Statement by the Director-General - General Council, 8 March 1999

My second point is that the banana issue has been, and still is, a difficult and complex one. We are just a few weeks from an outcome. The rule-based system is working and will continue to work, even if there are different interpretations about some important aspects related to the banana issue.

My third point is that the road map for the legal settlement of the question is in place, and I recommend that Members follow it. I refer to the final statement made by the Dispute Settlement Body Chairman, Ambassador Morjane, on 29 January 1999. The contents of his statement are well known.

There are three important points in that statement:

First, the two parties should find a mutually agreed solution to their problems in the bilateral consultations under Article 4 of the Dispute Settlement Understanding. This is not a procedural suggestion. This is at the heart of our legal system. We seek a solution to a problem firstly by mutual agreement and not by imposing rulings on either side. I invite again both parties to renew their efforts in this direction.

The second point of the Chairman's statement was a pragmatic one. Because there is a different interpretation of the assumptions which have to be taken into account in applying compensatory measures - the question of Article 21.5 and Article 22 - we have given to the same individuals the task of arbitrating the level of suspension and the consistency of the new EU measures with the rules of the WTO. In the next few weeks, we will have both determinations. The credibility of the WTO system will then prove again its strength.

The third point is that we have to better clarify the systemic issues concerning the differences between the two parties over the relationship between Article 21.5 and Article 22. This  third point is already moving on towards an early examination. The first such meeting will be on the 16  March.

We all need to draw a lesson from what is happening at present. We will have some other difficult issues before us in the future, ones which will also have a high profile for public opinion and for the trading system. It will require a very careful handling of those issues in order to avoid a situation which could endanger the system. What I mean is that all parties to a dispute need to work positively towards a solution within the WTO rules and procedures.

The real issue is not that it is the credibility of our Dispute Settlement System which is at stake. The system is - and will continue to be - ready to give its legal response to the disputes which are brought to it. It is the users of the system who will put their credibility at stake if they do not act in conformity with the letter and the spirit of the system, which seeks above all to produce mutually acceptable settlements.