ON THIS PAGE:
> Brazil — Aircraft, para. 121; Canada — Aircraft, para. 143
> Brazil — Aircraft, paras. 123–124; Canada — Aircraft, paras. 145–146
> Thailand — H-Beams, paras. 62–65 and 74
> US — Continued Suspension / Canada — Continued Suspension, Annex IV, paras. 3–10
> Philippines — Distilled Spirits, Footnote 12 to para. 5
C.6.1 Brazil — Aircraft, para. 121; Canada — Aircraft, para. 143 back to top
With respect to appellate proceedings, in particular, the provisions of the DSU impose an obligation of confidentiality which applies to WTO Members generally as well as to Appellate Body Members and staff. In this respect, Article 17.10 of the DSU states, without qualification, that “[t]he proceedings of the Appellate Body shall be confidential” (emphasis added). The word “proceeding” has been defined as follows:
In a general sense, the form and manner of conducting juridical business before a court or judicial officer. Regular and orderly progress in form of law, including all possible steps in an action from its commencement to the execution of judgment. (emphasis added)
More broadly, the word “proceedings” has been defined as “the business transacted by a court”. In its ordinary meaning, we take “proceedings” to include, in an appellate proceeding, any written submissions, legal memoranda, written responses to questions, and oral statements by the participants and the third participants; the conduct of the oral hearing before the Appellate Body, including any transcripts or tapes of that hearing; and the deliberations, the exchange of views and internal workings of the Appellate Body.
C.6.2 Brazil — Aircraft, paras. 123–124; Canada — Aircraft, paras. 145–146 back to top
In our view, the provisions of Articles 17.10 and 18.2 apply to all Members of the WTO, and oblige them to maintain the confidentiality of any submissions or information submitted, or received, in an Appellate Body proceeding. Moreover, those provisions oblige Members to ensure that such confidentiality is fully respected by any person that a Member selects to act as its representative, counsel or consultant. In this respect, we note, with approval, the following statement made by the panel in Indonesia — Automobiles:
We would like to emphasize that all members of parties’ delegations — whether or not they are government employees — are present as representatives of their governments, and as such are subject to the provisions of the DSU and of the standard working procedures, including Articles 18.1 and 18.2 of the DSU and paragraphs 2 and 3 of those procedures. In particular, parties are required to treat as confidential all submissions to the Panel and all information so designated by other Members; and, in addition, the Panel meets in closed session. Accordingly, we expect that all delegations will fully respect those obligations and will treat these proceedings with the utmost circumspection and discretion. (emphasis added) [Panel Report, Indonesia — Automobiles, para. 14.1]
Finally, we wish to recall that Members of the Appellate Body and its staff are covered by Article VII:1 of the Rules of Conduct, which provides:
Each covered person shall at all times maintain the confidentiality of dispute settlement deliberations and proceedings together with any information identified by a party as confidential. (emphasis added)
C.6.3 Thailand — H-Beams, paras. 62–65 and 74 back to top
… the Appellate Body received a written brief from the Consuming Industries Trade Action Coalition (“CITAC”), a coalition of United States companies and trade associations. In its brief, CITAC addressed some of the legal issues raised in this appeal. …
… Thailand wrote to us requesting that we reject this brief …
Thailand stated that it appeared on the face of the CITAC brief that this organization had had access to the appellant’s submission in this appeal. … Thailand also stated that certain arguments made in the brief showed a level of knowledge of Thailand’s arguments that “goes beyond what could be divined in the Notice of Appeal”. Thailand stated that there was no plausible explanation for CITAC, a United States private sector association, to have learned the precise format of Thailand’s appellant’s submission, other than that Poland or a third participant in this appeal had failed to treat Thailand’s submission as confidential and had disclosed it to CITAC, in violation of Articles 17.10 and 18.2 of the DSU.
Thailand also stated that it understood that Hogan & Hartson L.L.P., the law firm retained by Poland in this dispute, was also counsel for CITAC. Thailand stated there appeared to be “a very close link among CITAC, Hogan & Hartson L.L.P. and Poland”. Thailand asserted that this apparent linkage suggested that Hogan & Hartson L.L.P. had disclosed the contents of Thailand’s appellant’s submission to CITAC, in violation of Articles 17.10 and 18.2 of the DSU.
In our preliminary ruling of 14 December 2000, we stated:
The terms of Article 17.10 of the DSU are clear and unequivocal: “[t]he proceedings of the Appellate Body shall be confidential”. Like all obligations under the DSU, this is an obligation that all Members of the WTO, as well as the Appellate Body and its staff, must respect. WTO Members who are participants and third participants in an appeal are fully responsible under the DSU and the other covered agreements for any acts of their officials as well as their representatives, counsel or consultants. … We note that Poland has made substantial efforts to investigate this matter, and to gather information from its legal counsel, Hogan & Hartson L.L.P. We note as well the responses from the third participants, the European Communities, Japan and the United States. Furthermore, Poland has accepted the proposal made by Hogan & Hartson L.L.P. to withdraw as Poland’s legal counsel in this appeal. On the basis of the responses we have received from Poland and from the third participants, and on the basis of our own examination of the facts on the record in this appeal, we believe that there is prima facie evidence that CITAC received, or had access to, Thailand’s appellant’s submission in this appeal. We see no reason to accept the written brief submitted by CITAC in this appeal. Accordingly, we have returned this brief to CITAC.
C.6.4 US — Continued Suspension / Canada — Continued Suspension, Annex IV, paras. 3–10 back to top
The participants have different views on the scope of the term “proceedings” in Article 17.10 of the DSU. The European Communities argues that the term “proceedings” in Article 17.10 should be interpreted narrowly as referring to the Appellate Body’s internal work and does not include its oral hearing. The United States refers to the Recommendations by the Preparatory Committee for the WTO. The United States contends that the Preparatory Committee viewed Article 17.10 as focused on the deliberations of the Appellate Body. Canada concedes that the term “proceedings” covers the oral hearing. A similar view has been put forward by Brazil, China, India, and Mexico. We consider the term “proceedings” to mean the entire process by which an appeal is prosecuted, from the initiation of an appeal to the circulation of the Appellate Body report, including the oral hearing. This is also how the Appellate Body understood the term in Canada — Aircraft. Having agreed with this broad interpretation of the term “proceedings”, we now consider the precise meaning and scope of the confidentiality requirement in Article 17.10.
The third participants that object to the request to allow public observation argue that the confidentiality requirement in Article 17.10 is absolute and permits of no derogation. We disagree with this interpretation because Article 17.10 must be read in context, particularly in relation to Article 18.2 of the DSU. The second sentence of Article 18.2 expressly provides that “[n]othing in this Understanding shall preclude a party to a dispute from disclosing statements of its own positions to the public”. Thus, under Article 18.2, the parties may decide to forgo confidentiality protection in respect of their statements of position. With the exception of India, the participants and third participants agreed that the term “statements of its own positions” in Article 18.2 extends beyond the written submissions referred to in the first sentence of Article 18.2, and includes oral statements and responses to questions posed by the Appellate Body at the oral hearing. The third sentence of Article 18.2 states that “Members shall treat as confidential information submitted by another Member to the panel or the Appellate Body which that Member has designated as confidential”. This provision would be redundant if Article 17.10 were interpreted to require absolute confidentiality in respect of all elements of appellate proceedings. There would be no need to require, pursuant to Article 18.2, that a Member designate certain information as confidential. The last sentence of Article 18.2 ensures that even such designation by a Member does not put an end to the right of another Member to make disclosure to the public. Upon request, a Member must provide a non-confidential summary of the information contained in its written submissions that it designated as confidential, which can then be disclosed to the public. Thus, Article 18.2 provides contextual support for the view that the confidentiality rule in Article 17.10 is not absolute. Otherwise, no disclosure of written submissions or other statements would be permitted during any stage of the proceedings.
In practice, the confidentiality requirement in Article 17.10 has its limits. Notices of Appeal and Appellate Body reports are disclosed to the public. Appellate Body reports contain summaries of the participants’ and third participants’ written and oral submissions and frequently quote directly from them. Public disclosure of Appellate Body reports is an inherent and necessary feature of our rules-based system of adjudication. Consequently, under the DSU, confidentiality is relative and time-bound.
In our view, the confidentiality requirement in Article 17.10 is more properly understood as operating in a relational manner. There are different sets of relationships that are implicated in appellate proceedings. Among them are the following relationships. First, a relationship between the participants and the Appellate Body. Secondly, a relationship between the third participants and the Appellate Body. The requirement that the proceedings of the Appellate Body are confidential affords protection to these separate relationships and is intended to safeguard the interests of the participants and third participants and the adjudicative function of the Appellate Body, so as to foster the system of dispute settlement under conditions of fairness, impartiality, independence and integrity. In this case, the participants have jointly requested authorization to forgo confidentiality protection for their communications with the Appellate Body at the oral hearing. The request of the participants does not extend to any communications, nor touches upon the relationship, between the third participants and the Appellate Body. The right to confidentiality of third participants vis-à-vis the Appellate Body is not implicated by the joint request. The question is thus whether the request of the participants to forego confidentiality protection satisfies the requirements of fairness and integrity that are the essential attributes of the appellate process and define the relationship between the Appellate Body and the participants. If the request meets these standards, then the Appellate Body would incline towards authorizing such a joint request.
We note that the DSU does not specifically provide for an oral hearing at the appellate stage. The oral hearing was instituted by the Appellate Body in its Working Procedures, which were drawn up pursuant to Article 17.9 of the DSU. The conduct and organization of the oral hearing falls within the authority of the Appellate Body (compétence de la compétence) pursuant to Rule 27 of the Working Procedures. Thus, the Appellate Body has the power to exercise control over the conduct of the oral hearing, including authorizing the lifting of confidentiality at the joint request of the participants as long as this does not adversely affect the rights and interests of the third participants or the integrity of the appellate process. As we observed earlier, Article 17.10 also applies to the relationship between third participants and the Appellate Body. Nevertheless, in our view, the third participants cannot invoke Article 17.10, as it applies to their relationship with the Appellate Body, so as to bar the lifting of confidentiality protection in the relationship between the participants and the Appellate Body. Likewise, authorizing the participants’ request to forego confidentiality, does not affect the rights of third participants to preserve the confidentiality of their communications with the Appellate Body.
Some of the third participants argued that the Appellate Body is itself constrained by Article 17.10 in its power to authorize the lifting of confidentiality. We agree that the powers of the Appellate Body are themselves circumscribed in that certain aspects of confidentiality are incapable of derogation — even by the Appellate Body — where derogation may undermine the exercise and integrity of the Appellate Body’s adjudicative function. This includes the situation contemplated in the second sentence of Article 17.10, which provides that “[t]he reports of the Appellate Body shall be drafted without the presence of the parties to the dispute and in the light of the information provided and the statements made”. As noted by the participants, the confidentiality of the deliberations is necessary to protect the integrity, impartiality, and independence of the appellate process. In our view, such concerns do not arise in a situation where, following a joint request of the participants, the Appellate Body authorizes the lifting of the confidentiality of the participants’ statements at the oral hearing.
The Appellate Body has fostered the active participation of third parties in the appellate process in drawing up the Working Procedures and in appeal practice. Article 17.4 provides that third participants “may make written submissions to, and be given an opportunity to be heard by, the Appellate Body”. In its Working Procedures, the Appellate Body has given full effect to this right by providing for participation of third participants during the entirety of the oral hearing, while third parties meet with panels only in a separate session at the first substantive meeting. Third participants, however, are not the main parties to a dispute. Rather, they have a systemic interest in the interpretation of the provisions of the covered agreements that may be at issue in an appeal. Although their views on the questions of legal interpretation that come before the Appellate Body are always valuable and thoroughly considered, these issues of legal interpretation are not inherently confidential. Nor is it a matter for the third participants to determine how the protection of confidentiality in the relationship between the participants and the Appellate Body is best dealt with. In order to sustain their objections to public observation of the oral hearing, third participants would have to identify a specific interest in their relationship with the Appellate Body that would be adversely affected if we were to authorize the participants’ request — in this case, we can discern no such interests.
The request for public observation of the oral hearing has been made jointly by the three participants, Canada, the European Communities, and the United States. As we explained earlier, the Appellate Body has the power to authorize a joint request by the participants to lift confidentiality, provided that this does not affect the confidentiality of the relationship between the third participants and the Appellate Body, or impair the integrity of the appellate process. The participants have suggested alternative modalities that allow for public observation of the oral hearing, while safeguarding the confidentiality protection enjoyed by the third participants. The modalities include simultaneous or delayed closed-circuit television broadcasting in a room separate from the room used for the oral hearing. Finally, we do not see the public observation of the oral hearing, using the means described above, as having an adverse impact on the integrity of the adjudicative functions performed by the Appellate Body.
C.6.5 Philippines — Distilled Spirits, Footnote 12 to para. 5 back to top
The Philippines provided the third participants with copies of its appellant’s submission that did not contain certain information that was considered business confidential information in the Panel proceedings (pursuant to the Additional Working Procedures Concerning Business Confidential Information, adopted by the Panel on 31 August 2010). This information was, however, included in the copies of the Philippines’ appellant’s submission filed with the Appellate Body and served on the European Union and the United States. Following an enquiry from the Appellate Body Secretariat on 14 October 2011, the Philippines provided, on 18 October 2011, copies of its appellant’s submission containing the business confidential information to the third participants. The Philippines requested the third participants to treat such information as confidential. In response to questioning at the oral hearing in this appeal, the participants and third participants confirmed to the Appellate Body that the information the Philippines had designated as business confidential in its appellant’s submission was governed by the confidentiality rules of Article 18.2 of the DSU.
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