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ON THIS PAGE:
> US — Upland Cotton, paras. 272-273
> EC — Export Subsidies on Sugar, para. 332
> US — Anti-Dumping Measures on Oil Country Tubular
Goods, para. 189
> US — Anti-Dumping Measures on Oil Country Tubular Goods,
para. 220
> EC — Selected Customs Matters,
paras. 134-135
> US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina), para. 183 and footnote 383
> US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina), para. 184
> India — Additional Import Duties, paras. 229-230
> EC — Bananas III (Article 21.5 — Ecuador II) / EC
— Bananas III (Article 21.5 — US), paras. 321-323, 325
> US — Zeroing (EC) (Article 21.5 — EC), paras. 468
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I.0.1 US — Upland Cotton,
paras. 272-273 back to top
(WT/DS267/AB/R)
The question whether an expired measure is susceptible to a
recommendation under Article 19.1 of the DSU is a different matter. The
Appellate Body in US — Certain EC Products confirmed that the 3
March Measure had ceased to exist. It noted that there was an obvious
inconsistency between the finding of the panel that “the 3 March
Measure is no longer in existence” and the panel’s subsequent
recommendation that the Dispute Settlement Body (the “DSB”) request
the United States to bring the 3 March Measure into conformity with its
WTO obligations. Thus, the fact that a measure has expired may affect
what recommendation a panel may make. It is not, however, dispositive of
the preliminary question of whether a panel can address claims in
respect of that measure.
… Article 7.8 of the SCM Agreement provides that, where it
has been determined that “any subsidy has resulted in adverse
effects to the interests of another Member”, the subsidizing Member
must “take appropriate steps to remove the adverse effects or …
withdraw the subsidy” (emphasis added). The use of the word “resulted”
suggests that there could be a time-lag between the payment of a subsidy
and any consequential adverse effects. If expired measures underlying
past payments could not be challenged in WTO dispute settlement
proceedings, it would be difficult to seek a remedy for such adverse
effects. Further — in contrast to Articles 3.7 and 19.1 of the DSU —
the remedies under Article 7.8 of the SCM Agreement for adverse
effects of a subsidy are (i) the withdrawal of the subsidy or (ii)
the removal of adverse effects. Removal of adverse effects through
actions other than the withdrawal of a subsidy could not occur if the
expiration of a measure would automatically exclude it from a panel’s
terms of reference.
I.0.2 EC — Export Subsidies on Sugar,
para. 332 back to top
(WT/DS265/AB/R, WT/DS266/AB/R, WT/DS283/AB/R)
Under Article 19.1 of the DSU, where a panel “concludes that a
measure is inconsistent with a covered agreement, it shall recommend
that the Member concerned bring the measure into conformity with that
agreement” (footnote omitted). The panel is not required to make a
recommendation as to how the Member should implement its obligations or
as to the timeframe for implementation. However, Article 19.1 also
provides that “[a] panel or [the] Appellate Body may suggest
ways in which the Member concerned could implement the recommendations”
(emphasis added).
I.0.3 US — Anti-Dumping Measures on Oil Country Tubular Goods,
para. 189 back to top
(WT/DS282/AB/R)
The facts of the present appeal are quite different from those in EC
— Export Subsidies on Sugar. First, the Appellate Body’s finding
of non-compliance with Article 11 of the DSU in that dispute related to
the obligation of panels to make a recommendation under Article 4.7 of
the Agreement on Subsidies and Countervailing Measures (the “SCM
Agreement”) regarding the time period for withdrawal of a
prohibited subsidy. The Anti-Dumping Agreement has no provision
similar to Article 4.7 of the SCM Agreement that panels must
follow. The applicable provision in the present dispute regarding
suggestions for implementation is the second sentence of Article 19.1 of
the DSU, which Mexico does not rely on in this appeal, and which, in any
event, does not oblige panels to make such a suggestion. Secondly, the
panel’s error in EC — Export Subsidies on Sugar was in
wrongly exercising judicial economy — that is, failing to rule on a
claim before it. The Panel in the present dispute did not exercise
judicial economy with respect to Mexico’s claim that the USDOC acted
inconsistently with Article 11.3 of the Anti-Dumping Agreement in
the sunset review of the anti-dumping duty order on OCTG from Mexico. On
the contrary, as noted above, the Panel upheld Mexico’s claim of
inconsistency.
I.0.4 US — Anti-Dumping Measures on Oil Country Tubular Goods,
para. 220 back to top
(WT/DS282/AB/R)
As there is no appeal from the Panel’s finding that the USDOC’s
likelihood-of-dumping determination in the sunset review at issue in
this dispute was inconsistent with Article 11.3 of the Anti-Dumping
Agreement, we do not make any additional recommendation
regarding that finding. Given that we have not found in this Report that
the United States acted inconsistently with any of its WTO obligations,
we make no recommendation to the DSB pursuant to Article 19.1 of the DSU
in this regard.
I.0.5 EC — Selected Customs Matters,
paras. 134-135
back to top
(WT/DS315/AB/R)
The Panel considered that, when a violation of Article X:3(a) of the
GATT 1994 is claimed, the measure at issue must necessarily be a “manner
of administration” because, if such a violation is found, the WTO
Member concerned would need to alter the manner of administration in
order to comply with a recommendation made pursuant to Article 19.1 of
the DSU. In our view, this reasoning of the Panel is flawed because it
conflates the threshold question of whether a measure falls within a
panel’s terms of reference with the question of the means of
implementation in the event that a violation is found. Through the
recommendation under Article 19.1, the Member found to have violated a
provision of a covered agreement is required to take corrective action
to remove the violation. The recommendation envisaged in Article 19.1
concerns the stage of implementation and not the question of whether a
measure falls within a panel’s terms of reference. Moreover, the
Member concerned has a degree of discretion with respect to the nature
and type of action that it undertakes in order to achieve compliance.
Therefore, we have difficulty in understanding how the means of
compliance with a recommendation under Article 19.1 of the DSU should
govern the identification of the specific measure at issue in a panel
request. We agree, in this respect, with the United States that “[t]he
mere fact that a breach of Article X:3(a) may be removed by changing a
law’s administration is not a basis for concluding that the law is not
the measure at issue.”
… In [US — Upland Cotton], the
Appellate Body had to address the issue of whether an expired measure
can be a “measure at issue” within the meaning of Article 6.2 of the
DSU. The Appellate Body rejected the United States’ argument that,
because an expired measure is not susceptible to a recommendation under
Article 19.1 of the DSU, it cannot be a “measure at issue” under
Article 6.2. For the Appellate Body, the question of whether a panel can
address claims in respect of an expired measure is to be distinguished
from the question of whether that measure is susceptible to a
recommendation under Article 19.1. … the Appellate Body’s
reasoning in US — Upland Cotton supports our position that
Article 19.1 of the DSU does not place restrictions on the type of
measure that can be identified in a panel request under Article 6.2 of
the DSU.
I.0.6 US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina),
para. 183 and footnote 383 back to top
(WT/DS268/AB/RW)
… The Panel’s explanation is brief, but it is sufficient to
convey that the Panel considered Argentina’s request and that, in the
light of the discretionary nature of the authority to make a suggestion,
the Panel declined to exercise that discretion. The discretionary nature
of the authority to make a suggestion under Article 19.1 must be kept in
mind when examining the sufficiency of a panel’s decision not to
exercise such authority. However, it should not relieve a panel from
engaging with the arguments put forward by a party in support of such a
request. In the present case, Argentina offered several reasons in
support of its request for a suggestion. Although it would have been advisable for the Panel to articulate
more clearly the reasons why it declined to exercise its discretion to
make a suggestion, this does not mean that Panel’s exercise of its
discretion was improper, and, thus, even assuming arguendo that
Articles 11 and 12.7 were applicable to a request for suggestion, we do
not consider that, in the circumstances of this case, the Panel failed
to fulfil its duties under those provisions.383
I.0.7 US — Oil Country Tubular Goods Sunset Reviews (Article 21.5 — Argentina),
para. 184 back to top
(WT/DS268/AB/RW)
We noted earlier that Articles 19.1 and 21.3 of the DSU suggest that
alternative means of implementation may exist and that the choice
belongs, in principle, to the implementing Member. In addition, we
indicated that several systemic questions arise in connection with the
implementation of DSB recommendations and rulings in cases where a
sunset review was found to be inconsistent with Articles 11.3 and 11.4
of the Anti-Dumping Agreement. These complex questions are
implicated in Argentina’s request for a suggestion that the United
States terminate the anti-dumping duty order. We believe that these
questions are beyond the scope of the issues raised by the participants
in this appeal and, furthermore, we do not consider that we should
resolve them in the context of considering a request for a suggestion
under Article 19.1 of the DSU. For these reasons, we decline Argentina’s
request that we make a suggestion on how the United States could
implement the recommendations in this case.
I.0.8 India — Additional Import Duties,
paras. 229-230
back to top
(WT/DS360/AB/R)
We do not agree with India’s argument that the Panel’s “concluding
remarks” amount to a legal finding or a recommendation within the
meaning of the first sentence of Article 19.1, or a suggestion regarding
implementation within the meaning of the second sentence of Article 19.1
of the DSU. Rather, the Panel did not find a breach of Articles II:1(a)
and II:1(b), and made it clear that it was making “no recommendation
under Article 19.1 of the DSU”. As there was nothing to implement, it
is difficult to see why the Panel would have made a “suggestion” on
implementation. In addition, the Panel recalled its finding that the
customs notifications to which it referred in its “concluding remarks”
were outside its terms of reference, and that it, therefore, “did not
assess their impact upon the WTO-consistency of the [Additional Duty] on
alcoholic liquor and the [Extra-Additional Duty]”.
The Panel’s “concluding remarks” do not amount to findings,
conclusions, or recommendations regarding the WTO-conformity of the new
customs notifications issued by India. Instead, they are simply
explanations of the Panel’s conclusions, which are permissible, but not findings in and of themselves. We find
that the Panel did not act contrary to Articles 3.2, 11, and 19 of
the DSU in providing “concluding remarks” in paragraph 8.2 of the
Panel Report.
I.0.9 EC — Bananas III (Article 21.5 — Ecuador II) / EC — Bananas III (Article 21.5 — US),
paras. 321-323, 325
back to top
(WT/DS27/AB/RW2/ECU,
WT/DS27/AB/RW/USA, WT/DS27/AB/RW2/ECU/Corr.1,
WT/DS27/AB/RW/USA/Corr.1)
Suggestions made by panels or the Appellate Body pursuant to Article
19.1 of the DSU regarding ways of implementation form part of panel or
Appellate Body reports adopted by the DSB in previous proceedings. The
DSU does not expressly address the question of the legal status of
suggestions that form part of a report adopted by the DSB, nor does it
specify the legal consequences when a Member chooses to implement DSB
recommendations and rulings by following a suggestion for
implementation. A Member may choose whether or not to follow a
suggestion. The use of the term “could” in Article 19.1 clarifies
that Members are not obliged to follow suggestions for implementation.
Suggestions made pursuant to Article 19.1 are not in themselves the
subject of review by a compliance panel. Article 21.5 of the DSU only
refers to “measures taken to comply with the recommendations and
rulings” and not to measures taken to comply with suggestions issued
pursuant to the second sentence of Article 19.1. This confirms that an
Article 21.5 panel’s power of review is limited to the assessment of
the existence or consistency with the covered agreements of the measures
taken to comply with recommendations and rulings of the DSB. Thus, what
matters in Article 21.5 proceedings is whether the result of
implementation — whatever means are chosen — brings about
substantive compliance with the DSB recommendations and rulings. As the
Panel noted, the conformity of the measures taken to comply with the
covered agreements will depend on whether actual implementation of the
DSB recommendations and rulings has been achieved by the Member
concerned. Therefore, we agree with the Panel that the measures actually
taken by a Member to comply with DSB recommendations and rulings,
whether or not they follow the suggestions for implementation made in
previous proceedings, are the subject matter of the challenge in Article
21.5 proceedings.
We consider that suggestions made by panels or the Appellate Body
may, if correctly and fully implemented, lead to compliance with the DSB’s
recommendations and rulings. However, full compliance with DSB rulings
and WTO-consistency of the measures actually taken to comply cannot be
presumed simply because a Member declares that its measures taken to
comply conform to a suggestion made under Article 19.1 of the DSU. As
pointed out above, Article 21.5 proceedings focus on the measure
actually taken to comply, not the ways in which the Member could
implement the recommendations and rulings. Following a suggestion does
not guarantee substantive compliance with the recommendations and
rulings by the DSB. Whether such compliance has been achieved needs to
be determined through Article 21.5 proceedings. The adoption of a panel
or Appellate Body report by the DSB makes the recommendations and
rulings therein binding upon the parties. As noted earlier, such adoption by the DSB does not make suggestions for
implementation binding upon the parties (especially, where, as in this
case, the first Ecuador Article 21.5 panel made several suggestions);
nor does DSB adoption mean that actions taken to implement suggestions
must be presumed to be WTO-consistent or shielded from review in Article
21.5 proceedings.
…
Suggestions made by panels or the Appellate Body may provide useful
guidance and assistance to Members and facilitate implementation of DSB
recommendations and rulings, particularly in complex cases. However, the
fact that a Member has chosen to follow a suggestion does not create a
presumption of compliance in Article 21.5 proceedings. The fact that a
Member has chosen to follow a suggestion is part of the history and
background of the measure at issue in Article 21.5 proceedings, but it
should not in itself pre-empt a panel’s assessment of compliance under
Article 21.5. In our view, suggestions provide guidance, which is
necessarily prospective in nature and cannot, therefore, take account of
all circumstances in which implementation may occur.
I.0.10 US — Zeroing (EC) (Article 21.5 — EC),
paras. 468
back to top
(WT/DS294/AB/RW, WT/DS294/AB/RW/Corr.1)
In the light of [our] findings, we do not consider that the
suggestion the European Communities is requesting us to make would
provide useful guidance or facilitate the implementation of the
recommendations and rulings of the DSB. Therefore, we decline the
European Communities’ request for a suggestion under Article 19.1 of
the DSU.
383. In the light of the above, we need not decide here
whether the requirements of Articles 11 and 12.7 are applicable to a panel’s
consideration of a request for a suggestion pursuant to Article 19.1 of the DSU.
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