DS: India — Measures Concerning the Importation of Certain Agricultural Products

This dispute concerns India's import prohibition affecting certain agricultural products from countries reporting Notifiable Avian Influenza (NAI) to the World Organisation for Animal Health (OIE). This import prohibition is maintained through India's Avian Influenza (AI) measures, namely:

• the Livestock Importation Act 1898 (9 of 1898) (Livestock Act) published on 12 August 1898, as amended by the Livestock Importation (Amendment) Act 2001 (No. 28 of 2001) (Livestock Amendment Act), and published in the Gazette of India on 29 August 2001; and
   
• Statutory Order (S.O.) 1663(E) issued by India's Department of Animal Husbandry, Dairying, and Fisheries (DAHD) pursuant to the Livestock Act and published in the Gazette of India on 19 July 2011.

The United States complained that India's AI measures amounted to an import prohibition that was not based on the relevant international standard (the OIE Terrestrial Code) or on a scientific risk assessment. In particular, the United States requested the Panel to find that India's AI measures were inconsistent with a number of provisions of the Sanitary and Phytosanitary (SPS) Agreement: Article 2.2 (that SPS measures be applied only to the extent necessary to protect human, animal or plant life or health and the obligation to base these measures upon scientific principles), Article 2.3 (prohibition of arbitrary or unjustifiable discrimination), Article 3.1 (harmonization of SPS measures based on international standards), Articles 5.1 and 5.2 (risk assessment obligations), Article 5.5 (prohibition of arbitrary or unjustifiable distinctions in appropriate levels of protection (ALOPs)), Article 5.6 (obligation to ensure that SPS measures are not more trade-restrictive than required), Articles 6.1 and 6.2 (adaptation of measures to regional conditions), and Article 7, Annex B(2) and B(5)(a)-(d) (publication, notification and transparency requirements) of the SPS Agreement, as well as Article XI of the GATT 1994 (general elimination of quantitative restrictions).

India's main argument in response was that its AI measures “conform to” an international standard (OIE Terrestrial Code and, in particular, Chapter 10.4 of the Code), pursuant to Article 3.2 of the SPS Agreement, and that consequently, compliance with other provisions of the SPS Agreement (including those requiring that SPS measures have a scientific foundation) and the GATT 1994 must be presumed. Accordingly, India maintained that it was not under an obligation to provide to the Panel the scientific risk assessment conducted pursuant to Articles 5.1 and 5.2 for its AI measures, and that its AI measures were based on scientific principles and evidence in accordance with Article 2.2 of the SPS Agreement. India also submitted to the Panel two separate requests for a preliminary ruling concerning the consistency of the United States' panel request with Article 6.2 of the DSU (identify specific measures at issue and provide a brief summary of the legal basis of the complaint sufficient to present the problem clearly).

As with the majority of SPS cases, the Panel decided to seek advice on certain aspects of the dispute from experts and international organizations. The Panel  consulted with the OIE on the interpretation of the OIE Terrestrial Code and with three individual experts on AI surveillance regimes with particular respect to India's domestic measures and its disease situation.

With respect to India's first request for a preliminary ruling, the Panel issued a preliminary ruling on 22 May 2013 that was circulated to Members on 28 June 2013 and was later incorporated by reference into the Panel's Report. The Panel found, inter alia, that:

• The panel request was sufficiently precise in identifying the measure at issue as required by Article 6.2 of the DSU; and
   
• The products listed in S.O. 1663(E) and the United States' panel request were within the scope of the dispute.

The Panel responded to India's second request for a preliminary ruling in its Report. The Panel found, inter alia, that:

• Two of India's legal instruments that had not been explicitly mentioned in the United States' panel request were not measures at issue; and
   
• The United States was under no obligation to identify in its panel request India's rules applicable to domestic products in order to be able to rely on them in support of its arguments under Article 2.3 of the SPS Agreement.

In respect of the United States' claims pursuant to the SPS Agreement, the Panel found as a preliminary matter that India's AI measures are SPS measures within the meaning of Annex A(1) of the SPS Agreement and are subject to the disciplines of the Agreement.

The Panel further found that:

• India's AI measures are inconsistent with Article 3.1 of the SPS Agreement because they are not “based on” the relevant international standard (Chapter 10.4 of the OIE Terrestrial Code). Furthermore, India's AI measures do not “conform to” the relevant international standard (Chapter 10.4 of the OIE Terrestrial Code), within the meaning of Article 3.2 of the SPS Agreement;
   
• India's AI measures are inconsistent with Articles 5.1, 5.2 and 2.2 of the SPS Agreement because they are not based on a risk assessment;
   
• India's AI measures are inconsistent with Article 2.3 of the SPS Agreement because they arbitrarily and unjustifiably discriminate between Members where identical or similar conditions prevail and are applied in a manner which constitutes a disguised restriction on international trade;
   
• India's AI measures are inconsistent with Articles 5.6 and 2.2 of the SPS Agreement because they are significantly more trade-restrictive than required to achieve India's appropriate level of protection (ALOP) with respect to the products covered by Chapter 10.4 of the OIE Terrestrial Code, and therefore are also applied beyond the extent necessary to protect human and animal life or health;
   
• India's AI measures are inconsistent with Articles 6.2 and 6.1 of the SPS Agreement because they do not recognize the concept of disease-free areas and areas of low disease prevalence, and because they are not adapted to the SPS characteristics of these areas;
   
• India acted inconsistently with Article 7, Annex B(2) and Annex B(5)(a), (b) and (d) of the SPS Agreement because it failed to comply with a number of notification and publication requirements therein.

Having found that India's AI measures are inconsistent with Article 2.3 of the SPS Agreement, the Panel found it unnecessary to rule on the United States' alternative claim under Article 5.5 of the SPS Agreement. The Panel also found that the United States failed to make a prima facie case of violation of Annex B(5)(c) of the SPS Agreement (provide upon request to other Members copies of proposed regulations).

Finally, having found that India's AI measures are inconsistent with the provisions of the SPS Agreement as described above, the Panel found it unnecessary to rule on the United States' claim under Article XI of the GATT 1994 (general elimination of quantitative restrictions).

Articles 2.2, 5.1, and 5.2 of the SPS Agreement. The Appellate Body agreed with the Panel that its finding, that India's AI measures are inconsistent with Articles 5.1 and 5.2 because they are not based on a risk assessment, raised a presumption that those measures are also inconsistent with Article 2.2. However, the Appellate Body found that, by failing to consider whether such presumption had been rebutted by arguments and evidence presented by India to establish a scientific basis for its import prohibitions on fresh poultry meat and eggs from countries reporting low pathogenicity AI (LPNAI), the Panel erred in its application of Article 2.2. The Appellate Body thus reversed, in part, the Panel's findings that India's AI measures are inconsistent with Article 2.2 insofar as those findings concern India's import prohibitions on fresh poultry meat and eggs from countries reporting LPNAI. The Appellate Body was unable to complete the legal analysis under Article 2.2. The Appellate Body also upheld the Panel's findings that India's AI measures are inconsistent with Articles 5.1 and 5.2.

Articles 3.1 and 3.2 of the SPS Agreement. The Appellate Body found that the Panel did not, as India contended, act inconsistently with Article 11.2 of the SPS Agreement or Article 13.2 of the DSU in consulting with the OIE regarding the meaning of the OIE Terrestrial Code. After also rejecting claims raised by India under Article 11 of the DSU, the Appellate Body upheld the Panel's findings under Articles 3.1 and 3.2 that India's AI measures are neither “based on”, nor “conform to”, the relevant international standard (i.e., Chapter 10.4 of the OIE Terrestrial Code).

Article 6 of the SPS Agreement. The Appellate Body found that the Panel did not, as contended by India, err in interpreting the relationship between Article 6.1 and Article 6.3. The Appellate Body also found that, in applying Article 6.2 to determine whether India's AI measures recognize the concepts of disease-free areas and areas of low disease prevalence in respect of AI, the Panel did not err in taking account of both the instruments through which India maintains its import prohibitions (the Livestock Act, as amended, and S.O. 1663(E)), rather than relying on the parent legislation (the Livestock Act, as amended) alone. The Appellate Body endorsed the Panel's finding that India's AI measures violate Article 6 because they require the prohibition of all imports from any country that has notified AI to the OIE, and thus foreclose the possibility of allowing imports from AI-free areas within such countries. For these reasons, and after also rejecting claims raised by India under Article 11 of the DSU, the Appellate Body upheld the Panel's findings that India's AI measures are inconsistent with Articles 6.1 and 6.2.

Article 5.6 and Article 2.2 of the SPS Agreement. In addressing India's claim that the Panel erred in its application of Article 5.6 to India's AI measures, the Appellate Body found that the Panel did not err in finding that the United States had identified alternative measures that would achieve India's appropriate level of protection, and that the Panel did not fail to identify the alternative measures with precision. After also rejecting claims raised by India under Article 11 of the DSU, the Appellate Body upheld the Panel's findings that India's AI measures are inconsistent with Article 5.6 because they are significantly more trade-restrictive than required to achieve India's appropriate level of protection with respect to the products covered by Chapter 10.4 of the OIE Terrestrial Code, and found it unnecessary to address the Panel's finding under Article 2.2.

Article 2.3 of the SPS Agreement. The Appellate Body found that India had not established that the Panel acted inconsistently with Article 11 of the DSU in its consultations with the individual experts regarding the issue of whether LPNAI is exotic to India, or by requiring India to prove that LPNAI is exotic to India. The Appellate Body therefore upheld the Panel's finding that India's AI measures are inconsistent with the first sentence of Article 2.3 because they arbitrarily and unjustifiably discriminate between Members where identical or similar conditions prevail.