Cases Reported under GATT & WTO 1. United States Restrictions imposed on exports to Czeckoslovakia.

Aplication was made by Government of Czeckoslovakia to the Panel of experts under GATT. Request of Government of Czechoslovakia for a decision under Article XXIII as to whether or not the Government of United States of America failed to carry out its obligations under the Agreement through its administration to issue of export license. Mr. AUGENTHALER (Czechoslovakia) read a reply (GATT/CP.3/39) to the speech by the representative of the United States (GATT/CP.3/38), and in addition called attention to the possible effects on international trade if an unfavourable decision were given to the Czechoslovakian application. He said it was not only exports that might be unduly controlled on the pretext of national security; on the ground that security could be undermined by dependence on foreign supplies, a country might similarly restrict its imports, either discriminatorily or otherwise, by invoking the security clause of the Agreement. This would encourage the tendency towards autarky which the Agreement professed to eliminate. Mr. EVANS (United States of America), referring to the last section of the 4th paragraph ofMr. Augenthaler's reply, said that if at any time it were thought that a decision had been based on false premises, the interested party could have recourse to the appeal board which was instituted for that purpose. In reply to the question asked by Mr. Augenthaler as to whether the regulations requiring export licences for the export of goods to certain countries but not to others, did not contravene the provisions of Article I, Mr. Evans remarked that the provisions of Article I would not require uniformity of formalities, as applied to different countries, in respect of restrictions imposed for security reasons. In conclusion he said that since no new facts had been presented by the Czechoslovakian representative beyond what had already been given in the original statement, he would repeat his proposal that the CONTRACTING PARTIES dismiss the request on the ground that the charge was not supported by facts.

The CHAIRMAN, in summing up, concluded that if a decision must be made under paragraph 2 of Article XXIII, it should be understood that the consultation referred to in paragraph 1 of the Article had already taken place. Under paragraph 2, the CONTRACTING PARTIES should promptly investigate,and should either make an appropriate recommendation to the contracting parties concerned or give a ruling on the matter as appropriate. The complaint made by Czechoslovakia was based on Articles I and XXI and the United States justified any discrimination which might have occurred on the basis of Articles XX and XXI and particularly on the ground of security covered by the latter. The proposal for a Working Party to be set up to examine the issue had not found support during the discussions, and the representatives of Cuba and Pakistan had spoken against this suggestion. The CONTRACTING PARTIES, therefore, should give a decision in accordance with paragraph 2 of Article XXIII at the present meeting. The Czechoslovakian representative had posed the question of whether or not such regulations conform to the provisions of Article I. The Chairman, however, was of the opinion that the question was not appropriately put because the United States Government had defended its actions under Articles XX and XXI which embodied exceptions to the general rule contained in Article I. The question should be put as expressed in the Agenda item, i.e. whether the Government of the UnitedStates had failed to carry out its obligations under the Agreement through its administration of the issue of export licences. 2. Complaint by Canada. On 1 December 2008, Canada requested consultations with the United States concerning certain mandatory country of origin labelling (COOL) provisions in the Agricultural Marketing Act of 1946 as amended by the 2008 Farm Bill and as implemented through an Interim Final Rule of 28 July 2008. These include the obligation to inform consumers at the retail level of the country of origin in respect of covered commodities, including beef and pork. The eligibility for a designation of a covered commodity as exclusively having a US origin can only be derived from an animal that was exclusively born, raised and slaughtered in the United States. This would exclude such a designation in respect of beef or pork derived from livestock that is exported to the United States for feed or immediate slaughter.

Canada alleges that the mandatory COOL provisions appear to be inconsistent with the United States' obligations under the WTO Agreement, including:

Articles

III:4,

IX:4

and

X:3

of

the

GATT

1994;

Article 2 of the TBT Agreement, or, in the alternative, Articles 2, 5 and 7 of the SPS Agreement; and Article 2 of the Agreement on Rules of Origin.

On 12 December 2008, Mexico and Nicaragua requested to join the consultations. Subsequently, the United States informed the DSB that it had accepted the request of Mexico to join the consultations. On 7 May 2009, Canada requested further consultations concerning related amendments and measures adopted by the United States after Canada's initial request for consultations. It also includes any modifications or amendments to the COOL measures, including any further implementing guidance or other documents that may be published in relation to such measures. Canada considers that the cited measures appear to be inconsistent with the United States' obligations under the WTO Agreement, including:

Articles

III:4,

IX:2,

IX:4

and

X:3

of

GATT

1994;

Article 2 of the TBT Agreement, or, in the alternative, Articles 2, 5 and 7 of the SPS Agreement; and Article 2 of the Agreement on Rules of Origin.

On 15 May 2009, Mexico requested to join the further consultations. On 22 May 2009, Peru requested to join the further consultations. Subsequently, the United States informed the DSB that it had accepted the requests of Mexico and Peru to join the consultations. On 7 October 2009, Canada requested the establishment of a panel. At its meeting on 23 October 2009, the DSB deferred the establishment of a panel.

Panel and Appellate Body proceedings At its meeting on 19 November 2009, the DSB established a single panel pursuant to Article 9.1 of the DSU, to examine this dispute and dispute DS386. Argentina, Australia, China, Colombia, India, Japan, Korea, Mexico, Peru and New Zealand reserved their third-party rights. Subsequently, Brazil, the European Communities, Guatemala and Chinese Taipei reserved their third-party rights. On 30 April 2010, Canada requested the Director-General to compose the panel. On 10 May 2010, the Director-General composed the panel. On 21 December 2010, the Chairman of the panel informed the DSB that it would not be able to issue its report within six months. The timetable adopted by the Panel after consultations with the parties to the dispute envisaged that the final report shall be issued to the parties by the middle of 2011. The panel expects to conclude its work within that timeframe. On 18 November 2011, the panel report was circulated to Members. Summary of key findings

This dispute concerns: (i) the US statutory provisions and implementing regulations setting out the United States' mandatory country of origin labelling regime for beef and pork (COOL measure); as well as (ii) a letter issued by the US Secretary of Agriculture Vilsack on the implementation of the COOL measure (Vilsack letter). The Panel determined that the COOL measure is a technical regulation under the TBT Agreement, and that it is inconsistent with the United States' WTO obligations. In particular, the Panel found that the COOL measure violates Article 2.1 of the TBT Agreement by according less favourable treatment to imported Canadian cattle and hogs than to like domestic products. The Panel also found that the COOL measure does not fulfil its legitimate objective of providing consumers with information on origin, and therefore violates Article 2.2 of the TBT Agreement. As regards the Vilsack letter, the Panel found that the letter's suggestions for voluntary action went beyond certain obligations under the COOL measure, and that the letter therefore constitutes unreasonable administration of the COOL measure in violation of Article X:3(a) of the

GATT 1994. The Panel refrained from reviewing the Vilsack letter under the TBT Agreement, as it found that this letter is not a technical regulation under that agreement.

In light of the above findings of violation, the Panel did not consider it necessary to rule on the claims under Article III:4 of the GATT 1994 (national treatment) or on the non-violation claims under Article XXIII:1(b) of the GATT 1994.

3. Turkey Safeguard measures on imports of cotton yarn (other than sewing thread Complaint by India. On 13 February 2012, India requested consultations with Turkey regarding certain safeguard measures on imports of cotton yarn (other than sewing thread) from all origins. India challenges the definitive safeguard measures on imports of cotton yarn (other than sewing thread) imposed by Turkey with effect from 15 July 2008 for a period of three years. It also challenges the provisional safeguard measures imposed by Turkey retroactively and challenges the extension of the period of application of the definitive safeguard measures retroactively. Finally, India challenges the underlying investigation, any amendments, replacements, related or implementing acts or measures to the above. With respect to the definitive and provisional safeguard measures imposed by Turkey, India alleges that Turkey imposed provisional safeguard measures without making the required determination in the relevant review and concluded such review by recommending the continuation of the measures. Concerning the extension of the safeguard measures, India believes that Turkey imposed the extension of the measures prior to making a determination, contrary to its obligations under the Agreement on Safeguards. India alleges violations of Articles 2, 2.1, 3, 3.1, 4, 4.1(c), 4.2(a), 4.2(b), 4.2(c), 5, 5.1, 6, 7, 7.1, 7.2, 7.3, 7.5, 8, 12 and 12.1(c) of the Agreement on Safeguards and Article XIX:1(a) of the GATT 1994.

4. DISPUTE SETTLEMENT: Argentina Measures Affecting Imports of Footwear Complaint by the United States. On 1 March 1999, the US requested consultations with Argentina in respect of certain measures implemented by Argentina affecting imports of footwear. The US contended that:

in November 1998, Argentina adopted Resolution 1506 modifying Resolution 987 of 10 September 1997, which had established safeguard duties on imports of footwear from non-MERCOSUR countries. Resolution 1506 allegedly imposes a tariff-rate quota (TRQ) on such footwear imports in addition to the safeguard duties previously imposed, postpones any liberalization of the original safeguard duty until 30 November 1999, and liberalizes the TRQ only once during the life of the measure; Argentina has not notified this measure to the Committee on Safeguards; and the United States alleged violations of Articles 5.1, 7.4 and 12 of the Agreement on Safeguards.

Panel and Appellate Body proceedings Further to the request of the United States, the DSB established a panel at its meeting of 26 July 1999. The panel has not yet been composed. See also complaint by Indonesia (WT/DS123) and complaint by the EC (WT/DS121).

5. European Communities Measures Prohibiting the Importation and Marketing of Seal Products Complaint by Norway.

On 5 November 2009, Norway requested consultations with the European Communities concerning Regulation (EC) No. 1007/2009 of the European Parliament and of the EC Council of 16 September 2009 on trade in seal products, and subsequent related measures (the EC seal regime). According to Norway, the EC seal regime prohibits the importation and sale of processed and unprocessed seal products, while containing certain exceptions that afford privileged access to the EU market to seal products originating in the EC and certain third countries, but not Norway. Norway claims that the above measures are inconsistent with the obligations of the European Communities under Article 4.2 of the Agriculture Agreement; Article 2.1 and 2.2 of the TBT Agreement; and Articles I:1, III:4 and XI:1 of the GATT 1994. On 16 November 2009, Iceland requested to join the consultations. On 20 November 2009, Canada requested to join the consultations. On 19 October 2010, Norway renewed its consultation request with respect to the EU seal regime, which, in addition to Regulation (EC) No. 1007/2009, also includes: Commission Regulation (EU) No. 737/2010 (laying down rules for the implementation of Regulation (EC) No. 1007/2009); omissions to adopt adequate procedures for establishing that seal products conforming to the relevant conditions in the EU seal regime may be placed on the EU market; and any other related implementing measures. Norway claims that the EU seal regime imposes a prohibition on the importation and sale of seal products and establishes certain exceptions that discriminate in favour of seal products originated in the EU and certain third countries. Norway further claims that the EU seal regime also includes elements of a system for certifying that seal products are in conformity with the relevant conditions for being placed on the EU market that is discriminatory and trade-restrictive in a number of respects. Moreover, Regulation (EC) No. 1007/2009 and requested supplementary consultations concerning Commission Regulation (EU) No. 737/2010 do not establish adequate procedures for the assessment of conformity of imported seal products with the relevant conditions for being placed on the EU market.

Norway claims that the EU seal regime is inconsistent, inter alia , with Articles 2.1, 2.2, 5.1, 5.2, 5.4, 5.6, 6.1, 6.2, 7.1, 7.4, 7.5, 8.1 and 8.2 of the TBT Agreement; Articles I:1, III:4 and XI:1 of the GATT 1994 and Article 4.2 of the Agriculture Agreement. On 28 October 2010, Canada requested to join the supplementary consultations. On 14 March 2011, Norway requested the establishment of a panel. At its meeting on 25 March 2011, the DSB deferred the establishment of a panel. Panel and Appellate Body proceedings At its meeting on 21 April 2011, the DSB established a panel. As provided for in Article 9.1 of the DSU with regard to multiple complainants, the DSB agreed that the panel established at the DSB meeting on 25 March 2011 to examine the complaint by Canada (DS400), would also examine this complaint. Argentina, Canada, China, Colombia, Ecuador, Iceland, Japan, Mexico, Namibia and the United States reserved their third party rights. Subsequently, the Russian Federation reserved its third party rights. On 24 September 2012, Canada and Norway requested the Director-General to determine the composition of the panel. On 4 October 2012, the DirectorGeneral composed the panel. 6. Philippines Measures Affecting Trade and Investment in the Motor Vehicle Sector Complaint by the United States. On 23 May 2000, the US requested consultations with the Philippines in respect of certain measures in the Philippines Motor Vehicle Development Program (MVDP), including the Car Development Program, the Commercial Vehicle Development Program, and the Motorcycle Development Program. The United States asserted that:

the MVDP provided that motor vehicle manufacturers located in the Philippines who meet certain requirements are entitled to import parts, components and finished vehicles at a preferential tariff rate;

foreign manufacturers import licenses for parts, components and finished vehicles are conditioned on compliance with these requirements. Among the requirements referred to by the United States are the requirement that manufacturers use parts and components produced in the Philippines and that they earn a percentage of the foreign exchange needed to import those parts and components by exporting finished vehicles; and The United States considered that these measures are inconsistent with the obligations of the Philippines under Articles III:4, III:5 and XI:1 of the GATT 1994, Articles 2.1 and 2.2 of the TRIMS Agreement, and Article 3.1(b) of the SCM Agreement.

On 12 October 2000, the US requested the establishment of a panel. At its meeting on 23 October 2000, the DSB deferred the establishment of a panel. Panel and Appellate Body proceedings Further to a second request to establish a panel by the US, the DSB established a panel at its meeting of 17 November 2000. India and Japan reserved their third party rights. This panel has not yet been composed. 7. Australia Certain Measures Affecting the Importation of Fresh Fruit and Vegetables Complaint by the Philippines. On 18 October 2002, the Philippines requested consultations with Australia on certain measures affecting the importation into Australia of fresh fruit and vegetables, including bananas, which include, but are not limited to:

Section 64 of Quarantine Proclamation 1998 promulgated under the Quarantine Act 1908; regulations, requirements and procedures issued pursuant thereto; amendments their application. to any of the foregoing; and

The Philippines considered that these measures are inconsistent with the obligations of Australia under the GATT 1994, the SPS Agreement and the Agreement on Import Licensing Procedures. The relevant provisions of these agreements include, but are not limited to Articles XI and XIII of the GATT 1994; Articles 2, 3, 4, 5, 6 and 10 of the SPS Agreement; and Articles 1 and 3 of the Agreement on Import Licensing Procedures. On 1 November 2002, the EC and Thailand requested to join the consultations. On 7 November 2002, Australia informed the DSB that it had accepted the request of the EC and Thailand to join the consultations. On 7 July 2003, the Philippines requested the establishment of a panel. At its meeting on 21 July 2003, the DSB deferred the establishment of a panel.

Panel and Appellate Body proceedings Further to a second request to establish a panel by the Philippines, the DSB established a panel at its meeting on 29 August 2003. China, the EC, Ecuador, India, Thailand and the US reserved their third-party rights. On 4 September 2003, Chile reserved its third-party rights. 8. China Anti-Dumping and Countervailing Duties on Certain Automobiles from the United States. Complaint by the United States On 5 July 2012, the United States requested consultations with China with regard to Notice No. 20 [2011] and Notice No. 84 [2011] of the Ministry of Commerce of the People's Republic of China (MOFCOM) imposing anti-dumping and countervailing duties on certain automobiles from the United States, including any and all annexes. The United States alleges that these measures appear to be inconsistent with:

Articles 1, 3.1, 3.2, 3.4, 3.5, 4.1, 5.3, 5.4, 6.2, 6.5.1, 6.8 (including Annex II, paragraph 1), 6.9, 12.2, and 12.2.2 of the Anti-Dumping Agreement; Articles 10, 11.3, 11.4, 12.4.1, 12.7, 12.8, 15.1, 15.2, 15.4, 15.5, 16.1 22.3, and 22.5 of the SCM Agreement; and Article VI of the GATT 1994.

On 17 September 2012, the United States requested the establishment of a panel. At its meeting on 28 September 2012, the DSB deferred the establishment of a panel. Panel and Appellate Body proceedings At its meeting on 23 October 2012, the DSB established a panel. Colombia, the European Union, India, Japan, Korea, Oman, Saudi Arabia and Turkey reserved their third party rights. 9. United States Section 129(c)(1) of the Uruguay Round Agreements Act Complaint by Canada. On 17 January 2001, Canada requested consultations with the US concerning Section 129(c)(1) of the Uruguay Round Agreements Act (the URAA) and the Statement of Administrative Action accompanying the URAA. In Canadas view, in a situation in which the DSB has ruled that the US has, in an anti-dumping or countervailing duty proceeding, acted inconsistently with US obligations under the AD or SCM Agreements, the US law prohibits the US from complying fully with the DSB ruling. Under US law, determinations whether to levy anti-dumping or countervailing duties are made after the imports occur. With regard to imports that occurred prior to a date on which the US directs compliance with the DSB ruling, the measures require US authorities to disregard the DSB ruling in making such determinations, even where the determination whether to levy antidumping or countervailing duties is made after the date fixed by the DSB for compliance. In such circumstances, determinations by the US to levy antidumping or countervailing duties would be inconsistent with its obligations under the AD or SCM Agreements.

Canada considered that these measures are inconsistent with US obligations under Article 21.3 of the DSU, in the context of Articles 3.1, 3.2, 3.7 and 21.1 of the DSU; Article VI of the GATT 1994; Articles 10 and note 36, 19.2, 19.4 and note 51, 21.1, 32.1, 32.2, 32.3, and 32.5 of the SCM Agreement; Articles 1, 9.3, 11.1, 18.1-4 and note 12 of the AD Agreement; and Article XVI:4 of the WTO Agreement. Panel and Appellate Body proceedings Further to Canadas request, the DSB established a panel at its meeting of 23 August 2001. Chile, EC, India and Japan reserved their third-party rights. On 30 October 2001, the Panel was composed. On 30 April 2002, the Chairman of the Panel informed the DSB that the Panel would not be able to complete its work in six months due to the complexity of the matter and that the Panel expected to issue its final report to the parties by the end of June 2002. On 15 July 2002, the Panel circulated its report to Members. The Panel concluded that that Canada had failed to establish that section 129(c)(1) of the Uruguay Round Agreements Act was inconsistent with Articles VI:2, VI:3 and VI:6(a) of the GATT 1994; Articles 1, 9.3, 11.1 and 18.1 and 18.4 of the AD Agreement; Articles 10, 19.4, 21.1, 32.1 and 32.5 of the SCM Agreement; and Article XVI:4 of the WTO Agreement. In the light of its conclusion, the Panel made no recommendations to the DSB. On 30 August 2002, the DSB adopted the Panel report. 10. Japan Measures Affecting the Purchase of Telecommunications Equipment Complaint by the European Communities. This request for consultations, dated 18 August 1995, claims that a 1994 agreement reached between the United States and Japan concerning telecommunications equipment is inconsistent with GATT Articles I:1, III:4 and XVII:1(c), and nullifies or impairs benefits accruing to the EC. The United States has joined in the consultations. Mutually agreed solution Although there has been no official notification, the case appears to have been settled bilaterally.