DS492 European Union – Measures Affecting Tariff Concessions on Certain Poultry Meat Products

China said that from January 2002 until July 2008 the EU had prohibited imports of poultry products from China in response to an outbreak of avian influenza. China's main concern was that the EU had renegotiated tariff concessions involving these products based on import data compiled while imports of these products from China were banned. As such, it had not taken China's interests in the EU poultry market into account. In addition, the EU had allocated the majority of the new tariff-rate quotas (TRQs) to Brazil or Thailand because these members accounted for the majority of EU imports. This too was due to the absence of imports from China caused by the EU's ban. The panel found that the EU's allocation of the two TRQ shares among supplying countries was inconsistent with the requirements of Article XIII:2 of the General Agreement on Tariffs and Trade (GATT) 1994. China said it was pleased with the outcome of this dispute and that it appreciated the EU's decision to accept the adoption of the panel report.
The European Union welcomed the findings of the panel. The panel rejected all claims by China under Article XXVIII of the GATT 1994. In relation to claims under Article XIII of the GATT 1994, the panel rejected China's claim that the EU had acted inconsistently by failing to periodically update the initial TRQ allocations. This would have imposed a very burdensome obligation on all WTO members managing TRQs, the EU said. The panel also rejected China's contention that the EU had acted inconsistently with Article XIII by determining which countries had a substantial interest in supplying the products concerned on the basis of their actual share of imports into the EU, rather than an estimate of what import shares would have been in the absence of SPS measures restricting imports. 

Thailand said that DS492 concerned the modification of ten tariff lines in the EU's schedule of concessions covering poultry products. These modifications were negotiated with Thailand and Brazil, which had been identified by the EU as being members with principal supplying interests. The EU had replaced previously unlimited tariff concessions in these lines with TRQs. In this dispute the panel had decided various systemically important issues such as the procedure for determining principal and substantial supplying interest under Article XXVIII of the GATT 1994, the rules for the allocation of TRQs under Article XIII, and the relationship between these two provisions. 

Brazil said it expected that its rights, obtained by negotiation with the EU, would not be affected by the implementation of the panel's recommendations, both in terms of the size of the actual TRQ allocated to Brazil and with regard to the administration regime of such quotas.

The DSB adopted the panel report.

DS430 India – Measures Concerning the Importation of Certain Agricultural Products

India outlined the numerous steps it had taken to comply with the DSB's recommendations and rulings in DS430 regarding India's restrictions on poultry and other agricultural imports. Notification SO 2337(E), together with two amendment notifications, a set of guidelines and a questionnaire together formed a set of revised avian influenza measures. These brought India into compliance with the findings in DS430 in that they: (i) allowed imports of poultry and poultry products in accordance with the relevant international standard; (ii) recognized the concept of areas of low disease prevalence and disease-free areas; and (iii) they provided for the processes to be followed for recognition of such areas in accordance with the Agreement on Sanitary and Phytosanitary Measures and the World Organisation for Animal Health (OIE) Terrestrial Code. However, despite India's best efforts to resolve this dispute bilaterally, the United States had not agreed to enter into a sequencing agreement in this dispute. The US had also not accepted India's request to suspend the arbitration proceedings in this dispute under Article 22.6 of the DSU. India, therefore, had no option but to request the establishment of a compliance panel under Article 21.5 of the DSU.

The United States said that India had no basis for asserting compliance with the DSB's recommendations in DS430. Despite the DSB's findings that India's measures were WTO inconsistent, India continued to maintain a complete ban on US poultry and other agricultural products. The United States said that it could see no valid legal basis for India's assertion of compliance. In addition, a compliance panel proceeding at this point would not contribute to a prompt resolution of the dispute. The United States therefore objected to the establishment of a panel. The United States also noted that there was nothing in the DSU that required members to enter into a sequencing agreement.

Other delegations expressed their concerns about the issue of sequencing. Brazil said direct recourse to Article 22.6 of the DSU was only acceptable if no measure had been taken to comply. However, when there was disagreement about compliance, it was only logical to first have recourse to Article 21.5 of the DSU. The EU said that it hoped that India and the US would ensure that the dispute proceedings could be carried in the correct sequence, and that it believed proceedings under Article 22.6 of the DSU should be preceded by a multilateral determination of compliance. Colombia said it hoped that there would be a logical approach in the way members dealt with their concerns related to compliance, while Canada noted that the practice of concluding sequencing agreements among parties in a dispute contributed to the effectiveness and predictability of the dispute settlement system. Australia said there was no legal basis for the DSB to require suspension of an Article 22.6 arbitration contingent on an Article 21.5 panel finding, but that it considered sequencing agreements to be the preferred mechanism to resolve the issue.

Following the US objections, the DSB deferred the establishment of the compliance panel.

DS475 Russian Federation – Measures on the Importation of Live Pigs, Pork and Other Pig Products from the European Union

The Russian Federation informed the DSB of its intention to implement the DSB's recommendations and rulings in DS475. Russia said that it would need a reasonable period of time for implementation and that it stood ready to discuss this matter with the EU. 

The European Union said that it expected Russia to fully implement the DSB's recommendations and rulings and urged Russia to allow trade with safe EU products to take place. The EU said that it stood ready to discuss the reasonable period of time for implementation, but that since no legislative change was required for Russia to comply, it would not accept a long wait.

2017 Appellate Body selection process

The DSB chairman, Ambassador Junichi Ihara (Japan), recalled that the second four year terms of two Appellate Body members would expire on 30 June 2017 and 11 December 2017, respectively. Pursuant to Article 17.2 of the DSU they were not eligible for reappointment and DSB would have to appoint two new Appellate Body members. He also recalled that at the 25 January 2017 meeting, the previous DSB chairman, Ambassador Xavier Carim (South Africa) had outlined two possible approaches to fill the upcoming vacancies. Several delegations supported one single selection process. However, two delegations expressed a preference for undertaking two independent processes. One delegation suggested that the DSB could initiate a first selection process to fill the vacancy that would expire in June 2017 and that more time should be given to decide on when to launch a second process to fill the second vacancy.  It was however his understanding that those delegations supporting one single selection process would only agree to two independent processes if the work on both could be completed before the summer break or if there was prior clarity on the process and timing of both.

The chairman noted that between the February 2017 and April 2017 meetings, consultations had been held by Ambassador Carim, and then by himself after he had taken over chairmanship of the DSB, but, unfortunately, it had not been possible to come to an agreement on the way forward. In view of the Appellate Body's increased workload, every avenue should be explored to ensure its good functioning. The chairman therefore invited delegations with views on this matter to contact him directly or via the WTO secretariat. The chairman said that, for his part, he would continue to consult with delegations to be able to submit a proposal regarding the AB appointments as soon as possible.

A number of delegations took the floor to express concerns about the continued delay. Mexico, speaking on behalf of Argentina, Brazil, Colombia, Chile, Guatemala, Mexico and Peru, said they were concerned the selection process had not yet been launched to fill the first vacancy and which, traditionally, had gone to the Latin American region. Mexico said they were also concerned that there was not even a proposal in this regard despite it being required by the DSU, and that the delay could create a bad precedent for future selection processes. Canada, Australia, India, New Zealand and China expressed their concerns and disappointment that the selection process had not begun and urged members to be pragmatic in finding a solution to this issue. India said members should consider how similar matters had been dealt with in the past and asked for the reasons for the continued impasse.  The EU encouraged further consultations while the United States said it looked forward to further consultations on this matter.  Canada said there was no agreement among members that particular Appellate Body seats should be attached to specific members or regions, and underlined the importance of selecting a candidates based on their merits.  Australia agreed that the merit of the candidate should be the primary consideration for selection and that nothing in the DSU provided for regional preference.

Statements on implementation

The EU, Brazil, Canada and China made statements regarding US implementation of DS217 and DS234, “US — Continued Dumping and Subsidy Offset Act of 2000”.

Surveillance of implementation

The United States presented its status reports with regard to DS184, “US — Anti-Dumping Measures on Certain Hot-Rolled Steel Products from Japan” and DS160, “US — Section 110(5) of the US Copyright Act”.  The EU presented its status report with regard to DS291, “EC — Measures Affecting the Approval and Marketing of Biotech Products”.

Report on the dispute settlement workload

The DSB chairman provided an update on the Appellate Body’s workload, on the number of disputes in the panel queue and at the panel composition stage, and matters referred to arbitration.

Next DSB meeting

The next regular meeting of the DSB will take place on 22 May 2017