as such, in WTO
dispute settlement proceedings.
T.6.3.8 US — Oil Country Tubular Goods Sunset Reviews, para. 220
(WT/DS268/AB/R)
… Therefore, even assuming arguendo that a “practice” may
be challenged as a “measure” in WTO dispute settlement — an issue on
which we express no view here — we find that the record does not
allow us to complete the analysis of Argentina’s conditional appeal with
respect to the “practice” of the USDOC regarding the likelihood
determination in sunset reviews.
T.6.3.9 US — Upland Cotton, para. 262
(WT/DS267/AB/R)
Whether or not a measure is still in force is not dispositive of
whether that measure is currently affecting the operation of any covered
agreement. Therefore, we disagree with the United States’ argument that
measures whose legislative basis has expired are incapable of affecting
the operation of a covered agreement in the present and that, accordingly,
expired measures cannot be the subject of consultations under the
DSU. In our view, the question of whether measures whose legislative basis
has expired affect the operation of a covered agreement currently is an
issue that must be resolved on the facts of each case. The outcome of such
an analysis cannot be prejudged by excluding it from consultations and
dispute settlement proceedings altogether.
T.6.3.10 US — Upland Cotton, para. 269
(WT/DS267/AB/R)
The only temporal connotation contained in the ordinary meaning of the
expression “at issue”, as used in Article 6.2 of the DSU, is expressed
by its present tense: measures must be “at issue” — or, putting it
another way, “in dispute” — at the time the request is made.
Certainly, nothing inherent in the term “at issue” sheds light on
whether measures at issue must be currently in force, or whether they may
be measures whose legislative basis has expired.
T.6.3.11 US — Gambling,
paras. 121-123
(WT/DS285/AB/R, WT/DS285/AB/R/Corr.1)
The DSU provides for the “prompt settlement” of situations where
Members consider that their benefits under the covered agreements “are
being impaired by measures taken by another Member”. Two elements
of this reference to “measures” that may be the subject of dispute
settlement are relevant. First, as the Appellate Body has stated, a “nexus”
must exist between the responding Member and the “measure”, such that
the “measure” — whether an act or omission — must be “attributable”
to that Member. Secondly, the “measure” must be the source of
the alleged impairment, which is in turn the effect resulting from
the existence or operation of the “measure”.
Similarly [Article 4.2 of the DSU] contemplates that “measures”
themselves will “affect” the operation of a covered agreement.
Finally, we note that this distinction between measures and their effects
is also evident in the scope of application of the GATS, namely, to “measures
by Members affecting trade in services”.
We are therefore of the view that the DSU and the GATS focus on “measures”
as the subject of challenge in WTO dispute settlement. To the extent that
a Member’s complaint centres on the effects of an action taken by
another Member, that complaint must nevertheless be brought as a challenge
to the measure that is the source of the alleged effects.
T.6.3.12 US — Gambling, paras. 129, 131-132
(WT/DS285/AB/R, WT/DS285/AB/R/Corr.1)
… the Panel relied on certain Appellate Body decisions in support of
its view that “ ‘practice’ can be considered as an autonomous
measure that can be challenged in and of itself”. …
…
We disagree with the participants’ characterization of the Panel’s
statement on “practice”, in paragraph 6.197 of the Panel Report, as a
“finding” of the Panel. The Panel itself acknowledged that, in any
case, Antigua was not challenging a practice, as such. In this light, the
Panel’s statement on “practice”, in our view, was a mere obiter
dictum, and we need not rule on it.
We nevertheless express our disagreement with the Panel’s
understanding of previous Appellate Body decisions. The Appellate Body has
not, to date, pronounced upon the issue of whether “practice”
may be challenged, as such, as a “measure” in WTO dispute settlement.
T.6.3.13 EC — Selected Customs Matters,
paras. 131-132
(WT/DS315/AB/R)
… The question of whether a measure falls within a panel’s terms of
reference is a threshold issue, distinct from the question of whether the
measure is consistent or not with the legal provision(s) of the covered
agreement(s) to which the panel request refers. Therefore, questions
pertaining to the identification of the “measures at issue” and the
“claims” relating to alleged violation of WTO obligations, set out in
a panel request, should be analysed separately.
At the heart of the Panel’s reasoning stands the proposition that the
term “measure at issue” in Article 6.2 of the DSU should be
interpreted in the light of the specific WTO obligation that is raised in
a particular claim. This reasoning appears to us to be flawed. The Panel’s
proposition would introduce uncertainty because the identification of the
measure would vary depending on the substance of the legal provision
invoked by a complainant and the interpretation that a panel might give to
that provision. … In finding that the term “measures at issue”
in Article 6.2 should be interpreted in the light of the specific WTO
obligation that is alleged to be violated, the Panel blurred the
distinction between measures and claims.
T.6.3.14 EC — Selected Customs Matters, para. 133
(WT/DS315/AB/R)
In our view, a complainant is entitled to include in its panel request
an allegation of inconsistency with a covered agreement of any measure
that may be submitted to WTO dispute settlement. In US — Corrosion-Resistant Steel Sunset Review, the Appellate Body provided
guidance on the types of measures that may be the subject of dispute
settlement. Relying on, inter alia, Article 3.3 of the DSU, which
refers to “situations in which a Member considers that any benefits
accruing to it directly or indirectly under the covered agreements are
being impaired by measures taken by another Member”, the
Appellate Body stated that “[i]n principle, any act or omission
attributable to a WTO Member can be a measure of that Member for purposes
of dispute settlement proceedings.” As long as the specificity
requirements of Article 6.2 are met, we see no reason why a Member should
be precluded from setting out in a panel request “any act or omission”
attributable to another Member as the measure at issue.
T.6.3.15 EC — Selected Customs Matters, paras. 134-135
(WT/DS315/AB/R)
The Panel considered that, when a violation of Article X:3(a) of the
GATT 1994 is claimed, the measure at issue must necessarily be a “manner
of administration” because, if such a violation is found, the WTO Member
concerned would need to alter the manner of administration in order to
comply with a recommendation made pursuant to Article 19.1 of the DSU. In
our view, this reasoning of the Panel is flawed because it conflates the
threshold question of whether a measure falls within a panel’s terms of
reference with the question of the means of implementation in the event
that a violation is found. Through the recommendation under Article 19.1,
the Member found to have violated a provision of a covered agreement is
required to take corrective action to remove the violation. The
recommendation envisaged in Article 19.1 concerns the stage of
implementation and not the question of whether a measure falls within a
panel’s terms of reference. Moreover, the Member concerned has a degree
of discretion with respect to the nature and type of action that it
undertakes in order to achieve compliance. Therefore, we have difficulty
in understanding how the means of compliance with a recommendation under
Article 19.1 of the DSU should govern the identification of the specific
measure at issue in a panel request. We agree, in this respect, with the
United States that “[t]he mere fact that a breach of Article X:3(a) may
be removed by changing a law’s administration is not a basis for
concluding that the law is not the measure at issue.”
… In [US — Upland Cotton], the Appellate Body had to address
the issue of whether an expired measure can be a “measure at issue”
within the meaning of Article 6.2 of the DSU. The Appellate Body rejected
the United States’ argument that, because an expired measure is not
susceptible to a recommendation under Article 19.1 of the DSU, it cannot
be a “measure at issue” under Article 6.2. For the Appellate Body, the
question of whether a panel can address claims in respect of an expired
measure is to be distinguished from the question of whether that measure
is susceptible to a recommendation under Article 19.1. … the
Appellate Body’s reasoning in US — Upland Cotton supports our
position that Article 19.1 of the DSU does not place restrictions on the
type of measure that can be identified in a panel request under Article
6.2 of the DSU.
T.6.3.16 EC — Selected Customs Matters, para. 184
(WT/DS315/AB/R)
We begin our analysis by recalling the Appellate Body’s statement [at
paragraph 156] in EC — Chicken Cuts:
The term “specific measures at issue” in Article 6.2 suggests that,
as a general rule, the measures included in a panel’s terms of reference
must be measures that are in existence at the time of the establishment of
the panel. (footnote omitted)
This general rule, however, is qualified by at least two exceptions.
First, in Chile — Price Band System, the Appellate Body held that
a panel has the authority to examine a legal instrument enacted after the
establishment of the panel that amends a measure identified in the panel
request, provided that the amendment does not change the essence of the
identified measure. Secondly, in US — Upland Cotton, the
Appellate Body held that panels are allowed to examine a measure “whose
legislative basis has expired, but whose effects are alleged to be
impairing the benefits accruing to the requesting Member under a covered
agreement” at the time of the establishment of the panel.…
T.6.3.17 EC — Bananas III (Article 21.5
— Ecuador II) / EC — Bananas III (Article 21.5 — US), paras. 269-271
(WT/DS27/AB/RW2/ECU, WT/DS27/AB/RW/USA, WT/DS27/AB/RW2/ECU/Corr.1,
WT/DS27/AB/RW/USA/Corr.1)
The situation in the present case is different from that in US
— Upland Cotton, in that the measure in the present appeal was still in
force when the Panel was established and expired only towards the end of
the Panel proceedings. In US — Upland Cotton, certain measures
were no longer in force at the time of the establishment of the panel, but
the continued effect of past subsidies was claimed to still cause serious
prejudice to the complainants’ interests. However, we consider that, if
the DSU does not exclude from the scope of consultations, or from the
scope of panel proceedings, a measure that was no longer in force when the
dispute was initiated, then, a fortiori, a panel is not precluded
from making findings with respect to measures that expire during the
course of the proceedings.
We find further support for this interpretation in Article 7 of the DSU,
which sets out the standard terms of reference for panels. The terms of
reference for a panel pursuant to Article 7 define the scope of the
dispute and the mandate of the panel. In the present case, the panel
request identified, inter alia, EC Regulation 1964/2005, and the
DSB established the Panel on that basis with standard terms of reference.
The European Communities and the United States both agreed at the outset
of the proceedings that this Regulation was the measure at issue included
in the Panel’s terms of reference. The parties agreed that this measure
was within the jurisdiction of the Panel. The DSU nowhere provides that
the jurisdiction of a panel terminates or is limited by the expiry of the
measure at issue. On the contrary, when the DSU provides for limitations
on the authority of the panel in other instances, it does so in express
terms. Article 12.12 of the DSU, for example, provides that a panel’s
authority lapses if the work of the panel has been suspended for more than
12 months. The absence of a similar limitation, with respect to changes to
the scope of the panel’s jurisdiction after the panel has been
established and the terms of reference have been determined by the DSB,
lends further support to our interpretation that, once a panel has been
established and the terms of reference for the panel have been set, the
panel has the competence to make findings with respect to the measures
covered by its terms of reference. We thus consider it to be within the
discretion of the panel to decide how it takes into account subsequent
modifications or a repeal of the measure at issue. Accordingly, panels
have made findings on expired measures in some cases and declined to do so
in others, depending on the particularities of the disputes before them.
In the present case, the European Communities has advanced no reason, nor
do we see a reason, for interfering with the Panel’s exercise of that
discretion.
… We recall that the Appellate Body has distinguished the question
whether a panel can make a finding concerning an expired measure
from the question whether a panel can make a recommendation relating
to an expired measure. In US — Certain EC Products, the Appellate
Body reversed the panel’s decision to make a recommendation pursuant to
Article 19.1 of the DSU on the grounds that the panel had already found
that the measure at issue in that dispute had expired. The Appellate Body
confirmed, in US — Upland Cotton, that the fact that a measure
has expired may affect what recommendation a panel may make, but it is not
dispositive of the question whether a panel can make findings relating to
an expired measure.
T.6.3.18 US — Zeroing (Japan) (Article 21.5
— Japan), paras.
121-122
(WT/DS322/AB/RW)
… Apart from the reference in the present tense to the fact that the
complainant must identify the measures “at issue”, Article 6.2 does
not set out an express temporal condition or limitation on the measures
that can be identified in a panel request. Indeed, in US — Upland
Cotton, where the issue was raised in the context of measures that had
expired prior to the panel proceedings, the Appellate Body explained that
“nothing inherent in the term ‘at issue’ sheds light on whether
measures at issue must be currently in force, or whether they may be
measures whose legislative basis has expired”. In EC — Chicken Cuts,
the Appellate Body stated that “[t]he term ‘specific measures at issue’
in Article 6.2 suggests that, as a general rule, the measures included in
a panel’s terms of reference must be measures that are in existence at
the time of the establishment of the panel.” Nevertheless, the Appellate
Body also stated in that case that “measures enacted subsequent to the
establishment of the panel may, in certain limited circumstances, fall
within a panel’s terms of reference”.
We observed earlier that the requirements of Article 6.2 must be read
in the light of the specific function of Article 21.5 proceedings and that
the “specific measures at issue” to be identified in these proceedings
are measures that have a bearing on compliance with the recommendations
and rulings of the DSB. A measure that is initiated before there has been
recourse to an Article 21.5 panel, and which is completed during those
Article 21.5 panel proceedings, may have a bearing on whether there is
compliance with the DSB’s recommendations and rulings. Thus, if such a
measure incorporates the same conduct that was found to be WTO-inconsistent
in the original proceedings, it would show non-compliance with the DSB’s
recommendations and rulings. To exclude such a measure from an Article
21.5 panel’s terms of reference because the measure was not completed at
the time of the panel request but, rather, was completed during the
Article 21.5 proceedings, would mean that the disagreement “as to the
existence or consistency with a covered agreement of measures taken to
comply” would not be fully resolved by that Article 21.5 panel. New
Article 21.5 proceedings would therefore be required to resolve the
disagreement and establish whether there is compliance. Thus, an a
priori exclusion of measures completed during Article 21.5 proceedings
could frustrate the function of compliance proceedings. It would also be
inconsistent with the objectives of the DSU to provide for the “prompt
settlement of situations in which a Member considers that any benefits
accruing to it directly or indirectly under the covered agreements are
being impaired”, as reflected in Article 3.3, and to “secure a
positive solution to a dispute”, as contemplated in Article 3.7.
T.6.3.19 US — Zeroing (Japan) (Article 21.5
— Japan), paras.
124-125
(WT/DS322/AB/RW)
… As we noted above, Review 9 related to the same anti-dumping duty
order as Reviews 1, 2, and 3, which were found to be inconsistent in the
original proceedings, and to the three subsequent reviews (Reviews 4, 5,
and 6) being challenged by Japan as “measures taken to comply”. Japan’s
panel request expressly referred to “subsequent closely connected
measures”. Review 9 had been initiated at the time the matter was
referred to the Panel and was due to be completed during the Article 21.5
proceedings. Under these circumstances, we consider that the Panel was
correct in finding that Review 9 was within its terms of reference, as
doing so enabled it to fulfil its mandate to resolve the “disagreement”
between the parties and determine, in a prompt manner, whether the United
States had achieved compliance with the DSB’s recommendations and
rulings.
… the United States relies on the Appellate Body’s statement in EC
— Chicken Cuts that “[t]he term ‘specific measures at issue’
in Article 6.2 suggests that, as a general rule, the measures included in
a panel’s terms of reference must be measures that are in existence at
the time of the establishment of the panel”, and that only in “certain
limited circumstances” will measures enacted subsequent to a panel’s
establishment fall within the Panel’s terms of reference. According to
the United States, the circumstances of this case, including the fact that
it is a compliance proceeding, do not justify the inclusion of Review 9 in
the Panel’s terms of reference. As the United States itself recognizes,
however, in EC — Chicken Cuts, the Appellate Body did not rule
that Article 6.2 categorically prohibits the inclusion, within a panel’s
terms of reference, of measures that come into existence or are completed
after the panel is requested. Rather, the Appellate Body noted explicitly
that, in certain circumstances, such measures could be included in a panel’s
terms of reference. Moreover, whereas the statement in EC — Chicken
Cuts to which the United States refers was made in the context of
original WTO proceedings, we are dealing here with Article 21.5
proceedings. As we explained earlier, the requirements of Article 6.2 must
be adapted to a panel request under Article 21.5, and the scope and
function of Article 21.5 proceedings necessarily inform the interpretation
of the Article 6.2 requirements in such proceedings. The proceedings
before us present circumstances in which the inclusion of Review 9 was
necessary for the Panel to assess whether compliance had been achieved,
and thereby resolve the “disagreement as to the existence or consistency
with a covered agreement of measures taken to comply with the
recommendations and rulings”.
T.6.3.20 US — Zeroing (Japan) (Article 21.5
— Japan), paras.
126-127
(WT/DS322/AB/RW)
… the United States argues that Review 9 could not have been
impairing any benefits accruing to Japan, within the meaning of Article
3.3 of the DSU. The United States relies on a statement by the panel in US
— Upland Cotton that a measure implemented under legislation that,
at the time of the panel request, “did not exist, had never existed and
might not subsequently have ever come into existence” was not within the
panel’s terms of reference because such legislation could not have been
impairing any benefits accruing to the complainant, in the sense of
Article 3.3 of the DSU.
First, we note that the specific finding of the panel in US
— Upland Cotton, on which the United States relies, was not appealed.
Secondly, the Panel in these compliance proceedings found that the
situation before it differed from the one presented to the panel in US —
Upland Cotton. We agree that the circumstances of these compliance
proceedings are different from those before the panel in US — Upland
Cotton. In this case, Review 9 had already been initiated at the time
of the panel request, was due to be completed during the Panel
proceedings, and was the most recent periodic review stemming from the
same anti-dumping duty order on imports of ball bearings from Japan.
Thirdly, we recall that the Appellate Body in US — Upland Cotton stated
that, as regards the initiation of dispute settlement proceedings, Article
3.3 focuses “on the perception or understanding of an aggrieved Member”.
In the circumstances of this case, Japan had a basis to consider that
Review 9, as part of a “chain of measures or a continuum” in which
zeroing was used, could lead to the impairment of benefits accruing to it
under the Anti-Dumping Agreement and the GATT 1994. Moreover, as we
explained above, the inclusion of Review 9 was consistent with the
objective envisaged in Article 3.3, namely, ensuring the prompt settlement
of the dispute. It was then for the Panel to determine whether Review 9
fell within the scope of its jurisdiction and assess its consistency with
the covered agreements.
T.6.3.21 US — Zeroing (Japan) (Article 21.5
— Japan), para. 129
(WT/DS322/AB/RW)
The United States raises an additional argument that accepting the
Panel’s approach could lead to “asymmetry” in the sense that, on the
one hand, complaining parties would be allowed to challenge measures that
are subsequent to the panel request, while, on the other hand, similar
requests by respondents for the inclusion of measures coming into
existence during panel proceedings have been rejected by panels. We do not
detect such asymmetrical treatment of complainants and respondents. In
some cases, modifications of measures during the panel proceedings have
been taken into account to the benefit of respondents. In US — Zeroing (EC) (Article 21.5
— EC), developments subsequent to the
establishment of the panel were considered by the Appellate Body and, in
the light of those developments, the Appellate Body found that the United
States had “ultimately” not failed to comply with the DSB’s
recommendations and rulings in relation to certain sunset reviews.
Therefore, we do not agree that the alleged “asymmetry” in the
treatment of complaining and respondent parties arises in the manner
suggested by the United States.
T.6.4 “Post suspension of concessions”. See also Suspension
of Concessions or Other Obligations (S.9)
back to top
T.6.4.1 US — Continued Suspension / Canada
— Continued Suspension, paras. 327-329, 331-332
(WT/DS320/AB/R, WT/DS321/AB/R)
… We have found that the European Communities was required to bring
about substantive compliance for the United States and Canada to be under
an obligation to terminate the suspension of concessions pursuant to
Article 22.8 of the DSU. The DSB’s recommendations and rulings from EC
— Hormones included a finding that the import ban on meat from
cattle treated with oestradiol-17ß was inconsistent with Article 5.1 of
the SPS Agreement because it was not based on a proper risk
assessment. Thus, in order to determine whether the European Communities
had complied with the DSB’s recommendations and rulings, the Panel had
to examine whether the European Communities had brought its import ban
relating to oestradiol-17ß into conformity with Article 5.1 of the SPS
Agreement by basing the import ban in Directive 2003/74/EC relating to
the same substance on a proper risk assessment.
We face a somewhat different situation in relation to Article 5.7 of
the SPS Agreement. The European Communities did not invoke that
provision in EC — Hormones to justify its import ban on meat from
cattle treated with the other five hormones. Thus, the DSB’s
recommendations and rulings in EC — Hormones did not include
findings under Article 5.7 of the SPS Agreement. Instead, the
import ban relating to the other five hormones was found to be
inconsistent with Article 5.1 because it was not based on a proper risk
assessment. This raises the question as to whether the European
Communities’ changed justification precluded the Panel from examining
its consistency with the SPS Agreement, and particularly with
Article 5.7, a provision that was not part of the DSB’s recommendations
and rulings in EC — Hormones. In our view, the Panel was not
precluded from assessing the consistency of Directive 2003/74/EC with
Article 5.7 for the following reasons. 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.
The European Communities has characterized the import ban as a provisional
one and has sought to justify it under Article 5.7 of the SPS Agreement
… Article 22.8 demands substantive compliance with the DSB’s
recommendations and rulings. A change in justification, by itself, cannot
be said to achieve substantive compliance. Compliance with the DSB’s
recommendations and rulings concerning Article 5.1 and the definitive ban
on the five hormones cannot be established without reviewing the
alternative justification for the provisional ban under Article 5.7. If
the new justification for the ban is not consistent with the SPS
Agreement, substantive compliance has not been achieved.
… Also, we are mindful that a panel request submitted by an original
respondent in the post-suspension stage is different from a panel request
in original and compliance proceedings in the pre-suspension stage. In the
requests for establishment of a panel, the European Communities asserts
that it has brought itself into compliance with the DSB’s
recommendations and rulings which included a violation of Article 5.1. …
…
… It is evident from the panel requests that the consistency of the
United States’ and Canada’s continued suspension with Article 22.8 was
linked to the European Communities’ implementation of the DSB’s
recommendations and rulings in EC — Hormones. We fail to see how
the claims explicitly listed in the panel requests by the European
Communities could be resolved in isolation from the question of whether
Directive 2003/74/EC has brought the European Communities into compliance
with these DSB’s recommendations and rulings.
Taken together, these elements support the conclusion that the
consistency of Directive 2003/74/EC with Articles 5.1 and 5.7 of the SPS
Agreement was part of the matter to be examined by the Panel. In these
circumstances, we reject the European Communities’ claim that the Panel
exceeded its terms of reference by addressing the consistency of Directive
2003/74/EC with Articles 5.1 and 5.7 of the SPS Agreement. …
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