The texts reproduced here do not have the legal standing of the original documents which are entrusted and kept at the WTO Secretariat in Geneva.

> Article 1
> Article 2
> Article 3
> Article 4
> Article 5
> Article 6
> Article 7
> Article 8
> Article 9
> Article 10
> Article 11
> Article 12
> Article 13
> Article 14
> Article 15
> Article 16
> Article 17
> Article 18
> Article 19
> Article 20
> Article 21
> Article 22
> Article 23
> Article 24
> Article 25
> Article 26
> Article 27
> Appendix 1: Agreements Covered by the DSU
> Appendix 2: Special or Additional Dispute Settlement Rules and Procedures
> Appendix 3: Panel Working Procedures
> Appendix 4: Expert Review Groups
> Working Procedures for Appellate Review
> Working Procedures for Article 22.6 Arbitrations
> Rules of Conduct for the Understanding on Rules and Procedures Governing the Settlement of Disputes
> Rules of Procedure for Meetings of the Dispute Settlement Body
> Other Issues in WTO Dispute Proceedings
> Time-Frames in Relation to Panel and Appellate Body Reports

> Analytical Index main page

XXX. Appendix 3: Panel Working Procedures    back to top

A. Text of Appendix 3

Appendix 3: Working Procedures

1.     In its proceedings the panel shall follow the relevant provisions of this Understanding. In addition, the following working procedures shall apply.

2.     The panel shall meet in closed session. The parties to the dispute, and interested parties, shall be present at the meetings only when invited by the panel to appear before it.

3.     The deliberations of the panel and the documents submitted to it shall be kept confidential. Nothing in this Understanding shall preclude a party to a dispute from disclosing statements of its own positions to the public. Members shall treat as confidential information submitted by another Member to the panel which that Member has designated as confidential. Where a party to a dispute submits a confidential version of its written submissions to the panel, it shall also, upon request of a Member, provide a non-confidential summary of the information contained in its submissions that could be disclosed to the public.

4.     Before the first substantive meeting of the panel with the parties, the parties to the dispute shall transmit to the panel written submissions in which they present the facts of the case and their arguments.

5.     At its first substantive meeting with the parties, the panel shall ask the party which has brought the complaint to present its case. Subsequently, and still at the same meeting, the party against which the complaint has been brought shall be asked to present its point of view.

6.     All third parties which have notified their interest in the dispute to the DSB shall be invited in writing to present their views during a session of the first substantive meeting of the panel set aside for that purpose. All such third parties may be present during the entirety of this session.

7.     Formal rebuttals shall be made at a second substantive meeting of the panel. The party complained against shall have the right to take the floor first to be followed by the complaining party. The parties shall submit, prior to that meeting, written rebuttals to the panel.

8.     The panel may at any time put questions to the parties and ask them for explanations either in the course of a meeting with the parties or in writing.

9.     The parties to the dispute and any third party invited to present its views in accordance with Article 10 shall make available to the panel a written version of their oral statements.

10.     In the interest of full transparency, the presentations, rebuttals and statements referred to in paragraphs 5 to 9 shall be made in the presence of the parties. Moreover, each party’s written submissions, including any comments on the descriptive part of the report and responses to questions put by the panel, shall be made available to the other party or parties.

11.     Any additional procedures specific to the panel.

12.     Proposed timetable for panel work:

     The above calendar may be changed in the light of unforeseen developments. Additional meetings with the parties shall be scheduled if required.

 
B. Interpretation and Application of Appendix 3

1. General

(a) Appendix 3 and the panel’s margin of discretion

814.     The Appellate Body on EC — Hormones held that panels, under the DSU, enjoy a margin of discretion to deal with situations that “are not explicitly regulated”:

“[T]he DSU, and in particular its Appendix 3, leave panels a margin of discretion to deal, always in accordance with due process, with specific situations that may arise in a particular case and that are not explicitly regulated. Within this context, an appellant requesting the Appellate Body to reverse a panel’s ruling on matters of procedure must demonstrate the prejudice generated by such legal ruling.”(1184)

815.     The Appellate Body on EC — Hormones stated that it agreed with the Panel’s exercise of its margin of discretion when it allowed the United States to participate in the second substantive meeting of the proceedings initiated by Canada in the same dispute.(1185) With respect to “enhanced” third-party rights, see paragraphs 312-317 above.

816.     In India — Patents (US), the Appellate Body examined the Panel’s decision at the outset of the first substantive meeting — “that all legal claims would be considered if they were made prior to the end of that meeting; and this ruling was accepted by both parties”. The Appellate Body, in being called upon to determine whether the Panel had exceeded its terms of reference, stated:

“We do not find this statement … consistent with the letter and the spirit of the DSU. Although panels enjoy some discretion in establishing their own working procedures, this discretion does not extend to modifying the substantive provisions of the DSU. To be sure, Article 12.1 of the DSU says: ‘Panels shall follow the Working Procedures in Appendix 3 unless the panel decides otherwise after consulting the parties to the dispute’. Yet that is all that it says. Nothing in the DSU gives a panel the authority either to disregard or to modify other explicit provisions of the DSU.”(1186)

817.     The Panel in EC — Tariff Preferences addressed the issue of the joint representation of India, the complaining party and Paraguay, a third party, by the same legal counsel, the Advisory Centre of WTO Law (AWCL). The Panel stated that “flowing from its terms of reference and from the requirement … pursuant to Article 12 of the DSU, to determine and administer its Working Procedures, the Panel has the inherent authority — and, indeed, the duty — to manage the proceeding in a manner guaranteeing due process to all parties involved in the proceeding and to maintain the integrity of the dispute settlement system”. As regards the Panel’s conclusion on conflict of interest, see Section XXXVI.E.3 below.

(b) Working procedures as a means to ensure due process

818.     In this respect, see Section XXXVI.B.1 below.

2. Paragraph 3: non-confidential versions of written submissions

819.     In US — Steel Safeguards, the Panel sent a letter to all parties including a series of preliminary rulings on organizational matters. Among other issues, the Panel dealt with the United States’ request to require production of non-confidential versions of written submissions within 14 days following the filing of the written submissions. In this respect, see paragraph 484 above.

3. Paragraph 11: additional procedures

(a) Separate reports

820.     As regards the issuance of separate reports in panel proceedings with two or more complainants, see Article 9.2 (Section IX.B.1 above).

(b) Composition of parties’ delegations

821.     In Brazil — Aircraft (Article 21.5 — Canada II), the Panel’s Working Procedures included a paragraph 13 providing that the parties and third parties had the right to determine the composition of their own delegations:

“The parties and third parties to this proceeding have the right to determine the composition of their own delegations. Delegations may include, as representatives of the government concerned, private counsel and advisers. The parties and third parties shall have responsibility for all members of their delegations and shall ensure that all members of their delegations, as well as any other advisors consulted by a party or third party, act in accordance with the rules of the DSU and the working procedures of this Panel, particularly in regard to confidentiality of the proceedings. Parties shall provide a list of the participants of their delegation before or at the beginning of the meeting with the Panel.”(1187)

(c) Business confidential information (BCI)

822.     As regards procedures concerning BCI, see Section XVIII.B.1(c) above.

(d) Preliminary rulings

(i) General

823.     It is often the case that the parties to a dispute raise preliminary objections in panel and Appellate Body proceedings. Section XXXVI.C below is concerned with the issues arising from this procedural issue.

(ii) Procedures

824.     In EC — Tube or Pipe Fittings, the Panel’s Working Procedures provided that preliminary rulings must be requested not later than the first written submission, but that exceptions could be made upon showing of “good cause”. The European Communities requested the Panel to make a preliminary ruling rejecting a number of exhibits submitted by Brazil during the first substantive meeting on the grounds that they did not form part of the record of the underlying investigation. The Panel noted that, as Brazil submitted these exhibits in conjunction with its oral statement at the first meeting, which meant that the European Communities was not in a position to make a preliminary objection in its first written submission, good cause existed for enabling the Panel to consider the merits of the European Communities request for a preliminary ruling.(1188)

825.     In Canada — Wheat Exports and Grain Imports, the Panel gave the United States an opportunity to provide preliminary written submissions in response to Canada’s earlier preliminary submissions. At the request of Canada, the Panel also scheduled a preliminary hearing. The panel also decided to invite the third parties to participate in the preliminary proceedings.(1189)

(e) Participation of third parties in preliminary ruling proceedings

826.     In Canada — Wheat Exports and Grain Imports, the Panel, in a preliminary ruling, decided to grant third parties the possibility to participate in the proceedings regarding preliminary rulings requested by Canada concerning the consistency of the United States’ panel request with Article 6.2 of the DSU and Canada’s request for the adoption of specific procedures for the protection of proprietary or commercially sensitive information. As regards the specific rights granted to the third parties, see paragraph 935 below. The Panel thus amended paragraph 6 of its Working Procedures as follows:

“The third parties shall be invited in writing to present their views during a session of the preliminary hearing of the Panel set aside for that purpose as well as during a session of the first substantive meeting of the Panel set aside for that purpose. The third parties may be present during the entirety of these sessions.”(1190)

(f) Executive summaries

827.     In US — Line Pipe, the Working Procedures of the Panel requested the parties to present executive summaries of the claims and arguments contained in their written submissions and oral presentations.(1191) The parties presented various arguments in connection with the issue of confidential information. Those arguments were summarized in the parties’ executive summaries of their submissions and oral statements and were included in the relevant sections of the Panel’s report. In its comments on the descriptive part of the report, Korea requested the Panel to include as an annex to the Panel report a copy of their non-summarized closing oral statement made at the second substantive meeting, addressing the issue of confidential information and use of judicial economy. The Panel declined Korea’s request on the grounds that Korea’s closing statement formed part of their oral statement at the second substantive meeting and that, accordingly, any arguments presented therein should have been included in its executive summary of that oral statement. Nevertheless, the Panel clarified that all the communications and submissions of the parties formed part of the record of this proceeding, and were duly considered by the Panel.(1192)

828.     In EC — Tube or Pipe Fittings, the Panel’s Working Procedures requested the parties to submit an executive summary of the claims and arguments contained in their written submissions and oral presentations.(1193) In its comments on the descriptive part of the Panel Report, Brazil requested that the complete text of its first and second submissions, rather than Brazil’s executive summaries thereof, be included in Annexes A and C respectively of the Report. The Panel rejected this request as follows:

“This paragraph [of the Working Procedures] makes it clear that we are to use the executive summaries only for the purpose of assisting us in drafting a concise arguments section of the Panel Report so as to facilitate timely translation and circulation of the Panel Report to the Members. The rationale of this paragraph is to facilitate our production of a concise and timely descriptive part and not to attach the entire written submissions and statements of the parties. We find no substantiation for Brazil’s assertion that other panels that have adopted a similar paragraph in their working procedures have also nevertheless attached the parties’ entire written submissions to their reports. Indeed, this would seem to us to defeat the purpose of adopting the ‘executive summary approach’ in the first place.

Second, the attachment of executive summaries to our report also leaves the parties in control of the contents of the executive summaries and enables them to set forth their most important arguments as they wish to set these forth. Each party has the obligation and the discretion to ensure that its own executive summaries of its own submissions accurately reflects its claims and arguments. Neither party requested us to increase the page limits referred to in our Working Procedures.

Third, we adopted these Working Procedures after hearing the views of the parties, at which time Brazil expressed no objection to the formulation in paragraph 16 of the Working Procedures. We decided at the outset to follow the ‘executive summaries approach’ for these Panel proceedings. Having adopted this approach at the outset, we do not consider that it would beneficial, at this rather advanced stage in the proceedings, to adopt Brazil’s suggested approach of attaching its full first and second submissions. Our adoption of such an approach at this stage would result in significant further delays in issuing our Report, particularly in view of the lengthy nature of these submissions (totalling over 370 pages). This would impose a considerable translation burden, adding to the burden already being borne due to the operation of the WTO dispute settlement system generally. There would also be an incongruity if the full EC submissions were not also attached, which, if we were to address by taking the requisite procedural steps and then by annexing the EC submissions, would augment the translation burden. We find particularly salient, in this respect, Article 12.2 of the DSU, which provides:

“Panel procedures should provide sufficient flexibility so as to ensure high-quality panel reports, while not unduly delaying the panel process.” (emphasis added)

Fourth, as our Working Procedures also make clear, in no way are the executive summaries to substitute for the parties’ submissions. In the course of our examination of the parties’ claims and arguments in these proceedings, we have read and analysed with great care the full written and oral submissions of the parties and the exchanges of questions and answers relating thereto. Our findings and conclusions in this Panel Report are based upon these full written and oral submissions and questions and answers. They form an integral part of the record before the Panel in this case. We therefore believe that we have adhered to both the letter and spirit of our Working Procedures and do not believe that any prejudice has arisen to Brazil in the course of these proceedings from annexing executive summaries of its first and second written submissions.

Fifth, we recall that Article 18.2 of the DSU, as also reflected in paragraph 3 of our Working Procedures, states that nothing in the DSU shall preclude a party to a dispute from disclosing statements of its own positions to the public. There is therefore nothing precluding Brazil from making its full first and second submissions generally and publicly available (subject, of course, to the requirements of maintaining the confidentiality of the EC’s submissions in Article 18.2 of the DSU and paragraph 3 of our Working Procedures).(1194)”(1195)

829.     In US — Steel Safeguards, the Panel sent a letter to all parties including a series of preliminary rulings(1196) on organizational matters. Among the issues considered, the Panel referred to the executive summaries requested in paragraph 5 of the Panel’s Working Procedures, as follows:

“In relation to the requirement contained in paragraph 5 of the Working Procedures to submit executive summaries, on the basis of discussions with the parties, the Panel has decided to allow the United States to submit executive summaries that should not exceed 30 pages. The first 15 pages should deal with the common claims raised by the complainants. The additional 15 pages would allow the United States to deal with specific claims made individually by one or more of the complainants but which are not common to all the complainants.”(1197)

4. Timetable

(a) General

830.     In US — Steel Safeguards, the Panel sent a letter to all parties including a series of preliminary rulings(1198) on organizational matters. Among other issues, the Panel referred to the timetable for its proceedings as follows:

“The Panel notes at the outset that this case is likely to impose a heavy burden on parties in terms of their obligations to make submissions as set out in the timetable for the proceedings, a copy of which is attached. As is noted at the end of the timetable, the Panel would like to emphasize that the calendar may be changed during the panel process. The Panel would also like to assure parties that it will do its utmost, within reason, to accommodate the parties’ concerns and requests in relation to the deadlines set out in the timetable. Some of the requests that have been made by the parties in this respect are already reflected in the attached timetable.”(1199)

(b) Deadline for affirmative defence

831.     In Canada — Aircraft, Brazil argued that a good faith interpretation of the DSU requires a party making an affirmative defence to set forth the grounds for that affirmative defence in its first written submission to the panel. The Panel disagreed:

“As noted above, there is nothing in the DSU, or in the Appendix 3 Working Procedures, to prevent a party submitting new evidence or allegations after the first substantive meeting. We can see no basis in the DSU to treat the submission of affirmative defences after the first substantive meeting any differently. Thus, although it is desirable that affirmative defences, as with any claim, should be submitted as early as possible, there is no requirement that affirmative defences should be submitted before the end of the first substantive meeting with the parties. Provided that due process is respected, we see nothing to prohibit the submission of affirmative defences after the first substantive meeting with the parties.”(1200)

(c) Timing of the submission of evidence

832.     As regards the timing for the submission of evidence by the parties in panel proceedings, see Section XI.B.3(b) above.

(d) Timing for raising objections to panels’ jurisdiction

833.     In this regard, see Section VII.B.1(c)(ii) above.

(e) Timing for the filing of submissions with the WTO Dispute Settlement Registrar

834.     In US — Steel Safeguards, the Panel sent a letter to all parties including a series of preliminary rulings(1201) on organizational matters. Among the issues, the Panel referred to the timing for the filing of the parties’ written submissions with the WTO Dispute Settlement Registrar. The Panel decided to require parties to file their written submissions with the Registrar by 5:30 p.m. on the deadlines established by the Panel, except for those deadlines falling on a Friday in which case the submissions should be filed by 5:00 p.m. The Panel considered that, in exceptional circumstances, when it was not possible to comply with these time deadlines, the parties could agree upon an alternative arrangement with the Secretary to the Panel.(1202)

XXXI. Appendix 4: Expert Review Groups    back to top

A. Text of Appendix 4

Appendix 4: Expert Review Groups

        The following rules and procedures shall apply to expert review groups established in accordance with the provisions of paragraph 2 of Article 13.

1.     Expert review groups are under the panel’s authority. Their terms of reference and detailed working procedures shall be decided by the panel, and they shall report to the panel.

2.     Participation in expert review groups shall be restricted to persons of professional standing and experience in the field in question.

3.     Citizens of parties to the dispute shall not serve on an expert review group without the joint agreement of the parties to the dispute, except in exceptional circumstances when the panel considers that the need for specialized scientific expertise cannot be fulfilled otherwise. Government officials of parties to the dispute shall not serve on an expert review group. Members of expert review groups shall serve in their individual capacities and not as government representatives, nor as representatives of any organization. Governments or organizations shall therefore not give them instructions with regard to matters before an expert review group.

4.     Expert review groups may consult and seek information and technical advice from any source they deem appropriate. Before an expert review group seeks such information or advice from a source within the jurisdiction of a Member, it shall inform the government of that Member. Any Member shall respond promptly and fully to any request by an expert review group for such information as the expert review group considers necessary and appropriate.

5.     The parties to a dispute shall have access to all relevant information provided to an expert review group, unless it is of a confidential nature. Confidential information provided to the expert review group shall not be released without formal authorization from the government, organization or person providing the information. Where such information is requested from the expert review group but release of such information by the expert review group is not authorized, a non-confidential summary of the information will be provided by the government, organization or person supplying the information.

6.     The expert review group shall submit a draft report to the parties to the dispute with a view to obtaining their comments, and taking them into account, as appropriate, in the final report, which shall also be issued to the parties to the dispute when it is submitted to the panel. The final report of the expert review group shall be advisory only.

B. Interpretation and Application of Appendix 4

No jurisprudence or decision of a competent WTO body.

XXXII. Working Procedures for Appellate Review    back to top

A. Text of the Working Procedures for Appellate Review(1203)

“Definitions

1.     In these Working Procedures for Appellate Review,

“appellant”

means any party to the dispute that has filed a Notice of Appeal pursuant to Rule 20;

“appellate report”

means an Appellate Body report as described in Article 17 of the DSU;

“appellee”

means any party to the dispute that has filed a submission pursuant to Rule 22 or paragraph 4 of Rule 23;

“consensus”

a decision is deemed to be made by consensus if no Member formally objects to it;

“covered agreements”

has the same meaning as “covered agreements” in paragraph 1 of Article 1 of the DSU;

“division”

means the three Members who are selected to serve on any one appeal in accordance with paragraph 1 of Article 17 of the DSU and paragraph 2 of Rule 6;

“documents”

means the Notice of Appeal, any Notice of Other Appeal and the submissions and other written statements presented by the participants or third participants;

“DSB”

means the Dispute Settlement Body established under Article 2 of the DSU;

“DSU”

means the Understanding on Rules and Procedures Governing the Settlement of Disputes which is Annex 2 to the WTO Agreement;

“Member”

means a Member of the Appellate Body who has been appointed by the DSB in accordance with Article 17 of the DSU;

“other appellant”

means any party to the dispute that has filed a Notice of Other Appeal pursuant to paragraph 1 of Rule 23;

“participant”

means any party to the dispute that has filed a Notice of Appeal pursuant to Rule 20, a Notice of Other Appeal pursuant to Rule 23 or a submission pursuant to Rule 22 or paragraph 4 of Rule 23;

“party to the dispute”

means any WTO Member who was a complaining or defending party in the panel dispute, but does not include a third party;

“proof of service”

means a letter or other written acknowledgement that a document has been delivered, as required, to the parties to the dispute, participants, third parties or third participants, as the case may be;

“Rules”

means these Working Procedures for Appellate Review;

“Rules of Conduct”

means the Rules of Conduct for the Understanding on Rules and Procedures Governing the Settlement of Disputes as attached in Annex II to these Rules;

“SCM Agreement”

means the Agreement on Subsidies and Countervailing Measures which is in Annex 1A to the WTO Agreement;

“Secretariat”

means the Appellate Body Secretariat;

“service address”

means the address of the party to the dispute, participant, third party or third participant as generally used in WTO dispute settlement proceedings, unless the party to the dispute, participant, third party or third participant has clearly indicated another address;

“third participant”

means any third party that has filed a written submission pursuant to Rule 24(1); or any third party that appears at the oral hearing, whether or not it makes an oral statement at that hearing;

“third party”

means any WTO Member who has notified the DSB of its substantial interest in the matter before the panel pursuant to paragraph 2 of Article 10 of the DSU;

“WTO”

means the World Trade Organization;

“WTO Agreement”

means the Marrakesh Agreement Establishing the World Trade Organization, done at Marrakesh, Morocco on 15 April 1994;

“WTO Member”

means any State or separate customs territory possessing full autonomy in the conduct of its external commercial relations that has accepted or acceded to the WTO in accordance with Articles XI, XII or XIV of the WTO Agreement; and

“WTO Secretariat”

means the Secretariat of the World Trade Organization.

PART I MEMBERS

Duties and Responsibilities

2.     (1)     A Member shall abide by the terms and conditions of the DSU, these Rules and any decisions of the DSB affecting the Appellate Body.

        (2)     During his/her term, a Member shall not accept any employment nor pursue any professional activity that is inconsistent with his/her duties and responsibilities.

        (3)     A Member shall exercise his/her office without accepting or seeking instructions from any international, governmental, or non-governmental organization or any private source.

        (4)     A Member shall be available at all times and on short notice and, to this end, shall keep the Secretariat informed of his/her whereabouts at all times.

Decision-Making

3.     (1)     In accordance with paragraph 1 of Article 17 of the DSU, decisions relating to an appeal shall be taken solely by the division assigned to that appeal. Other decisions shall be taken by the Appellate Body as a whole.

        (2)     The Appellate Body and its divisions shall make every effort to take their decisions by consensus. Where, nevertheless, a decision cannot be arrived at by consensus, the matter at issue shall be decided by a majority vote.

Collegiality

4.     (1)     To ensure consistency and coherence in decision-making, and to draw on the individual and collective expertise of the Members, the Members shall convene on a regular basis to discuss matters of policy, practice and procedure.

        (2)     The Members shall stay abreast of dispute settlement activities and other relevant activities of the WTO and, in particular, each Member shall receive all documents filed in an appeal.

        (3)     In accordance with the objectives set out in paragraph 1, the division responsible for deciding each appeal shall exchange views with the other Members before the division finalizes the appellate report for circulation to the WTO Members. This paragraph is subject to paragraphs 2 and 3 of Rule 11.

        (4)     Nothing in these Rules shall be interpreted as interfering with a division’s full authority and freedom to hear and decide an appeal assigned to it in accordance with paragraph 1 of Article 17 of the DSU.

Chairman

5.     (1)     There shall be a Chairman of the Appellate Body who shall be elected by the Members.

        (2)     The term of office of the Chairman of the Appellate Body shall be one year. The Appellate Body Members may decide to extend the term of office for an additional period of up to one year. However, in order to ensure rotation of the Chairmanship, no Member shall serve as Chairman for more than two consecutive terms.

        (3)     The Chairman shall be responsible for the overall direction of the Appellate Body business, and in particular, his/her responsibilities shall include:

(a)     the supervision of the internal functioning of the Appellate Body; and

(b)     any such other duties as the Members may agree to entrust to him/her.

        (4)     Where the office of the Chairman becomes vacant due to permanent incapacity as a result of illness or death or by resignation or expiration of his/her term, the Members shall elect a new Chairman who shall serve a full term in accordance with paragraph 2.

        (5)     In the event of a temporary absence or incapacity of the Chairman, the Appellate Body shall authorize another Member to act as Chairman ad interim, and the Member so authorized shall temporarily exercise all the powers, duties and functions of the Chairman until the Chairman is capable of resuming his/her functions.

Divisions

6.     (1)     In accordance with paragraph 1 of Article 17 of the DSU, a division consisting of three Members shall be established to hear and decide an appeal.

       (2)     The Members constituting a division shall be selected on the basis of rotation, while taking into account the principles of random selection, unpredictability and opportunity for all Members to serve regardless of their national origin.

       (3)     A Member selected pursuant to paragraph 2 to serve on a division shall serve on that division, unless:

(i)     he/she is excused from that division pursuant to Rules 9 or 10;

(ii)     he/she has notified the Chairman and the Presiding Member that he/she is prevented from serving on the division because of illness or other serious reasons pursuant to Rule 12; or

(iii)     he/she has notified his/her intentions to resign pursuant to Rule 14.

Presiding Member of the Division

7.     (1)     Each division shall have a Presiding Member, who shall be elected by the Members of that division.

       (2)     The responsibilities of the Presiding Member shall include:

(a)     coordinating the overall conduct of the appeal proceeding;

(b)     chairing all oral hearings and meetings related to that appeal; and

(c)     coordinating the drafting of the appellate report.

       (3)     In the event that a Presiding Member becomes incapable of performing his/her duties, the other Members serving on that division and the Member selected as a replacement pursuant to Rule 13 shall elect one of their number to act as the Presiding Member.

Rules of Conduct

8.     (1)     On a provisional basis, the Appellate Body adopts those provisions of the Rules of Conduct for the Understanding on Rules and Procedures Governing the Settlement of Disputes, attached in Annex II to these Rules, which are applicable to it, until Rules of Conduct are approved by the DSB.

       (2)     Upon approval of Rules of Conduct by the DSB, such Rules of Conduct shall be directly incorporated and become part of these Rules and shall supersede Annex II.

9.    (1)     Upon the filing of a Notice of Appeal, each Member shall take the steps set out in Article VI:4(b)(i) of Annex II, and a Member may consult with the other Members prior to completing the disclosure form.

       (2)     Upon the filing of a Notice of Appeal, the professional staff of the Secretariat assigned to that appeal shall take the steps set out in Article VI:4(b)(ii) of Annex II.

       (3)     Where information has been submitted pursuant to Article VI:4(b)(i) or (ii) of Annex II, the Appellate Body shall consider whether further action is necessary.

       (4)     As a result of the Appellate Body’s consideration of the matter pursuant to paragraph 3, the Member or the professional staff member concerned may continue to be assigned to the division or may be excused from the division.

10.  (1)     Where evidence of a material violation is filed by a participant pursuant to Article VIII of Annex II, such evidence shall be confidential and shall be supported by affidavits made by persons having actual knowledge or a reasonable belief as to the truth of the facts stated.

       (2)     Any evidence filed pursuant to Article VIII:1 of Annex II shall be filed at the earliest practicable time: that is, forthwith after the participant submitting it knew or reasonably could have known of the facts supporting it. In no case shall such evidence be filed after the appellate report is circulated to the WTO Members.

       (3)     Where a participant fails to submit such evidence at the earliest practicable time, it shall file an explanation in writing of the reasons why it did not do so earlier, and the Appellate Body may decide to consider or not to consider such evidence, as appropriate.

       (4)     While taking fully into account paragraph 5 of Article 17 of the DSU, where evidence has been filed pursuant to Article VIII of Annex II, an appeal shall be suspended for fifteen days or until the procedure referred to in Article VIII:14–16 of Annex II is completed, whichever is earlier.

       (5)     As a result of the procedure referred to in Article VIII:14–16 of Annex II, the Appellate Body may decide to dismiss the allegation, to excuse the Member or professional staff member concerned from being assigned to the division or make such other order as it deems necessary in accordance with Article VIII of Annex II.

11.  (1)     A Member who has submitted a disclosure form with information attached pursuant to Article VI:4(b)(i) or is the subject of evidence of a material violation pursuant to Article VIII:1 of Annex II, shall not participate in any decision taken pursuant to paragraph 4 of Rule 9 or paragraph 5 of Rule 10.

       (2)     A Member who is excused from a division pursuant to paragraph 4 of Rule 9 or paragraph 5 of Rule 10 shall not take part in the exchange of views conducted in that appeal pursuant to paragraph 3 of Rule 4.

       (3)     A Member who, had he/she been a Member of a division, would have been excused from that division pursuant to paragraph 4 of Rule 9, shall not take part in the exchange of views conducted in that appeal pursuant to paragraph 3 of Rule 4.

Incapacity

12.  (1)     A Member who is prevented from serving on a division by illness or for other serious reasons shall give notice and duly explain such reasons to the Chairman and to the Presiding Member.

       (2)     Upon receiving such notice, the Chairman and the Presiding Member shall forthwith inform the Appellate Body.

Replacement

13.     Where a Member is unable to serve on a division for a reason set out in paragraph 3 of Rule 6, another Member shall be selected forthwith pursuant to paragraph 2 of Rule 6 to replace the Member originally selected for that division.

Resignation

14.     (1)     A Member who intends to resign from his/her office shall notify his/her intentions in writing to the Chairman of the Appellate Body who shall immediately inform the Chairman of the DSB, the Director-General and the other Members of the Appellate Body.

          (2)     The resignation shall take effect 90 days after the notification has been made pursuant to paragraph 1, unless the DSB, in consultation with the Appellate Body, decides otherwise.

Transition

15.     A person who ceases to be a Member of the Appellate Body may, with the authorization of the Appellate Body and upon notification to the DSB, complete the disposition of any appeal to which that person was assigned while a Member, and that person shall, for that purpose only, be deemed to continue to be a Member of the Appellate Body.

PART II PROCESS

General Provisions

16.     (1)     In the interests of fairness and orderly procedure in the conduct of an appeal, where a procedural question arises that is not covered by these Rules, a division may adopt an appropriate procedure for the purposes of that appeal only, provided that it is not inconsistent with the DSU, the other covered agreements and these Rules. Where such a procedure is adopted, the division shall immediately notify the parties to the dispute, participants, third parties and third participants as well as the other Members of the Appellate Body.

          (2)     In exceptional circumstances, where strict adherence to a time-period set out in these Rules would result in a manifest unfairness, a party to the dispute, a participant, a third party or a third participant may request that a division modify a time-period set out in these Rules for the filing of documents or the date set out in the working schedule for the oral hearing. Where such a request is granted by a division, any modification of time shall be notified to the parties to the dispute, participants, third parties and third participants in a revised working schedule.

17.     (1)     Unless the DSB decides otherwise, in computing any time-period stipulated in the DSU or in the special or additional provisions of the covered agreements, or in these Rules, within which a communication must be made or an action taken by a WTO Member to exercise or preserve its rights, the day from which the time-period begins to run shall be excluded and, subject to paragraph 2, the last day of the time-period shall be included.

          (2)     The DSB Decision on “Expiration of Time-Periods in the DSU”, WT/DSB/M/7, shall apply to appeals heard by divisions of the Appellate Body.

Documents

18.     (1)     No document is considered filed with the Appellate Body unless the document is received by the Secretariat within the time-period set out for filing in accordance with these Rules.

          (2)     Except as otherwise provided in these Rules, every document filed by a party to the dispute, a participant, a third party or a third participant shall be served on each of the other parties to the dispute, participants, third parties and third participants in the appeal.

          (3)     A proof of service on the other parties to the dispute, participants, third parties and third participants shall appear on, or be affixed to, each document filed with the Secretariat under paragraph 1 above.

          (4)     A document shall be served by the most expeditious means of delivery or communication available, including by:

     (a)     delivering a copy of the document to the service address of the party to the dispute, participant, third party or third participant; or

     (b)     sending a copy of the document to the service address of the party to the dispute, participant, third party or third participant by facsimile transmission, expedited delivery courier or expedited mail service.

          (5)     Upon authorization by the division, a participant or a third participant may correct clerical errors in any of its documents (including typographical mistakes, errors of grammar, or words or numbers placed in the wrong order). The request to correct clerical errors shall identify the specific errors to be corrected and shall be filed with the Secretariat no later than 30 days after the date of the filing of the Notice of Appeal. A copy of the request shall be served upon the other parties to the dispute, participants, third parties and third participants, each of whom shall be given an opportunity to comment in writing on the request. The division shall notify the parties to the dispute, participants, third parties and third participants of its decision.

Ex Parte Communications

19.     (1)     Neither a division nor any of its Members shall meet with or contact one party to the dispute, participant, third party or third participant in the absence of the other parties to the dispute, participants, third parties and third participants.

          (2)     No Member of the division may discuss any aspect of the subject matter of an appeal with any party to the dispute, participant, third party or third participant in the absence of the other Members of the division.

          (3)     A Member who is not assigned to the division hearing the appeal shall not discuss any aspect of the subject matter of the appeal with any party to the dispute, participant, third party or third participant.

Commencement of Appeal

20.     (1)     An appeal shall be commenced by notification in writing to the DSB in accordance with paragraph 4 of Article 16 of the DSU and simultaneous filing of a Notice of Appeal with the Secretariat.

          (2)     A Notice of Appeal shall include the following information:

         (a)   the title of the panel report under appeal;

         (b)   the name of the party to the dispute filing the Notice of Appeal;

         (c)   the service address, telephone and facsimile numbers of the party to the dispute; and

         (d)   a brief statement of the nature of the appeal, including:

          (i)     identification of the alleged errors in the issues of law covered in the panel report and legal interpretations developed by the panel;

          (ii)    a list of the legal provision(s) of the covered agreements that the panel is alleged to have erred in interpreting or applying; and

          (iii)   without prejudice to the ability of the appellant to refer to other paragraphs of the panel report in the context of its appeal, an indicative list of the paragraphs of the panel report containing the alleged errors.

Appellant’s Submission

21.     (1)   The appellant shall, within 7 days after the date of the filing of the Notice of Appeal, file with the Secretariat a written submission prepared in accordance with paragraph 2 and serve a copy of the submission on the other parties to the dispute and third parties.

          (2)   A written submission referred to in paragraph 1 shall

      (a)   be dated and signed by the appellant; and

      (b)   set out

        (i)     a precise statement of the grounds for the appeal, including the specific allegations of errsors in the issues of law covered in the panel report and legal interpretations developed by the panel, and the legal arguments in support thereof;

        (ii)     a precise statement of the provisions of the covered agreements and other legal sources relied on; and

        (iii)     the nature of the decision or ruling sought.

Appellee’s Submission

22.     (1)   Any party to the dispute that wishes to respond to allegations raised in an appellant’s submission filed pursuant to Rule 21 may, within 25 days after the date of the filing of the Notice of Appeal, file with the Secretariat a written submission prepared in accordance with paragraph 2 and serve a copy of the submission on the appellant, other parties to the dispute and third parties.

         (2)   A written submission referred to in paragraph 1 shall

      (a)  be dated and signed by the appellee; and

      (b)  set out

       (i)     a precise statement of the grounds for opposing the specific allegations of errors in the issues of law covered in the panel report and legal interpretations developed by the panel raised in the appellant’s submission, and the legal arguments in support thereof;

       (ii)     an acceptance of, or opposition to, each ground set out in the appellant’s submission;

       (iii)     a precise statement of the provisions of the covered agreements and other legal sources relied on; and

       (iv)     the nature of the decision or ruling sought.

Multiple Appeals

23.  (1) Within 12 days after the date of the filing of the Notice of Appeal, a party to the dispute other than the original appellant may join in that appeal or appeal on the basis of other alleged errors in the issues of law covered in the panel report and legal interpretations developed by the panel. That party shall notify the DSB in writing of its appeal and shall simultaneously file a Notice of Other Appeal with the Secretariat.

          (2)  A Notice of Other Appeal shall include the following information:

      (a)   the title of the panel report under appeal;

      (b)   the name of the party to the dispute filing the Notice of Other Appeal;

      (c)   the service address, telephone and facsimile numbers of the party to the dispute; and either

       (i)     a statement of the issues raised on appeal by another participant with which the party joins; or

       (ii)     a brief statement of the nature of the other appeal, including:

       (A)     identification of the alleged errors in the issues of law covered in the panel report and legal interpretations developed by the panel;

       (B)     a list of the legal provision(s) of the covered agreements that the panel is alleged to have erred in interpreting or applying; and

       (C)     without prejudice to the ability of the other appellant to refer to other paragraphs of the panel report in the context of its appeal, an indicative list of the paragraphs of the panel report containing the alleged errors.

          (3)     The other appellant shall, within 15 days after the date of the filing of the Notice of Appeal, file with the Secretariat a written submission prepared in accordance with paragraph 2 of Rule 21 and serve a copy of the submission on the other parties to the dispute and third parties.

          (4)     The appellant, any appellee and any other party to the dispute that wishes to respond to a submission filed pursuant to paragraph 3 may file a written submission within 25 days after the date of the filing of the Notice of Appeal, and any such submission shall be in the format required by paragraph 2 of Rule 22.

          (5)     This Rule does not preclude a party to the dispute which has not filed a submission under Rule 21 or a Notice of Other Appeal under paragraph 1 of this Rule from exercising its right of appeal pursuant to paragraph 4 of Article 16 of the DSU.

          (6)     Where a party to the dispute which has not filed a submission under Rule 21 or a Notice of Other Appeal under paragraph 1 of this Rule exercises its right to appeal as set out in paragraph 5, a single division shall examine the appeals.

Amending Notices of Appeal

23bis. (1)  The division may authorize an original appellant to amend a Notice of Appeal or an other appellant to amend a Notice of Other Appeal.

          (2)  A request to amend a Notice of Appeal or a Notice of Other Appeal shall be made as soon as possible in writing and shall state the reason(s) for the request and identify precisely the specific amendments that the appellant or other appellant wishes to make to the Notice. A copy of the request shall be served on the other parties to the dispute, participants, third participants and third parties, each of whom shall be given an opportunity to comment in writing on the request.

          (3)  In deciding whether to authorize, in full or in part, a request to amend a Notice of Appeal or Notice of Other Appeal, the division shall take into account:

(a)     the requirement to circulate the appellate report within the time-period set out in Article 17.5 of the DSU or, as appropriate, Article 4.9 of the SCM Agreement; and,

(b)     the interests of fairness and orderly procedure, including the nature and extent of the proposed amendment, the of the request to amend a Notice of Appeal or Notice of Other Appeal, any reasons why the proposed amended Notice of Appeal or Notice of Other Appeal was not or could not have been filed on its original date, and any other considerations that may be appropriate.

          (4)  The division shall notify the parties to the dispute, participants, third participants, and third parties of its decision. In the event that the division authorizes an amendment to a Notice of Appeal or a Notice of Other Appeal, it shall provide an amended copy of the Notice to the DSB.

Third Participants

24.  (1)     Any third party may file a written submission containing the grounds and legal arguments in support of its position. Such submission shall be filed within 25 days after the date of the filing of the Notice of Appeal.

        (2)     A third party not filing a written submission shall, within the same period of0. 25 days, notify the Secretariat in writing if it intends to appear at the oral hearing, and, if so, whether it intends to make an oral statement.

        (3)     Third participants are encouraged to file written submissions to facilitate their positions being taken fully into account by the division hearing the appeal and in order that participants and other third participants will have notice of positions to be taken at the oral hearing.

        (4)     Any third party that has neither filed a written submission pursuant to paragraph (1), nor notified the Secretariat pursuant to paragraph (2), may notify the Secretariat that it intends to appear at the oral hearing, and may request to make an oral statement at the hearing. Such notifications and requests should be notified to the Secretariat in writing at the earliest opportunity.

Transmittal of Record

25.  (1)     Upon the filing of a Notice of Appeal, the Director-General of the WTO shall transmit forthwith to the Appellate Body the complete record of the panel proceeding.

        (2)     The complete record of the panel proceeding includes, but is not limited to:

      (a)     written submissions, rebuttal submissions, and supporting evidence attached thereto by the parties to the dispute and the third parties;

      (b)     written arguments submitted at the panel meetings with the parties to the dispute and the third parties, the recordings of such panel meetings, and any written answers to questions posed at such panel meetings;

      (c)     the correspondence relating to the panel dispute between the panel or the WTO Secretariat and the parties to the dispute or the third parties; and

      (d)     any other documentation submitted to the panel.

Working Schedule

26.     (1)     Forthwith after the commencement of an appeal, the division shall draw up an appropriate working schedule for that appeal in accordance with the time-periods stipulated in these Rules.

          (2)     The working schedule shall set forth precise dates for the filing of documents and a timetable for the division’s work, including, where possible, the date for the oral hearing.

          (3)     In accordance with paragraph 9 of Article 4 of the DSU, in appeals of urgency, including those which concern perishable goods, the Appellate Body shall make every effort to accelerate the appellate proceedings to the greatest extent possible. A division shall take this into account in drawing up its working schedule for that appeal.

          (4)     The Secretariat shall serve forthwith a copy of the working schedule on the appellant, the parties to the dispute and any third parties.

Oral Hearing

27.     (1)     A division shall hold an oral hearing, which shall be held, as a general rule, between 35 and 45 days after the date of the filing of a Notice of Appeal.

          (2)     Where possible in the working schedule or otherwise at the earliest possible date, the Secretariat shall notify all parties to the dispute, participants, third parties and third participants of the date for the oral hearing.

          (3)     (a)     Any third party that has filed a submission pursuant to Rule 24(1), or has notified the Secretariat pursuant to Rule 24(2) that it intends to appear at the oral hearing, may appear at the oral hearing, make an oral statement at the hearing, and respond to questions posed by the division.

                   (b)     Any third party that has notified the Secretariat pursuant to Rule 24(4) that it intends to appear at the oral hearing may appear at the oral hearing.

                   (c)     Any third party that has made a request pursuant to Rule 24(4) may, at the discretion of the division hearing the appeal, taking into account the requirements of due process, make an oral statement at the hearing, and respond to questions posed by the division.

          (4)     The Presiding Member may set time-limits for oral arguments.

Written Responses

28.     (1)     At any time during the appellate proceeding, including, in particular, during the oral hearing, the division may address questions orally or in writing to, or request additional memoranda from, any participant or third participant, and specify the time-periods by which written responses or memoranda shall be received.

          (2)     Any such questions, responses or memoranda shall be made available to the other participants and third participants in the appeal, who shall be given an opportunity to respond.

          (3)     When the questions or requests for memoranda are made prior to the oral hearing, then the questions or requests, as well as the responses or memoranda, shall also be made available to the third parties, who shall also be given an opportunity to respond.

Failure to Appear

29.     Where a participant fails to file a submission within the required time-periods or fails to appear at the oral hearing, the division shall, after hearing the views of the participants, issue such order, including dismissal of the appeal, as it deems appropriate.

Withdrawal of Appeal

30.     (1)     At any time during an appeal, the appellant may withdraw its appeal by notifying the Appellate Body, which shall forthwith notify the DSB.

          (2)     Where a mutually agreed solution to a dispute which is the subject of an appeal has been notified to the DSB pursuant to paragraph 6 of Article 3 of the DSU, it shall be notified to the Appellate Body.

Prohibited Subsidies

31.     (1)     Subject to Article 4 of the SCM Agreement, the general provisions of these Rules shall apply to appeals relating to panel reports concerning prohibited subsidies under Part II of that Agreement.

          (2)     The working schedule for an appeal involving prohibited subsidies under Part II of the SCM Agreement shall be as set out in Annex I to these Rules.

Entry into Force and Amendment

32.     (1)     These Rules shall enter into force on 15 February 1996.

          (2)     The Appellate Body may amend these Rules in compliance with the procedures set forth in paragraph 9 of Article 17 of the DSU.

          (3)     Whenever there is an amendment to the DSU or to the special or additional rules and procedures of the covered agreements, the Appellate Body shall examine whether amendments to these Rules are necessary.

ANNEX I TIMETABLE FOR APPEALS(1)

(footnote original) 1 Rule 17 applies to the computation of the time-periods below.
(footnote original) 2 Rule 20.
(footnote original) 3 Rule 21(1).
(footnote original) 4 Rule 23(1).
(footnote original) 5 Rule 23(3).
(footnote original) 6 Rules 22 and 23(4).
(footnote original) 7 Rule 24(1).
(footnote original) 8 Rule 24(2).
(footnote original) 9 Rule 27.
(footnote original) 10 Article 17:5, DSU.
(footnote original) 11 Article 4:9, SCM Agreement.
(footnote original) 12 Article 17:14, DSU.
(footnote original) 13 Article 4:9, SCM Agreement.

ANNEX II

     [For the text of the Rules of Conduct for the Under standing on Rules and Procedures Governing the Settlement of Disputes, please refer to Section XXXIV below.]

ANNEX III

     Table of Consolidated and Revised Versions of the Working Procedures for Appellate Review

B. Interpretation and Application of the Appellate Body Working Procedures

1. General

835.     On 15 February 1996, the Appellate Body circulated its Working Procedures as an unrestricted document.(1204) On 24 January 2002 and 1 May 2003, the Appellate Body circulated consolidated, revised versions of its Working Procedures.(1205) On 4 January 2005, the Appellate Body circulated another consolidated, revised version replacing the May 2003 version and reflecting amendments to Rules 1, 18(5), 20, 21, 23, 27 and Annex I, as well as the addition of a new Rule 23bis and a new Annex III, as discussed in WT/AB/WP/W/8 and WT/AB/WP/W/9. These new consolidated Working Procedures are to be applied to appeals initiated after 1 January 2005. Although the current version of the Analytical Index only covers developments in dispute settlement up until the end of December 2004, the authors have decided to include this version in Section A above since it will be the version in force when this Analytical Index is published.

2. Appellate Body’s authority to adopt procedural rules

836.     In US — Lead and Bismuth II, the Appellate Body examined whether it could admit amicus curiae briefs (see Section XXXVI.G.2 below; with respect to the issue of amicus curiae briefs in general, see Section XXXVI.G below). The Appellate Body confirmed its broad authority to adopt procedural rules:

“[Article 17.9 of the DSU] makes clear that the Appellate Body has broad authority to adopt procedural rules which do not conflict with any rules and procedures in the DSU or the covered agreements.(1206) Therefore, we are of the opinion that as long as we act consistently with the provisions of the DSU and the covered agreements, we have the legal authority to decide whether or not to accept and consider any information that we believe is pertinent and useful in an appeal.”(1207)

3. Appellate Body’s authority to disregard its Working Procedures

837.     In US — Gasoline, the United States in its appeal argued that the issues of whether clean air is an exhaustible natural resources within the meaning of Article XX(g) of the GATT 1994 and whether the baseline establishment rules were consistent with the TBT Agreement were not properly brought before the Appellate Body in accordance with its Working Procedures. In that case, Venezuela and Brazil had appealed the relevant findings of the Panel, but brought up these issues in their appellee’s submission, contrary to the Appellate Body’s Working Procedures which stipulated that such “cross-appeal” be brought in an appellant’s submission. The Appellate Body refused to “casually … disregard” its own Working Procedures and stated:

“[T]o deal with those two issues, under the circumstances of this appeal, would have required the Appellate Body casually to disregard its own Working Procedures and to do so in the absence of a compelling reason grounded on, for instance, fundamental fairness or force majeure. Venezuela and Brazil could have appealed the Panel’s finding and non-finding on the two matters by taking advantage of Rules 23(1) or 23(4) of the Working Procedures and thereby placing the Appellate Body in a position to dispose of those issues directly in one and the same appellate proceeding.

… the route … Brazil and Venezuela chose for addressing the two issues in question is not contemplated by the Working Procedures, and therefore, these issues are not properly the subject of this appeal.”(1208)

4. Interpretation of the Working Procedures

838.     In EC — Sardines, the Appellate Body stated that its Working Procedures cannot be interpreted in a way that could undermine the effectiveness of the dispute settlement system because they have been drawn up pursuant to the DSU:

“[W]e emphasize that the Working Procedures must not be interpreted in a way that could undermine the effectiveness of the dispute settlement system, for they have been drawn up pursuant to the DSU and as a means of ensuring that the dispute settlement mechanism achieves the aim of securing a positive solution to a dispute.(1209) As we have said:

‘The procedural rules of WTO dispute settlement are designed to promote … the fair, prompt and effective resolution of trade disputes.’(1210)

This obligation to interpret the Working Procedures in a way that promotes the effective resolution of disputes is complemented by the obligation of Members, set out in Article 3.10 of the DSU, to ‘engage in [dispute settlement] procedures in good faith in an effort to resolve the dispute’. Hence, the right to withdraw an appeal must be exercised subject to these limitations, which are applicable generally to the dispute settlement process.”(1211)

5. Rule 3.1: decision-making

839.     See Section XXXII.B.9 below.

6. Rule 3.2: concurrent opinions

840.     In this respect, see Section XVII.B.7 above.

7. Rule 8: rules of conduct

841.     In Brazil — Aircraft, the Appellate Body recalled that its Members are subject to the Rules of Conduct:

“[W]e wish to recall that Members of the Appellate Body and its staff are covered by Article VII:1 of the Rules of Conduct,(1212) 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)”(1213)

8. Rule 13: replacement of Appellate Body member in a given appeal

842.     In US — Lead and Bismuth II, Mr Christopher Beeby, one of the members of the Division hearing the appeal, passed away and Mr Julio Lacarte-Muró, another member of the Appellate Body, was selected to replace him.(1214)

843.     In US — Offset Act (Byrd Amendment), Mr Giorgio Sacerdoti replaced Mr A.V. Ganesan as Presiding Member of the Division hearing this appeal because the latter was prevented from continuing to serve on the Division for serious personal reasons.(1215)

844.     In US — Softwood Lumber IV, Mr Giorgio Sacerdoti replaced Mr A.V. Ganesan as a Member of the Division hearing this appeal because the latter was prevented from continuing to serve on the Division for serious personal reasons.(1216)

9. Rule 16

(a) Rule 16(1): “appropriate procedure for the purposes of that appeal only”

845.     In EC — Bananas III, the Appellate Body accepted Saint Lucia’s request to be assisted by private counsel during the Appellate Body hearing on the grounds that it is for a WTO Member to decide who should represent it as members of its delegation in an oral hearing of the Appellate Body.(1217) In this regard, see paragraphs 1022–1023 below.

846.     In Guatemala — Cement I, both parties, Guatemala and Mexico, had filed their appellee’s submissions in Spanish. In order to ensure that the third participant, the United States, would have time to prepare its submission after receiving an English version of the appellant’s submission, the Appellate Body granted the United States additional time to file its third participant’s submission. The Appellate Body further declined Mexico’s request that its appellee’s submission be withheld from Guatemala and the United States until the end of the time-period allowed to the United States to file its third participant’s submission.(1218)

847.     In Brazil — Aircraft, Brazil and Canada had requested that the Appellate Body apply, mutatis mutandis, the Procedures Governing Business Confidential Information adopted by the Panel in this case. The Appellate Body issued a preliminary ruling(1219) in which it concluded that it was not necessary, under the circumstances of this case, to adopt additional procedures to protect business confidential information.(1220)

848.     In EC — Asbestos, the Appellate Body adopted an additional procedure, for the purposes of this appeal only, pursuant to Rule 16(1) of its Working Procedures, to deal with any possible submissions received from amici curiae. In this regard, see Section XXXVI.G.3 below.

849.     In US — Lead and Bismuth II, due to the passing away of Mr Christopher Beeby, the Appellate Body, pursuant to Rule 13 of the Working Procedures, had selected Mr Julio Lacarte-Muró to replace him (see paragraph 842 above). “In view of these extraordinary circumstances, the newly-constituted Division decided, pursuant to Rule 16(1) of the Working Procedures, and in the interests of fairness and orderly procedure in the conduct of this appeal, to hold another oral hearing on 4 April 2000. On that date, the participants and third participants presented oral arguments and responded to questions put to them by the Members of the newly-constituted Division. Due to these same extraordinary circumstances, the participants in this appeal, the European Communities and the United States, agreed to a two-week extension of the 90-day time limit for the consideration of this appeal, and thus agreed that the Report would be circulated no later than 10 May 2000.”(1221)

850.     In US — Countervailing Measures on Certain EC Products, the European Communities filed a request for a Preliminary Ruling, alleging that the United States’ Notice of Appeal was not in conformity with Rule 20(2)(d) of the Working Procedures for Appellate Review. The European Communities asked the Appellate Body to order the United States, pursuant to Rule 16(1) of the Working Procedures, immediately to file further and better particulars to its notice of appeal identifying the precise legal findings and legal interpretations that it was challenging. The Appellate Body thus invited the United States “to identify the precise findings and interpretations of the Panel which are alleged, in the Notice of Appeal filed on 9 September 2002, to constitute errors”.(1222)

(b) Rule 16(2): “exceptional circumstances”

851.     In EC — Bed Linen, the European Communities and India requested the Appellate Body to extend the time-period for filing the appellee’s and third participant’s submissions. The Division hearing the appeal accepted the request pursuant to Rule 16(2) of the Working Procedure and in the light of the “exceptional circumstances” in that appeal.(1223)

852.     In US — FSC (Article 21.5 — EC), the United States requested the Appellate Body to modify its timetable on the grounds that the bioterrorists’ attack amounted to “exceptional circumstances” under Rule 16(2) of the Appellate Body Working Procedures:

“By letter of 22 October 2001, the United States requested the Appellate Body pursuant to Rule 16(2) of the Working Procedures to modify the timetable set out in the Working Schedule for Appeal for the filing of the appellant’s submissions by the United States. The United States stated that suspected bioterrorist attacks had compromised the ability of the United States to conduct the necessary consultations with the United States Congress with regard to this appeal.(1224) According to the United States, the effect of these circumstances was such that adhering to the original timetable would result in manifest unfairness to the United States. In its letter of 23 October 2001, the European Communities did not object to the request made by the United States, but requested that, in order to preserve the balance of procedural rights afforded to the participants in this appeal, the Appellate Body extend the deadline for the filing of the European Communities’ appellee’s submission by 14 days. In a letter dated 23 October 2001, the Division of the Appellate Body hearing the appeal accepted that the circumstances identified by the United States constituted ‘exceptional circumstances’ within the meaning of Rule 16(2) of the Working Procedures and that maintaining the deadline for submission of the appellants’ submission would result in ‘manifest unfairness’ to the United States. Accordingly, the Division agreed to modify the Working Schedule for this appeal to allow the United States an additional seven days for the filing of its appellant’s submission. In the same letter, the Division also extended by seven days the deadlines for the filing of the other appellant’s submissions, the appellee’s submission, and the third participants’ submissions.”(1225)

(c) Rule 16(2): change of date

853.     In EC — Bananas III, pursuant to Rule 16(2) of the Working Procedures, Jamaica asked the Appellate Body to postpone the dates of the oral hearing, set out in the working schedule. This request was not granted as the Appellate Body was not persuaded that there were exceptional circumstances resulting in manifest unfairness to any participant or third participant that justified the postponement of the oral hearing in the appeal.(1226)

854.     In US — Shrimp (Article 21.5 — Malaysia), on 13 August 2001, the United States requested that the Division hearing this appeal change the date of the oral hearing set out in the working schedule for this appeal. After inviting the participants to make their views known with respect to this request, the Division ruled that it would not change the date of the oral hearing.(1227)

10. Rule 20: notice of appeal

(a) Purpose of the notice of appeal

855.     In US — Countervailing Measures on Certain EC Products, the Appellate Body rejected the argument by the United States that the notice of appeal serves a limited purpose as simply a formal trigger for initiating the appeal and stressed the importance of the notice of appeal as the means to allow the appellees to exercise their right of defence:

“[O]ur previous rulings have underscored the important balance that must be maintained between the right of Members to exercise the right of appeal meaningfully and effectively, and the right of appellees to receive notice through the Notice of Appeal of the findings under appeal, so that they may exercise their right of defence effectively. Hence, we disagree with the contention of the United States here that the Notice of Appeal ‘serves a limited purpose’ as ‘simply a formal trigger for initiating the appeal.’ Indeed, if this were the only objective of the notice, our Working Procedures would have included only the first paragraph of Rule 20, which refers to commencement of an appeal through written notification to the Dispute Settlement Body and Appellate Body Secretariat. However, Rule 20 also prescribes additional requirements for commencing an appeal; it provides that the Notice of Appeal must include ‘a brief statement of the nature of the appeal, including the allegations of errors in the issues of law covered in the panel report and legal interpretations developed by the panel.’(1228) The notification under Rule 20(1) serves as the ‘trigger’ to which the United States refers. The additional requirements under Rule 20(2) serve to ensure that the appellee also receives notice, albeit brief, of the ‘nature of the appeal’ and the ‘allegations of errors’ by the panel.”(1229)

(b) Rule 20(2)(d): “brief statement of the nature of appeal, including the allegations of error”

(i) Identification standard

856.     In US — Shrimp, the Appellate Body discussed the requirement in the Working Procedures for Appellate Review according to which the appellant is to be brief in its notice of appeal in setting out “the nature of the appeal, including the allegations of errors”. The Appellate Body concluded that “the ‘nature of the appeal’ and ‘the allegations of errors’ are sufficiently set out where the notice of appeal adequately identifies the findings or legal interpretations of the Panel that are being appealed as erroneous”:

“The Working Procedures for Appellate Review enjoin the appellant to be brief in its notice of appeal in setting out ‘the nature of the appeal, including the allegations of errors’. We believe that, in principle, the ‘nature of the appeal’ and ‘the allegations of errors’ are sufficiently set out where the notice of appeal adequately identifies the findings or legal interpretations of the Panel which are being appealed as erroneous. The notice of appeal is not expected to contain the reasons why the appellant regards those findings or interpretations as erroneous. The notice of appeal is not designed to be a summary or outline of the arguments to be made by the appellant. The legal arguments in support of the allegations of error are, of course, to be set out and developed in the appellant’s submission.”(1230)

857.     The appellees in US — Shrimp argued that the notice of appeal of the United States was both vague and cursory and therefore not in compliance with the procedural requirements of Rule 20(2) of the Working Procedures for Appellate Review. The Appellate Body disagreed:

“It is scarcely necessary to add that an appellee is, of course, always entitled to its full measure of due process. In the present appeal, perhaps the best indication that that full measure of due process was not in any degree impaired by the notice of appeal filed by the United States, is the developed and substantial nature of the appellees’ submissions.”(1231)

858.     In US — Countervailing Measures on Certain EC Products, the Appellate Body emphasized that, generally, a notice of appeal that simply refers to the paragraph numbers found in the “Conclusions and Recommendations” section of a panel report, or that simply quotes them in full, is insufficient to provide adequate notice of the allegations of error on appeal. In this case, however, as the section in question was particularly detailed, the Appellate Body considered that the notice of appeal was adequate in this respect:

“We observe that, in coming to these conclusions, we have before us a rather unusual example of the ‘Conclusions and Recommendations’ section of a panel report. In most panel reports, the ‘Conclusions and Recommendations’ section is relatively brief, setting out findings in summary fashion. Detailed legal interpretations and reasoning upon which panels rely are usually found only in the ‘Findings’ sections of panel reports. In this case, however, the Panel’s ‘Conclusions and Recommendations’ are more detailed than usual. Paragraphs 8.1(a)–8.1(d) of the Panel Report include, not only the Panel’s findings, but also certain of the reasons leading to those findings. Hence, in this case, it is possible, by reading the ‘Conclusions and Recommendations’ section from the Panel Report, to discern alleged errors of law appealed by the United States. We emphasize, however, that generally, a Notice of Appeal that refers simply to the paragraph numbers found in the ‘Conclusions and Recommendations’ section of a panel report, or that quotes them in full, will be insufficient to provide adequate notice of the allegations of error on appeal, and, hence, will fall short of the requirements set out in Rule 20(2)(d) of the Working Procedures.”(1232)

859.     In US — Offset Act (Byrd Amendment), the Appellate Body considered that generic statements in a notice of appeal do not give the appellees adequate notice of the “nature of the appeal” and the “allegations of errors” made by the panel:

“We do not agree with the United States’ contention that the first numbered paragraph of the United States’ Notice of Appeal, referring generally to the Panel’s failure properly to interpret Article 18.1 of the Anti-Dumping Agreement and Article 32.1 of the SCM Agreement, ‘plainly covers’ a claim that the Panel exceeded its terms of reference. As we have said, the Notice of Appeal ‘serve[s] to ensure that the appellee also receives notice, albeit brief, of the “nature of the appeal” and the “allegations of errors” by the panel.’(1233) Generic statements such as that relied upon by the United States cannot serve to give the appellees adequate notice that they will be required to defend against a claim that the Panel exceeded its terms of reference. This is particularly so for procedural errors; it can be especially difficult to discern a claim of procedural error by a panel from general references to panel findings or from extracts of a panel report, because allegations of procedural error by a panel may not necessarily be raised until the appellate stage.”(1234)

(ii) Distinction between “claims of error” and “legal arguments”

860.     In Chile — Price Band System, Chile argued that the Panel had erred in choosing to examine Argentina’s claim under Article 4.2 of the Agreement on Agriculture before examining its claim under Article II:1(b) of the GATT 1994. Argentina raised a procedural objection, alleging that Chile introduced this point for the first time in its appellant’s submission, when, according to Argentina, Chile should have included this “allegation of error” in its notice of appeal pursuant to Rule 20(2)(d) of the Working Procedures for Appellate Review. The Appellate Body referred to the distinction it made between claims and legal arguments under Article 6.2 of the DSU in EC — Bananas III (see paragraph 223 above). The Appellate Body considered that this distinction “is also relevant to the distinction between ‘allegations of error’ and legal arguments as contemplated by Rule 20 of the Working Procedures”:

“In our view, this distinction between claims and legal arguments under Article 6.2 of the DSU is also relevant to the distinction between ‘allegations of error’ and legal-arguments as contemplated by Rule 20 of the Working Procedures. Bearing this distinction in mind, we do not agree with Argentina that Chile’s arguments regarding the order of analysis chosen by the Panel amount to a separate ‘allegation of error’ that Chile should have — or could have — included in its Notice of Appeal. In fact, we do not see, nor has Argentina explained, what separate ‘allegation of error’ could have been made, or what legal basis for such ‘allegation of error’ there could have been. Rather than making a separate ‘allegation of error’, Chile has, in our view, simply set out a legal argument in support of the issues it raised on appeal relating to Article 4.2 of the Agreement on Agriculture and Article II:1(b) of the GATT 1994.(1235)”(1236)

(iii) Claims not included in the notice of appeal

861.     In EC — Bananas III, the Appellate Body, having found that the European Communities had not properly indicated, in its notice of appeal, that it was appealing one particular Panel finding, decided to exclude that particular finding from the scope of the appeal:

“In our view, the claims of error by the European Communities set out in paragraphs (c) and (d) of the Notice of Appeal do not cover the Panel’s finding in paragraph 7.93 of the Panel Reports. The finding in that paragraph explicitly deals with Ecuador’s right to invoke Article XIII:2 or XIII:4 of the GATT 1994, given that Ecuador acceded to the WTO after the WTO Agreement entered into force and after the tariff quota for the BFA countries had been negotiated and inscribed in the EC Schedule to the GATT 1994. There is no specific mention of this Panel finding in either the Notice of Appeal or in the main arguments of the appellant’s submission by the European Communities. Therefore, Ecuador had no notice that the European Communities was appealing this finding. For these reasons, we conclude that the Panel’s finding in paragraph 7.93 of the Panel Reports should be excluded from the scope of this appeal.”(1237)

862.     As regards the need to include claims on Article 11 of the DSU in the notice of appeal, see paragraphs 866–868 below.

863.     In US — Offset Act (Byrd Amendment), the Appellate Body, having found that the notice of appeal did not include claims on the jurisdiction of the Panel, decided, nevertheless, that “the issue of a panel’s jurisdiction is so fundamental that it is appropriate to consider claims that a panel has exceeded its jurisdiction even if such claims were not raised in the Notice of Appeal”:

“Notice of Appeal does not provide notice to the appellees that the United States intended to make claims that the Panel exceeded its terms of reference; the next question is whether we are precluded from examining these claims on appeal. As we have explained, if an appellee has not received sufficient notice in the Notice of Appeal that a particular claim will be advanced by the appellant, that claim normally will be excluded from the appeal. However, we observe that the United States has argued in this appeal that we are entitled to examine questions of jurisdiction in any event, even if not included in the Notice of Appeal.(1238)

We agree with the United States’ position. We have stated previously, in relation to a panel’s obligation to address issues related to its jurisdiction, that:

‘… panels have to address and dispose of certain issues of a fundamental nature, even if the parties to the dispute remain silent on those issues. In this regard, we have previously observed that “[t]he vesting of jurisdiction in a panel is a fundamental prerequisite for lawful panel proceedings.” For this reason, panels cannot simply ignore issues which go to the root of their jurisdiction — that is, to their authority to deal with and dispose of matters. Rather, panels must deal with such issues — if necessary, on their own motion — in order to satisfy themselves that they have authority to proceed.(1239) (footnote omitted)’

… we have said, ‘[a]n objection to jurisdiction should be raised as early as possible’ and it would be preferable, in the interests of due process, for the appellant to raise such issues in the Notice of Appeal, so that appellees will be aware that this claim will be advanced on appeal. However, in our view, the issue of a panel’s jurisdiction is so fundamental that it is appropriate to consider claims that a panel has exceeded its jurisdiction even if such claims were not raised in the Notice of Appeal.”(1240)

(iv) Amendment of the notice of appeal

864.     In US — Countervailing Measures on Certain EC Products, the European Communities had claimed that the United States’ notice of appeal did not meet the requirements set out in Rule 20(2)(d). The United States then submitted a letter supplementing their notice of appeal. The Appellate Body decided to examine both the notice of appeal and its supplement with a view to giving full meaning and effect to the right of appeal:

“In conducting our analysis, we will examine both the Notice of Appeal and the letter of 13 September 2002 supplementing the Notice of Appeal. Although the Working Procedures do not expressly provide for the filing of clarifications or further particulars or supplementary or amended Notices of Appeal, we consider it appropriate, in the particular circumstances of this case, to examine both documents with a view to giving ‘full meaning and effect to the right of appeal.’(1241) We note in particular that the additional document was filed by the United States in response to our invitation to do so, based in part on a request for additional particulars filed by the European Communities. Moreover, the additional document was filed shortly after the filing of the Notice of Appeal (three days). Finally, we note that the European Communities referred to both the Notice of Appeal and the letter of 13 September 2002 in its arguments on this issue.”(1242)

(v) Replacement of a notice of appeal

865.     The Appellate Body on EC — Sardines, after having considered that the conditional withdrawal of its notice of appeal by the European Communities was appropriate and effective, and that, therefore, the filing of a replacement notice of appeal did not constitute a second appeal,(1243) rejected Peru’s request that the replacement Notice of Appeal be declared inadmissible because neither the DSU nor the Working Procedures “accord[s] an appellant the right to appeal the same panel report twice on different grounds”:

“Peru alleges that, in sanctioning the approach of the European Communities in this appeal, we would be creating a procedural right for which the DSU has not provided — a right that can only be added to the DSU through a formal amendment by the Members of the World Trade Organization (the ‘WTO’). We are, however, not creating a new procedural right; we are only upholding the right to withdraw an appeal. In addition, in admitting the replacement Notice of Appeal in this dispute, we are, as we were in United States — Import Prohibition of Certain Shrimp and Shrimp Products (‘US — Shrimp’), seeking to:

‘… give full meaning and effect to the right of appeal and to give a party which regards itself aggrieved by some legal finding or interpretation in a panel report a real and effective opportunity to demonstrate the error in such finding or interpretation.’(1244)

In that same Report, we added that ‘an appellee is, of course, always entitled to its full measure of due process.’(1245) In the circumstances of this case, we believe that Peru has been accorded the full measure of its due process rights, because the withdrawal of the original Notice and the filing of a replacement Notice were carried out in response to objections raised by Peru, the replacement Notice was filed in a timely manner and early in the process, and the replacement Notice contained no new or modified grounds of appeal. Also, Peru has not demonstrated that it suffered prejudice as a result. Moreover, Peru was given an adequate opportunity to address its concerns about the European Communities’ actions during the course of the appeal.

In our view, the withdrawal of the original Notice of Appeal of 25 June 2002 and its replacement with the Notice of Appeal of 28 June 2002 was not an exercise of abusive litigation techniques by the European Communities, but rather was an appropriate response under the circumstances to Peru’s objections regarding the original Notice of Appeal.”(1246)

(vi) Article 11 of the DSU: allegation of a panel’s failure to make an objective assessment

866.     In US — Countervailing Measures on Certain EC Products, the Appellate Body established that a claim of error by a panel under Article 11 of the DSU is only possible in the context of an appeal and thus it needs to be included in the notice of appeal:

“A claim of error by a panel under Article 11 of the DSU is possible only in the context of an appeal. By definition, this claim will not be found in requests for establishment of a panel, and panels therefore will not have referred to it in panel reports. Accordingly, if appellants intend to argue that issue on appeal, they must refer to it in Notices of Appeal in a way that will enable appellees to discern it and know the case they have to meet.

Accordingly, we do not believe that the European Communities can be said to have been notified that the United States intended to argue on appeal that the Panel failed to act consistently with Article 11 of the DSU, and, consequently, we consider that the issue of the Panel’s compliance with Article 11 of the DSU is not properly before us in this appeal.”(1247)

867.     In Japan — Apples, the Appellate Body stressed that notice of an Article 11 claim cannot be assumed merely because there is a challenge to a panel’s analysis of a substantive provision of a WTO agreement.

“By referring to the Panel’s alleged failure to comply with Article 11 of the DSU only in the context of Article 2.2, Japan did not enable the United States to ‘know the case [it had] to meet’(1248) as to the Article 11 claim related to Article 5.1 of the SPS Agreement. The Appellate Body has consistently emphasized that due process requires that a Notice of Appeal place an appellee on notice of the issues raised on appeal.(1249) It is this concern with due process, reflected in Rule 20 of the Working Procedures, that underlay the Appellate Body’s ruling on the sufficiency of the Notice of Appeal in US — Countervailing Measures on Certain EC Products.

Japan acknowledged during the oral hearing that it did not give the United States notice of its Article 11 claim specifically with respect to the Panel’s analysis under Article 5.1 of the SPS Agreement. Japan claimed, however, that ‘since we raised the claim under Article 5.1 of the SPS Agreement, this naturally involved some factual issues and … we can assume that the United States was notified’ as to the related Article 11 claim. We disagree. As noted above,(1250) the Appellate Body determined in US — Countervailing Measures on Certain EC Products that Article 11 claims are distinct from those raised under substantive provisions of other covered agreements. It follows from this distinction that notice of an Article 11 challenge cannot be ‘assumed’ merely because there is a challenge to a panel’s analysis of a substantive provision of a WTO agreement. Rather, an Article 11 claim constitutes a ‘separate “allegation of error”’(1251) that must be included in a Notice of Appeal. We therefore reject Japan’s assertion that an Article 11 challenge is only a ‘legal argument’ underlying the issues raised on appeal.(1252)”(1253)

868.     In US — Steel Safeguards, the Appellate Body further emphasized that a claim under Article 11 of the DSU must not be vague or ambiguous but stand by itself and be substantiated, as such, and not as subsidiary to another alleged violation:

“A challenge under Article 11 of the DSU must not be vague or ambiguous. On the contrary, such a challenge must be clearly articulated and substantiated with specific arguments. An Article 11 claim is not to be made lightly, or merely as a subsidiary argument or claim in support of a claim of a panel’s failure to construe or apply correctly a particular provision of a covered agreement.(1254) A claim under Article 11 of the DSU must stand by itself and be substantiated, as such, and not as subsidiary to another alleged violation.

The United States’ arguments on Article 11 of the DSU are mentioned only in passing in its appellant’s submission. Nowhere do we find a clearly articulated claim or specific arguments that would support such a claim. Moreover, the United States did not clarify its challenge under Article 11 of the DSU during the oral hearing. In sum, the United Stated has not substantiated its claim that the Panel acted inconsistently with Article 11 of the DSU, and this claim must therefore fail.”(1255)

11. Rule 23: multiple appeals (cross appeal)

(a) Conditional appeals

869.     In US — Gasoline, the United States argued that certain of Venezuela’s and Brazil’s arguments were in fact conditional appeals and requested the Appellate Body to disregard them since those two parties had not filed a notice of appeal in that regard. The Appellate Body agreed with the United States and considered that Venezuela and Brazil should have taken advantage of Rules 23(1) or 23(4) of the Working Procedures:

“The arguments raised by Venezuela and Brazil on the clean air and TBT issues may be seen to be, in effect, conditional appeals, that is, conditional on the Appellate Body’s overturning the Panel’s overall findings on Article XX(g) and not finding in favour of Venezuela and Brazil as to the other requirements of Article XX. This condition is not fulfilled. Even if this condition had been fulfilled, the Appellate Body would have been most reluctant to pass upon these two issues. We observe, in the first place, that the issues in fact raised by the Appellant, the United States, are not of the kind which cannot be decided without at the same time necessarily resolving the clean air issue or the applicability of the TBT Agreement. In the second place, to deal with those two issues [i.e. the clean air issue and the application of the TBT Agreement], under the circumstances of this appeal, would have required the Appellate Body casually to disregard its own Working Procedures and to do so in the absence of a compelling reason grounded on, for instance, fundamental fairness or force majeure. Venezuela and Brazil could have appealed the Panel’s finding and non-finding on the two matters by taking advantage of Rules 23(1) or 23(4) of the Working Procedures and thereby placing the Appellate Body in a position to dispose of those issues directly in one and the same appellate proceeding.

… the route they chose for addressing the two issues in question is not contemplated by the Working Procedures, and therefore, these issues are not properly the subject of this appeal.”(1256)

870.     In US — Steel Safeguards, the complainants made a number of conditional appeals. These appeals were conditional upon the Appellate Body reversing some of the Panel’s findings. Since the Appellate Body upheld those findings, it did not consider it necessary to examine those conditional appeals.(1257)

12. Rule 24: third participants

871.     In Argentina — Footwear (EC), the Appellate Body received a letter from the Government of Paraguay indicating its interest “in attending” the oral hearing in this appeal. Several days later, the Appellate Body received a second letter from Paraguay clarifying that it was not requesting an opportunity to “make oral arguments or presentations at the oral hearing” as set forth in Rule 27.3 of the Working Procedures. Rather, Paraguay maintained that, as a third party which had notified its interest to the DSB under Article 10.2 of the DSU, it had the right to “participate passively” in the oral hearing before the Appellate Body in the present dispute. No participant or third participant objected to the participation of Paraguay on a “passive” basis. Subsequently, the Members of the Division hearing the appeal informed Paraguay, the participants and third participants that, having regard to the provisions of Articles 10.2 and 17.4 of the DSU as well as the provisions of Rules 24 and 27 of the Working Procedures, Paraguay would be allowed to attend the oral hearing as a “passive observer”.(1258)

872.     In India — Autos, the Appellate Body defined the scope of “passive observer” as attending the oral hearing and hearing the oral statements and responses to questioning by the participants and the third participant in this appeal.(1259)

13. Rule 26: working schedule

(a) Extension of deadline for participants’ or third participants’ submissions

873.     In EC — Bananas III, in accordance with Rule 16(2) of the Working Procedures, and at the request of the complaining parties, the Appellate Body granted a two-day extension for the filing of the appellees’ and third participants’ submissions.(1260)

874.     In Guatemala — Cement I, Guatemala filed an appellant’s submission drafted in Spanish. Two weeks later, Mexico filed an appellee’s submission also drafted in Spanish. In order to ensure that the third participant would have time to prepare its submission after receiving an English version of the appellant’s submission, the Appellate Body granted the United States additional time to file its third participant’s submission.(1261)

875.     In EC — Bed Linen, the European Communities and India requested the Appellate Body to extend the time-period for filing the appellee’s and third participant’s submissions. The Division hearing the appeal accepted the request pursuant to Rule 16(2) of the Working Procedures and in the light of the “exceptional circumstances” in that appeal.(1262)

876.     In US — Softwood Lumber IV, for scheduling reasons, the United States withdrew its notice of appeal pursuant to Rule 30 of the Working Procedures, conditional on its right to re-file the notice of appeal at a later date. Three weeks later, the United States re-filed a substantively identical notice of appeal pursuant to Rule 20 of the Working Procedures. On that same day, the United States filed its appellant’s submission in accordance with the Working Schedule drawn up by the Division for this appeal.(1263) The European Communities, a third participant in the proceedings, requested the Appellate Body to modify the Working Schedule in light of these developments. The following day, the Appellate Body declined the European Communities’ request, noting that extending the date for the filing of third participants’ submissions would significantly reduce the time available for the Division to consider carefully the arguments raised therein as well as the time available to the participants to respond to those arguments. The Division also observed that the new notice of appeal filed by the United States was, in all relevant respects, identical to the one submitted previously, and that the critical time-period for third participants and appellees to prepare their responses to arguments raised by appellants and other appellants is the period between the receipt of the appellant’s or other appellant’s submission, which contains the appellants’ arguments, and the due date for the filing of the third participants’ submissions. The Division noted that the time-period between the receipt of the appellant’s submission and the due date for third participants’ submissions in this case was the same as it would have been had the notice of appeal been filed 10 days before the date of the appellant’s submission, as normally occurs.(1264)

(b) Extension of deadline for circulation of Appellate Body Report

877.     In this regard, see Section XVII.B.4 above.

14. Rule 27: oral hearing

(a) Change of date

878.     For information relating to requests by parties to change the date set for an oral hearing, see paragraphs 853–854 above.

(b) Joint oral hearing

879.     In US — 1916 Act, the United States, the European Communities and Japan appealed certain issues of law and legal interpretations developed in the Panel Reports, US — 1916 Act, complaint by the European Communities(1265) and US — 1916 Act, complaint by Japan.(1266) These Panel Reports were rendered by two Panels composed of the same three members.(1267) The two Panel Reports, while not identical, were alike in all major respects.(1268) In view of the close similarity of the issues raised in the two appeals, it was decided, after consultation with the parties, that a single Division would hear and decide both appeals.(1269)

15. Rule 28: written responses

880.     In US — Gasoline, further to the oral hearing, the participants and third participants were invited to provide, and did provide, the Appellate Body and each other with final written statements of their respective positions.(1270)

881.     In Japan — Alcoholic Beverages II, the parties answered most of the Appellate Body’s questions orally at the hearing. They also answered a number in writing. The Division hearing the appeal gave each participant an opportunity to respond to the written post-hearing memoranda of the other participants.(1271)

882.     In US — Underwear, the participants and third participant in the oral hearing did not take advantage of an invitation by the Division hearing the appeal to submit post-hearing memoranda. The United States later submitted a written clarification and amplification of its oral response to one of the Division’s questions. The next day, Costa Rica responded in writing to the United States’ clarification.(1272)

883.     In EC — Poultry, at the request of the Division hearing the appeal, the participants and third participants submitted written post-hearing memoranda on particular issues relating to the appeal. The participants submitted their respective written replies to these post-hearing memoranda.(1273)

884.     In US — Shrimp, at the invitation of the Appellate Body, the United States, India, Pakistan, Thailand and Malaysia filed additional submissions on certain issues arising under Article XX(b) and Article XX(g) of the GATT 1994.(1274)

885.     In Canada — Patent Term, at the request of the Appellate Body Division hearing the appeal, the participants submitted additional memoranda on certain issues of legal interpretation arising under Articles 70.1 and 70.2 of the TRIPS Agreement. The Division afforded each participant an opportunity to respond to the additional memoranda submitted by the other participant.(1275)

886.     In US — Section 211 Appropriations Act, the Division hearing the appeal requested that the participants submit additional written memoranda on the interpretation by domestic courts of Article 6quinquies of the Paris Convention (1967), or the interpretation by domestic courts of legislation incorporating Article 6quinquies. Both participants filed the additional written memoranda and were given an opportunity to respond to these memoranda at the oral hearing.(1276)

887.     In US — FSC (Article 21.5 — EC), at the oral hearing, the Division requested the United States to submit in writing certain of its responses to questioning. The Division also authorized the European Communities and the third participants, if they wished, to respond in writing by 30 November 2001.(1277)

16. Rule 30(1): withdrawal of appeal

(a) General

888.     As of 31 December 2004, appellants have withdrawn their notices of appeal on five occasions. On four of these occasions (US — FSC;(1278) US — Line Pipe;(1279) EC — Sardines;(1280) US — Softwood Lumber IV)(1281) the withdrawals were “conditional” upon the filing of a new notice of appeal. In India — Autos, India withdrew its appeal and did not file a new one.(1282)

(b) Nature of the right to withdraw an appeal

889.     The Appellate Body on EC — Sardines considered that Rule 30(1) grants the appellant the right to withdraw an appeal which on its face appears to be “unfettered”. The Appellate Body however warned that, in spite of the permissive language of Rule 30(1), the Working Procedures must not be interpreted in a way that could undermine the effectiveness of the dispute settlement system:

“This rule accords to the appellant a broad right to withdraw an appeal at any time. This right appears, on its face, to be unfettered: an appellant is not subject to any deadline by which to withdraw its appeal; an appellant need not provide any reason for the withdrawal; and an appellant need not provide any notice thereof to other participants in an appeal. More significantly for this appeal, there is nothing in the Rule prohibiting the attachment of conditions to a withdrawal. Indeed, in two previous cases, notices of appeal were withdrawn subject to the condition that new notices would be filed.(1283) Nor is the right to withdraw an appeal expressly subject to the condition that no new notice be filed on the same matter after the withdrawal.

However, despite this permissive language, we emphasize that the Working Procedures must not be interpreted in a way that could undermine the effectiveness of the dispute settlement system, for they have been drawn up pursuant to the DSU and as a means of ensuring that the dispute settlement mechanism achieves the aim of securing a positive solution to a dispute.(1284)”(1285)

(c) Legality of a conditional withdrawal of an appeal

890.     In EC — Sardines, Peru claimed that Rule 30 did not permit conditions to be attached to a withdrawal of an appeal. The Appellate Body disagreed:

“Peru submits that nothing in Rule 30 of the Working Procedures permits the attachment of conditions to the withdrawal of a notice of appeal, and that, therefore, this appeal must be deemed to have been withdrawn irrespective of whether the conditions are met. We find no support in Rule 30 for Peru’s position. While it is true that nothing in the text of Rule 30(1) explicitly permits an appellant to exercise its right subject to conditions, it is also true that nothing in the same text prohibits an appellant from doing so. As we have just explained, in our view, the right to withdraw a notice of appeal under Rule 30(1) is broad, subject only to the limitations we have described. Therefore, we see no reason to interpret Rule 30 as granting a right to withdraw an appeal only if that withdrawal is unconditional. Rather, the correct interpretation, in our view, is that Rule 30(1) permits conditional withdrawals, unless the condition imposed undermines the ‘fair, prompt and effective resolution of trade disputes’, or unless the Member attaching the condition is not ‘engag[ing] in [dispute settlement] procedures in good faith in an effort to resolve the dispute.’ Therefore, it is necessary to examine any such conditions attached to withdrawals on a case-by-case basis to determine whether, in fact, the particular condition in a particular case in any way obstructs the dispute settlement process, or in some way diminishes the rights of the appellee or other participants in the appeal.”(1286)

891.     In EC — Sardines, the Appellate Body considered whether, by withdrawing its notice of appeal subject to the condition of filing a replacement notice of appeal, the European Communities had effectively undermined the “fair, prompt and effective resolution of trade disputes” or has not “engage[d] in [dispute settlement] procedures in good faith in an effort to resolve the dispute”.(1287) The Appellate Body considered that attaching a condition to the withdrawal was not unreasonable under the circumstances of the case(1288) and addressed examples of situations where the attachment of conditions to a withdrawal of appeal could be abusive or contrary to the DSU:

“We agree with Peru that there may be situations where the withdrawal of an appeal on condition of refiling a new notice, and the filing thereafter of a new notice, could be abusive and disruptive. However, in such cases, we would have the right to reject the condition, and also to reject any filing of a new notice of appeal, on the grounds either that the Member seeking to file such a new notice would not be engaging in dispute settlement proceedings in good faith, or that Rule 30(1) of the Working Procedures must not be used to undermine the fair, prompt, and effective resolution of trade disputes. We agree with Peru that the rules must be interpreted so as to ‘ensure that appellate review proceedings do not become an arena for unfortunate litigation techniques that frustrate the objectives of the DSU, and that developing countries do not have the resources to deal with’.(1289) The case before us, however, presents none of these circumstances.

In addition, we believe there are circumstances that, although not constituting ‘abusive practices’, would be in violation of the DSU, and would, thus, compel us to disallow the conditional withdrawal of a notice of appeal as well as the filing of a replacement notice. For example, if the conditional withdrawal or the filing of a new notice were to take place after the 60-day deadline in Article 16.4 of the DSU for adoption of panel reports, this would effectively circumvent the requirement to file appeals within 60 days of circulation of panel reports. In such circumstances, we would reject the conditional withdrawal and the new notice of appeal.

…

Peru alleges that, in sanctioning the approach of the European Communities in this appeal, we would be creating a procedural right for which the DSU has not provided — a right that can only be added to the DSU through a formal amendment by the Members of the World Trade Organization (the ‘WTO’). We are, however, not creating a new procedural right; we are only upholding the right to withdraw an appeal. In addition, in admitting the replacement Notice of Appeal in this dispute, we are, as we were in United States — Import Prohibition of Certain Shrimp and Shrimp Products (‘US — Shrimp’), seeking to:

‘… give full meaning and effect to the right of appeal and to give a party which regards itself aggrieved by some legal finding or interpretation in a panel report a real and effective opportunity to demonstrate the error in such finding or interpretation.’(1290)

In that same Report, we added that ‘an appellee is, of course, always entitled to its full measure of due process.’(1291) In the circumstances of this case, we believe that Peru has been accorded the full measure of its due process rights, because the withdrawal of the original Notice and the filing of a replacement Notice were carried out in response to objections raised by Peru, the replacement Notice was filed in a timely manner and early in the process, and the replacement Notice contained no new or modified grounds of appeal. Also, Peru has not demonstrated that it suffered prejudice as a result. Moreover, Peru was given an adequate opportunity to address its concerns about the European Communities’ actions during the course of the appeal.”(1292)

(d) Replacement of a notice of appeal

892.     The Appellate Body on EC — Sardines, having agreed to the European Communities’ conditional withdrawal of an appeal, rejected Peru’s argument that to permit this would be to create a new procedural right not foreseen under the DSU. Rather, the Appellate Body held that they were merely upholding the right to withdraw an appeal. See also paragraph 865 above.

“Peru alleges that, in sanctioning the approach of the European Communities in this appeal, we would be creating a procedural right for which the DSU has not provided — a right that can only be added to the DSU through a formal amendment by the Members of the World Trade Organization (the ‘WTO’). We are, however, not creating a new procedural right; we are only upholding the right to withdraw an appeal.”(1293)

XXXIII. Working Procedures for Article 22.6 Arbitrations    back to top

A. Text of the Working Procedures for Article 22.6 Arbitrations

893.     In both Canada — Aircraft Credits and Guarantees (Article 22.6–Canada) and US — Offset Act (Byrd Amendment), the Arbitrator(s) attached their working procedures to their Decisions. The following is a reproduction of the working procedures in US — Offset Act (Byrd Amendment):(1294)

“The Arbitrator will follow the normal working procedures of the DSU where relevant and as adapted to the circumstances of the present proceedings, in accordance with the timetable it has adopted. In this regard, —

(a)     the Arbitrator will meet in closed session;

(b)     the deliberations of the Arbitrator and the documents submitted to it shall be kept confidential. However, this is without prejudice to the parties’ disclosure of statements of their own positions to the public, in accordance with Article 18.2 of the DSU;

(c)     at any substantive meeting with the parties, the Arbitrator will ask the United States to present orally its views first, followed by the party(ies) having requested authorization to suspend concessions or other obligations;

(d)     each party shall submit all factual evidence to the Arbitrator no later than in its written submission to the Arbitrator, except with respect to evidence necessary during the hearing or for answers to questions. Derogations to this procedure will be granted upon a showing of good cause, in which case the other party(ies) shall be accorded a period of time for comments, as appropriate;

(e)     the parties shall provide an electronic copy (on a computer format compatible with the Secretariat’s programmes) together with the printed version (6 copies) of their submissions, including the methodology paper, on the due date. All these copies must be filed with the Dispute Settlement Registrar, […]. Electronic copies may be sent by e-mail to […]. Parties shall provide 6 copies and an electronic version of their oral statements during any meeting with the Arbitrator or no later than noon on the day following any such meeting.

(f)     except as otherwise indicated in the timetable, submissions should be provided at the latest by 5.00 p.m. on the due date so that there is a possibility to send them to the Arbitrator on that date. As is customary, distribution of submissions to the other party(ies) shall be made by the parties themselves;

(g)     if necessary, and at any time during the proceedings, the Arbitrator may put questions to any party to clarify any point that is unclear. Whenever appropriate, a right to comment on the responses will be granted to the other party(ies);

(h)     any material submitted shall be concise and limited to questions of relevance in this particular procedure.

(i)     Parties have the right to determine the composition of their own delegations. Delegations may include, as representatives of the government concerned, private counsel and advisers. Parties shall have responsibility for all members of their delegations and shall ensure that all members of their delegations act in accordance with the rules of the DSU and these Working Procedures, particularly in regard to confidentiality of the proceedings. Parties shall provide a list of the participants of their delegation prior to, or at the beginning of, any meeting with the Arbitrator.

(j)     to facilitate the maintenance of the record of the arbitration, and to maximize the clarity of submissions and other documents, in particular the references to exhibits submitted by parties, parties shall sequentially number their exhibits throughout the course of the arbitration.”

 
B. Interpretation and Application of the Working Procedures

1. Admissibility of new evidence

894.     In Canada — Aircraft Credits and Guarantees (Article 22.6 — Canada), Canada requested the Arbitrator to reject certain evidence presented by Brazil on the grounds of its late submission (at the end of the substantive meeting). The Arbitrator, after referring to the working procedures and the existing jurisprudence in this area, accepted Canada’s objection and rejected Brazil’s new evidence:

“We recall that paragraph (d) of our Working Procedures provides that:

‘(d) the parties shall submit all factual evidence to the Arbitrators no later than the first written submissions to the Arbitrators, except with respect to evidence necessary for purposes of rebuttals or answers to questions. Exceptions to this procedure will be granted upon a showing of good cause. In such cases, the other party shall be accorded a period of time for comment, as appropriate;’

The purpose of paragraph (d), which is also found, mutatis mutandis, in most panel and Article 21.5 DSU compliance panel working procedures, is to ensure that parties are given sufficient opportunities to comment on any piece of evidence submitted in the course of the proceedings. Paragraph (d) clearly states the circumstances in which evidence may be submitted after the first written submission. First, additional evidence may be submitted for the purpose of rebuttals or answers to questions. Second, the Arbitrator may allow new evidence to be submitted at a later time, upon a showing of good cause. In all events, paragraph (d) requires that the other party shall be accorded a period of time for comment, as appropriate.

We recall that in Argentina — Measures Affecting Imports of Footwear, Textiles, Apparel and Other Items,(1295) the Panel was confronted with a situation of evidence submitted late in the proceedings.(1296) The Panel considered that due process required that it accept the evidence submitted by the United States on the understanding that Argentina would have a period of time to provide further comments on the additional pieces of evidence. The Appellate Body upheld the Panel’s reasoning, confirming that the Panel enjoyed a certain amount of discretion in its dealing with evidence and stating that Argentina had not requested more time to comment.(1297)

… In this case, Canada requests that the Arbitrator reject the evidence, since Brazil showed no good cause for submitting late a piece of information that had been available to it for some time.(1298) Brazil responds that Exhibits BRA-76 and 77 were submitted as part of its reply to question No. 2 of the Arbitrator to both parties. However, nowhere do we find any reference to these exhibits in Brazil’s reply of 1 November 2002. Assuming the evidence was for purposes of rebuttal, we see no particular reason why it could not have been submitted together with Brazil’s oral statement at our meeting rather than with its closing statement. By delaying the presentation of this evidence until its closing statement, Brazil’s position as respondent gave it a procedural advantage since it spoke last, and it was not foreseen in the Working Procedures that Canada could reply at that point. This makes such a late submission of evidence even less acceptable. Intentionally submitting evidence at a time where the other party is normally no longer in a position to comment — as in this case — not only adversely affects the interests of that party, it also affects due process in general and can generate delays in the work of panels and Arbitrators, thus making it more difficult for them to meet the deadlines contained in the WTO Agreement. Hence, we felt it more appropriate to exclude such evidence rather than to allow Canada to respond, the more so as Canada had expressly requested the Arbitrator to reject such evidence. As a result, we decided not to take into account the evidence submitted by Brazil in Exhibits BRA-76 and 77.”(1299)

2. Admissibility of new arguments

895.     In Canada — Aircraft Credits and Guarantees (Article 22.6 — Canada), Brazil had advanced new arguments in its concluding remarks at the first substantive meeting. Canada thus presented an additional submission to the Arbitrator to respond to those arguments. The Arbitrator decided to accept this additional submission on the following grounds:

“[Canada’s additional] submission should not be treated as a reply to new evidence, but as a new submission of arguments which is not foreseen in the Working Procedures. A strict interpretation of our Working Procedures should lead us to disregard Canada’s additional submission. However, we note that Brazil developed a rather new line of argumentation in its concluding remarks. It was in the interest of due process and of the information of the Arbitrator to hear what Canada had to say about it, if it wished to do so. We also note that, even if Canada decided to reply to Brazil’s arguments, Brazil’s right — as respondent — to speak last was preserved by the opportunity given to parties to comment on each other’s replies to the questions of the Arbitrator. We saw no reason to formally intervene in that process as long as due process was ultimately respected. We also do not believe that our passivity in this respect could lead to an endless exchange of arguments since the comments on the replies to the questions were the last opportunity for parties to express their views, as provided by the Arbitrator at its hearing with the parties.

For these reasons we decide to accept Canada’s comments on Brazil’s concluding statement and Brazil’s remarks on those comments.”(1300)

3. Confidential/non-confidential versions of the Arbitrators’ decision

896.     In Canada — Aircraft Credits and Guarantees (Article 22.6 — Canada), both parties insisted on the confidentiality of certain documents. The Arbitrator decided to prepare two versions of its decision: (i) a confidential version, including the details of its calculations and all the information relied upon, issued exclusively to the parties on a confidential basis; and (ii) a non-confidential version circulated to all WTO Members. In order to decide which information should be excluded from this non-confidential version, the Arbitrator requested the parties to identify the commercially sensitive information which they considered should be removed.(1301)

XXXIV. Rules of Conduct for the Understanding on Rules and Procedures Governing the Settlement of Disputes    back to top

A. Text of the Rules of Conduct(1302)

Rules of Conduct for the Understanding on Rules and Procedures Governing the Settlement of Disputes

I.     Preamble

Members,

          Recalling that on 15 April 1994 in Marrakesh, Ministers welcomed the stronger and clearer legal framework they had adopted for the conduct of international trade, including a more effective and reliable dispute settlement mechanism;

          Recognizing the importance of full adherence to the Understanding on Rules and Procedures Governing the Settlement of Disputes (“DSU”) and the principles for the management of disputes applied under Articles XXII and XXIII of GATT 1947, as further elaborated and modified by the DSU;

          Affirming that the operation of the DSU would be strengthened by rules of conduct designed to maintain the integrity, impartiality and confidentiality of proceedings conducted under the DSU thereby enhancing confidence in the new dispute settlement mechanism;

          Hereby establish the following Rules of Conduct.

II.     Governing Principle

1.      Each person covered by these Rules (as defined in paragraph 1 of Section IV below and hereinafter called “covered person”) shall be independent and impartial, shall avoid direct or indirect conflicts of interest and shall respect the confidentiality of proceedings of bodies pursuant to the dispute settlement mechanism, so that through the observance of such standards of conduct the integrity and impartiality of that mechanism are preserved. These Rules shall in no way modify the rights and obligations of Members under the DSU nor the rules and procedures therein.

III.     Observance of the Governing Principle

1.      To ensure the observance of the Governing Principle of these Rules, each covered person is expected (1) to adhere strictly to the provisions of the DSU; (2) to disclose the existence or development of any interest, relationship or matter that that person could reasonably be expected to know and that is likely to affect, or give rise to justifiable doubts as to, that person’s independence or impartiality; and (3) to take due care in the performance of their duties to fulfil these expectations, including through avoidance of any direct or indirect conflicts of interest in respect of the subject matter of the proceedings.

2.      Pursuant to the Governing Principle, each covered person shall be independent and impartial, and shall maintain confidentiality. Moreover, such persons shall consider only issues raised in, and necessary to fulfil their responsibilities within, the dispute settlement proceeding and shall not delegate this responsibility to any other person. Such person shall not incur any obligation or accept any benefit that would in any way interfere with, or which could give rise to, justifiable doubts as to the proper performance of that person’s dispute settlement duties.

IV.     Scope

1.      These Rules shall apply, as specified in the text, to each person serving: (a) on a panel; (b) on the Standing Appellate Body; (c) as an arbitrator pursuant to the provisions mentioned in Annex “1a”; or (d) as an expert participating in the dispute settlement mechanism pursuant to the provisions mentioned in Annex “1b”. These Rules shall also apply, as specified in this text and the relevant provisions of the Staff Regulations, to those members of the Secretariat called upon to assist the panel in accordance with Article 27.1 of the DSU or to assist in formal arbitration proceedings pursuant to Annex “1a”; to the Chairman of the Textiles Monitoring Body (hereinafter called “TMB”) and other members of the TMB Secretariat called upon to assist the TMB in formulating recommendations, findings or observations pursuant to the WTO Agreement on Textiles and Clothing; and to Standing Appellate Body support staff called upon to provide the Standing Appellate Body with administrative or legal support in accordance with Article 17.7 of the DSU (hereinafter “Member of the Secretariat or Standing Appellate Body support staff”), reflecting their acceptance of established norms regulating the conduct of such persons as international civil servants and the Governing Principle of these Rules.

2.      The application of these Rules shall not in any way impede the Secretariat’s discharge of its responsibility to continue to respond to Members’ requests for assistance and information.

3.      These Rules shall apply to the members of the TMB to the extent prescribed in Section V.

V.     Textiles Monitoring Body

1.      Members of the TMB shall discharge their functions on an ad personam basis, in accordance with the requirement of Article 8.1 of the Agreement on Textiles and Clothing, as further elaborated in the working procedures of the TMB, so as to preserve the integrity and impartiality of its proceedings.(1)

(footnote original) 1 These working procedures, as adopted by the TMB on 26 July 1995 (G/TMB/R/1), currently include, inter alia, the following language in paragraph 1.4: “In discharging their functions in accordance with paragraph 1.1 above, the TMB members and alternates shall undertake not to solicit, accept or act upon instructions from governments, nor to be influenced by any other organisations or undue extraneous factors. They shall disclose to the Chairman any information that they may consider likely to impede their capacity to discharge their functions on an ad personam basis. Should serious doubts arise during the deliberations of the TMB regarding the ability of a TMB member to act on an ad personam basis, they shall be communicated to the Chairman. The Chairman shall deal with the particular matter as necessary.”

 VI.     Self-Disclosure Requirements by Covered Persons

1.     (a)     Each person requested to serve on a panel, on the Standing Appellate S Body, as an arbitrator, or as an expert shall, at the time of the request, receive from the Secretariat these Rules, which include an Illustrative List (Annex 2) of examples of the matters subject to disclosure.

        (b)     Any member of the Secretariat described in paragraph IV:1, who may expect to be called upon to assist in a dispute, and Standing Appellate Body support staff, shall be familiar with these Rules.

2.     As set out in paragraph VI:4 below, all covered persons described in paragraph VI.1(a) and VI.1(b) shall disclose any information that could reasonably be expected to be known to them at the time which, coming within the scope of the Governing Principle of these Rules, is likely to affect or give rise to justifiable doubts as to their independence or impartiality. These disclosures include the type of information described in the Illustrative List, if relevant.

3.     These disclosure requirements shall not extend to the identification of matters whose relevance to the issues to be considered in the proceedings would be insignificant. They shall take into account the need to respect the personal privacy of those to whom these Rules apply and shall not be so administratively burdensome as to make it impracticable for otherwise qualified persons to serve on panels, the Standing Appellate Body, or in other dispute settlement roles.

4.     (a)     All panellists, arbitrators and experts, prior to confirmation of their appointment, shall complete the form at Annex 3 of these Rules. Such information would be disclosed to the Chair of the Dispute Settlement Body (“DSB”) for consideration by the parties to the dispute.

   (b)     (i)     Persons serving on the Standing Appellate Body who, through rotation, are selected to hear the appeal of a particular panel case, shall review the factual portion of the Panel report and complete the form at Annex 3. Such information would be disclosed to the Standing Appellate Body for its consideration whether the member concerned should hear a particular appeal.

            (ii)      Standing Appellate Body support staff shall disclose any relevant matter to the Standing Appellate Body, for its consideration in deciding on the assignment of staff to assist in a particular appeal.

   (c)     When considered to assist in a dispute, members of the Secretariat shall disclose to the Director-General of the WTO the information required under paragraph VI:2 of these Rules and any other relevant information required under the Staff Regulations, including the information described in the footnote.(**)

(footnote original) ** Pending adoption of the Staff Regulations, members of the Secretariat shall make disclosures to the Director-General in accordance with the following draft provision to be included in the Staff Regulations:

        “When paragraph VI:4(c) of the Rules of Conduct for the DSU is applicable, members of the Secretariat would disclose to the Director-General of the WTO the information required in paragraph VI:2 of those Rules, as well as any information regarding their participation in earlier formal consideration of the specific measure at issue in a dispute under any provisions of the WTO Agreement, including through formal legal advice under Article 27.2 of the DSU, as well as any involvement with the dispute as an official of a WTO Member government or otherwise professionally, before having joined the Secretariat.

        The Director-General shall consider any such disclosures in deciding on the assignment of members of the Secretariat to assist in a dispute.

        When the Director-General, in the light of his consideration, including of available Secretariat resources, decides that a potential conflict of interest is not sufficiently material to warrant non-assignment of a particular member of the Secretariat to assist in a dispute, the Director-General shall inform the panel of his decision and of the relevant supporting information.”

5.     During a dispute, each covered person shall also disclose any new information relevant to paragraph VI:2 above at the earliest time they become aware of it.

6.     The Chair of the DSB, the Secretariat, parties to the dispute, and other individuals involved in the dispute settlement mechanism shall maintain the confidentiality of any information revealed through this disclosure process, even after the panel process and its enforcement procedures, if any, are completed.

VII.     Confidentiality

1.     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. No covered person shall at any time use such information acquired during such deliberations and proceedings to gain personal advantage or advantage for others.

2.     During the proceedings, no covered person shall engage in ex parte contacts concerning matters under consideration. Subject to paragraph VII:1, no covered person shall make any statements on such proceedings or the issues in dispute in which that person is participating, until the report of the panel or the Standing Appellate Body has been derestricted.

VIII.     Procedures Concerning Subsequent Disclosure and Possible Material Violations

1.     Any party to a dispute, conducted pursuant to the WTO Agreement, who possesses or comes into possession of evidence of a material violation of the obligations of independence, impartiality or confidentiality or the avoidance of direct or indirect conflicts of interest by covered persons which may impair the integrity, impartiality or confidentiality of the dispute settlement mechanism, shall at the earliest possible time and on a confidential basis, submit such evidence to the Chair of the DSB, the Director-General or the Standing Appellate Body, as appropriate according to the respective procedures detailed in paragraphs VIII:5 to VIII:17 below, in a written statement specifying the relevant facts and circumstances. Other Members who possess or come into possession of such evidence may provide such evidence to the parties to the dispute in the interest of maintaining the integrity and impartiality of the dispute settlement mechanism.

2.     When evidence as described in paragraph VIII:1 is based on an alleged failure of a covered person to disclose a relevant interest, relationship or matter, that failure to disclose, as such, shall not be a sufficient ground for disqualification unless there is also evidence of a material violation of the obligations of independence, impartiality, confidentiality or the avoidance of direct or indirect conflicts of interests and that the integrity, impartiality or confidentiality of the dispute settlement mechanism would be impaired thereby.

3.     When such evidence is not provided at the earliest practicable time, the party submitting the evidence shall explain why it did not do so earlier and this explanation shall be taken into account in the procedures initiated in paragraph VIII:1.

4.     Following the submission of such evidence to the Chair of the DSB, the Director-General of the WTO or the Standing Appellate Body, as specified below, the procedures outlined in paragraphs VIII:5 to VIII:17 below shall be completed within fifteen working days.

Panellists, Arbitrators, Experts

5.     If the covered person who is the subject of the evidence is a panellist, an arbitrator or an expert, the party shall provide such evidence to the Chair of the DSB.

6.     Upon receipt of the evidence referred to in paragraphs VIII:1 and VIII:2, the Chair of the DSB shall forthwith provide the evidence to the person who is the subject of such evidence, for consideration by the latter.

7.     If, after having consulted with the person concerned, the matter is not resolved, the Chair of the DSB shall forthwith provide all the evidence, and any additional information from the person concerned, to the parties to the dispute. If the person concerned resigns, the Chair of the DSB shall inform the parties to the dispute and, as the case may be, the panellists, the arbitrator(s) or experts.

8.     In all cases, the Chair of the DSB, in consultation with the Director-General and a sufficient number of Chairs of the relevant Council or Councils to provide an odd number, and after having provided a reasonable opportunity for the views of the person concerned and the parties to the dispute to be heard, would decide whether a material violation of these Rules as referred to in paragraphs VIII:1 and VIII:2 above has occurred. Where the parties agree that a material violation of these Rules has occurred, it would be expected that, consistent with maintaining the integrity of the dispute settlement mechanism, the disqualification of the person concerned would be confirmed.

9.     The person who is the subject of the evidence shall continue to participate in the consideration of the dispute unless it is decided that a material violation of these Rules has occurred.

10.     The Chair of the DSB shall thereafter take the necessary steps for the appointment of the person who is the subject of the evidence to be formally revoked, or excused from the dispute as the case may be, as of that time.

Secretariat

11.     If the covered person who is the subject of the evidence is a member of the Secretariat, the party shall only provide the evidence to the Director-General of the WTO, who shall forthwith provide the evidence to the person who is the subject of such evidence and shall further inform the other party or parties to the dispute and the panel.

12.     It shall be for the Director-General to take any appropriate action in accordance with the Staff Regulations.(***)

(footnote original) *** Pending adoption of the Staff Regulations, the Director-General would act in accordance with the following draft provision for the Staff Regulations: “If paragraph VIII:11 of the Rules of Conduct for the DSU governing the settlement of disputes is invoked, the Director-General shall consult with the person who is the subject of the evidence and the panel and shall, if necessary, take appropriate disciplinary action.”

13.     The Director-General shall inform the parties to the dispute, the panel and the Chair of the DSB of his decision, together with relevant supporting information.

Standing Appellate Body

14.     If the covered person who is the subject of the evidence is a member of the Standing Appellate Body or of the Standing Appellate Body support staff, the party shall provide the evidence to the other party to the dispute and the evidence shall thereafter be provided to the Standing Appellate Body.

15.     Upon receipt of the evidence referred to in paragraphs VIII:1 and VIII:2 above, the Standing Appellate Body shall forthwith provide it to the person who is the subject of such evidence, for consideration by the latter.

16.     It shall be for the Standing Appellate Body to take any appropriate action after having provided a reasonable opportunity for the views of the person concerned and the parties to the dispute to be heard.

17.     The Standing Appellate Body shall inform the parties to the dispute and the Chair of the DSB of its decision, together with relevant supporting information.

***

18.     Following completion of the procedures in paragraphs VIII:5 to VIII:17, if the appointment of a covered person, other than a member of the Standing Appellate Body, is revoked or that person is excused or resigns, the procedures specified in the DSU for initial appointment shall be followed for appointment of a replacement, but the time-periods shall be half those specified in the DSU.(****) The member of the Standing Appellate Body who, under that Body’s rules, would next be selected through rotation to consider the dispute, would automatically be assigned to the appeal. The panel, members of the Standing Appellate Body hearing the appeal, or the arbitrator, as the case may be, may then decide, after consulting with the parties to the dispute, on any necessary modifications to their working procedures or proposed timetable.

(footnote original) **** Appropriate adjustments would be made in the case of appointments pursuant to the Agreement on Subsidies and Countervailing Measures.

19.     All covered persons and Members concerned shall resolve matters involving possible material violations of these Rules as expeditiously as possible so as not to delay the completion of proceedings, as provided in the DSU.

20.     Except to the extent strictly necessary to carry out this decision, all information concerning possible or actual material violations of these Rules shall be kept confidential.

IX. Review

1.     These Rules of Conduct shall be reviewed within two years of their adoption and a decision shall be taken by the DSB as to whether to continue, modify or terminate these Rules.

ANNEX 1a

Arbitrators acting pursuant to the following provisions:

• Articles 21.3(c); 22.6 and 22.7; 26.1(c) and 25 of the DSU;
  
• Article 8.5 of the Agreement on Subsidies and Countervailing Measures;
  
• Articles XXI.3 and XXII.3 of the General Agreement on Trade in Services.

ANNEX 1b

Experts advising or providing information pursuant to the following provisions:

• Article 13.1; 13.2 of the DSU;
  
• Article 4.5 of the Agreement on Subsidies and Countervailing Measures;
  
• Article 11.2 of the Agreement on the Application of Sanitary and Phytosanitary Measures;
  
• Article 14.2; 14.3 of the Agreement on Technical Bariers to Trade

ANNEX 2

ILLUSTRATIVE LIST OF INFORMATION TO BE DISCLOSED

     This list contains examples of information of the type that a person called upon to serve in a dispute should disclose pursuant to the Rules of Conduct for the Understanding on Rules and Procedures Governing the Settlement of Disputes.

     Each covered person, as defined in Section IV:1 of these Rules of Conduct, has a continuing duty to disclose the information described in Section VI:2 of these Rules which may include the following:

(a)     financial interests (e.g. investments, loans, shares, interests, other debts); business interests (e.g. directorship or other contractual interests); and property interests relevant to the dispute in question;

(b)     professional interests (e.g. a past or present relationship with private clients, or any interests the person may have in domestic or international proceedings, and their implications, where these involve issues similar to those addressed in the dispute in question);

(c)     other active interests (e.g. active participation in public interest groups or other organisations which may have a declared agenda relevant to the dispute in question);

(d)     considered statements of personal opinion on issues relevant to the dispute in question (e.g. publications, public statements);

(e)     employment or family interests (e.g. the possibility of any indirect advantage or any likelihood of pressure which could arise from their employer, business associates or immediate family members).

ANNEX 3

Dispute Number: ________

WORLD TRADE ORGANIZATION DISCLOSURE FORM

     I have read the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU) and the Rules of Conduct for the DSU. I understand my continuing duty, while participating in the dispute settlement mechanism, and until such time as the Dispute Settlement Body (DSB) makes a decision on adoption of a report relating to the proceeding or notes its settlement, to disclose herewith and in future any information likely to affect my independence or impartiality, or which could give rise to justifiable doubts as to the integrity and impartiality of the dispute settlement mechanism; and to respect my obligations regarding the confidentiality of dispute settlement proceedings.

Signed:

Dated:

B. Interpretation and Application of the Rules of Conduct

897.     At its meeting on 3 December 1996,(1303) the DSB adopted the Rules of Conduct for the Understanding on Rules and Procedures Governing the Settlement of Disputes.(1304)

898.     With a communication, dated 20 January 1997, from the Chairman of the Appellate Body addressed to the Chairman of the Dispute Settlement Body, and circulated to Members for information, “the Appellate Body confirms that the Rules of Conduct have been directly incorporated into the Working Procedures for Appellate Review. Accordingly, the Rules of Conduct, as adopted by the Dispute Settlement Body, are made a part of, and supersede Annex II of, the Working Procedures for Appellate Review.”(1305)

899.     At its meeting on 25, 28 and 29 January and 1 February 1999,(1306) and in accordance with Section IX of the Rules of Conduct, which provides for a periodic review of the rules, the DSB agreed to continue to apply the current Rules of Conduct.(1307)

XXXV. Rules of Procedure for Meetings of the Dispute Settlement Body    back to top

A. Text of the Rules of Procedure

Rules of Procedure for Meetings of the Dispute Settlement Body(1308)

1.     When the General Council convenes as the Dispute Settlement Body (DSB), it shall follow the rules of procedure for meetings of the General Council, except as provided otherwise in the Dispute Settlement Understanding (DSU) or below.

Chapter IV — Observers

2.     Observership at meetings of the DSB shall be governed by paragraphs 9 to 11 of Annex 2 and paragraph 3, including footnote 5 of Annex 3 to these Rules.(1)

(footnote original) 1 WT/L/161.

Chapter V — Officers

3.     The DSB shall elect its own Chairperson(*) from among the representatives of Members. The election shall take place at the first meeting of the year and shall take effect at the end of the meeting. The Chairperson shall hold office until the end of the first meeting of the following year.

(footnote original) * The Dispute Settlement Body shall apply the relevant guidelines contained in the “Guidelines for Appointment of Officers to WTO Bodies” (WT/L/31).

4.     If the Chairperson is absent from any meeting or part thereof, the Chairperson of the General Council or in the latter’s absence, the Chairperson of the Trade Policy Review Body, shall perform the functions of the Chairperson. If the Chairpersons of the General Council and of the Trade Policy Review Body are also not present, the DSB shall elect an interim Chairperson for that meeting or that part of the meeting.

5.     If the Chairperson can no longer perform the functions of the office, the DSB shall designate a Chairperson in accordance with paragraph 4 to perform those functions pending the election of a new Chairperson.

B. Interpretation and Application of the Rules of Procedure

1. Adoption

900.     At its meeting of 10 February 1995, the DSB, in accordance with Article IV:3 of the WTO Agreement, adopted the Rules of Procedure contained in PC/IPL/9 with the exception of the rules concerning officers and the participation of international organizations as observers in the WTO, which were at the time open issues. Once agreement was reached on those pending issues, the rules of procedure were circulated in document WT/DSB/9.

2. Reference to General Council procedures

901.     Further to its own rules of procedures, the DSB follows the rules of procedure for meetings of the General Council,(1309) except as otherwise provided in the DSU or in document WT/DSB/9.

XXXVI. Other Issues in WTO Dispute Settlement Proceedings    back to top

A. Order of Analysis

1. Provisions of different WTO Agreements

(a) Test: Agreement that deals specifically and in detail with the measure at issue

902.     In EC — Bananas III, the Appellate Body enunciated the test that should be applied in order to decide the order of analysis where two or more provisions from different covered Agreements appear a priori to apply to the measure in question. According to the Appellate Body, the provision from the Agreement that “deals specifically, and in detail” with the measures at issue should be analysed first. See paragraph 903 below.(1310)

(i) GATT 1994 versus Licensing Agreement

903.     In EC — Bananas III, the Appellate Body, disagreeing with the Panel’s choice, considered that the Panel should have applied the Licensing Agreement first (instead of the GATT 1994), “since this agreement deals specifically, and in detail, with the administration of import licensing procedures”:

“Although Article X:3(a) of the GATT 1994 and Article 1.3 of the Licensing Agreement both apply, the Panel, in our view, should have applied the Licensing Agreement first, since this agreement deals specifically, and in detail, with the administration of import licensing procedures. If the Panel had done so, then there would have been no need for it to address the alleged inconsistency with Article X:3(a) of the GATT 1994.”(1311)

(ii) GATT 1994 versus SPS Agreement

904.     In EC — Hormones, the Panel, in a finding not reviewed by the Appellate Body, considered which Agreement, the SPS Agreement or the GATT 1994,(1312) should be examined first in this particular dispute. The Panel considered that the SPS Agreement was to be addressed first because it “specifically addresses the type of measure in dispute”:

“[I]n accordance with the ordinary meaning to be given to the terms of the SPS Agreement in their context and in the light of its object and purpose (in conformity with Article 31 of the Vienna Convention), there is no requirement, in any of the provisions of the SPS Agreement, that a prior violation of a GATT provision need be established before the SPS Agreement applies.

Having reached the conclusion that we are not per se required to address GATT claims prior to those raised under the SPS Agreement, we must then decide which of the two agreements we should examine first in this particular dispute. The SPS Agreement specifically addresses the type of measure in dispute. If we were to examine GATT first, we would in any event need to revert to the SPS Agreement: if a violation of GATT were found, we would need to consider whether Article XX(b) could be invoked and would then necessarily need to examine the SPS Agreement; if, on the other hand, no GATT violation were found, we would still need to examine the consistency of the measure with the SPS Agreement since nowhere is consistency with GATT presumed to be consistency with the SPS Agreement. For these reasons, and in order to conduct our consideration of this dispute in the most efficient manner, we shall first examine the claims raised under the SPS Agreement.”(1313)

905.     The Panel on Australia — Salmon also dealt with the question whether to address first the provisions of the GATT 1994 or those of the SPS Agreement:

“Canada recognizes that the SPS Agreement provides for obligations additional to those contained in GATT 1994, but, nevertheless, first addresses its claim under Article XI of GATT 1994. Australia invokes Article 2.4 of the SPS Agreement, which presumes GATT consistency for measures found to be in conformity with the SPS Agreement, to first address the SPS Agreement. We note, moreover, that (1) the SPS Agreement specifically addresses the type of measure in dispute, and (2) we will in any case need to examine the SPS Agreement, whether or not we find a GATT violation (since GATT consistency is nowhere presumed to constitute consistency with the SPS Agreement). In order to conduct our consideration of this dispute in the most efficient manner, we shall, therefore, first address the claims made by Canada under the SPS Agreement before addressing those put forward under GATT 1994.”(1314)

(iii) GATT 1994 versus TBT Agreement

906.     In EC — Asbestos, the Panel was faced with the difficulty of applying the above test set out by the Appellate Body in EC — Bananas III because the parties did not agree on the legal nature of the measure itself (technical regulation covered by the TBT Agreement or a general ban coming under the scope of the GATT 1994 alone) (see paragraphs 902–903 above). The Panel decided to start by examining the ways in which the Decree at issue violated the TBT Agreement since “if the Decree is a ‘technical regulation’ within the meaning of the TBT Agreement, then the latter would deal with the measure in the most specific and most detailed manner”:

“According to the Appellate Body in European Communities — Regime for the Importation, Sale and Distribution of Bananas,(1315) when the GATT 1994 and another Agreement in Annex 1A appear a priori to apply to the measure in question, the latter should be examined on the basis of the Agreement that deals ‘specifically, and in detail,’ with such measures. In this particular case, as the parties do not agree on the legal nature of the measure itself (technical regulation covered by the TBT Agreement or general ban coming under the scope of the GATT 1994 alone), it is difficult at this stage to determine which Agreement, either the GATT 1994 or the TBT Agreement, deals with the measure in question most specifically and in the most detailed manner without undertaking an in-depth examination of the measure in the light of each Agreement.

In order to decide upon the order in which our consideration should proceed, in the way suggested by the Appellate Body, the hypothesis should be that, if the Decree is a ‘technical regulation’ within the meaning of the TBT Agreement, then the latter would deal with the measure in the most specific and most detailed manner. Consequently, in our view it must first be determined whether the Decree is a technical regulation within the meaning of the TBT Agreement. If this is the case, we shall start considering this case by examining the ways in which the Decree violates the TBT Agreement. If we find that the Decree is not a ‘technical regulation’, we shall then immediately start to consider it in the context of the GATT 1994.”(1316)

907.     In EC — Sardines, the Panel considered whether to examine the claims in the order requested by Peru. Peru had requested the Panel to first examine its claim under Article 2.4 of the TBT Agreement and then examine its claims under Articles 2.2 and 2.1 of the TBT Agreement only if the EC Regulation was not considered inconsistent with Article 2.4. Peru further requested the Panel to examine its claims in respect of Article III:4 of the GATT 1994 only if the EC Regulation was not considered inconsistent with the provisions of the TBT Agreement invoked by Peru. The Panel recalled the Appellate Body’s statement in EC — Bananas III stating that where two agreements apply simultaneously, a panel should normally consider the more specific agreement before the more general agreement. Furthermore, the Panel recalled the Appellate Body’s statement in US — FSC in relation to the sequencing of claims:

“These requests by Peru on sequencing of claims thereby oblige us to consider whether there is an interpretative methodology that compels panels to adopt a particular order which, if not followed, would constitute an error of law.(1317) We recall the Appellate Body’s statement in US — FSC in relation to the US argument that the panel erred by commencing its analysis with Article 3.1(a) rather than footnote 59 of the Subsidies  and Countervailing Measures Agreement. The Appellate Body stated:

‘In our view, it was not a legal error for the Panel to begin its examination of whether the FSC measure involves export subsidies by examining the general definition of a “subsidy” that is applicable to export subsidies in Article 3.1(a). In any event, whether the examination begins with the general definition of a “subsidy” in Article 1.1 or with footnote 59, we believe that the outcome of the European Communities’ claim under Article 3.1(a) would be the same. The appropriate meaning of both provisions can be established and can be given effect, irrespective of whether the examination of the claim of the European Communities under Article 3.1(a) begins with Article 1.1 or with footnote 59.’(1318)

In our view, if the EC Regulation is a technical regulation, it would not constitute an error of law to start the examination of the consistency of the EC Regulation with Article 2.4 followed by Articles 2.2 and 2.1 of the TBT Agreement as necessary since such sequential examination would not affect the interpretation of the other provisions.”(1319)

(iv) GATT 1994 versus Agreement on Agriculture

908.     In EC — Bananas III, the Appellate Body considered that “the provisions of the GATT 1994, including Article XIII, apply to market access commitments concerning agricultural products, except to the extent that the Agreement on Agriculture contains specific provisions dealing specifically with the same matter”.(1320)

909.     In Chile — Price Band System, the Appellate Body considered whether the Panel had erred in choosing to examine Argentina’s claim under Article 4.2 of the Agreement on Agriculture before examining its claim under Article II:1(b) of the GATT 1994. The Appellate Body upheld the Panel’s order of analysis and found that Article 4.2 of the Agreement on Agriculture “applies specifically to agricultural products,” whereas Article II:1(b) of the GATT 1994 “applies generally to trade in all goods”.(1321)

(v) GATT 1994 versus SCM Agreement

910.     In Indonesia — Autos, the Panel, in a finding not reviewed by the Appellate Body, considered whether there is a conflict between the SCM Agreement and Article III of the GATT 1994. The Panel recalled that for a conflict to exist between two agreements, they must cover the same substantive matter. The Panel found that there was no conflict since the two provisions have different purposes.(1322)

(vi) GATT 1994 versus TRIMs Agreement

911.     In Indonesia — Autos, the Panel considered that it should first examine the claims under the TRIMs Agreement since the TRIMs Agreement is more specific than Article III:4 of the GATT 1994:

“As to which claims, those under Article III:4 of GATT or Article 2 of the TRIMs Agreement, to examine first, we consider that we should first examine the claims under the TRIMs Agreement since the TRIMs Agreement is more specific than Article III:4 as far as the claims under consideration are concerned. A similar issue was presented in Bananas III, where the Appellate Body discussed the relationship between Article X of GATT and Article 1.3 of the Licensing Agreement and concluded that the Licensing Agreement being more specific it should have been applied first.(1323) This is also in line with the approach of the panel and the Appellate Body in the Hormones(1324) dispute, where the measure at issue was examined first under the SPS Agreement since the measure was alleged to be an SPS measure.”(1325)

2. Provisions within the same Agreement

(a) GATT 1994

(i) Articles III and XI

912.     In India — Autos, the Panel recalled the GATT Panel Report on Canada — FIRA when it stated that Articles III and XI of the GATT 1994 have distinct scopes of application. It quoted from that Panel that “the General Agreement distinguishes between measures affecting the ‘importation’ of products, which are regulated in Article XI:1, and those affecting ‘imported products’, which are dealt with in Article III. If Article XI:1 were interpreted broadly to cover also internal requirements, Article III would be partly superfluous.(1326)”(1327)

913.     In India — Autos, the Panel did, however, consider that under certain circumstances, specific measures may have an impact upon both the importation of products (Article XI) and the competitive conditions of imported products on the internal market (Article III):

“[I]t therefore cannot be excluded a priori that different aspects of a measure may affect the competitive opportunities of imports in different ways, making them fall within the scope either of Article III (where competitive opportunities on the domestic market are affected) or of Article XI (where the opportunities for importation itself, i.e. entering the market, are affected), or even that there may be, in perhaps exceptional circumstances, a potential for overlap between the two provisions, as was suggested in the case of state trading…

…

The Panel went on to note: …

there may be circumstances in which specific measures may have a range of effects. In appropriate circumstances they may have an impact both in relation to the conditions of importation of a product and in respect of the competitive conditions of imported products on the internal market within the meaning of Article III:4.(1328) This is also in keeping with the well established notion that different aspects of the same measure may be covered by different provisions of the covered Agreements.”(1329)

(b) GATS

(i) Annex on Telecommunication and Member’s Reference Paper on Commitments

915.     In Mexico — Telecoms, the United States presented two claims concerning Mexico’s Reference Paper commitments first, followed by its claim concerning Section 5 of the Annex on Telecommunications. The Panel decided to examine these claims in the order presented by the United States on the grounds that such an “order will allow us to analyse the issues in the most efficient manner”.(1330)

(c) SCM Agreement

(i) Articles 1.1 and 3.1(a)

916.     In US — FSC, the Appellate Body examined the United States’ argument that the Panel had erred by failing to begin its examination of the European Communities’ claim under Articles 1.1 and 3.1(a) of the SCM Agreement, rather than with footnote 59 of that Agreement. The Appellate Body considered that “whether the examination begins with the general definition of a ‘subsidy’ in Article 1.1 or with footnote 59, we believe that the outcome of the European Communities’ claim under Article 3.1(a) would be the same”:

“Instead, the Panel began its examination with the general definition of a ‘subsidy’ that is set forth in Article 1.1 of the SCM Agreement. This definition applies throughout the SCM Agreement, to all the different types of ‘subsidy’ covered by that Agreement. In our view, it was not a legal error for the Panel to begin its examination of whether the FSC measure involves export subsidies by examining the general definition of a ‘subsidy’ that is applicable to export subsidies in Article 3.1(a). In any event, whether the examination begins with the general definition of a ‘subsidy’ in Article 1.1 or with footnote 59, we believe that the outcome of the European Communities’ claim under Article 3.1(a) would be the same. The appropriate meaning of both provisions can be established and can be given effect, irrespective of whether the examination of the claim of the European Communities under Article 3.1(a) begins with Article 1.1 or with footnote 59.”(1331)

(ii) Articles 3.1(a) and 27.4

917.     In Brazil — Aircraft, the Appellate Body examined the order of the legal reasoning of the Panel. The Appellate Body criticized the fact that the Panel had examined whether Brazil, the defending party, had met the requirements of a particular provision (in casu Article 3.1(a) of the SCM Agreement) and had only subsequently considered whether this particular provision applied to Brazil in its capacity as a developing country, in light of another provision (in casu Article 27.4 of the SCM Agreement). The Appellate Body found that the reverse order of analysis would have been appropriate. The Appellate Body also found that the Panel should not have considered Brazil’s ‘affermative defence’ based on item (k) of the Illustrative List before determining whether Article 3.1(a) applied to Brazil:

“Our interpretation of the relationship between Article 27 and Article 3.1(a) of the SCM Agreement(1332) leads us, in this appeal, to examine, first, the issues appealed relating to whether Brazil has increased the level of its export subsidies contrary to the provisions of Article 27.4. Only if we determine that Brazil has not complied with the conditions of Article 27.4, and thereby find that the provisions of Article 3.1(a) do in fact apply to Brazil, will we need to examine Brazil’s appeal of the Panel’s findings relating to its alleged ‘affirmative defence’ under item (k) of the Illustrative List.”(1333)

(d) TRIPS Agreement

(i) Articles 33 and 70

918.     In Canada — Patent Term, the Appellate Body considered what the order of its analysis should be regarding Articles 33 and 70 of the TRIPS Agreement and decided to start with the examination of the latter:

“As in every appeal, a threshold question is whether the measure before us falls within the scope of one of the covered agreements, in this case the TRIPS Agreement. For this reason, we begin our analysis of the legal issues raised in this appeal by considering Article 70, because this Article determines the overall applicability of the obligations of the TRIPS Agreement, including the obligation found in Article 33, to the measure in dispute. Only if we conclude from addressing Article 70 that the measure before us does fall within the scope of the TRIPS Agreement will it become necessary for us to examine the consistency of Section 45 of Canada’s Patent Act with Article 33 of that Agreement.”(1334)

B. Due Process in WTO Dispute Settlement Proceedings

1. Standard panel working procedures as a tool to ensure due process

919.     In EC — Bananas III, the Appellate Body indicated that issues including whether or not a claim had been specified in the request for establishment of a panel “could be decided early in panel proceedings, without causing prejudice or unfairness to any party or third party, if panels had detailed, standard working procedures that allowed, inter alia, for preliminary rulings”.(1335)

920.     The Appellate Body on India — Patents (US) also pointed to the relevance of having standard panel working procedures that provide for appropriate factual discovery at an early stage in order to assist the requirements of due process:

“It is worth noting that, with respect to fact-finding, the dictates of due process could better be served if panels had standard working procedures that provided for appropriate factual discovery at an early stage in panel proceedings.”(1336)

921.     Similarly, the Appellate Body in Argentina — Textiles and Apparel observed that “standard working procedures for panels would help to ensure due process and fairness in panel proceedings”:

“As we have observed in two previous Appellate Body Reports, we believe that detailed, standard working procedures for panels would help to ensure due process and fairness in panel proceedings. See European Communities — Regime for the Importation, Sale and Distribution of Bananas, adopted 25 September 1997, WT/DS27/AB/R, para. 144; India — Patent Protection for Pharmaceutical and Agricultural Chemical Products, adopted 16 January 1998, WT/DS50/AB/R, para. 95.”(1337)

2. Due process demands when identifying the measures and claims at issue

922.     In India — Patents (US), the Appellate Body noted that “the demands of due process that are implicit in the DSU make [the clear statement of the claims and the free disclosure of facts] especially necessary during consultations”. See paragraph 118 above.

923.     The European Communities argued in EC — Computer Equipment that its right to due process during the course of the proceedings was violated because the term “LAN equipment” lacked precision in the request for establishment of a panel. The Appellate Body stated:

“We do not see how the alleged lack of precision of the terms, LAN equipment and PCs with multimedia capability, in the request for the establishment of a panel affected the rights of defence of the European Communities in the course of the panel proceedings. As the ability of the European Communities to defend itself was not prejudiced by a lack of knowing the measures at issue, we do not believe that the fundamental rule of due process was violated by the Panel.”(1338)

924.     The Appellate Body on Korea — Dairy, when considering if the mere listing in the request for establishment of the Articles claimed to have been violated meets the standard of Article 6.2, took into account whether the ability of the respondent to defend itself had been prejudiced by that fact. See paragraph 220 above.

925.     In Chile — Price Band System, the Appellate Body ruled that “[t]he requirements of due process and orderly procedure dictate that claims must be made explicitly in WTO dispute settlement”. See paragraph 233 above.

926.     Also in Chile — Price Band System, the Appellate Body, in the context of its analysis of whether an amendment to a measure after the request for establishment of a panel was part of the measure at issue, considered the importance for the “demands of due process” “that a complaining party should not have to adjust its pleadings throughout dispute settlement proceedings in order to deal with a disputed measure as a ‘moving target’”.(1339) See paragraph 272 above.

3. Identification of appealed measures

927.     In this regard, see paragraphs 855–861 above.

4. Right of response

928.     In Australia — Salmon, the Appellate Body warned panels to be careful to observe due process, when complying with the Article 12.2 requirement of flexibility in panel procedures, by providing parties with adequate opportunity to respond to evidence submitted:

“We note that Article 12.2 of the DSU provides that ‘[p]anel procedures should provide sufficient flexibility so as to ensure high-quality panel reports, while not unduly delaying the panel process.’ However, a panel must also be careful to observe due process, which entails providing the parties adequate opportunity to respond to the evidence submitted.”(1340)

929.     In Australia — Salmon, the Appellate Body further indicated that “[a] fundamental tenet of due process is that a party be provided with an opportunity to respond to claims made against it”. In this case, Australia had claimed that the Panel erred in failing to accord it an opportunity to submit a formal written rebuttal submission to respond to the oral statement made by Canada at the second meeting. The Appellate Body, noting that Australia had requested one week to respond to Canada’s oral statement and that the Panel had granted Australia’s request, dismissed the claim as follows:

“A fundamental tenet of due process is that a party be provided with an opportunity to respond to claims made against it. In this case, we believe that the Panel did accord Australia a proper opportunity to respond by allowing Australia to submit a third written submission. We cannot see how the Panel failed to accord due process to Australia by granting the extra time it had requested.”(1341)

930.     In Chile — Price Band System, the Appellate Body concluded that the Panel had made a finding on a claim not made by Argentina.(1342) Chile had claimed that, by making a finding on that claim, the Panel had deprived Chile of a fair right to response. The Appellate Body agreed with Chile and ruled that the Panel had acted inconsistently with Article 11 of the DSU by denying Chile the fair right of response and thus had denied it the due process rights to which it was entitled:

“There is, furthermore, the requirement of due process. As Argentina made no claim under the second sentence of Article II:1(b) of the GATT 1994, Chile was entitled to assume that the second sentence was not in issue in the dispute, and that there was no need to offer a defence against a claim under that sentence. We agree with Chile that, by making a finding on the second sentence — a claim that was neither made nor argued — the Panel deprived Chile of a ‘fair right of response’.(1343)

As we said in India — Patents, ‘… the demands of due process … are implicit in the DSU’.(1344) And, as we said in Australia — Salmon on the right of response, ‘[a] fundamental tenet of due process is that a party be provided with an opportunity to respond to claims made against it’.(1345) Chile contends that this fundamental tenet of due process was not observed on this issue.

As we said earlier, Article 11 imposes duties on panels that extend beyond the requirement to assess evidence objectively and in good faith, as suggested by Argentina. This requirement is, of course, an indispensable aspect of a panel’s task. However, in making ‘an objective assessment of the matter before it’, a panel is also duty bound to ensure that due process is respected. Due process is an obligation inherent in the WTO dispute settlement system. A panel will fail in the duty to respect due process if it makes a finding on a matter that is not before it, because it will thereby fail to accord to a party a fair right of response. In this case, because the Panel did not give Chile a fair right of response on this issue, we find that the Panel failed to accord to Chile the due process rights to which it is entitled under the DSU.”(1346)

C. Preliminary Rulings

1. General

(a) Lack of regulation in standard working procedures

931.     In EC — Bananas III, the Appellate Body considered that the compliance of the Panel request with Article 6.2 could be decided early by a preliminary ruling if panels had detailed, standard working procedures that allowed it:

“As a panel request is normally not subjected to detailed scrutiny by the DSB, it is incumbent upon a panel to examine the request for the establishment of the panel very carefully to ensure its compliance with both the letter and the spirit of Article 6.2 of the DSU…

…

We note, in passing, that this kind of issue could be decided early in panel proceedings, without causing prejudice or unfairness to any party or third party, if panels had detailed, standard working procedures that allowed, inter alia, for preliminary rulings.”(1347)

932.     In Canada — Aircraft, the Panel noted that there is no requirement nor established practice that obliges the Panel to issue a preliminary ruling before the deadline for the parties’ first written submission. See paragraph 933 below.

(b) Absence of a requirement to rule on a preliminary basis

933.     In Canada — Aircraft, Canada asked the Panel to issue a preliminary ruling on its jurisdiction before the deadline for the parties’ first written submission. The Panel denied the request on the grounds that there is no requirement nor established practice in that regard:

“Canada asked the Panel to issue the requested ruling on the Panel’s jurisdiction prior to the deadline for the parties’ first written submissions. In our view, there is no requirement in the DSU for panels to rule on preliminary issues prior to the parties’ first written submissions. Nor is there any established practice to this effect, for there are numerous panel reports where rulings on preliminary issues have been reserved until the final report.(1348) Furthermore, there may be cases where the panel wishes to seek further clarification from the parties before providing a preliminary ruling. Indeed, we considered it necessary to request such clarification in the present case. In our view, the possibility for obtaining such clarification would be lost — or at least significantly undermined — if a panel were required to rule on preliminary issues before the deadline for the parties’ first written submissions. For these reasons, we rejected Canada’s request for a preliminary ruling on this issue prior to the deadline for the parties’ first submissions.”(1349)

(c) Preliminary ruling procedures followed in certain disputes

934.     In this regard, see Section XXX.B.3(d)(ii) above.

(d) Participation of third parties in preliminary ruling proceedings

935.     In Canada — Wheat Exports and Grain Imports, the Panel, after consulting the parties to the dispute in accordance with Article 12.1 of the DSU, decided, in a preliminary ruling, that the third parties to this dispute were to be invited to participate in the proceedings up to the time the Panel issues its preliminary rulings on the requests made by Canada concerning the consistency with Article 6.2 of the DSU of the United States’ request for the establishment and certain additional procedures proposed by Canada for the protection of proprietary or commercially sensitive information. As regards the extent of this participation, the Panel decided as follows:

“(a)     third parties shall receive the preliminary written submissions of the parties to the dispute;(1350)

(b)     third parties shall have an opportunity to make preliminary written submissions to the Panel for purposes of commenting on the parties’ preliminary written submissions; and

(c)     third parties shall have an opportunity to be heard by the Panel on the issues raised in the parties’ preliminary written submissions.”(1351)

(e) Preliminary rulings in Article 22.6 Arbitrations

936.     In this respect, see Section XXII.B.8(d) above.

2. Parties’ objections

937.     In EC — Hormones, the Appellate Body ruled that “a procedural objection raised by a party to a dispute should be sufficiently specific to enable the panel to address it(1352)”.(1353)

938.     The Appellate Body on Mexico — Corn Syrup (Article 21.5 — US) stated that requirements of good faith, due process and orderly procedure dictate that objections should be explicitly raised for the Panel to be required to address them:

“[T]he ‘observations’ raised by Mexico were not expressed in a fashion that indicated that Mexico was raising an objection to the authority of the Panel. The requirements of good faith, due process and orderly procedure dictate that objections, especially those of such potential significance, should be explicitly raised. Only in this way will the panel, the other party to the dispute, and the third parties, understand that a specific objection has been raised, and have an adequate opportunity to address and respond to it. In our view, Mexico’s objection was not explicitly raised. Thus, in making its ‘observations’, Mexico did not meet this standard.

(…)

However, had we been satisfied that Mexico did, in fact, explicitly raise its objections before the Panel, then the Panel may well have been required to ‘address’ those objections, whether by virtue of Articles 7.2 and 12.7 of the DSU, or the requirements of due process.(1354) In such circumstances, however, the Panel could have satisfied that duty simply by stating in its Report that it declined to examine or rule on Mexico’s ‘objections’ due to the untimely manner in which they were raised. We note, in this regard, that Mexico was aware of all the facts on which it now relies in arguing that the Panel had no authority to deal with and dispose of the matter as soon as the United States submitted its communication seeking recourse to Article 21.5 of the DSU on 12 October 2000. Yet Mexico mentioned these alleged deficiencies, for the first time, more than four months later, at the meeting with the Panel on 20 February 2000. Mexico did not take advantage of the opportunities it had to raise the issues at the DSB meeting of 23 October 2000, or in either of its written submissions to the Panel.”(1355)

939.     As regards the requirement to raise objections in a timely manner, see paragraph 980 below.

3. Issues that have been the object of a preliminary objection

(a) Adequacy of consultations

940.     In Korea — Alcoholic Beverages, Korea requested a preliminary ruling on the adequacy of the consultations on the grounds that the complainants had not engaged in consultations in good faith with a view to reaching a mutual solution as envisaged by the DSU.(1356) As regards the content of the Panel’s preliminary ruling, see paragraph 120 above.

(b) Compliance of panel request with Article 6.2 requirements

941.     In EC — Bananas III, the Appellate Body considered that “this kind of issue could be decided early in panel proceedings, without causing prejudice or unfairness to any party or third party, if panels had detailed, standard working procedures that allowed, inter alia, for preliminary rulings”.(1357)

942.     In Korea — Alcoholic Beverages, Korea requested the Panel to issue a preliminary ruling on the specificity of the request for establishment of the panel by both the European Communities and the United States. Korea argued that the description of the product concerned by the European Communities (“certain alcoholic beverages falling within HS heading 2208”) and the United States (“other distilled spirits such as whisky, brandy, vodka, gin and ad-mixtures”) were not specific enough to satisfy Article 6.2.(1358) For information on the actual preliminary ruling, see paragraph 209 above.

943.     In Thailand — H-Beams, Thailand had asked the Panel for a preliminary ruling on the sufficiency of Poland’s panel request with respect to the lack of clarity as regards Articles 5 and 6 of the Anti-Dumping Agreement. In assessing and identifying the claim brought under Article 6.2, the Appellate Body responded:

“Thailand argues that it was prejudiced by the lack of clarity of Poland’s panel request. The fundamental issue in assessing claims of prejudice is whether a defending party was made aware of the claims presented by the complaining party, sufficient to allow it to defend itself. In assessing Thailand’s claims of prejudice, we consider it relevant that, although Thailand asked the Panel for a preliminary ruling on the sufficiency of Poland’s panel request with respect to Articles 5 and 6 of the Anti-Dumping Agreement at the time of filing of its first written submission, it did not do so at that time with respect to Poland’s claims under Articles 2 and 3 of that Agreement. We must, therefore, conclude that Thailand did not feel at that time that it required additional clarity with respect to these claims, particularly as we note that Poland had further clarified its claims in its first written submission. This is a strong indication to us that Thailand did not suffer any prejudice on account of any lack of clarity in the panel request.”(1359)

944.     In US — Wheat Exports and Grain Imports, Canada raised several preliminary objections that the United States’ claims under Article XVII of the GATT 1994, rail car allocation and Article 2 of the TRIMS Agreement as set out in the panel request failed to satisfy the requirements of Article 6.2 of the DSU. The Panel disregarded Canada’s objections as regards the rail car allocation and the TRIMS Agreement but agreed with Canada in that the United States had failed to comply with Article 6.2 requirements as regards its claim under Article XVII of the GATT 1994.(1360)

945.     In US — Oil Country Tubular Goods Sunset Reviews, the United States requested the Panel to dismiss certain claims raised by Argentina in its panel request on the grounds that, inconsistently with the requirements of Article 6.2 of the DSU, these claims were identified in vague terms. The Panel declined the United States’ request for preliminary rulings.(1361)

(c) Panel composition

946.     In Guatemala — Cement II, Guatemala submitted a preliminary objection to the Panel requesting it to rule that the composition of the Panel was inconsistent with WTO and international law principles because one of the members of the Panel had served on the previous Guatemala — Cement I. The Panel issued a preliminary ruling rejecting Guatemala’s request. For the content of the Panel’s ruling, see paragraph 293 above.

(d) Panel’s jurisdiction

(i) Measures withdrawn before establishment of the Panel

947.     In Argentina — Textiles and Apparels, the Panel declined to issue a preliminary ruling on the objection raised by Argentina as regards the Panel not having jurisdiction to address the specific duties on footwear that were withdrawn before the Panel was established.(1362)

(ii) Double fora

948.     In Argentina — Poultry Anti-Dumping Duties, Argentina raised as a preliminary issue the fact that, prior to bringing WTO dispute settlement proceedings against Argentina’s anti-dumping measure, Brazil had challenged that measure before a MERCOSUR Ad Hoc Arbitral Tribunal. Argentina requested that, in light of the prior MERCOSUR proceedings, the Panel refrain from ruling on the claims raised by Brazil in the present WTO dispute settlement proceedings.(1363) In order to defend this position, Argentina invoked the principle of estoppel. In this regard, see paragraph 79 above. In the alternative, Argentina asserted that the Panel should be bound by the ruling of the MERCOSUR Tribunal.(1364) In this regard, see paragraph 23 above.

(iii) Claims outside the panel’s terms of reference

949.     In EC — Tube or Pipe Fittings, the European Communities requested the Panel to make a preliminary ruling that certain of Brazil’s claims were not within its terms of reference. The Panel noted that among the said claims, there were several provisions cited by Brazil in its first written submission not mentioned in its request for establishment. The Panel accordingly found that Brazil’s claims under those provisions were not within its terms of reference. As regards the content of the Panel’s preliminary ruling, see paragraph 221 above.

950.     In US — Softwood Lumber V, the United States raised a preliminary objection that Canada had included in its first written submission claims with respect to a number of provisions of the Anti-Dumping Agreement that were not included in the Panel Request, claiming that these were therefore outside the Panel’s terms of reference.(1365) The Panel, in its Report, agreed that some of the provisions mentioned by Canada in its written submissions were not part of its terms of reference since they were not included in the panel request.(1366)

951.     In Canada — Wheat Exports and Grain Imports, the Panel, in a preliminary ruling, found that certain portions of the United States’ panel request that dealt with Article XVII of the GATT 1994 claim failed to satisfy the requirements of Article 6.2 of the DSU insofar as they did not identify the specific measures at issue.(1367)

952.     In US — Oil Country Tubular Goods Sunset Reviews, the United States requested a preliminary ruling on the grounds that certain claims that appeared in Argentina’s first written submission were not within the Panel’s terms of reference because these claims had not been raised in Argentina’s panel request. The Panel declined the request.(1368)

(e) Clarity of claims in written submissions

953.     In EC — Tube or Pipe Fittings, the European Communities had requested the Panel to refuse to consider certain of Brazil’s claims on the grounds that these claims were defective as they were only vaguely defined in Brazil’s first written submission.(1369) As regards the Panel’s preliminary ruling, see paragraph 235 above.

(f) Evidence

(i) Timing of the submission of evidence

954.     In Korea — Alcoholic Beverages, Korea requested the Panel to issue a preliminary ruling rejecting certain evidence submitted by the European Communities after the second substantive meeting. Korea alleged that its rights of defence were violated by the late submission of such evidence.(1370) As regards the content of the Panel’s preliminary ruling, see paragraph 368 above.

955.     In Canada — Aircraft, Canada requested the Panel to make a preliminary ruling on the issue of whether the complaining party may adduce new evidence or allegations after the end of the first substantive meeting. Canada argued that it would suffer prejudice under the accelerated procedure under Article 4 of the SCM Agreement as a result of the late submission of allegations or evidence.(1371) As regards the content of the Panel’s preliminary ruling, see paragraph 369 above.

956.     In US — Offset Act (Byrd Amendment), Canada asked the Panel to accept as evidence a letter which it submitted after the first substantive meeting. In spite of the United States’ objections, the Panel issued a preliminary ruling accepting the evidence. As regards the reasoning of the Panel’s ruling, see paragraph 370 above.(1372)

957.     In US — Steel Safeguards, the Panel sent a letter to all parties including a series of preliminary rulings on organizational matters. Among the issues, the Panel referred to the timing for the submission of evidence in the context of the parties’ discussion about the wording of paragraph 11 of the Panel’s Working Procedures. For the content of the Panel’s preliminary ruling, see paragraph 373 above.

(ii) Information not made available to the investigating authorities

958.     In EC — Tube or Pipe Fittings, the European Communities requested the Panel to make a preliminary ruling rejecting a number of exhibits submitted by Brazil during the first substantive meeting on the grounds that they did not form part of the record of the underlying investigation.(1373)

959.     In US — Softwood Lumber V, the United States raised a preliminary objection claiming that Canada had introduced certain new evidence in the context of the proceedings that had not been before the investigating authority during the course of the investigation.(1374) Since the United States had not requested the Panel to rule on a preliminary basis, the Panel preferred to rule within its report where it indicated that it would not take such evidence into consideration.(1375)

(g) Third-party rights

(i) Third-party participation in preliminary proceedings

960.     In Canada — Wheat Exports and Grain Imports, the Panel, after consulting with the parties to the dispute in accordance with Article 12.1 of the DSU, decided, in a preliminary ruling, that the third parties to this dispute would be invited to participate in the proceedings up to the time the Panel issued its preliminary rulings. These rulings related to requests made by Canada concerning the consistency with Article 6.2 of the DSU of the United States’ request for the establishment and certain additional procedures proposed by Canada for the protection of proprietary or commercially sensitive information. As regards the extent of this participation, see paragraph 935 above.

(ii) Access to second written submissions by third parties in Article 21.5 proceedings

961.     In Australia — Automotive Leather II (Article 21.5 — US), the European Communities raised a preliminary objection and argued that since in this case there was to be only one meeting of the Panel, at which the Panel would be considering both submissions of each party, the third parties, in accordance with Article 10.3 of the DSU, should receive all of the parties’ submissions. The Panel, in a preliminary ruling, rejected the European Communities’ request.(1376) For the content of the Panel’s preliminary ruling, see paragraph 617 above.

962.     In Australia — Salmon (Article 21.5 — Canada), the Panel was also requested to rule on a preliminary basis on this issue and did so following the approach in Australia — Automotive Leather II (Article 21.5 — US).(1377)

963.     In Canada — Dairy (Article 21.5 — New Zealand and US), also in a preliminary ruling, the Panel, however, decided to allow third parties access to the second written submissions of the parties.(1378) For the content of the Panel’s preliminary ruling, see paragraph 619 above.

964.     In US — FSC (Article 21.5 — EC), the Panel, in a preliminary ruling, did not follow the position of the Panel in Canada — Dairy (Article 21.5 — New Zealand and US) and denied access to second written submissions to third parties on the grounds that it was not permitted by Article 10.3 of the DSU. However, the Appellate Body disagreed with the Panel.(1379) For the content of the Panel’s preliminary ruling, see paragraph 620 above.

(h) Confidentiality

(i) Breach of confidentiality of the consultation process

965.     In Korea — Alcoholic Beverages, Korea requested a preliminary ruling on whether both complainants, the European Communities and the United States, had breached the confidentiality requirement of Article 4.6 by making reference, in their submissions, to information supplied by Korea during consultations.(1380) As regards the Panel’s preliminary ruling in this regard, see paragraph 135 above.

(ii) Disclosure of written submissions

966.     In Argentina — Poultry Anti-Dumping Duties, Brazil informed the Panel of its intention to make its first written submission (except the exhibits) available to the public, after providing Argentina with an opportunity to indicate whether the submission should be revised to exclude any information deemed to be confidential. Argentina objected and submitted that a Member is only entitled by virtue of Article 18.2 of the DSU to disclose written statements of its positions. See paragraphs 482–483 above.

(iii) Non-confidential versions of written submissions

967.      In US — Steel Safeguards, the Panel sent a letter to all parties including a series of preliminary rulings on organizational matters. Among the issues, the Panel dealt with the United States’ request to require production of non-confidential versions of written submissions within 14 days following the filing of the written submissions. In this respect, see paragraph 484 above.

(iv) Business confidential information

968.     In Canada — Aircraft and Brazil — Aircraft, the Appellate Body issued a preliminary ruling on 11 June 1999 that it was not necessary to adopt additional procedures to protect business confidential information in the appellate proceeding. The Appellate Body held that the existing provisions concerning confidentiality of dispute settlement proceedings were sufficient for the purposes at issue. In this regard, see paragraph 486 above.

969.     In Canada — Wheat Exports and Grain Imports, the Panel, in a preliminary ruling, having rejected the parties’ specific proposals for the protection of confidential information, adopted its own procedures for the protection of such information.(1381)

(v) Confidentiality concerns when private counsel intervene

970.     In Thailand — H-Beams, an industry association submitted an amicus brief which cited Thailand’s confidential submission. Thailand then claimed that Poland’s private counsel might have violated WTO rules of confidentiality by providing Thailand’s submission to the said association. Although Poland and the lawyer concerned denied the alleged breach of confidentiality, the Appellate Body issued a preliminary ruling rejecting the amicus brief. See paragraphs 491—493 above.

(i) Private counsel

971.     In EC — Bananas III, St Lucia submitted to the Appellate Body a letter explaining its reasons for including two private lawyers in its delegation for the oral hearing. The Appellate Body issued a preliminary ruling indicating that nothing in the WTO Agreement, the DSU or its Working Procedures prevented a Member from admitting whomever it deems fit to become part of its delegation to Appellate Body proceedings. See paragraph 1022 below.

972.     In Indonesia — Autos, Indonesia had announced that two private lawyers were members of its delegation for the first substantive meeting of the Panel with the parties. Following a request by the United States to exclude those lawyers from the meeting, the Chairman issued a preliminary ruling on behalf of the Panel following the line in EC — Bananas III: see paragraph 1024 below.

973.     In Korea — Alcoholic Beverages, Korea requested the Panel to issue a preliminary ruling with respect to permission to have private counsel attend the Panel meetings and address the Panel. The Panel accepted the presence of private counsel. As regards the content of the Panel’s preliminary ruling in this regard, see paragraph 1025 below.

974.     As regards confidentiality concerns when private lawyers are concerned, see paragraphs 491–493 and 970 above.

(j) Panel’s timetable

975.     In US — Steel Safeguards, the Panel sent a letter to all parties including a series of preliminary rulings on organizational matters. Among the issues dealt with, the Panel referred to the timetable for its proceedings. In this regard, see paragraph 830 above.

(k) Executive summaries

976.     In US — Steel Safeguards, the Panel sent a letter to all parties including a series of preliminary rulings on organizational matters. Among the issues, the Panel referred to executive summaries. For the content of the Panel’s preliminary ruling, see paragraph 829 above.

(l) Meaning of the term “second written submissions”

977.     In US — Steel Safeguards, the Panel sent a letter to all parties including a series of preliminary rulings on organizational matters. Among the issues, the Panel dealt with a request by the United States to change the reference in its Working Procedures from “rebuttal submission” to “rebuttal”. In this respect, see paragraph 403 above.

(m) Timing for the filing of submissions in panel proceedings

978.     In US — Steel Safeguards, the Panel sent a letter to all parties including a series of preliminary rulings(1382) on organizational matters. Among the issues, the Panel referred to the timing for the filing of the parties’ written submissions with the WTO Dispute Settlement Registrar. As regards the content of this preliminary ruling, see paragraph 834 above.

(n) Amicus curiae

979.     In EC — Asbestos, the Panel received several written submissions from non-governmental organizations. The Panel issued a preliminary ruling informing the parties that, in the light of the European Communities’ decision to incorporate into its own submissions the amicus briefs submitted by two organizations, the Panel would consider these two documents on the same basis as the other documents furnished by the European Communities in this dispute. At the second substantive meeting of the Panel with the parties, the Panel gave Canada the opportunity to reply, in writing or orally, to the arguments set forth in these two amicus briefs. At that same meeting, the Panel also informed the parties that it had decided not to take into consideration the other amicus briefs submitted.(1383) At the appeal stage, the Appellate Body adopted an additional procedure, for the purposes of this appeal only, pursuant to Rule 16(1) of its Working Procedures, to deal with any possible submissions received from amici curiae. With respect to the additional procedures, see Section XXXII.B.9 above. Pursuant to the additional procedure, the Appellate Body received 17 applications requesting leave to file a written brief in this appeal. Six of these 17 applications were received after the deadline specified in the additional procedure and, for this reason, leave to file a written brief was denied to these six applicants. The other 11 applications were considered by the Appellate Body but finally denied for failure to comply sufficiently with all the requirements set forth in paragraph 3 of the Additional Procedure.(1384)

4. Timing

(a) Promptness of objections

980.     In Mexico — Corn Syrup (Article 21.5 — US), the Appellate Body ruled that parties must raise objections in a timely manner:

“When a Member wishes to raise an objection in dispute settlement proceedings, it is always incumbent on that Member to do so promptly. A Member that fails to raise its objections in a timely manner, notwithstanding one or more opportunities to do so, may be deemed to have waived its right to have a panel consider such objections.”(1385)

981.     In US — 1916 Act, the Appellate Body agreed with the Panel that objections on the Panel’s jurisdiction should not be raised at the interim review stage for the first time although it also agreed with the Panel that certain jurisdictional issues may need to be addressed by the Panel at any time:

“We agree with the Panel that the interim review was not an appropriate stage in the Panel’s proceedings to raise objections to the Panel’s jurisdiction for the first time. An objection to jurisdiction should be raised as early as possible and panels must ensure that the requirements of due process are met. However, we also agree with the Panel’s consideration that ‘some issues of jurisdiction may be of such a nature that they have to be addressed by the Panel at any time.’(1386) We do not share the European Communities’ view that objections to the jurisdiction of a panel are appropriately regarded as simply ‘procedural objections’. The vesting of jurisdiction in a panel is a fundamental prerequisite for lawful panel proceedings. We, therefore, see no reason to accept the European Communities’ argument that we must reject the United States’ appeal because the United States did not raise its jurisdictional objection before the Panel in a timely manner.”(1387)

982.     The Appellate Body on Thailand — H-Beams stressed that the importance of the request for establishment was such that the defending party was entitled to request further clarification on the claims raised in a panel request from the complaining party, even before the filing of the first written submission:(1388)

“In view of the importance of the request for the establishment of a panel, we encourage complaining parties to be precise in identifying the legal basis of the complaint. We also note that nothing in the DSU prevents a defending party from requesting further clarification on the claims raised in a panel request from the complaining party, even before the filing of the first written submission. In this regard, we point to Article 3.10 of the DSU which enjoins Members of the WTO, if a dispute arises, to engage in dispute settlement procedures ‘in good faith in an effort to resolve the dispute’. As we have previously stated, the ‘procedural rules of WTO dispute settlement are designed to promote, not the development of litigation techniques, but simply the fair, prompt and effective resolution of trade disputes’.(1389)”(1390)

983.     In US — Offset Act (Byrd Amendment), the Appellate Body recalled that “[a]n objection to jurisdiction should be raised as early as possible”(1391) and clarified that “it would be preferable, in the interests of due process, for the appellant to raise such issues in the Notice of Appeal, so that appellees will be aware that this claim will be advanced on appeal”.(1392)

984.     In EC — Tube or Pipe Fittings, the European Communities requested the Panel to make a preliminary ruling rejecting a number of exhibits submitted by Brazil during the first substantive meeting on the grounds that they did not form part of the record of the underlying investigation. In this case, the Panel’s Working Procedures provided that preliminary rulings must be requested not later than the first written submission, but that exceptions could be made upon showing of “good cause”. The Panel noted that, as Brazil submitted these exhibits in conjunction with its oral statement at the first meeting, which meant that the European Communities was not in a position to make a preliminary objection in its first written submission, good cause existed for it to consider the merits of the European Communities request for a preliminary ruling.(1393)

985.     In US — Wheat Exports and Grain Imports, Canada had raised several preliminary objections regarding compliance by the United States’ panel request with the requirements of Article 6.2 (see paragraph 944 above). The United States argued that Canada’s request for a preliminary ruling should be denied because Canada failed to raise its procedural objection at the earliest opportunity. The Panel, referring to the Appellate Body’s findings in Thailand — H-Beams (see paragraph 982 above), considered that “the Appellate Body notes that there is no legal bar to any Member requesting clarification of a panel request even before the filing of the first written submission”. It further concluded that such a “statement does not suggest that, in Thailand — H-Beams, Thailand should have raised its concerns at the DSB meetings at which Poland’s panel request was on the agenda”. Accordingly, the Panel rejected the United States’ argument.(1394) On appeal, the Appellate Body upheld the Panel and considered that a determination as to the timeliness of a preliminary objection under Article 6.2 must be examined on a case-by-case basis:

“As regards objections to the adequacy of panel requests, the Appellate Body has stated that compliance with the requirements of Article 6.2 of the DSU must be determined on the merits of each case.(1395) Similarly, it would appear to us that a determination as to the timeliness of an objection raised under Article 6.2 must be examined on a case-by-case basis. This is consistent with the discretion given to panels, under the DSU, to deal with specific situations that may arise in a particular case and that are not explicitly regulated.(1396) Furthermore, under Article 12 of the DSU, it is the panel that sets the timetable for the panel proceedings and, therefore, it is the panel that is in the best position to determine whether, under the particular circumstances of each case, an objection is raised in a timely manner.”(1397)

(b) Timing of the preliminary ruling

986.     In Canada — Aircraft, Canada asked the Panel to make a ruling on the Panel’s jurisdiction before the deadline set for the submission of the written submission of the parties. The Panel stated:

“In our view, there is no requirement in the DSU for panels to rule on preliminary issues prior to the parties’ first written submissions. Nor is there any established practice to this effect, for there are numerous panel reports where rulings on preliminary issues have been reserved until the final report. Furthermore, there may be cases where the panel wishes to seek further clarification from the parties before providing a preliminary ruling.”(1398)

987.     In US — Softwood Lumber V, the United States raised two preliminary objections (on the Panel’s terms of reference and introduction of new evidence), but did not request the Panel to rule on them on a preliminary basis.(1399)

D. Burden of Proof

1. The rule on burden of proof

988.     In US — Wool Shirts and Blouses, the Appellate Body held that the burden of proof rests upon the party, whether complaining or defending, who asserts the affermative of a particular claim or defence:

“[W]e find it difficult, indeed, to see how any system of judicial settlement could work if it incorporated the proposition that the mere assertion of a claim might amount to proof. It is, thus, hardly surprising that various international tribunals, including the International Court of Justice, have generally and consistently accepted and applied the rule that the party who asserts a fact, whether the claimant or the respondent, is responsible for providing proof thereof.(1400) Also, it is a generally-accepted canon of evidence in civil law, common law and, in fact, most jurisdictions, that the burden of proof rests upon the party, whether complaining or defending, who asserts the affirmative of a particular claim or defence. If that party adduces evidence sufficient to raise a presumption that what is claimed is true, the burden then shifts to the other party, who will fail unless it adduces sufficient evidence to rebut the presumption.(1401)

In the context of the GATT 1994 and the WTO Agreement, precisely how much and precisely what kind of evidence will be required to establish such a presumption will necessarily vary from measure to measure, provision to provision, and case to case.”(1402)

989.     The Panel on Turkey — Textiles, in a finding not addressed by the Appellate Body, summed up the rules on burden of proof under WTO jurisprudence as follows:

“(a)     it is for the complaining party to establish the violation it alleges;

(b)     it is for the party invoking an exception or an affirmative defence to prove that the conditions contained therein are met; and

(c)     it is for the party asserting a fact to prove it.”(1403)

990.     In EC — Hormones, the Appellate Body discussed the allocation of the burden of proof in the context of the SPS Agreement, but referred to its statement in US — Wool Shirts and Blouses and stated that this rule “embodies a rule applicable in any adversarial proceedings”:

“The initial burden lies on the complaining party, which must establish a prima facie case of inconsistency with a particular provision of the SPS Agreement on the part of the defending party, or more precisely, of its SPS measure or measures complained about. When that prima facie case is made, the burden of proof moves to the defending party, which must in turn counter or refute the claimed inconsistency. This seems straightforward enough and is in conformity with our ruling in United States — Shirts and Blouses,(1404) which the Panel invokes and which embodies a rule applicable in any adversarial proceedings.”(1405)

991.     In Japan — Apples, the Appellate Body emphasized the distinction between the two “distinct” principles relating to the burden of proof:

“It is important to distinguish, on the one hand, the principle that the complainant must establish a prima facie case of inconsistency with a provision of a covered agreement(1406) from, on the other hand, the principle that the party that asserts a fact is responsible for providing proof thereof.(1407) In fact, the principles are distinct.”(1408)

2. Evidence and arguments remain in equipoise

992.     In US — Section 301 Trade Act, the Panel clarified, in the light of the allocation of the burden of proof, which party would benefit in case of uncertainty (i.e. in case all evidence and arguments were to remain in “equipoise”):

“Since, in this case, both parties have submitted extensive facts and arguments in respect of the EC claims, our task will essentially be to balance all evidence on record and decide whether the EC, as party bearing the original burden of proof, has convinced us of the validity of its claims. In case of uncertainty, i.e. in case all the evidence and arguments remain in equipoise, we have to give the benefit of the doubt to the US as defending party.”(1409)

3. Establishing a prima facie case

(a) What is a prima facie case?

993.     In EC — Hormones, the Appellate Body specified what is meant by the term “prima facie case”:

“It is also well to remember that a prima facie case is one which, in the absence of effective refutation by the defending party, requires a panel, as a matter of law, to rule in favour of the complaining party presenting the prima facie case.”(1410)

(b) Source of evidence for a prima facie case

994.     In US — Wool Shirts and Blouses, the Appellate Body stated that the nature and scope of evidence required to establish a prima facie case “will vary from measure to measure, provision to provision, and case to case”.(1411)

995.     In Korea — Dairy, Korea argued in its appeal that the Panel should have looked solely at the evidence submitted by the European Communities as the complaining party to determine whether the European Communities had met its burden of proof of making a prima facie case. The Appellate Body disagreed and stated, inter alia: “In carrying out this mandate, a panel has the duty to examine and consider all the evidence before it, not just the evidence submitted by one or the other party, and to evaluate the relevance and probative force of each piece thereof”:

“Korea appears to suggest that the Panel, in evaluating Korea’s actions leading up to the adoption of its safeguard measure, should have looked solely to the evidence submitted by the European Communities as complaining party. We do not agree with Korea in this respect. It is, of course, true that the European Communities has the onus of establishing its claim that Korea’s safeguard measure is inconsistent with the requirements of Article 4.2 of the Agreement on Safeguards. However, under Article 11 of the DSU, a panel is charged with the mandate to determine the facts of the case and to arrive at factual findings. In carrying out this mandate, a panel has the duty to examine and consider all the evidence before it, not just the evidence submitted by one or the other party, and to evaluate the relevance and probative force of each piece thereof…. The determination of the significance and weight properly pertaining to the evidence presented by one party is a function of a panel’s appreciation of the probative value of all the evidence submitted by both parties considered together.

We note that in examining the [Report of the Korean Authority], the Panel did not do anything out of the ordinary. The European Communities’ claim was that Korea had disregarded certain requirements of Article 4.2 of the Agreement on Safeguards in its actions preceding and accompanying the adoption of its safeguard measure. The [Report of the Korean Authority] was issued by the Korean authorities which, inter alia, investigated and evaluated the assertions of serious injury to the domestic industry involved. Thus, that Report was clearly relevant to the task of the Panel to determine the facts, and the Panel was within its discretionary authority in deciding whether or not, or to what extent, it should rely upon the Report in ascertaining the facts relating to Korea’s injury determination.”(1412)

(c) No need to state explicitly that a prima facie case has been made.

996.     The Appellate Body has held on several occasions that a Panel was not obliged to make an explicit finding that a party has met its burden of proof of making a prima facie case: for example, see paragraph 1005 below. Further, in Thailand — H-Beams, the Appellate Body stated:

“In our view, a panel is not required to make a separate and specific finding, in each and every instance, that a party has met its burden of proof in respect of a particular claim, or that a party has rebutted a prima facie case. Thus, the Panel did not err to the extent that it made no specific findings on whether Poland had met its burden of proof.”(1413)

997.     In Korea — Dairy, Korea argued in its appeal that “‘as a threshold matter’, ‘a panel must evaluate and make a finding on whether the complaining Member (i.e., the Member with the burden of proof ) has established a prima facie case of a violation’, before requiring the respondent to submit evidence of its own case or defence.” By ignoring this step, the Panel “’did not consider and a fortiori did not find that the European Communities made a prima facie case that justified its proceeding to examine the evidence and arguments’ of Korea”.(1414) The Appellate Body stated:

“We find no provision in the DSU or in the Agreement on Safeguards that requires a panel to make an explicit ruling on whether the complainant has established a prima facie case of violation before a panel may proceed to examine the respondent’s defence and evidence.”(1415)

4. Relevance of the difficulty of collecting information to prove a case

998.     In EC — Sardines, the Appellate Body also found that there is nothing in the WTO dispute settlement system to support the notion that the allocation of the burden of proof should be decided on the basis of a comparison between the respective difficulties that might possibly be encountered by the complainant and the respondent in collecting information to prove a case:

“The degree of difficulty in substantiating a claim or a defence may vary according to the facts of the case and the provision at issue. For example, on the one hand, it may be relatively straightforward for a complainant to show that a particular measure has a text that establishes an explicit and formal discrimination between like products and is, therefore, inconsistent with the national treatment obligation in Article III of the GATT 1994. On the other hand, it may be more difficult for a complainant to substantiate a claim of a violation of Article III of the GATT 1994 if the discrimination does not flow from the letter of the legal text of the measure, but rather is a result of the administrative practice of the domestic authorities of the respondent in applying that measure. But, in both of those situations, the complainant must prove its claim. There is nothing in the WTO dispute settlement system to support the notion that the allocation of the burden of proof should be decided on the basis of a comparison between the respective difficulties that may possibly be encountered by the complainant and the respondent in collecting information to prove a case.”(1416)

5. Necessary collaboration of the parties

999.     In Argentina — Textiles and Apparel, the Panel, in a finding not addressed by the Appellate Body, made the following statement regarding burden of proof and the requirement of collaboration of the parties in presenting facts and evidence to the panel:

“Another incidental rule to the burden of proof is the requirement for collaboration of the parties in the presentation of the facts and evidence to the panel and especially the role of the respondent in that process. It is often said that the idea of peaceful settlement of disputes before international tribunals is largely based on the premise of co-operation of the litigating parties. In this context the most important result of the rule of collaboration appears to be that the adversary is obligated to provide the tribunal with relevant documents which are in its sole possession. This obligation does not arise until the claimant has done its best to secure evidence and has actually produced some prima facie evidence in support of its case. It should be stressed, however, that ‘discovery’ of documents, in its common-law system sense, is not available in international procedures.

… Before an international tribunal, parties do have a duty to collaborate in doing their best to submit to the adjudicatory body all the evidence in their possession.”(1417)

6. Relationship between the burden of proof and a panel’s fact-finding mandate

1000.     In Japan — Agricultural Products II, the Appellate Body held that while a panel had a broad and “comprehensive authority” to engage in fact-finding under Article 13 of the DSU, it could not use this authority so as to effectively relieve the complaining party of making a prima facie case of inconsistency:

“Article 13 of the DSU allows a panel to seek information from any relevant source and to consult individual experts or expert bodies to obtain their opinion on certain aspects of the matter before it. In our Report in United States — Import Prohibition of Certain Shrimp and Shrimp Products (‘United States — Shrimp’), we noted the ‘comprehensive nature’ of this authority, and stated that this authority is ‘indispensably necessary’ to enable a panel to discharge its duty imposed by Article 11 of the DSU to ‘make an objective assessment of the matter before it, including an objective assessment of the facts of the case and the applicability of and conformity with the relevant covered agreements ….’

Furthermore, we note that the present dispute is a dispute under the SPS Agreement. Article 11.2 of the SPS Agreement explicitly instructs panels in disputes under this Agreement involving scientific and technical issues to ‘seek advice from experts’.

Article 13 of the DSU and Article 11.2 of the SPS Agreement suggest that panels have a significant investigative authority. However, this authority cannot be used by a panel to rule in favour of a complaining party which has not established a prima facie case of inconsistency based on specific legal claims asserted by it. A panel is entitled to seek information and advice from experts and from any other relevant source it chooses, pursuant to Article 13 of the DSU and, in an SPS case, Article 11.2 of the SPS Agreement, to help it to understand and evaluate the evidence submitted and the arguments made by the parties, but not to make the case for a complaining party.

In the present case, the Panel was correct to seek information and advice from experts to help it to understand and evaluate the evidence submitted and the arguments made by the United States and Japan with regard to the alleged violation of Article 5.6. The Panel erred, however, when it used that expert information and advice as the basis for a finding of inconsistency with Article 5.6, since the United States did not establish a prima facie case of inconsistency with Article 5.6 based on claims relating to the ‘determination of sorption levels’. The United States did not even argue that the ‘determination of sorption levels’ is an alternative measure which meets the three elements under Article 5.6.”(1418)

7. Relevance of the mandatory/discretionary distinction

1001.     In US — Carbon Steel, the Appellate Body, endorsing the approach of the Panel, considered that when there is an issue related to the mandatory/discretionary aspect of the law of a Member, the burden of proof will be on the complainant to demonstrate that the law is mandatory. The Appellate Body further noted that a responding Member’s law will be treated as WTO-consistent “until proven otherwise”:

“[A] responding Member’s law will be treated as WTO-consistent until proven otherwise. The party asserting that another party’s municipal law, as such, is inconsistent with relevant treaty obligations bears the burden of introducing evidence as to the scope and meaning of such law to substantiate that assertion …. The nature and extent of the evidence required to satisfy the burden of proof will vary from case to case.”(1419)

1002.     As regards which party has the burden of proof in respect of whether certain legislation is mandatory or discretionary when this is invoked as an affermative defence, see paragraph 188 above.

1003.     As regards the mandatory/discretionary distinction in general, see Section VI.B.3(c)(ii) above.

8. Application of the burden of proof in the context of a given WTO Agreement

(a) Burden of proof in the GATT 1994

1004.     In India — Quantitative Restrictions, India argued in its appeal that the Panel erred in finding that the proviso to Article XVIII:11 of GATT 1994 was to be properly characterized as an affirmative defence and that India, therefore, bore the burden of proof in respect thereof. The Appellate Body upheld the finding of the Panel:

“Assuming that the complaining party has successfully established a prima facie case of inconsistency with Article XVIII:11 and the Ad Note, the responding party may, in its defence, either rebut the evidence adduced in support of the inconsistency or invoke the proviso. In the latter case, it would have to demonstrate that the complaining party violated its obligation not to require the responding party to change its development policy. This is an assertion with respect to which the responding party must bear the burden of proof. We, therefore, agree with the Panel that the burden of proof with respect to the proviso is on India.”(1420)

1005.     In India — Quantitative Restrictions, India argued on appeal that the Panel did not apply the rules on burden of proof correctly. India claimed that the Panel failed to analyse whether the United States had made a prima facie case prior to considering the answers provided by the IMF to the Panel’s questions and prior to shifting the burden of proof to India. India also argued that the evidence introduced by the United States could not, as a matter of law, have constituted a prima facie case that India’s balance-of-payments restrictions were not justified under the Ad Note. The Appellate Body stated that a Panel was not required to make an explicit statement that a prima facie case has been made:

“In support of its argument, India refers to the Appellate Body Report in European Communities — Hormones, where the Appellate Body stated:

‘In accordance with our ruling in United States — Shirts and Blouses, the Panel should have begun the analysis of each legal provision by examining whether the United States and Canada had presented evidence and legal instruments sufficient to demonstrate that the EC measures were inconsistent with the obligations assumed by the European Communities under each Article of the SPS Agreement addressed by the Panel…. Only after such a prima facie determination has been made by the Panel may the onus be shifted to the European Communities to bring forward evidence and arguments to disprove the complaining party’s claim.’

We do not interpret the above statement as requiring a panel to conclude that a prima facie case is made before it considers the views of the IMF or any other experts that it consults. Such consideration may be useful in order to determine whether a prima facie case has been made. Moreover, we do not find it objectionable that the Panel took into account, in assessing whether the United States had made a prima facie case, the responses of India to the arguments of the United States. This way of proceeding does not imply, in our view, that the Panel shifted the burden of proof to India. We, therefore, are not of the opinion that the Panel erred in law in proceeding as it did.”(1421)

1006.     The Appellate Body on India — Quantitative Restrictions then rejected India’s appeal on the grounds “that the evidence introduced by the United States could not, as a matter of law, have constituted a prima facie case”. The Appellate Body recalled its previous findings in this respect and held that the “weighing and assessing of the evidence” was outside the scope of review.

“As to the second alleged mistake, namely, that the evidence introduced by the United States could not, as a matter of law, have constituted a prima facie case that India’s balance-of-payments restrictions were not justified under the Ad Note, we recall that in European Communities — Hormones, the Appellate Body stated:

‘Determination of the credibility and weight properly to be ascribed to (that is, the appreciation of ) a given piece of evidence is part and parcel of the fact finding process and is, in principle, left to the discretion of a panel as the trier of facts …’

Similarly, in Korea — Taxes on Alcoholic Beverages, the Appellate Body stated:

‘The Panel’s examination and weighing of the evidence submitted fall, in principle, within the scope of the Panel’s discretion as the trier of facts and, accordingly, outside the scope of appellate review….’

We believe that this second mistake alleged by India relates to the weighing and assessing of the evidence adduced by the United States, and is, therefore, outside the scope of appellate review.”(1422)

(b) Burden of proof under the Enabling Clause

1007.     The Appellate Body stated in EC — Tariff Preferences that as an exception provision, the ultimate burden of proof under the Enabling Clause falls on the respondent party:

“As a general rule, the burden of proof for an ‘exception’ falls on the respondent, that is, as the Appellate Body stated in US — Wool Shirts and Blouses, on the party ‘assert[ing] the affirmative of a particular … defence’.(1423) From this allocation of the burden of proof, it is normally for the respondent, first, to raise the defence and, second, to prove that the challenged measure meets the requirements of the defence provision.

We are therefore of the view that the European Communities must prove that the Drug Arrangements satisfy the conditions set out in the Enabling Clause. Consistent with the principle of jura novit curia, it is not the responsibility of the European Communities to provide us with the legal interpretation to be given to a particular provision in the Enabling Clause; instead, the burden of the European Communities is to adduce sufficient evidence to substantiate its assertion that the Drug Arrangements comply with the requirements of the Enabling Clause.”(1424)

1008.     However, the Appellate Body also found in EC — Tariff Preferences that the complainant bears the burden of raising the Enabling Clause in its panel request in order to convey the “legal basis of the complaint sufficient to present the problem clearly” as required by Article 6 of the DSU. At the same time, the Appellate Body reiterated its view that the ultimate burden of justifying the challenged measure under the Enabling Clause is with the respondent:

“In our view, the special status of the Enabling Clause in the WTO system has particular implications for WTO dispute settlement. As we have explained, paragraph 1 of the Enabling Clause enhances market access for developing countries as a means of improving their economic development by authorizing preferential treatment for those countries, ‘notwithstanding’ the obligations of Article I. It is evident that a Member cannot implement a measure authorized by the Enabling Clause without according an ‘advantage’ to a developing country’s products over those of a developed country. It follows, therefore, that every measure undertaken pursuant to the Enabling Clause would necessarily be inconsistent with Article I, if assessed on that basis alone, but it would be exempted from compliance with Article I because it meets the requirements of the Enabling Clause. Under these circumstances, we are of the view that a complaining party challenging a measure taken pursuant to the Enabling Clause must allege more than mere inconsistency with Article I:1 of the GATT 1994, for to do only that would not convey the ‘legal basis of the complaint sufficient to present the problem clearly’. In other words, it is insufficient in WTO dispute settlement for a complainant to allege inconsistency with Article I:1 of the GATT 1994 if the complainant seeks also to argue that the measure is not justified under the Enabling Clause. This is especially so if the challenged measure, like that at issue here, is plainly taken pursuant to the Enabling Clause, as we discuss infra.

…

The responsibility of the complaining party in such an instance, however, should not be overstated. It is merely to identify those provisions of the Enabling Clause with which the scheme is allegedly inconsistent, without bearing the burden of establishing the facts necessary to support such inconsistency. That burden, as we concluded above, remains on the responding party invoking the Enabling Clause as a defence.”(1425)

(c) Burden of proof in the SPS Agreement

(i) Burden of proof in the context of Article 2.2 of the SPS Agreement

1010.     The Appellate Body explained in Japan — Apples that the complainant could establish a prima facie case of inconsistency with Article 2.2 of the SPS Agreement even though it confined its arguments to a claim asserted by it, and found that the Panel acted within the limits of its investigative authority when the Panel assessed relevant allegations of fact asserted by Japan as the respondent:

“Japan also contends that the Panel did not have the authority to make certain findings of fact …. We disagree with Japan….The Panel acted within the limits of its investigative authority because it did nothing more than assess relevant allegations of fact asserted by Japan, in the light of the evidence submitted by the parties and the opinions of the experts.

Japan also submits that, ‘in order to establish a prima facie case of insufficient scientific evidence under Article 2.2 of the SPS Agreement, the complaining party must establish that there is not sufficient evidence for any of the perceived risks underlying the measure.’ … We find no basis for the approach advocated by Japan. As the Appellate Body stated in EC — Hormones, ‘a prima facie case is one which, in the absence of effective refutation by the defending party, requires a panel, as a matter of law, to rule in favour of the complaining party presenting the prima facie case.’(1426) In US — Wool Shirts and Blouses, the Appellate Body stated that the nature and scope of evidence required to establish a prima facie case ‘will vary from measure to measure, provision to provision, and case to case.’(1427) In the present case, the Panel appears to have concluded that in order to demonstrate a prima facie case that Japan’s measure is maintained without sufficient scientific evidence, it sufficed for the United States to address only the question of whether mature, symptomless apples could serve as a pathway for fire blight.

The Panel’s conclusion seems appropriate to us for the following reasons. First, the claim pursued by the United States was that Japan’s measure is maintained without sufficient scientific evidence to the extent that it applies to mature, symptomless apples exported from the United States to Japan. What is required to demonstrate a prima facie case is necessarily influenced by the nature and the scope of the claim pursued by the complainant. A complainant should not be required to prove a claim it does not seek to make. Secondly, the Panel found that mature, symptomless apple fruit is the commodity ‘normally exported’ by the United States to Japan.(1428) The Panel indicated that the risk that apple fruit other than mature, symptomless apples may actually be imported into Japan would seem to arise primarily as a result of human or technical error, or illegal actions,(1429) and noted that the experts characterized errors of handling and illegal actions as ‘small’ or ‘debatable’ risks.(1430) Given the characterization of these risks, in our opinion it was legitimate for the Panel to consider that the United States could demonstrate a prima facie case of inconsistency with Article 2.2 of the SPS Agreement through argument based solely on mature, symptomless apples. Thirdly, the record contains no evidence to suggest that apples other than mature, symptomless ones have ever been exported to Japan from the United States as a result of errors of handling or illegal actions…. “(1431)

(ii) Burden of proof in the context of Article 3.2 of the SPS Agreement

1012.     In EC — Hormones, the Appellate Body examined whether the Panel correctly allocated the burden of proof under the SPS Agreement. The Appellate Body noted that the Panel made an interpretative ruling that “the SPS Agreement allocates the ‘evidentiary burden’ to the Members imposing an SPS measure” on the basis of, inter alia, Article 3.2 of the SPS Agreement. The Appellate Body noted that the Panel drew a reverse inference from Article 3.2 of the SPS Agreement to the effect that “if a measure does not conform to international standards, the Member imposing such a measure must bear the burden of proof in any complaint of inconsistency with the provisions of the SPS Agreement.” The Appellate Body reversed the Panel’s ruling and stated:

“The presumption of consistency with relevant provisions of the SPS Agreement that arises under Article 3.2 in respect of measures that conform to international standards may well be an incentive for Members so to conform their SPS measures with such standards. It is clear, however, that a decision of a Member not to conform a particular measure with an international standard does not authorize imposition of a special or generalized burden of proof upon that Member, which may, more often than not, amount to a penalty.

…

The Panel relies on two interpretative points in reaching its above finding. First, the Panel posits the existence of a ‘general rule — exception’ relationship between Article 3.1 (the general obligation) and Article 3.3 (an exception) and applies to the SPS Agreement what it calls ‘established practice under GATT 1947 and GATT 1994’ to the effect that the burden of justifying a measure under Article XX of the GATT 1994 rests on the defending party. It appears to us that the Panel has misconceived the relationship between Articles 3.1, 3.2 and 3.3, a relationship discussed below, which is qualitatively different from the relationship between, for instance, Articles I or III and Article XX of the GATT 1994. Article 3.1 of the SPS Agreement simply excludes from its scope of application the kinds of situations covered by Article 3.3 of that Agreement, that is, where a Member has projected for itself a higher level of sanitary protection than would be achieved by a measure based on an international standard. Article 3.3 recognizes the autonomous right of a Member to establish such higher level of protection, provided that that Member complies with certain requirements in promulgating SPS measures to achieve that level. The general rule in a dispute settlement proceeding, requiring a complaining party to establish a prima facie case of inconsistency with a provision of the SPS Agreement before the burden of showing consistency with that provision is taken on by the defending party, is not avoided by simply describing that same provision as an ‘exception’. In much the same way, merely characterizing a treaty provision as an ‘exception’ does not by itself justify a ‘stricter’ or ‘narrower’ interpretation of that provision than would be warranted by examination of the ordinary meaning of the actual treaty words, viewed in context and in the light of the treaty’s object and purpose, or, in other words, by applying the normal rules of treaty interpretation. It is also well to remember that a prima facie case is one which, in the absence of effective refutation by the defending party, requires a panel, as a matter of law, to rule in favour of the complaining party presenting the prima facie case.”(1432)

(d) Burden of proof in the SCM Agreement

1013.     In Brazil — Aircraft, Canada appealed the Panel’s finding that, in a case involving a claim of violation of Article 3.1(a) of the SCM Agreement against a developing country Member, the complaining party has the burden of proving that the developing country Member in question has not complied with at least one of the elements set out in Article 27.4 of the SCM Agreement. Canada argued that since Article 27.4 of the SCM Agreement is in the nature of a conditional exception or an affermative defence, the respondent developing country Member has the burden of proof whereas Brazil submitted that since Article 27 is a transitional provision that contains a set of special and differential rights and obligations for developing country Members, the complaining party, namely Canada, has the burden of proving that the developing country Member is not in compliance with Article 27.4 of the SCM Agreement. The Appellate Body stated:

“On reading paragraphs 2(b) and 4 of Article 27 together, it is clear that the conditions set forth in paragraph 4 are positive obligations for developing country Members, not affirmative defences. If a developing country Member complies with the obligations in Article 27.4, the prohibition on export subsidies in Article 3.1(a) simply does not apply. However, if that developing country Member does not comply with those obligations, Article 3.1(a) does apply.

For these reasons, we agree with the Panel that the burden is on the complaining party (in casu Canada) to demonstrate that the developing country Member (in casu Brazil) is not in compliance with at least one of the elements set forth in Article 27.4. If such non-compliance is demonstrated, then, and only then, does the prohibition of Article 3.1(a) apply to that developing country Member.”(1433)

1014.     In Canada — Aircraft, Canada justified its refusal to provide information on the disputed financing of the transaction at issue on the grounds that Brazil had not established a prima facie case that such financing constituted a prohibited export subsidy under Article 3.1(a) of the SCM Agreement. The Appellate Body stated:

“A prima facie case, it is well to remember, is a case which, in the absence of effective refutation by the defending party (that is, in the present appeal, the Member requested to provide the information), requires a panel, as a matter of law, to rule in favour of the complaining party presenting the prima facie case. There is, as noted earlier, nothing in either the DSU or the SCM Agreement to support Canada’s assumption. To the contrary, a panel is vested with ample and extensive discretionary authority to determine when it needs information to resolve a dispute and what information it needs. A panel may need such information before or after a complaining or a responding Member has established its complaint or defence on a prima facie basis. A panel may, in fact, need the information sought in order to evaluate evidence already before it in the course of determining whether the claiming or the responding Member, as the case may be, has established a prima facie case or defence. Furthermore, a refusal to provide information requested on the basis that a prima facie case has not been made implies that the Member concerned believes that it is able to judge for itself whether the other party has made a prima facie case. However, no Member is free to determine for itself whether a prima facie case or defence has been established by the other party. That competence is necessarily vested in the panel under the DSU, and not in the Members that are parties to the dispute.”(1434)

(e) Burden of proof in the TRIPS Agreement

1015.     In India — Patents (US), India challenged the application of the burden of proof by the Panel, arguing that the Panel erroneously required the United States, the complaining party, merely to raise “reasonable doubts” suggesting a violation of Article 70.8 of the TRIPS Agreement, and subsequently placed the burden on India to dispel such doubts. The Appellate Body recalled the finding of the Panel and rejected India’s claim:

“India raises the additional argument that the Panel erred in its application of the burden of proof in assessing Indian municipal law. In particular, India alleges that the Panel, after having required the United States merely to raise ‘reasonable doubts’ suggesting a violation of Article 70.8, placed the burden on India to dispel such doubts.

The Panel states:

‘As the Appellate Body report on Shirts and Blouses points out, “a party claiming a violation of a provision of the WTO Agreement by another Member must assert and prove its claim”. In this case, it is the United States that claims a violation by India of Article 70.8 of the TRIPS Agreement. Therefore, it is up to the United States to put forward evidence and legal arguments sufficient to demonstrate that action by India is inconsistent with the obligations assumed by India under Article 70.8. In our view, the United States has successfully put forward such evidence and arguments. Then, … the onus shifts to India to bring forward evidence and arguments to disprove the claim. We are not convinced that India has been able to do so (footnotes deleted).’(1435)

This statement of the Panel is a legally correct characterization of the approach to burden of proof that we set out in United States — Shirts and Blouses.(1436) However, it is not sufficient for a panel to enunciate the correct approach to burden of proof; a panel must also apply the burden of proof correctly. A careful reading of paragraphs 7.35 and 7.37 of the Panel Report reveals that the Panel has done so in this case. These paragraphs show that the United States put forward evidence and arguments that India’s ‘administrative instructions’ pertaining to mailbox applications were legally insufficient to prevail over the application of certain mandatory provisions of the Patents Act. India put forward rebuttal evidence and arguments. India misinterprets what the Panel said about ‘reasonable doubts’. The Panel did not require the United States merely to raise ‘reasonable doubts’ before the burden shifted to India. Rather, after properly requiring the United States to establish a prima facie case and after hearing India’s rebuttal evidence and arguments, the Panel concluded that it had ‘reasonable doubts’ that the ‘administrative instructions’ would prevail over the mandatory provisions of the Patents Act if a challenge were brought in an Indian court.

For these reasons, we conclude that the Panel applied the burden of proof correctly in assessing the compliance of India’s domestic law with Article 70.8(a) of the TRIPS Agreement.”(1437)

(f) Burden of proof in the TBT Agreement

1016.     In EC — Sardines, the European Communities had asserted before the Panel that Codex Stan 94 was “in effective or inappropriate” to fulfil the “legitimate objectives” of the European Communities Regulation at issue. The Panel was of the view that the European Communities was thus asserting the affermative of a particular claim or defence, and, therefore, that the burden of proof was on the European Communities to demonstrate that claim.(1438) The Panel justified its position as follows: first, it reasoned that the complainant is not in a position to “spell out” the “legitimate objectives” pursued by a Member through a technical regulation; and, second, it reasoned “that the assessment of whether a relevant international standard is ‘inappropriate’ … may extend to considerations which are proper to the Member adopting or applying a technical regulation”.(1439) The Panel, although it acknowledged the Appellate Body’s finding in EC — Hormones (see paragraph 990 above), concluded that it “does not have a direct bearing” on the question of the allocation of the burden of proof under the second part of Article 2.4 of the TBT Agreement”.(1440) The Appellate Body disagreed with the Panel’s conclusion that its ruling on the issue of the burden of proof in EC — Hormones had no “direct bearing” on this case and reversed the Panel’s finding on burden of proof.(1441) The Appellate Body thus concluded that the complaining Member seeking a ruling on the inconsistency of the measure applied by the defendant with Article 2.4 of the TBT Agreement was to bear the burden of proving its claim:

“We disagree with the Panel’s conclusion that our ruling on the issue of the burden of proof has no ‘direct bearing’ on this case. The Panel provides no explanation for this conclusion and, indeed, could not have provided any plausible explanation. For there are strong conceptual similarities between, on the one hand, Article 2.4 of the TBT Agreement and, on the other hand, Articles 3.1 and 3.3 of the SPS Agreement, and our reasoning in EC — Hormones is equally apposite for this case. The heart of Article 3.1 of the SPS Agreement is a requirement that Members base their sanitary or phytosanitary measures on international standards, guidelines, or recommendations. Likewise, the heart of Article 2.4 of the TBT Agreement is a requirement that Members use international standards as a basis for their technical regulations. Neither of these requirements in these two agreements is absolute. Articles 3.1 and 3.3 of the SPS Agreement permit a Member to depart from an international standard if the Member seeks a level of protection higher than would be achieved by the international standard, the level of protection pursued is based on a proper risk assessment, and the international standard is not sufficient to achieve the level of protection pursued. Thus, under the SPS Agreement, departing from an international standard is permitted in circumstances where the international standard is ineffective to achieve the objective of the measure at issue. Likewise, under Article 2.4 of the TBT Agreement, a Member may depart from a relevant international standard when it would be an ‘ineffective or inappropriate means for the fulfilment of the legitimate objectives pursued’ by that Member through the technical regulation.

Given the conceptual similarities between, on the one hand, Articles 3.1 and 3.3 of the SPS Agreement and, on the other hand, Article 2.4 of the TBT Agreement, we see no reason why the Panel should not have relied on the principle we articulated in EC — Hormones to determine the allocation of the burden of proof under Article 2.4 of the TBT Agreement. In EC — Hormones, we found that a ‘general rule—exception’ relationship between Articles 3.1 and 3.3 of the SPS Agreement does not exist, with the consequence that the complainant had to establish a case of inconsistency with both Articles 3.1 and 3.3.(1442) We reached this conclusion as a consequence of our finding there that ‘Article 3.1 of the SPS Agreement simply excludes from its scope of application the kinds of situations covered by Article 3.3 of that Agreement’.(1443) Similarly, the circumstances envisaged in the second part of Article 2.4 are excluded from the scope of application of the first part of Article 2.4. Accordingly, as with Articles 3.1 and 3.3 of the SPS Agreement, there is no ‘general rule-exception’ relationship between the first and the second parts of Article 2.4. Hence, in this case, it is for Peru — as the complaining Member seeking a ruling on the inconsistency with Article 2.4 of the TBT Agreement of the measure applied by the European Communities — to bear the burden of proving its claim. This burden includes establishing that Codex Stan 94 has not been used ‘as a basis for’ the EC Regulation, as well as establishing that Codex Stan 94 is effective and appropriate to fulfil the ‘legitimate objectives’ pursued by the European Communities through the EC Regulation.”(1444)

1017.     As regards the statements of the Appellate Body in EC — Sardines on the lack of relevance of the difficulty of collecting information to prove a case in the allocation of the burden of proof, see paragraph 998 above.

(g) Burden of proof in the Agreement on Agriculture

1018.     With respect to the burden of proof in relation to Article 10.3 of the Agreement on Agriculture, see the excerpts from the reports of the panels and Appellate Body referenced in the Chapter on the Agreement on Agriculture, Section XI.B.3(b).

(h) Burden of proof in Article 21.3(c) arbitrations

1019.     With respect to the burden of proof in Article 21.3(c) proceedings, see paragraphs 593–594 above.

(i) Burden of proof in Article 21.5 compliance panel proceedings

1020.     With respect to the burden of proof in Article 21.5 proceedings, see paragraph 622 above.

(j) Burden of proof in Article 22.6 arbitrations

1021.     With respect to the burden of proof under Article 22.6 proceedings, see paragraphs 689–690 above.

E. Private Counsel

1. Presence of private counsel in oral hearings

1022.     In EC — Bananas III, the Panel did not allow the presence of private lawyers at the first substantive meeting.(1445) The Appellate Body, however, allowed their presence in the oral hearing and to that effect it issued a preliminary ruling indicating that nothing in the WTO Agreement, the DSU or its Working Procedures prevented a Member from admitting whomever it deems fit to become part of its delegation to Appellate Body proceedings. Accordingly, the Appellate Body held that a Member could include private counsel in its delegation to an Appellate Body hearing:

“[W]e can find nothing in the Marrakesh Agreement Establishing the World Trade Organization (the ‘WTO Agreement’), the DSU or the Working Procedures, nor in customary international law or the prevailing practice of international tribunals, which prevents a WTO Member from determining the composition of its delegation in Appellate Body proceedings. Having carefully considered the request made by the government of Saint Lucia, and the responses dated 14 July 1997 received from Canada; Jamaica; Ecuador, Guatemala, Honduras, Mexico and the United States, we rule that it is for a WTO Member to decide who should represent it as members of its delegation in an oral hearing of the Appellate Body.”(1446)

1023.     In its Report, the Appellate Body in EC — Bananas III further justified its preliminary ruling (see paragraph 1022 above) as follows:

“We note that there are no provisions in the Marrakesh Agreement Establishing the World Trade Organization (the ‘WTO Agreement’), in the DSU or in the Working Procedures that specify who can represent a government in making its representations in an oral hearing of the Appellate Body. With respect to GATT practice, we can find no previous panel report which speaks specifically to this issue in the context of panel meetings with the parties. We also note that representation by counsel of a government’s own choice may well be a matter of particular significance — especially for developing-country Members — to enable them to participate fully in dispute settlement proceedings. Moreover, given the Appellate Body’s mandate to review only issues of law or legal interpretation in panel reports, it is particularly important that governments be represented by qualified counsel in Appellate Body proceedings.”(1447)

1024.     In Indonesia — Autos, the Panel applied the same principle to the presence of private lawyers before panels:

“I wish to inform the parties that having carefully reviewed the letters received in the preliminary matter before us, and having heard the arguments of the parties, the Panel does not agree with the United States’ request to exclude from meetings of the Panel certain persons nominated by the Government of Indonesia as members of its delegation. We conclude that it is for the Government of Indonesia to nominate the members of its delegation to meetings of this Panel, and we find no provision in the WTO Agreement or the DSU, including the standard rules of procedure included therein, which prevents a WTO Member from determining the composition of its delegation to WTO panel meetings. Nor does past practice in GATT and WTO dispute settlement point us to a different conclusion in this case. In particular, we note that unlike in this present case, the working procedures of the Bananas III Panel contained a specific provision requiring the presence only of government officials.

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. I would ask the four Heads of Delegation to confirm that all members of their delegations are present as representatives of their governments, and as such will abide by all of the applicable provisions; and therefore that the governments are responsible for the actions of their representatives.(1448)”(1449)

1025.     In Korea — Alcoholic Beverages, Korea requested the Panel to issue a preliminary ruling with respect to permission to have private counsel attend the Panel meetings and address the Panel. In Korea’s view, in order to fully defend its interests and match the much greater resources of the complaining parties, it had to retain the services of expert counsel with long standing experience in matters of international economic law and international economics. The European Communities had no problem with the presence of private counsel provided that Korea assumed full responsibility for any breach of confidentiality which might result from the presence at the Panel meetings of non-governmental persons. The United States, however, indicated, among other things, that the established practice applied in disputes under the GATT 1947 system excluded the routine presence of private lawyers in panel proceedings and asked the Panel, in the event that it decided to accept Korea’s request, to impose appropriate safeguards with respect to those persons. The Panel accepted the presence of private counsel as follows:

“Having considered the request of Korea for the right to use private counsel at the panel meetings, and the responses of the European Communities and the United States, we decided to permit the appearance of private counsel before the Panel and to allow them to address arguments to the Panel in this case. In our view, it is appropriate to grant such a request in order to ensure that Korea has every opportunity to fully defend its interests in this case. However, such permission is granted based on the representations by Korea that the private counsel concerned are official members of the delegation of Korea, that they are retained by and responsible to the Government of Korea, and that they will fully respect the confidentiality of the proceedings and that Korea assumes full responsibility for confidentiality of the proceedings on behalf of all members of its delegation, including non-government employees.

We note that written submissions of the parties which contain confidential information may, in some cases, be provided to non-government advisors who are not members of an official delegation at a panel meeting. The duty of confidentiality extends to all governments that are parties to a dispute and to all such advisors regardless of whether they are designated as members of delegations and appear at a panel meeting.

The United States offered several suggestions for new rules and procedures in regard to these questions. However, in our view, the broader question of establishing further rules on confidentiality and possibly rules of conduct specifically directed at the role of non-governmental advisors generally is a matter more appropriate for consideration by the Dispute Settlement Body and is not within the terms of reference of this Panel.”(1450)

2. Confidentiality concerns

1026.     As regards confidentiality concerns when private lawyers are concerned, see Section XVIII.B.1(d) above.

3. Conflict of interest

1027.     In EC — Tariff Preferences, the European Communities had raised ethical concerns arising from the joint representation of India, the complaining party and Paraguay, a third party, by the same legal counsel, the Advisory Centre of WTO Law (ACWL). The Panel considered that it had an obligation to clarify this issue:

“The Panel nonetheless considers that, flowing from its terms of reference and from the requirement, in Article 11 of the DSU, to ‘make an objective assessment of the matter before it … ‘, as well as the requirement, pursuant to Article 12 of the DSU, to determine and administer its Working Procedures, the Panel has the inherent authority — and, indeed, the duty — to manage the proceeding in a manner guaranteeing due process to all parties involved in the proceeding and to maintain the integrity of the dispute settlement system. With specific reference to issues raised in the instant case, it is incumbent on the Panel to clarify whether the ACWL’s joint representation of India and Paraguay poses any ethical concerns of the kind raised by the European Communities. At the same time, and although the European Communities asks the Panel for a ruling whether, as a matter of principle, the same legal counsel can represent simultaneously a party and a third party and, if so, under what conditions, the Panel considers that it cannot rule on such issues in the abstract, but only as they relate to the specific case before it.”(1451)

1028.     The Panel in EC — Tariff Preferences then examined the issue of whether there was a conflict of interest when the complainant and a third party were represented by the same legal counsel. In this regard, the Panel found that some common ethical rules of conduct in national jurisdictions were applicable to a conflict of interest situation in WTO dispute settlement proceedings, one such applicable rule being that parties concerned could waive any conflict of interest by their express consent to their joint representation:

“As a general matter, the Panel considers that it is the responsibility of legal counsel to ensure that it is not placing itself in a position of actual or potential conflict of interest when agreeing to represent, and thereafter representing, one or more WTO Members in a dispute under the DSU. In this regard, the Panel notes that bar associations in many jurisdictions have elaborated rules of conduct dealing explicitly with conflicts of interest through joint representation.(1452)

Common to all such ethical rules of conduct is the principle that counsel shall not accept or continue representation of more than one client in a matter in which the interests of the clients actually or potentially conflict. Underlying this principle is the fundamental notion that a client must have full confidence in the objectivity and independence of the professional advice provided to it by counsel. A second common element to all such ethical rules, however, is the possibility for clients, when faced with counsel being subject to actual or potential conflict of interest as the result of joint representation, to consent to such joint representation, but only following full disclosure by counsel. In other words, following disclosure of the actual or potential conflict of interest, clients may waive such conflict. Yet a third common element is that counsel shall nevertheless discontinue such joint representation at such time as counsel becomes aware that the interests of the two (or more) clients are directly adverse.

The Panel considers that the above-described common elements to ethical rules of conduct in many jurisdictions are equally appropriate to dealing with issues of representational conflict of interest in the WTO dispute settlement context.”(1453)

1029.     In EC — Tariff Preferences, the Panel further found no “conflict of interest” based on the fact that the parties concerned had consented to the joint representation following a full disclosure of information by the legal counsel to them:

“The Panel agrees with India and Paraguay that the parties most likely to be concerned by any potential or actual conflict of interest are those agreeing to joint representation, here India and Paraguay. It would seem that the basis for raising concerns over such joint representation would be considerably less for other parties in the case, who would be unlikely to be prejudiced by any joint representation of India and Paraguay. While the Panel does not exclude that, in a different case, there could be concerns of a more systemic nature, that could be raised by parties other than those agreeing to joint representation, the Panel is of the view that the European Communities has not demonstrated the existence of a particular situation which gives rise to such concerns in the instant case. The Panel accordingly does not consider that it is faced with an issue of principle or one having systemic implications for the WTO dispute settlement system.

As stated in the Introduction, India and Paraguay claim to have been fully informed about their joint representation by the ACWL and have given their written consent to such joint representation. In these circumstances, the Panel considers that India and Paraguay, as well as counsel for this party and third party, have done everything necessary to allow for the continued joint representation of India and Paraguay by the ACWL.”(1454)

F. Judicial Economy

1. Legal basis for the exercise of judicial economy

1030.     The Panel on US — Wool Shirts and Blouses decided to exercise judicial economy with respect to some of India’s claims in that dispute, stating “India is entitled to have the dispute over the contested ‘measure’ resolved by the Panel, and if we judge that the specific matter in dispute can be resolved by addressing only some of the arguments raised by the complaining party, we can do so. We, therefore, decide to address only the legal issues we think are needed in order to make such findings as will assist the DSB in making recommendations or in giving rulings in respect of this dispute. ”The Appellate Body upheld the finding of the Panel and discussed the legal basis for judicial economy. The Appellate Body began by noting the function of panels, as defined under Article 11 of the DSU:

“The function of panels is expressly defined in Article 11 of the DSU, which reads as follows:

‘The function of panels is to assist the DSB in discharging its responsibilities under this Understanding and the covered agreements. Accordingly, a panel should make an objective assessment of the matter before it, including an objective assessment of the facts of the case and the applicability of and conformity with the relevant covered agreements, and make such other findings as will assist the DSB in making the recommendations or in giving the rulings provided for in the covered agreements … (emphasis added).’

Nothing in this provision or in previous GATT practice requires a panel to examine all legal claims made by the complaining party. Previous GATT 1947 and WTO panels have frequently addressed only those issues that such panels considered necessary for the resolution of the matter between the parties, and have declined to decide other issues. Thus, if a panel found that a measure was inconsistent with a particular provision of the GATT 1947, it generally did not go on to examine whether the measure was also inconsistent with other GATT provisions that a complaining party may have argued were violated.(1455) In recent WTO practice, panels likewise have refrained from examining each and every claim made by the complaining party and have made findings only on those claims that such panels concluded were necessary to resolve the particular matter.(1456)

Although a few GATT 1947 and WTO panels did make broader rulings, by considering and deciding issues that were not absolutely necessary to dispose of the particular dispute, there is nothing anywhere in the DSU that requires panels to do so.(1457)”(1458)

1031.     The Appellate Body on US — Wool Shirts and Blouses also referred to Article 3.7 of the DSU and emphasized that a requirement to address all legal claims raised by a party is inconsistent with the basic aim of dispute settlement, namely to settle disputes:

“Furthermore, such a requirement [to address all legal claims] is not consistent with the aim of the WTO dispute settlement system. Article 3.7 of the DSU explicitly states:

‘The aim of the dispute settlement mechanism is to secure a positive solution to a dispute. A solution mutually acceptable to the parties to a dispute and consistent with the covered agreements is clearly to be preferred.’

Thus, the basic aim of dispute settlement in the WTO is to settle disputes. This basic aim is affirmed elsewhere in the DSU. Article 3.4, for example, stipulates:

‘Recommendations or rulings made by the DSB shall be aimed at achieving a satisfactory settlement of the matter in accordance with the rights and obligations under this Understanding and under the covered agreements.’”(1459)

1032.     Finally, the Appellate Body in US — Wool Shirts and Blouses rejected the argument by India that, pursuant to Article 3.2, panels were obliged to address all legal claims raised by the parties:

“As India emphasizes, Article 3.2 of the DSU states that the Members of the WTO ‘recognize’ that the dispute settlement system ‘serves to preserve the rights and obligations of Members under the covered agreements, and to clarify the existing provisions of those agreements in accordance with customary rules of interpretation of public international law’ (emphasis added). Given the explicit aim of dispute settlement that permeates the DSU, we do not consider that Article 3.2 of the DSU is meant to encourage either panels or the Appellate Body to ‘make law’ by clarifying existing provisions of the WTO Agreement outside the context of resolving a particular dispute. A panel need only address those claims which must be addressed in order to resolve the matter in issue in the dispute.(1460)

We note, furthermore, that Article IX of the WTO Agreement provides that the Ministerial Conference and the General Council have the ‘exclusive authority’ to adopt interpretations of the WTO Agreement and the Multilateral Trade Agreements.(1461) This is explicitly recognized in Article 3.9 of the DSU, which provides:

‘The provisions of this Understanding are without prejudice to the rights of Members to seek authoritative interpretation of provisions of a covered agreement through decision-making under the WTO Agreement or a covered agreement which is a Plurilateral Trade Agreement.’

In the light of the above, we believe that the Panel’s finding in paragraph 7.20 of the Panel Report is consistent with the DSU as well as with practice under the GATT 1947 and the WTO Agreement.”

1033.     The Appellate Body confirmed its approach to judicial economy in India — Patents (US):

“[A] panel has the discretion to determine the claims it must address in order to resolve the dispute between the parties — provided that those claims are within that panel’s terms of reference.”(1462)

2. Exercise of judicial economy with respect to arguments

1034.     While the Appellate Body has, on several occasions, reiterated that panels are not obliged to address every legal claim made by a party — i.e. the ability of panels to exercise judicial economy — in EC — Poultry it held that a panel also had the discretion to decide which arguments made by the parties it was going to address in its analysis. See paragraph 333 above.

3. No obligation to exercise judicial economy

1035.     In US — Lead and Bismuth II, the United States, the defending party, argued that the Panel was required to exercise judicial economy and not address issues which did not need to be addressed for resolving the dispute at hand. The Appellate Body rejected the argument and emphasized that the exercise of judicial economy was within the discretion of a Panel, but that a Panel was never required to exercise judicial economy:

“The United States seems to consider that our Report in United States — Shirts and Blouses sets forth a general principle that panels may not address any issues that need not be addressed in order to resolve the dispute between the parties. We do not agree with this characterization of our findings. In that appeal, India had argued that it was entitled to a finding by the Panel on each of the legal claims that it had made. We, however, found that the principle of judicial economy allows a panel to decline to rule on certain claims.

…

In order to resolve the claim of the European Communities, the Panel deemed it necessary to address the two principal arguments made in support of this claim. In doing so, the Panel acted within the context of resolving this particular dispute and, therefore, within the scope of its mandate under the DSU.”(1463)

1036.     In Argentina — Footwear (EC), the Appellate Body expressed its “surprise” that the Panel had made a certain finding under the Agreement on Safeguards:

“We are somewhat surprised that the Panel, having determined that there were no ‘increased imports’, and having determined that there was no ‘serious injury’, for some reason went on to make an assessment of causation. It would be difficult, indeed, to demonstrate a ‘causal link’ between ‘increased imports’ that did not occur and ‘serious injury’ that did not exist. Nevertheless, we see no error in the Panel’s interpretation of the causation requirements, or in its interpretation of Article 4.2(b) of the Agreement on Safeguards.”(1464)

4. Requirement for a panel to state it is exercising judicial economy

1037.     In Canada — Autos, the Appellate Body admonished the Panel for not stating explicitly that it was exercising judicial economy, when it did not address a particular claim:

“In our view, it was not necessary for the Panel to make a determination on the European Communities’ alternative claim relating to the CVA requirements under Article 3.1(a) of the SCM Agreement in order ‘to secure a positive solution’ to this dispute. The Panel had already found that the CVA requirements violated both Article III:4 of the GATT 1994 and Article XVII of the GATS. Having made these findings, the Panel, in our view, exercising the discretion implicit in the principle of judicial economy, could properly decide not to examine the alternative claim of the European Communities that the CVA requirements are inconsistent with Article 3.1(a) of the SCM Agreement.

We are bound to add that, for purposes of transparency and fairness to the parties, a panel should, however, in all cases, address expressly those claims which it declines to examine and rule upon for reasons of judicial economy. Silence does not suffice for these purposes.”(1465)

5. “False” judicial economy

1038.     In Australia — Salmon, the Appellate Body held that the right to exercise judicial economy could not be exercised where only a partial resolution of a dispute would result:

“The principle of judicial economy has to be applied keeping in mind the aim of the dispute settlement system. This aim is to resolve the matter at issue and ‘to secure a positive solution to a dispute’. To provide only a partial resolution of the matter at issue would be false judicial economy. A panel has to address those claims on which a finding is necessary in order to enable the DSB to make sufficiently precise recommendations and rulings so as to allow for prompt compliance by a Member with those recommendations and rulings ‘in order to ensure effective resolution of disputes to the benefit of all Members.’”(1466)

1039.     In Japan — Agricultural Products, the Appellate Body found an error of law in the Panel’s exercise of judicial economy. As in Australia — Salmon, the Appellate Body found that the Panel had exercised “false” judicial economy and had provided only a partial resolution of the dispute before it:

“We note that there is an error of logic in the Panel’s finding in paragraph 8.63. The Panel stated that it had found earlier in its Report that the varietal testing requirement violates Article 2.2, and that there was, therefore, no need to examine whether the measure at issue was based on a risk assessment in accordance with Articles 5.1 and 5.2 of the SPS Agreement. We note, however, that the Panel’s finding of inconsistency with Article 2.2 only concerned the varietal testing requirement as it applies to apples, cherries, nectarines and walnuts. With regard to the varietal testing requirement as it applies to apricots, pears, plums and quince, the Panel found that there was insufficient evidence before it to conclude that this measure was inconsistent with Article 2.2. The Panel, therefore, made an error of logic when it stated, in general terms, that there was no need to examine whether the varietal testing requirement was consistent with Article 5.1 because this requirement had already been found to be inconsistent with Article 2.2. With regard to the varietal testing requirement as it applies to apricots, pears, plums and quince, there was clearly still a need to examine whether this measure was inconsistent with Article 5.1. By not making a finding under Article 5.1 with regard to the varietal testing requirement as it applies to apricots, pears, plums and quince, the Panel improperly applied the principle of judicial economy. We believe that a finding under Article 5.1 with respect to apricots, pears, plums and quince is necessary ‘in order to ensure effective resolution’ of the dispute.”(1467)

1040.     In Argentina — Ceramic Tiles, the Panel declined to exercise judicial economy despite its finding under Article 6.8 of the Anti-Dumping Agreement that “cast doubt on the entire final determination of dumping” by the investigating authorities. The Panel indicated that “[m]indful of the Appellate Body’s comments in [Australia — Salmon],(1468) we will continue with our analysis of the other claims made before us ‘because it could prove of utility depending on any appeal’(1469) and in order ‘to enable the DSB to make sufficiently precise recommendations and rulings so as to allow for prompt compliance with those recommendations and rulings’.(1470)”(1471)

G. Amicus Curiae Briefs

1. Access to the dispute settlement process by non-WTO members

1041.     In connection with the access to the WTO dispute settlement process, the Appellate Body in US — Shrimp emphasized that such access and the legal right to have one’s submission considered by a panel existed only in respect of WTO Members:(1472)

“It may be well to stress at the outset that access to the dispute settlement process of the WTO is limited to Members of the WTO. This access is not available, under the WTO Agreement and the covered agreements as they currently exist, to individuals or international organizations, whether governmental or non-governmental. Only Members may become parties to a dispute of which a panel may be seized, and only Members ‘having a substantial interest in a matter before a panel’ may become third parties in the proceedings before that panel.(1473) Thus, under the DSU, only Members who are parties to a dispute, or who have notified their interest in becoming third parties in such a dispute to the DSB, have a legal right to make submissions to, and have a legal right to have those submissions considered by, a panel. Correlatively, a panel is obliged in law to accept and give due consideration only to submissions made by the parties and the third parties in a panel proceeding. These are basic legal propositions; they do not, however, dispose of the issue here presented by the appellant’s first claim of error. We believe this interpretative issue is most appropriately addressed by examining what a panel is authorized to do under the DSU.”(1474)

1042.     In Turkey — Textiles, Turkey argued that India should have directed its complaint against the customs union between Turkey and the European Communities instead of directing it solely against Turkey. Turkey argued that it was not responsible for actions collectively taken by the members of the customs union through the institutions created by the agreement. The Panel did not accept this argument and ultimately held that the measures at issue had been taken by Turkey. See also paragraphs 171 and 323–325 above. The Panel also emphasized that the customs union between Turkey and the European Communities did not have standing under WTO law:

“[T]he WTO dispute settlement system is based on Members’ rights; is accessible to Members only; and is enforced and monitored by Members only. The Turkey-EC customs union is not a WTO Member, and in that respect does not have any autonomous legal standing for the purpose of WTO law and therefore its dispute settlement procedures. Moreover, the European Communities’ import restrictions appear a priori to be WTO compatible and could not be the object of any panel recommendation that the European Communities brings its measure into conformity with the WTO Agreement, as required by Article 19 of the DSU.”(1475)

2. Authority to admit amicus curiae briefs

1043.     In US — Shrimp, the Appellate Body found that the Panel had erred in its legal interpretation of Article 13 of the DSU and held that accepting non-requested information from non-governmental sources was not incompatible with the provisions of the DSU. The Appellate Body emphasized the “comprehensive nature” of a panel’s authority to seek information in the context of a dispute:

“The comprehensive nature of the authority of a panel to ‘seek’ information and technical advice from ‘any individual or body’ it may consider appropriate, or from ‘any relevant source’, should be underscored. This authority embraces more than merely the choice and evaluation of the source of the information or advice which it may seek. A panel’s authority includes the authority to decide not to seek such information or advice at all. We consider that a panel also has the authority to accept or reject any information or advice which it may have sought and received, or to make some other appropriate disposition thereof. It is particularly within the province and the authority of a panel to determine the need for information and advice in a specific case, to ascertain the acceptability and relevancy of information or advice received, and to decide what weight to ascribe to that information or advice or to conclude that no weight at all should be given to what has been received.

The thrust of Articles 12 and 13, taken together, is that the DSU accords to a panel established by the DSB, and engaged in a dispute settlement proceeding, ample and extensive authority to undertake and to control the process by which it informs itself both of the relevant facts of the dispute and of the legal norms and principles applicable to such facts. That authority, and the breadth thereof, is indispensably necessary to enable a panel to discharge its duty imposed by Article 11 of the DSU to ‘make an objective assessment of the matter before it, including an objective assessment of the facts of the case and the applicability of and conformity with the relevant covered agreements ….’ (emphasis added)”(1476)

1044.     In US — Lead and Bismuth II, the Appellate Body considered that as long as it acts consistently with the provisions of the DSU and the covered agreements, the Appellate Body also has the legal authority pursuant to Article 17.9 of the DSU to decide whether or not to accept and consider any information that it believes is relevant and useful in an appeal:

“In considering this matter, we first note that nothing in the DSU or the Working Procedures specifically provides that the Appellate Body may accept and consider submissions or briefs from sources other than the participants and third participants in an appeal. On the other hand, neither the DSU nor the Working Procedures explicitly prohibit[s] acceptance or consideration of such briefs…. [Article 17.9] makes clear that the Appellate Body has broad authority to adopt procedural rules which do not conflict with any rules and procedures in the DSU or the covered agreements. Therefore, we are of the opinion that as long as we act consistently with the provisions of the DSU and the covered agreements, we have the legal authority to decide whether or not to accept and consider any information that we believe is pertinent and useful in an appeal.”(1477)

1045.     In US — Lead and Bismuth II, the Appellate Body drew a distinction between, on the one hand, parties and third parties to a dispute, which have a legal right to participate in panel and Appellate Body proceedings, and, on the other hand, private individuals and organizations, which are not Members of the WTO, and which, therefore, do not have a legal right to participate in dispute settlement proceedings:

“We wish to emphasize that in the dispute settlement system of the WTO, the DSU envisages participation in panel or Appellate Body proceedings, as a matter of legal right, only by parties and third parties to a dispute. And, under the DSU, only Members of the WTO have a legal right to participate as parties or third parties in a particular dispute….

Individuals and organizations, which are not Members of the WTO, have no legal right to make submissions to or to be heard by the Appellate Body. The Appellate Body has no legal duty to accept or consider unsolicited amicus curiae briefs submitted by individuals or organizations, not Members of the WTO. The Appellate Body has a legal duty to accept and consider only submissions from WTO Members which are parties or third parties in a particular dispute.”(1478)

1046.     The Appellate Body on US — Lead and Bismuth II further explained that participation by private individuals and organizations is dependent upon the Appellate Body permitting such participation if it finds it useful to do so:

“[W]e have the legal authority under the DSU to accept and consider amicus curiae briefs in an appeal in which we find it pertinent and useful to do so. In this appeal, we have not found it necessary to take the two amicus curiae briefs filed into account in rendering our decision.”(1479)

1047.     In EC — Sardines, the Appellate Body received for the first time an amicus curiae brief from a WTO Member, Morocco, that had not exercised its third-party rights at the panel stage of the proceedings. The Appellate Body found that it was entitled to accept the amicus curiae brief submitted by Morocco, and to consider it. However, the Appellate Body emphasized that, in accepting the brief filed by Morocco in this appeal, it was not suggesting that each time a Member files such a brief it was required to accept and consider it. The Appellate Body indicated that it could well exercise its discretion to reject an amicus curiae brief if, by accepting it, this would interfere with the “fair, prompt and effective resolution of trade disputes”:

“As we explained in US — Lead and Bismuth II, the DSU gives WTO Members that are participants and third participants a legal right to participate in appellate proceedings.(1480) In particular, WTO Members that are third participants in an appeal have the right to make written and oral submissions. The corollary is that we have a duty, by virtue of the DSU, to accept and consider these submissions from WTO Members. By contrast, participation as amici in WTO appellate proceedings is not a legal right, and we have no duty to accept any amicus curiae brief. We may do so, however, based on our legal authority to regulate our own procedures as stipulated in Article 17.9 of the DSU. The fact that Morocco, as a sovereign State, has chosen not to exercise its right to participate in this dispute by availing itself of its third-party rights at the panel stage does not, in our opinion, undermine our legal authority under the DSU and our Working Procedures to accept and consider the amicus curiae brief submitted by Morocco.

Therefore, we find that we are entitled to accept the amicus curiae brief submitted by Morocco, and to consider it. We wish to emphasize, however, that, in accepting the brief filed by Morocco in this appeal, we are not suggesting that each time a Member files such a brief we are required to accept and consider it. To the contrary, acceptance of any amicus curiae brief is a matter of discretion, which we must exercise on a case-by-case basis. We recall our statement that:

The procedural rules of WTO dispute settlement are designed to promote … the fair, prompt and effective resolution of trade disputes.(1481)

Therefore, we could exercise our discretion to reject an amicus curiae brief if, by accepting it, this would interfere with the ‘fair, prompt and effective resolution of trade disputes.’ This could arise, for example, if a WTO Member were to seek to submit an amicus curiae brief at a very late stage in the appellate proceedings, with the result that accepting the brief would impose an undue burden on other participants.”(1482)

3. Appellate Body additional procedure for amicus curiae briefs

1048.     In EC — Asbestos, the Appellate Body adopted an additional procedure, for the purposes of this appeal only, pursuant to Rule 16(1) of its Working Procedures, to deal with any possible submissions received from amici curiae. The additional procedure was posted on the WTO website on 8 November 2000 and provided as follows:

“1.     In the interests of fairness and orderly procedure in the conduct of this appeal, the Division hearing this appeal has decided to adopt, pursuant to Rule 16(1) of the Working Procedures for Appellate Review, and after consultations with the parties and third parties to this dispute, the following additional procedure for purposes of this appeal only.

2.     Any person, whether natural or legal, other than a party or a third party to this dispute, wishing to file a written brief with the Appellate Body, must apply for leave to file such a brief from the Appellate Body by noon on Thursday, 16 November 2000.

3.     An application for leave to file such a written brief shall:

(a)     be made in writing, be dated and signed by the applicant, and include the address and other contact details of the applicant;

(b)     be in no case longer than three typed pages;

(c)     contain a description of the applicant, including a statement of the membership and legal status of the applicant, the general objectives pursued by the applicant, the nature of the activities of the applicant, and the sources of financing of the applicant;

(d)     specify the nature of the interest the applicant has in this appeal;

(e)     identify the specific issues of law covered in the Panel Report and legal interpretations developed by the Panel that are the subject of this appeal, as set forth in the Notice of Appeal (WT/DS135/8) dated 23 October 2000, which the applicant intends to address in its written brief;

(f)     state why it would be desirable, in the interests of achieving a satisfactory settlement of the matter at issue, in accordance with the rights and obligations of WTO Members under the DSU and the other covered agreements, for the Appellate Body to grant the applicant leave to file a written brief in this appeal; and indicate, in particular, in what way the applicant will make a contribution to the resolution of this dispute that is not likely to be repetitive of what has been already submitted by a party or third party to this dispute; and

(g)     contain a statement disclosing whether the applicant has any relationship, direct or indirect, with any party or any third party to this dispute, as well as whether it has, or will, receive any assistance, financial or otherwise, from a party or a third party to this dispute in the preparation of its application for leave or its written brief.

5.     The Appellate Body will review and consider each application for leave to file a written brief and will, without delay, render a decision whether to grant or deny such leave.

6.     The grant of leave to file a brief by the Appellate Body does not imply that the Appellate Body will address, in its Report, the legal arguments made in such a brief.

7.     Any person, other than a party or a third party to this dispute, granted leave to file a written brief with the Appellate Body, must file its brief with the Appellate Body Secretariat by noon on Monday, 27 November 2000.

8.     A written brief filed with the Appellate Body by an applicant granted leave to file such a brief shall:

(a)     be dated and signed by the person filing the brief;

(b)     be concise and in no case longer than 20 typed pages, including any appendices; and

(c)     set out a precise statement, strictly limited to legal arguments, supporting the applicant’s legal position on the issues of law or legal interpretations in the Panel Report with respect to which the applicant has been granted leave to file a written brief.

8.     An applicant granted leave shall, in addition to filing its written brief with the Appellate Body Secretariat, also serve a copy of its brief on all the parties and third parties to the dispute by noon on Monday, 27 November 2000.

9.     The parties and the third parties to this dispute will be given a full and adequate opportunity by the Appellate Body to comment on and respond to any written brief filed with the Appellate Body by an applicant granted leave under this procedure.” (original emphasis)(1483)

4. Admission/rejection of amicus curiae briefs

1049.     In US — Shrimp, the Appellate Body admitted three amicus curiae briefs that were attached as exhibits to the appellant’s submission in that appeal. The Appellate Body concluded that those briefs formed part of the appellant’s submission, and observed that it was for a participant in an appeal to determine for itself what to include in its submission.(1484)

1050.     In EC — Asbestos, the Panel received several written submissions from non-governmental organizations. The Panel issued a preliminary ruling informing the parties that, in the light of the European Communities’ decision to incorporate into its own submissions the amicus briefs submitted by two organizations, the Panel would consider these two documents on the same basis as the other documents furnished by the European Communities in this dispute. At the second substantive meeting of the Panel with the parties, the Panel gave Canada the opportunity to reply, in writing or orally, to the arguments set forth in these two amicus briefs. At that same meeting, the Panel also informed the parties that it had decided not to take into consideration the other amicus briefs submitted.(1485) At the appeal stage, the Appellate Body adopted an additional procedure, for the purposes of this appeal only, pursuant to Rule 16(1) of its Working Procedures, to deal with any possible submissions received from amici curiae. With respect to the additional procedures, see Section XXXVI.G.3 above. Pursuant to the additional procedure, the Appellate Body received 17 applications requesting leave to file a written brief in this appeal. Six of these 17 applications were received after the deadline specified in the additional procedure and, for this reason, leave to file a written brief was denied to these six applicants. The other 11 applications were considered by the Appellate Body but finally denied for failure to comply sufficiently with all the requirements set forth in paragraph 3 of the Additional Procedure.(1486)

1051.     In Thailand — H-Beams, an industry association submitted an amicus brief which cited Thailand’s confidential submission. Thailand then claimed that Poland’s private counsel might have violated WTO rules of confidentiality by providing Thailand’s submission to the said association. Although Poland and the lawyer concerned denied the alleged breach of confidentiality, the Appellate Body issued a preliminary ruling rejecting the amicus brief. See Section XVIII.B.1(b) above.

1052.     In EC — Sardines, the Appellate Body received for the first time an amicus curiae brief from a WTO Member, Morocco, that had not exercised its third-party rights at the panel stage of the proceedings. The Appellate Body found that it was entitled to accept the amicus curiae brief submitted by Morocco, and to consider it. See paragraph 1047 above in this regard.(1487)

1053.     In US — Countervailing Measures on Certain EC Products, the Appellate Body received an amicus curiae brief from a United States’ industry association. The Appellate Body did not take it into account on the grounds that they did not find it to be of assistance in the appeal.(1488)

1054.     In US — Steel Safeguards, the Appellate Body received an amicus curiae brief from an industry association, the American Institute for International Steel. The Appellate Body did not take it into account on the grounds that it was primarily directed to a question that was not part of any of the claims and thus the Appellate Body did not find it to be of assistance in the appeal.(1489)

1055.     In US — Softwood Lumber IV, the Appellate Body received two amicus curiae briefs from the Indigenous Network on Economies and Trade (Canada) and jointly from Defenders of Wildlife, Natural Resources Defense Council and Northwest Ecosystem Alliance (United States). The Appellate Body did not find it necessary to take the two amicus curiae briefs into account in rendering its decision on the grounds that these briefs dealt with questions not addressed in the submissions of the participants or third participants and that no participant or third participant adopted the arguments made in these briefs.(1490)