DISPUTE SETTLEMENT

Note

This summary has been prepared by the WTO Secretariat’s Information and External Relations Division to help public understanding about developments in WTO disputes. It is not a legal interpretation of the issues, and it is not intended as a complete account of the issues. These can be found in the reports themselves and in the minutes of the Dispute Settlement Body’s meetings.

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DS573: Turkey — Additional duties on imports of air conditioning machines from Thailand

Thailand presented its first request for a WTO dispute panel to rule on an additional 9.27% duty imposed by Turkey on imports of Thai air conditioners. The tariffs were imposed in response to Thailand's earlier decision to extend safeguard duties on imports of non-alloy hot rolled steel flat products for an additional three years.

Thailand told the DSB that it engaged in good faith consultations with Turkey to resolve the dispute but that the two sides were unable to find agreement, prompting Thailand to submit its request for the panel. Thailand said that because Turkey was not an affected member with a substantial interest as an exporter of the products covered by its safeguard, it was not entitled to suspend trade concessions against Thailand under the WTO's Safeguards Agreement. Furthermore, even if Turkey had the right to suspend concessions, the level of additional duties imposed by Turkey and the duration of its measures were not in line with the obligation to suspend only "substantially equivalent" concessions.

Turkey said it regretted Thailand's decision to seek a panel and said the request was premature because the two sides have not yet exhausted all possibilities to arrive at a mutually convenient solution for this dispute. Turkey said it stands ready to engage in meaningful and constructive discussion with Thailand on how this could be achieved and given these circumstances it is unable to agree to the establishment of a panel.

The DSB took note of the statements and agreed to revert to the matter.

DS234: United States – Continued Dumping and Subsidy Offset Act of 2000

The European Union reiterated its request that the United States cease transferring anti-dumping and countervailing duties to the US domestic industry, arguing that every such disbursement was a clear act of non-compliance with the rulings on this matter. Brazil and Canada agreed with the EU that the matter should remain on the DSB agenda and called on the US to fully comply. The United States referred to its previous statement and said it had taken all action necessary to comply.

DS316: European Communities and Certain Member States – Measures Affecting Trade in Large Civil Aircraft: Implementations of the recommendations adopted by the DSB

The United States said that once again the European Union has not provided a status report concerning dispute DS316. The EU has argued that Article 21.6 of the WTO's Dispute Settlement Understanding (DSU) requires that the issue of implementation remain on the DSB agenda until the issue is resolved and that where a member disagrees with another member's assertion that implementation of a ruling has been achieved, the issue remains unresolved for the purposes of Article 21.6. The stated EU position contradicts its actions in this dispute, the US said. Under the EU's own view, the EU should be providing a status report, yet it has failed to do so. The only difference is that now that the EU is a responding party, the EU is choosing to contradict the reading of Article 21.6 it has long erroneously promoted, the US said.

The European Union said that the US assertion the EU is taking inconsistent positions under Article 21.6 is without merit. In the DS316 case, the dispute is at a stage where the defending party does not have an obligation to submit status reports to the DSB; the EU notified to the WTO a new set of measures to comply with the ruling, the US has contested the EU's claim, and a compliance panel has been established at the request of the EU to review the new measures. In the case of DS234, the situation is completely different; the dispute has been adjudicated and there are no further proceedings pending, but the EU does not agree with the US assertion that it has implemented the ruling, meaning that the issue remains unresolved for the purposes of Article 21.6.

The EU said it would be very concerned with a reading of Article 21.6 that would require the defending party to notify the status of its implementation while dispute settlement proceedings on that precise issue are ongoing.

Appellate Body appointments

Mexico, speaking on behalf of 73 WTO members, once again introduced the group's proposal calling for the establishment of a selection committee for the appointment of new Appellate Body members, the submission of candidates within 30 days, and the issuance by the committee of recommendations within 60 days. Four vacancies now exist on the Appellate Body, which normally has seven members, with two more members due to depart in December. The considerable number of members supporting the proposal reflects a common concern with the current situation in the Appellate Body that is seriously affecting its workings and the overall dispute settlement system against the best interest of its members, Mexico said.

The United States once again said it was not in a position to agree to the joint proposal. As explained in previous meetings, the US said the systemic concerns it has identified remain unaddressed. These concerns include appellate rulings that go far beyond the text setting out WTO rules in areas such as subsidies, anti-dumping duties, anti-subsidy duties, standards and technical barriers to trade, and safeguards. The Appellate Body has also issued advisory opinions on issues not necessary to resolve a dispute and reviewed panel fact-finding despite appeals being limited to legal issues.

Furthermore, the Appellate Body has asserted that panels must follow its rulings although WTO members have not agreed to a system of precedent in the WTO, and has continuously disregarded the 90-day deadline for issuing rulings, the United States said. And for more than a year the US has been calling on WTO members to correct the situation where the Appellate Body acts as if it has the power to permit ex-Appellate Body members to continue to decide appeals even after their terms of office have expired. The US will continue to insist that WTO rules be followed by the WTO dispute settlement system, and will continue with efforts to seek a solution to these important issues.

More than 20 WTO members intervened on the matter. These members largely reiterated concerns voiced in previous DSB meetings, namely: that the impasse was of growing concern given that the terms for two of the three remaining Appellate Body members will expire in December, essentially rendering the Appellate Body inoperative; that members had an obligation under Article 17.2 of the WTO's Dispute Settlement Understanding to fill Appellate Body vacancies as they arise; and that, while they were ready to engage in discussions to end the impasse, the question of filling vacancies and the question of how to address concerns regarding the Appellate Body were different issues which should not be linked. 

Many of those who intervened welcomed the discussions taking place as part of the informal process launched under the General Council to overcome the impasse in the selection of Appellate Body members and encouraged all members to take an active part in the deliberations.

Surveillance of implementation

The United States presented status reports with regard to DS184, "US — Anti-Dumping Measures on Certain Hot-Rolled Steel Products from Japan",  DS160, "United States — Section 110(5) of US Copyright Act", DS464, "United States — Anti-Dumping and Countervailing Measures on Large Residential Washers from Korea", DS471, "United States — Certain Methodologies and their Application to Anti-Dumping Proceedings Involving China" and DS488, "US — Anti-Dumping Measures on Certain Oil Country Tubular Goods from Korea".

The United States informed WTO members that following an agreement with Korea notified to the WTO on 11 January the reasonable period of time for the US to comply with the ruling in DS488 has been extended to 12 July 2019.

The European Union presented its status report with regard to DS291, "EC — Measures Affecting the Approval and Marketing of Biotech Products".

Indonesia presented its status reports in DS484, "Indonesia — Measures Concerning the Importation of Chicken Meat and Chicken Products" and DS477 and DS478, "Indonesia — Importation of Horticultural Products, Animals and Animal Products". 

Next meeting

The next meeting of the DSB is scheduled for 26 March.

More information on WTO dispute settlement is available here.

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