The EC, in reiterating a panel request first made at the previous DSB meeting, said that
the measure in question was an instrument designed to assist US exports. It said that the
taxation system granted export subsidies it resulted in profits of US parent companies
being exempted from taxes.The United States said
that the EC had raised a matter that it had considered resolved. It viewed the EC panel
request as legally unwarranted and commercially unjustified action, and was confident its
arguments would prevail in the panel process.
Canada
reserved third-party rights to participate in the panel proceedings.
Panel report adopted
The DSB
considered a panel report, circulated on 24 August, on the EC's complaint against India's
patent protection for pharmaceutical and agricultural products. The panel found that India
had not complied with its obligations under Article 70.8(a) of the TRIPS Agreement by
failing to establish a legal basis that adequately preserves novelty and priority in
respect of applications for product patents for pharmaceutical and agricultural chemical
inventions, and was also not in compliance with Article 70.9 of the TRIPS Agreement by
failing to establish a system for the grant of exclusive marketing rights.
The EC
welcomed the report as confirming its views in this dispute. It requested the adoption of
the report.
India said it
was prepared to join a possible consensus for the adoption of the report It said that the
aspects of the report had raised certain systemic issues, including its concerns over the
initiation by the EC of panel proceedings on a matter that had already been examined by a
panel (upon a complaint by the United States), and where the EC had participated as a
third party. India stressed that it recognized its obligations under the TRIPS Agreement,
and had established the required “mailbox” for product patents when the WTO
entered into force. It said that its differences with the EC in this regard concerned
certain legal issues.
The DSB
adopted the panel report.
US measure affecting government procurement
The European
Communities and Japan made separate requests for the establishment of a panel to examine a
law enacted by Massachusetts that prohibited the awarding of state contracts to companies
that do business in or with Myanmar. They contended that this measure violated provisions
of the plurilateral Agreement on Government Procurement.
The EC said
that if this law was allowed to stand, it would undermine a fundamental principle of the
agreement, namely that political considerations should not be part of decision-making with
regard to the awarding of procurement contracts. It stressed that its request did mean the
EC approved practices of Myanmar.
Japan said
that it had been working with Myanmar on the question of human rights both bilaterally and
in the Human Rights Commission. It said that improvements were required in this area in
Myanmar but this did not justify an imposition of trade measures by any government.
The United
States expressed regret about the panel requests, citing its common interest with the EC
and Japan in improving the human rights situation in Myanmar. It said that with the
assistance of Massachusetts officials, it would continue efforts to reach a
mutually-agreed solution with the EC and Japan, and thus was not in a position to agree to
a panel at that meeting.
Implementation of DSB recommendations
Canada
presented its fifth status report on the implementation of the DSB recommendations on the
periodicals dispute. It said that it was working for legislative changes that would enable
it to comply fully with the recommendations by 30 October, including the revocation of
excise taxes on foreign periodicals and changes to the postal subsidy programme.
The United
States expressed concern over plans in Canada to introduce legislation that would continue
the discrimination against foreign magazines. It said it would closely monitor the
situation, and that it was prepared to use its legal rights, if necessary.
The EC
presented its second status report on the implementation of the DSB recommendations
concerning its banana regime. It said that it had adopted a regulation that partially
implemented the recommendations, and that it had begun negotiations with substantial
suppliers with regard to the allocate of shares in the EC banana tariff-rate quotas.
Under a
separate item in the agenda, the United States, also speaking on behalf of Ecuador,
Guatemala, Honduras, Mexico and Panama, expressed concerns over what it said was the EC's
failure to comply with the DSB's recommendations regarding its regime for the importation,
sale and distribution of bananas. It expressed regret that the EC had refused their
proposal for the reconvening of the original panel to examine the consistency of the
revised EC measures. The United States believed that the EC's measures to comply with the
DSB recommendations were inconsistent with WTO provisions because the market allocation
for the ACP and Latin American countries was almost the same, and the new criteria for
distributing import licenses appeared to be discriminatory. In its view, if the EC
believed that its measures were WTO-consistent, it should welcome the opportunity to prove
this before the original panel.
The EC
stressed that its implementation of the DSB recommendations was on schedule, and that the
time-period for doing so had not yet expired. It said that a panel could not be
established to examine the proposed EC measures because these were not yet final. The EC
said it would not object to the original panel examining its final measures.
Many
delegations said that the WTO Dispute Settlement Understanding was not completely clear
and precise on the procedures in the implementation stage of the dispute-settlement
process.
“Other business”
Korea said
that it had withdrawn its request for a panel to examine its complaint against the United
States' imposition of anti-dumping duties on imports of colour TVs from Korea. It said
this was in response to a final determination by the United States, in August, to revoke
the anti-dumping duty order on Samsung Electronics.
The EC
expressed concern over a request by Indonesia to implement the DSB recommendations
regarding measures affecting the automobile industry over a 15-month period, which it
viewed as excessively long. The two other complainants in this case, Japan and the United
States, expressed the hope that agreement with Indonesia over implementation would be
reached soon.
Indonesia
emphasized that it would comply fully with the DSB recommendations. However, it requested
a maximum period of time to do so in the lights of its critical economic situation.
Indonesia said that a transitional period was needed to phase out the automobile programme
in question so as not to further exacerbate the unemployment problem. It said that the
government had revoked import duty and luxury tax exemption subsidies to the producers of
the National Car, and that it would take further measures to implement the DSB
recommendations. |
