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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DS517: China — Tariff Rate Quotas for Certain Agricultural Products

China submitted its second request for a dispute panel to determine whether it has complied with a 2019 ruling concerning its administration of TRQs for certain agricultural products.  The DSB agreed to the establishment of the panel. China's first request was blocked at the 26 July meeting of the DSB.

China reiterated that it has fully implemented the rulings and recommendations of the DSB in this dispute and that, while it was reluctant to request the establishment of a compliance panel, it is doing so as a consequence of the United States decision to request authorization to suspend concessions or other obligations with respect to China under Article 22.2 of the Dispute Settlement Understanding. China said it was deeply concerned about the systemic implications of the US approach and emphasized that, despite its request for a compliance panel, the burden to prove the WTO-inconsistency of China's compliance measures remains with the US.

The United States said it does not agree that China has complied with the WTO ruling. It noted that there is a lack of transparency and fairness in China's administration of TRQ measures. The US further said that it has paused the arbitration of its request to suspend concessions to China. The US said it is willing to work with China to reach a resolution.

The DSB agreed to the establishment of a panel. Australia, Brazil, Canada, the European Union, Guatemala, India, Japan, the Russian Federation, Chinese Taipei, and the United Kingdom reserved their rights to participate as third parties in the proceedings.

DS599: Panama — Measures Concerning the Importation of Certain Products from Costa Rica

Costa Rica submitted its first request for the establishment of a dispute panel to examine measures imposed by the Panama on imports originating in Costa Rica including dairy products, meat products, fish food, strawberries, pineapple, plantains, and bananas. Costa Rica requested consultations with Panama on the matter in January 2021 but failed to settle the dispute.

Costa Rica noted its commitments to the multilateral trading system and said it has enjoyed long and prosperous trade relations with Panama. Costa Rica acknowledged Panamanian authorities' willingness for constructive dialogue but noted that situations may arise where impartial views are required, particularly that of a dispute panel. Costa Rica said Panama's decision to ban certain Costa Rican imports over the last two years lacks scientific evidence or justification.

Panama said it regrets Costa Rica's request despite efforts from both countries to maintain the flow of agricultural goods while at the same time applying appropriate levels of sanitary and phytosanitary standards. Panama said that if this issue was brought to dispute settlement proceedings, it would entail much time and resources from both parties and therefore it was better to object to Costa Rica's panel request and continue discussions to find a solution.

The DSB agreed to revert to the matter at a future meeting if requested by a member.

DS601: China — Anti-Dumping Measures on Stainless Steel Products from Japan

Japan submitted its first request for the establishment of a dispute panel to examine anti-dumping measures imposed by the China on stainless steel products from Japan. Japan requested consultations with China on the matter in June 2021 but failed to resolve their differences.

Japan said China's price effect analysis was flawed because it treated three different products (slabs, coils and plates) as a single product and did not properly analyze the impact of each on domestic prices. Japan said China cumulatively assessed the impact of imports from four WTO members that were not in a competitive relationship with each other and is thus inconsistent with the Anti-Dumping Agreement. China's assessment was insufficient to demonstrate the causal relationship between the imports and the injury to domestic industry, Japan said.

China said its anti-dumping regime is in line with relevant WTO rules. China said it was not in the position to support Japan's request and that it believed it was premature to establish a panel in this dispute.

The DSB agreed to revert to the matter at a future meeting if requested by a member.

Statement by Tunisia regarding the panel report in DS578: Morocco — Definitive Anti-Dumping Measures on School Exercise Books from Tunisia.

Tunisia noted that the panel report for the dispute was circulated to members on 27 July 2021 and that Morocco notified its decision to appeal the report. However, Morocco did not make an appellant's submission on the same day contrary to working procedures and in turn, Tunisia is of the view it is not in a position to respond. Tunisia further stated that, based on its reading of procedures, the suspension of the adoption of the panel report should be lifted on 27 October and that Tunisia would be entitled to request the DSB to adopt the report at its 29 November meeting. Until then, Tunisia said it will do everything possible to try to resolve the dispute. It requested the chair to convene the parties as quickly as possible to try to reach an agreement either on the substance of the dispute or on an ad hoc appeal procedure under the chair's guidance.

Morocco said it remained open to continuing consultations including with the Secretariat or the DSB chair to resolve the situation. Morocco also affirmed its notice of appeal and reserved its right to respond to Tunisia's statements at the next DSB meeting.

The Russian Federation and Canada reiterated statements expressing concern over some members' decision to appeal panel reports when the appellate body is not functioning and called on members to engage with a good faith effort to resolve disputes.

The chair of the DSB, Ambassador Didier Chambovey of Switzerland, noting Morocco's agreement to a procedure involving him, invited the parties to begin consultations as soon as possible.

DS217, 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. The United States said it has taken all actions necessary to implement the ruling and that, once a member has said it has complied with a ruling, that member should no longer be required to submit status reports on implementation. 

DS316: European Communities and Certain Member States — Measures affecting trade in large civil aircraft: Implementation of the recommendations adopted by the DSB

The United States said it placed this item on the agenda of the DSB meeting to highlight that the EU has once again not provided WTO members with a status report concerning the dispute.  It noted that on June 15, the US and the EU reached an “Understanding on a cooperative framework for Large Civil Aircraft” which, among other things, suspends the retaliatory tariffs related to this dispute for five years, sets clear principles that any financing for the production or development of large civil aircraft will be on market terms, and commits the two sides to joint collaboration to address non-market practices in this sector.  The European Union said it welcomed the fact that the parties in this dispute have now reached an understanding on a cooperative framework for large civil aircraft, and that this has allowed the parties to suspend their respective retaliation measures for a period of five years. The EU considers that it is not required to submit an implementation status reports to the DSB.

Appellate Body appointments

Mexico, speaking on behalf of 121 members, once again introduced the group's proposal to start the selection processes for the appointment of Appellate Body members.  The extensive number of members submitting the proposal reflects a common concern over the current situation in the Appellate Body that is seriously affecting the overall WTO dispute settlement system against the best interest of members, Mexico said for the group.

Twenty members took the floor to reiterate the importance of resolving the impasse over the appointment of new members as soon as possible and of re-establishing a functioning Appellate Body. They pledged their support to continue efforts to find a solution acceptable to all.

The United States said it was not in a position to support the proposed decision.  The US continues to have systemic concerns with the Appellate Body, which it has explained and raised over the past 16 years and across multiple administrations.  The US said it believes that WTO members must undertake fundamental reform if the dispute settlement system is to remain viable and credible, and that the system can and should better support the WTO’s negotiating and monitoring functions.  The US said it looked forward to further discussions with members on those concerns and to constructive engagement with members at the appropriate time.   

For the 121 members, Mexico again came back to say that the fact a Member may have concerns about certain aspects of the functioning of the Appellate Body cannot serve as pretext to impair and disrupt the work of the DSB and the dispute settlement in general, and that there was no legal justification for the current blocking of the selection processes, which is causing concrete nullification and impairment of rights for many members.

The chair said that resolving the impasse is of great interest to all WTO members and a matter which also requires political engagement by all members. The DSB chair said he will take up the matter again with the General Council chair in the coming days.

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”, and DS471, “United States — Certain Methodologies and their Application to Anti-Dumping Proceedings Involving China.” The European Union presented a status report with regard to DS291, “EC — Measures Affecting the Approval and Marketing of Biotech Products.” Indonesia presented its status reports in DS477 and DS478, “Indonesia — Importation of Horticultural Products, Animals and Animal Products.”" 

Next meeting

The next DSB meeting will take place on 27 September.

 

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