DISPUTE SETTLEMENT SYSTEM TRAINING MODULE: CHAPTER 6
The process — Stages in a typical WTO dispute settlement case
Findings, conclusions and recommendations and suggestions on implementation
The latter part of the panel report is generally referred to as the “Findings”. This is the section setting out the panel’s reasoning to support its final conclusions as to whether the complainant’s claim should be upheld or rejected. This reasoning is a comprehensive discussion of the applicable law in light of the facts established by the panel on the basis of the evidence before it and in the light of the arguments submitted by the parties (Article 12.7 of the DSU).
In the typical case of a violation complaint, the panel decides whether there has been a violation of the invoked provision(s) of one or more covered agreement(s). (As discussed above, the additional requirement of nullification or impairment, where applicable, takes up no more than a short paragraph at the end of the conclusions referring to the presumption of Article 3.8 of the DSU.) In the much less frequent case of a non-violation complaint, the panel decides whether a benefit accruing to the complainant under a covered agreement has been nullified or impaired as a result of a measure that nonetheless conforms with the covered agreement in question. Individual panelists have the right to express a separate opinion in the panel report, but they must do so anonymously (Article 14.3 of the DSU).
The panel’s findings are usually very detailed and specific, often with long legal discussions of whether or not the respondent has acted inconsistently with the covered agreements invoked by the complainant. It is often said that the dispute settlement system has evolved over the years from a diplomatic forum to a more judicial or juridical system. In the early days of GATT 1947, panel conclusions were not always as specific and did not always express clear legal results as is the case today.1
Where the panel concludes that the challenged measure is inconsistent with a covered agreement, the panel report also contains a recommendation that the responding Member bring the challenged measure into conformity with (WTO) law (Article 19.1 of the DSU, first sentence). In practice, these recommendations are formulated as recommendations to the DSB that it request the Member concerned to bring its measure into conformity. The panel may also suggest ways in which the Member concerned could implement the recommendation (Article 19.1 of the DSU, second sentence). However, the panel is not obliged to make such a suggestion (“may”), even when requested by the complainant(s). If the panel makes use of its right to suggest possible ways of implementation, such “suggestions” on how the respondent “could” put itself into compliance are not binding on the responding party. The responding party enjoys the freedom to choose any of the various options that may exist to bring about compliance. All the respondent is obliged to do is to make its measure(s) fully compatible with WTO law.
When a non-violation complaint succeeds, there is no obligation for the responding party to withdraw the measure found to nullify or impair benefits under, or impede an objective of the relevant covered agreement. In such cases the panel recommends that the Member concerned make a adjustment that is mutually satisfactory to the parties (Article 26.1(b) of the DSU). A possible form of adjustment would be that the respondent compensate the complainant with alternative trade opportunities to make up for the nullified or impaired benefit.
A special rule on the panel’s recommendation also exists in respect of prohibited subsidies under the SCM Agreement: if the panel concludes that the challenged subsidy is prohibited, it must “recommend that the subsidizing Member withdraw the subsidy without delay” and must specify the time-period for this withdrawal (Article 4.7 of the SCM Agreement).
Interim review back to top
The panel issues its report to the parties in an “interim” form and as a confidential document containing all the above elements, ideally two to four weeks after the receipt of comments on the descriptive part. The interim report contains the revised descriptive part, the findings, the conclusions and the recommendations, and, as the case may be, suggestions for implementation. It is thus a complete report, although it is not yet final. Parties are again entitled to make comments and may also request a meeting of the panel to further argue specific points raised with respect to the interim report. This is the interim review stage (Article 15 of the DSU). A party may request that the panel review precise aspects of the interim decision. The period of review must not exceed two weeks. The panel may hold an additional meeting with the two sides, which, in practice, the parties rarely request.
The interim report is the first substantial indication that the parties receive as to the likely outcome of the panel report. Although the interim report is confidential, one or more of the parties often leak its content to the press.
The interim review is designed for a reconsideration of precise aspects of the panel report; it is rare for the parties to ask the panel to completely overturn its interim decision. The likelihood of a panel overturning its own (interim) decision would probably not be very high; the panel already knows the arguments of the party in question and has made up its mind.
However, insofar as facts are concerned, the situation is different because the appellate review is limited to legal questions (Article 17.6 of the DSU). The establishment of facts falls exclusively in the domain of panels, and the Appellate Body does not review factual questions. Accordingly, the interim review is the last opportunity for the parties to rectify any factual mistake in the panel report and parties should make use of that opportunity.
Irrespective of whether or not the panel modifies its findings after the interim review, its final report must contain a reference to the arguments raised by the parties during the interim review stage (Article 15.3 of the DSU). This typically becomes a separate section, in which the panel discusses the merits of the parties’ comments during the interim review stage.
Issuance and circulation of the final report back to top
The panel should submit its final report to the parties to the dispute within two weeks following conclusion of the interim review. Once the report is translated into the other official WTO languages2, it is circulated to all WTO Members and becomes a public WT/DS document (the symbol ends on “R”, thus WT/DS###/R).
In cases of multiple complaints on the same matter where a single panel is established, the panel must submit separate reports if one of the parties involved so requests in a timely fashion (Article 9.2 of the DSU).3
1. Panel Report, Belgian Family Allowances, para. 8. back to text
2. The three official languages of the WTO are English, French and Spanish. See the concluding paragraph of the WTO Agreement. back to text
3. Appellate Body Report, US — Offset Act (Byrd Amendment), paras. 311-316. back to text