21/04/2013 Delivery | Westlaw India

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%ontent $ye: %ases, &e'"s#at"on, U( %ases, U(
&e'"s#at"on, U( )ou!na#s, U(
%u!!ent A*a!eness, EU +ate!"a#s
and %u!!ent A*a!eness
$"t#e : P!oo!t"ona#"ty and !emed"es "n
,$O d"sutes
-e#".e!y se#e/t"on: %u!!ent -o/ument
Numbe! o0 do/uments de#".e!ed: 1
1 2013 $2omson Reute!s Sout2 As"a P!".ate &"m"ted
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European Journal of International Law
2003
Proportionality and remedies in WTO disputes
And!e* -4 +"t/2e##
Subjet! Inte!nat"ona# #a*4 Ot"er related subjets! -"sute !eso#ut"on
#eywords! -"sute !eso#ut"on5 P!oo!t"ona#"ty5 Remed"es5 $!eaty "nte!!etat"on5 ,o!#d
$!ade O!'an"sat"on
Le$islation! Unde!stand"n' on Ru#es and P!o/edu!es 6o.e!n"n' t2e Sett#ement o0
-"sutes 1774 8,$O9 A!t422
A'!eement on Subs"d"es and %ounte!.a"#"n' +easu!es 1774 8,$O9
A'!eement on $e:t"#es and %#ot2"n' 1774 8,$O9 A!t4344
A'!eement on Sa0e'ua!ds on Imo!ts and E:o!ts 1774 8,$O9 A!t4;41
%ases! Un"ted States 8-e0"n"t".e Sa0e'ua!d +easu!es on Imo!ts o0 %"!/u#a! ,e#ded
%a!bon <ua#"ty &"ne P"e 0!om (o!ea9, Re 8Un!eo!ted, +a!/2 =, 20029 8,$O9
Un"ted States 8$!ans"t"ona# Sa0e'ua!d +easu!e on %ombed %otton >a!n 0!om Pa?"stan9,
Re 8Un!eo!ted, No.embe! ;, 20019 8,$O9
*E.J.I.L. 985 &bstrat
This article considers the role of proportionality in determining the level and type of
remedies available to World Trade Organization Members for violations of legal
obligations or for certain other undesirable or unfair conduct. As an aid to interpretation,
proportionality confirms the purpose of suspension of concessions as inducing
compliance and may clarify the meaning of nullification or impairment and the
appropriate response to actionable or prohibited subsidies. !o"ever, principles such
as proportionality must yield to the relevant te#t of the WTO agreements, "here that
te#t is unambiguous, and WTO Tribunals must carefully investigate the meaning and
scope of a principle before using it in the WTO. $ontrary to certain past decisions, the
principle of proportionality is not relevant to the imposition of safeguards in the WTO.
%t goes "ithout saying that a breach of a commercial treaty may not &ustify the ta'ing of
hostages in response.(
' Introdution
$2e o!d"na!y mean"n' o0 @!oo!t"ona#"tyA "s t2e @qua#"ty, /2a!a/te!, o! 0a/t o0 be"n'
!oo!t"ona#A, *2"/2 "n tu!n "s de0"ned as @/o!!esond"n' "n de'!ee, s"Be, amount, et/A42 In
#a*, t2e not"on o0 !oo!t"ona#"ty 2as se.e!a# mean"n's, o0 .a!y"n' b!eadt2, deend"n'
on t2e /onte:t4 At "ts b!oadest, !oo!t"ona#"ty "n #e'a# te!ms !e0e!s to t2e *E.J.I.L. 986
!equ"!ement 0o! a @!oe! o! ba#an/ed !e#at"ons2" bet*een /omet"n' /ons"de!at"onsA,3 a
de0"n"t"on t2at "s on#y ma!'"na##y mo!e se/"0"/ t2an t2e mean"n' o0 t2e *o!d "n o!d"na!y
En'#"s2 and t2at seems to #a/? no!mat".e d"!e/t"on4 +o!e a!t"/u#a!#y, !oo!t"ona#"ty @"s
sa"d to "n.o#.e t2e "dea t2at t2e!e s2ou#d be a !easonab#e !e#at"ons2" o! ba#an/e
bet*een an end and t2e means used to a/2"e.e t2"s endA44
In t2"s a!t"/#e, I t!y to na!!o* t2e mean"n' o0 !oo!t"ona#"ty by e:am"n"n' "ts e:"sten/e
and /ontent as a 'ene!a# !"n/"#e o0 #a*, a !"n/"#e o0 /ustoma!y "nte!nat"ona# #a*, and
a !"n/"#e o0 ,$O #a*4 I do not !oose to /ondu/t an e:2aust".e "n.est"'at"on o0 t2e
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many d"00e!ent /"!/umstan/es "n *2"/2 t2e not"on o0 !oo!t"ona#"ty a!"ses "n #a*4 No! "s
my 'oa# to estab#"s2 de0"n"t".e#y *2et2e! !oo!t"ona#"ty "s a 'ene!a# !"n/"#e o0 #a*; o!
a !"n/"#e o0 /ustoma!y "nte!nat"ona# #a*43 Rat2e!, "n t2e 0o##o*"n' se/t"ons I e:am"ne
some o0 t2e e."den/e t2at /ou#d suo!t a su''est"on t2at !oo!t"ona#"ty 2as a/2"e.ed
su/2 a status 8*2"/2 *ou#d add #e'"t"ma/y to any use o0 t2e !"n/"#e "n t2e ,$O9, *2"#e
attemt"n' to unde!stand t2e mean"n' o0 and !at"ona#e 0o! !oo!t"ona#"ty4 I t2en
/ons"de! 2o* su/2 a !"n/"#e m"'2t be used "n ,$O d"sutes, e"t2e! to "nte!!et ,$O
!o."s"ons o! as t2e bas"s o0 a /#a"m4
At t2e outset, "t "s ne/essa!y to d"st"n'u"s2 t*o ma"n 0o!ms "n *2"/2 !oo!t"ona#"ty /ou#d
be sa"d to e:"st as a 'ene!a# !"n/"#e o0 #a*, a !"n/"#e o0 /ustoma!y "nte!nat"ona# #a*,
and a !"n/"#e o0 ,$O #a*4 $2e 0"!st, mo!e 'ene!a#, 0o!m o0 t2e !oo!t"ona#"ty !"n/"#e
!o."des a 'u"de to ba#an/"n' /omet"n' !"'2ts, .a#ues o! ot2e! obCe/t".es4D In t2"s 0o!m,
0o! e:am#e, !oo!t"ona#"ty may "mose #"m"ts on t2e !est!"/t"on o0 2uman !"'2ts and
"nd"."dua# 0!eedoms "n domest"/ /onst"tut"ons= o! "n "nte!nat"ona# #a*47 S"m"#a!#y, "n t2e
,$O, some /ommentato!s 2a.e used t2e not"on o0 @!oo!t"ona#"tyA to e:#a"n 2o* to
e.a#uate "n0!"n'ements o0 o! e:/et"ons to *E.J.I.L. 987 stated ,$O obCe/t".es, !u#es
o! d"s/"#"nes410 E"#0 /an be seen as !e/o'n"B"n' t2"s 0o!m o0 !oo!t"ona#"ty as a !"n/"#e
o0 ,$O #a*, "n t2e 0o##o*"n' te!ms:
F$G2e !"n/"#e o0 !oo!t"ona#"ty "s one o0 t2e mo!e bas"/ !"n/"#es unde!#y"n' t2e
mu#t"#ate!a# t!ad"n' system, a#t2ou'2 t2e!e "s no e:#"/"t !e0e!en/e to "t "n ,$O #a*4
Eo*e.e!, t2e bas"/ "dea o0 !oo!t"ona#"ty, "4e4 t2e due ba#an/"n' o0 /omet"n' !"'2ts, "s
!e0#e/ted se.e!a# t"mes "n ,$O a'!eements411
,$O !o."s"ons t2at may be seen as !e0#e/t"n' a !"n/"#e o0 !oo!t"ona#"ty o0ten "n/#ude
*o!ds su/2 as @ne/essa!yA, @!oo!t"onateA, @#ess t!ade !est!"/t".eA,12 and @/ommensu!ateA4
$2e se/ond 0o!m o0 !oo!t"ona#"ty "s na!!o*e!4 It add!esses t2e !equ"s"te !e#at"ons2"
bet*een t2e ena#ty "mosed 0o! a '".en o00en/e4 H!oad#y sea?"n', !oo!t"ona#"ty may
be !equ"!ed bet*een un"s2ment and /!"me 8at t2e domest"/ #e.e#9, /ounte!measu!e and
"nte!nat"ona##y *!on'0u# a/t 8at t2e "nte!nat"ona# #e.e#9, and !eta#"at"on and ."o#at"on o!
ot2e! undes"!ab#e /ondu/t 8"n t2e ,$O94 $2ese 0o!ms a!e !e#ated and not ne/essa!"#y
mutua##y e:/#us".e4 $2e se/ond 0o!m /ou#d be des/!"bed as a subset o0 t2e 0"!st, 0o!
"nstan/e, "n t2e sense t2at "t may "n.o#.e ba#an/"n' t2e !"'2ts o0 an "nd"."dua# *2o 2as
/omm"tted a /!"me a'a"nst t2e .a!"ous 'oa#s o0 un"s2ment and t2e !"'2ts o0 t2e
/ommun"ty4 Eo*e.e!, 0o! t2e sa?e o0 /#a!"ty, I /on/ent!ate on t2e se/ond4 $2e se/ond
0o!m o0 !oo!t"ona#"ty !esents a mo!e mana'eab#e "nqu"!y 0o! t2"s a!t"/#e, and "t bea!s
a!t"/u#a! e:am"nat"on be/ause "t 2as been #"tt#e /ons"de!ed "n t2e /onte:t o0 t2e ,$O4
He#o*, I 0"!st e:#a"n 2o* !oo!t"ona#"ty may be seen as a 'ene!a# !"n/"#e o0 #a* and a
!"n/"#e o0 /ustoma!y "nte!nat"ona# #a*, be0o!e tu!n"n' to 2o* !oo!t"ona#"ty "s !e0#e/ted
"n t2e ,$O !u#es /on/e!n"n' !emed"es4 A'a"nst t2"s ba/?'!ound, I e.a#uate t2e use to
date o0 !oo!t"ona#"ty "n dete!m"n"n' !emed"es "n ,$O d"sutes and 2o* t2"s !"n/"#e
m"'2t 2e# 'u"de 0utu!e d"sutes4
( Proportionality as a Priniple in &ssessin$ )emedies
A General Principle of La! "ri#e and Punish#ent
I be'"n my assessment o0 !oo!t"ona#"ty by e:am"n"n' t2e !e#at"ons2" bet*een /!"me
and un"s2ment as a 'ene!a# !"n/"#e o0 #a*4 A $!"a# %2ambe! o0 t2e Inte!nat"ona#
%!"m"na# $!"buna# 0o! t2e 0o!me! >u'os#a."a 2as !e/o'n"Bed t2e !equ"!ement t2at a
un"s2ment be !oo!t"onate to t2e /!"me 0o! *2"/2 "t "s "mosed as a @'ene!a# !"n/"#e
o0 /!"m"na# #a*A413 $2"s !"n/"#e 0o!ms a!t o0 t2e #a* o0 se.e!a# /ommon #a* /ount!"es4
He#o*, I use t2e Un"ted States and Aust!a#"a as e:am#es4
*E.J.I.L. 988 In t2e Un"ted States, !oo!t"ona#"ty "s "n/o!o!ated "n t2e E"'2t2
Amendment, *2"/2 2as been 2e#d to !o2"b"t un"s2ments t2at a!e d"s!oo!t"onate to
t2e o00en/e4 $2"s amendment states t2at @FeG:/ess".e ba"# s2a## not be !equ"!ed, no!
e:/ess".e 0"nes "mosed, no! /!ue# and unusua# un"s2ments "n0#"/tedA4 $2e most
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"mo!tant o0 t2ese !o2"b"t"ons 2as been t2e !o2"b"t"on o0 /!ue# and unusua#
un"s2ment414 +any !"'2ts 8su/2 as 0!eedom o0 see/2 o! 0!eedom o0 "nte!state t!ade9
a!e stated "n abso#ute te!ms, e.en t2ou'2 t2ey may need to be ba#an/ed a'a"nst ot2e!
!"'2ts o! obCe/t".es4 Eo*e.e!, t2e !"'2t not to su00e! e:/ess".e un"s2ment "tse#0
"n/o!o!ates t2e not"on o0 !oo!t"ona#"ty4
$2e te:t o0 t2e E"'2t2 Amendment /#ea!#y !equ"!es !oo!t"ona#"ty bet*een t2e
un"s2ment and t2e o00en/e *2en t2e un"s2ment "n.o#.es ba"# o! 0"nes4 On "ts te!ms,
!oo!t"ona#"ty "s not st!"/t#y !equ"!ed 0o! ot2e! 0o!ms o0 un"s2ment4 Eo*e.e!, t2e
Su!eme %ou!t 2as !ead t2e !e0e!en/e to @/!ue# and unusua# un"s2mentA to en/omass
t2e !"n/"#e o0 !oo!t"ona#"ty4 In 17=3, t2e %ou!t stated "n a maCo!"ty o"n"on "n )olem
v !elm :
$2e E"'2t2 Amendment de/#a!es: @E:/ess".e ba"# s2a## not be !equ"!ed, no! e:/ess".e
0"nes "mosed, no! /!ue# and unusua# un"s2ments "n0#"/ted4A $2e 0"na# /#ause !o2"b"ts not
on#y ba!ba!"/ un"s2ments, but a#so senten/es t2at a!e d"s!oo!t"onate to t2e /!"me
/omm"ttedI $2e !"n/"#e t2at a un"s2ment s2ou#d be !oo!t"onate to t2e /!"me "s
dee#y !ooted and 0!equent#y !eeated "n /ommonJ#a* Cu!"s!uden/e I ,2en t2e
K!ame!s o0 t2e E"'2t2 Amendment adoted t2e #an'ua'e o0 t2e En'#"s2 H"## o0 R"'2ts,
t2ey a#so adoted t2e En'#"s2 !"n/"#e o0 !oo!t"ona#"ty I $2e /onst"tut"ona# !"n/"#e o0
!oo!t"ona#"ty 2as been !e/o'n"Bed e:#"/"t#y "n t2"s %ou!t 0o! a#most a /entu!y41;
$2e "n/#us"on o0 a !"n/"#e o0 !oo!t"ona#"ty *"t2"n t2e *o!ds @/!ue# and unusua#
un"s2mentA "s suo!ted by t2e su''est"on t2at @"t *ou#d be anoma#ous "ndeedA "0
!oo!t"ona#"ty *e!e !equ"!ed "n /onne/t"on *"t2 ba"# and 0"nes but not ot2e! 0o!ms o0
un"s2ment413 Ne.e!t2e#ess, 0o! some Cust"/es at #east, t2e a#"/at"on o0 t2e !"n/"#e
deends on t2e tye o0 un"s2ment "mosed4 As !e'a!ds /a"ta# un"s2ment 8t2e deat2
ena#ty9, "t seems 0a"!#y *e## estab#"s2ed t2at t2e !"n/"#e o0 !oo!t"ona#"ty a#"es41D
,2en "t /omes to nonJ/a"ta# un"s2ment, t2e Cu!"s!uden/e "s #ess /#ea!, *"t2 some
Cud'es ma"nta"n"n' t2at no test o0 !oo!t"ona#"ty "s ne/essa!y1= and ot2e!s ma"nta"n"n'
t2at st!"/t !oo!t"ona#"ty "s !equ"!ed417 Eo*e.e!, t2e !e.a"#"n' *E.J.I.L. 989 maCo!"ty
."e* "s t2at, @FtG2!ou'2 t2"s t2"/?et o0 E"'2t2 Amendment Cu!"s!uden/e, one 'o.e!n"n'
#e'a# !"n/"#e eme!'es as L/#ea!#y estab#"s2edM I: A '!oss d"s!oo!t"ona#"ty !"n/"#e "s
a#"/ab#e to senten/es 0o! te!ms o0 yea!sA420 $2"s means t2at su/2 a senten/e must not
be '!oss#y d"s!oo!t"onate to t2e o00en/e /omm"tted4 A#t2ou'2 t2e a!amete!s 0o!
dete!m"n"n' *2et2e! a senten/e ."o#ates t2"s standa!d a!e not /#ea!#y de0"ned, a ."o#at"on
*"## o//u! on#y "n !a!e o! e:t!ao!d"na!y /"!/umstan/es421 In *"ing v. $alifornia, a
#u!a#"ty o0 t2e %ou!t endo!sed t2"s @'!oss d"s!oo!t"ona#"tyA !"n/"#e, but us"n' "nstead
8!at2e! /on0us"n'#y9 t2e #abe# @na!!o* !oo!t"ona#"ty !"n/"#eA422 $2e !"n/"#e /an be
des/!"bed as na!!o* "n t2e sense t2at "t *"## not be ."o#ated by t2e "mos"t"on o0 a
un"s2ment t2at "s d"s!oo!t"onate to t2e o00en/e as #on' "t "s not '!oss#y
d"s!oo!t"onate4
$2e !eason t2at se.e!a# Cust"/es o0 t2e Su!eme %ou!t ta?e t2e ."e* t2at st!"/t
!oo!t"ona#"ty bet*een an o00en/e and un"s2ment "n t2e 0o!m o0 a senten/e o0 some
yea!s "s not !equ"!ed !obab#y !e#ates "n a!t to t2e"! e!/et"on o0 t2e !oe! !o#e o0 t2e
Cud"/"a!y: a !e."e*"n' /ou!t must a//o!d #e'"s#atu!es and senten/"n' /ou!ts @substant"a#
de0e!en/e I"n dete!m"n"n' t2e tyes and #"m"ts o0 un"s2ments 0o! /!"mes, as *e## as I"n
senten/"n' /on."/ted /!"m"na#sA423 $2e '!oss d"s!oo!t"ona#"ty test t2e!e0o!e !e#"es, to
t2e e:tent oss"b#e, on @obCe/t".e 0a/to!sA424 $2us, t2e %ou!t /ons"de!s not on#y t2e
@'!a."ty o0 t2e o00ense and t2e 2a!s2ness o0 t2e ena#tyA 8*2"/2 m"'2t deend on t2e
%ou!tNs o*n o#"/y assessments9 but a#so @t2e senten/es "mosed on ot2e! /!"m"na#s "n
t2e same Cu!"sd"/t"onA and @t2e senten/es "mosed 0o! /omm"ss"on o0 t2e same /!"me "n
ot2e! Cu!"sd"/t"onsA 8*2"/2 /an be dete!m"ned as a matte! o0 0a/t942;
In Aust!a#"a, as "n t2e Un"ted States, t2e E"'2 %ou!t 2as em2as"Bed t2e need to ta?e
a//ount o0 @obCe/t".e /"!/umstan/esA "n dete!m"n"n' *2et2e! a a!t"/u#a! senten/e "s
d"s!oo!t"onate to t2e o00en/e4 $2us, t2e E"'2 %ou!t 2as des/!"bed t2e !"n/"#e o0
!oo!t"ona#"ty as 0o##o*s:
FAG bas"/ !"n/"#e o0 senten/"n' #a* "s t2at a senten/e o0 "m!"sonment "mosed by a
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/ou!t s2ou#d ne.e! e:/eed t2at *2"/2 /an be Cust"0"ed as a!o!"ate o! !oo!t"onate to
t2e '!a."ty o0 t2e /!"me /ons"de!ed "n t2e #"'2t o0 "ts obCe/t".e /"!/umstan/es I3
*E.J.I.L. 99$ $2e E"'2 %ou!t 2as used t2e !"n/"#e o0 !oo!t"ona#"ty to dete!m"ne t2e
oute! #"m"ts o0 senten/"n' d"s/!et"on, on#y "nte!.en"n' *2e!e t2e e:e!/"se o0 t2at
d"s/!et"on @!e0#e/ts an e!!o! o0 !"n/"#e o! !esu#ts "n some man"0est "nCust"/eA42D $2e
not"on o0 @man"0est "nCust"/eA may be /oma!ab#e to t2e 2"'2 t2!es2o#d o0 @'!oss
d"s!oo!t"ona#"tyA a#"ed by t2e Su!eme %ou!t o0 t2e Un"ted States4
$2e E"'2 %ou!t 2as not yet !o."ded /#ea! 'u"dan/e on 2o* to a#y t2"s !"n/"#e42=
Eo*e.e!, t2e %ou!tNs !eason"n' does o"nt to /e!ta"n /ons"de!at"ons t2at may be !e#e.ant
"n senten/eJsett"n', *2"/2 may s2ed #"'2t on t2e !easons unde!#y"n' t2e !oo!t"ona#"ty
!"n/"#e4 A#t2ou'2 t2ese /ons"de!at"ons may d"00e! "n natu!e o! *e"'2t "n sett"n' a
m"n"mum as oosed to a ma:"mum senten/e,27 t2ey may "n/#ude t2e senten/es
!e."ous#y "mosed 0o! t2e o00en/e "n quest"on,30 t2e oss"b"#"ty o0 !e2ab"#"tat"on,31 @t2e
!oens"ty o0 t2e o00ende! to /omm"t ."o#ent /!"mes, t2e #"?e#"2ood o0 2"s !eJo00end"n'
and t2e need to !ote/t t2e /ommun"tyA432 $2ese /ons"de!at"ons a!e #"n?ed to t2e
obCe/t".es o0 un"s2ment, *2"/2 S/a#"a ) o0 t2e Su!eme %ou!t o0 t2e Un"ted States
add!essed b!"e0#y "n *"ing v. $alifornia. In 2"s Eonou!Ns ."e*, !oo!t"ona#"ty de!".es
0!om t2e not"on o0 un"s2ment as !et!"but"on 8mean"n' @un"s2ment "mosed as
!eayment o! !e.en'e 0o! t2e o00ense /omm"ttedA9,33 but "t 2as no #a/e to t2e e:tent
t2at t2e obCe/t".e o0 a un"s2ment "s dete!!en/e, "n/aa/"tat"on, o! !e2ab"#"tat"on434
$2e .a!"ous t2eo!"es o0 !et!"but"on @Cust"0y un"s2ment on t2e '!ound t2at e!sons *2o
/u#ab#y /omm"t o! attemt a/ts and om"ss"ons t2at a!e mo!a##y *!on' dese!.e
un"s2mentA43; Unde! t2ese t2eo!"es, !oo!t"ona#"ty #ays a dom"nant !o#e433 Assum"n'
t2at !et!"but"on !o."des one !eason 0o! un"s2ment, t2e quest"on a!"ses *2et2e! t2e
un"s2ment t2at a /u#!"t dese!.es s2ou#d be dete!m"ned abso#ute#y 8t2e non/oma!at".e
o! /a!d"na# a!oa/29 o! a//o!d"n' to t2e un"s2ment !e/e".ed by ot2e! eo#e
/omm"tt"n' t2e same o! ot2e! o00en/es 8t2e /oma!at".e o! o!d"na# a!oa/2943D $2e
/oma!at".e a!oa/2 attends to t2e /on/e!n e:!essed by se.e!a# Cust"/es o0 t2e
Su!eme %ou!t o0 t2e Un"ted States and t2e E"'2 %ou!t o0 Aust!a#"a t2at 2"'2e! /ou!ts
s2ou#d assess un"s2ments obCe/t".e#y and *"t2out "nte!.en"n' *E.J.I.L. 99% undu#y "n
t2e de/"s"onJma?"n' o0 t2e #e'"s#atu!e o! #o*e! /ou!ts4 >et a u!e#y /oma!at".e
a!oa/2 *ou#d #ea.e t2e /ou!ts no !oom to assess t2e '!a."ty o0 t2e o00en/e 8"n te!ms
o0 t2e 2a!m /aused and t2e 0au#t o! /u#ab"#"ty o0 t2e e!son /omm"tt"n' t2e o00en/e943=
$2"s may e:#a"n *2y senten/"n' "n bot2 Cu!"sd"/t"ons aea!s to !equ"!e mo!e t2an a
s"m#e "nse/t"on o0 senten/es !e."ous#y "mosed 0o! t2e o00en/e /omm"tted4
I0 !et!"but"on demands !oo!t"ona#"ty, *2at s/oe "s t2e!e 0o! ut"#"ta!"an /on/e!ns su/2
as t2e need to !ote/t t2e /ommun"tyO37 Put d"00e!ent#y, "s S/a#"a ) /o!!e/t t2at t2e
!"n/"#e o0 !oo!t"ona#"ty /annot a#y to t2e e:tent t2at a un"s2ment a"ms to !e.ent
t2e o00ende! 0!om !eo00end"n'O $2e ans*e! seems to #"e "n t2e tye and st!"n'en/y o0
!oo!t"ona#"ty a#"ed4 A//o!d"n' to %o2en, @e.e!yone "s to be un"s2ed a#"?e "n
!oo!t"on to t2e '!a."ty o0 2"s o00ense o! to t2e e:tent to *2"/2 2e 2as made ot2e!s
su00e!A440 $2us, s"m#"0y"n' 0o! t2e sa?e o0 /#a!"ty, t2e /u!!ent Aust!a#"an and Un"ted
States os"t"ons /ou#d be e:#a"ned as 0o##o*s: nonJ/oma!at".e !oo!t"ona#"ty, de!".ed
0!om not"ons o0 0a"!ness and !et!"but"on, sets an abso#ute /e"#"n' on t2e se.e!"ty o0 t2e
un"s2ment 0o! a '".en o00en/e, based on t2e se!"ousness o0 t2e o00en/e "n te!ms o0 t2e
/u#ab"#"ty o0 t2e o00ende! and t2e 2a!m /aused4 He#o* t2"s /e"#"n', senten/es s2ou#d be
un"0o!m "n a /oma!at".e sense un#ess some Cust"0"/at"on e:"sts 8ut"#"ta!"an o! ot2e!*"se9
0o! dea!t"n' 0!om t2e usua# de'!ee o0 un"s2ment4
& Principle of "usto#ar' International La! "ounter#easures for
(ron)ful Acts
$2e !e."ous se/t"on add!essed !oo!t"ona#"ty as "t !e#ates to "n0!"n'ement o0
"nd"."dua#sN !"'2ts, name#y "n0!"n'ement ta?"n' t2e 0o!m o0 un"s2ment 0o! a !e/o'n"Bed
o00en/e by an "nd"."dua#4 Eo*e.e!, !oo!t"ona#"ty a#so oe!ates "n "nte!nat"ona# #a* to
#"m"t "n0!"n'ement o0 t2e !"'2ts o0 states and, "n a!t"/u#a!, "n0!"n'ement ta?"n' t2e 0o!m
o0 /ounte!measu!es 0o! an "nte!nat"ona##y *!on'0u# a/t /omm"tted by a state4
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A!t"/#e ;1 o0 t2e Inte!nat"ona# &a* %omm"ss"onNs A!t"/#es on Resons"b"#"ty o0 States 0o!
Inte!nat"ona##y ,!on'0u# A/ts 8I&% A!t"/#es9 !o."des t2at /ounte!measu!es @must be
/ommensu!ate *"t2 t2e "nCu!y su00e!ed, ta?"n' "nto a//ount t2e '!a."ty o0 t2e
"nte!nat"ona##y *!on'0u# a/t and t2e !"'2ts "n quest"onA441 A!'uab#y, t2"s !o."s"on !e0#e/ts
t2e !oo!t"ona#"ty !"n/"#e t2at a#"es *"t2 !ese/t to /ounte!measu!es unde!
/ustoma!y "nte!nat"ona# #a*442 In 2"s /ommenta!"es on t2e I&% A!t"/#es, %!a*0o!d states
t2at @FG!oo!t"ona#"ty "s a *e##Jestab#"s2ed !equ"!ement 0o! ta?"n' /ounte!measu!es,
be"n' *"de#y !e/o'n"Bed "n State !a/t"/e, do/t!"ne and Cu!"s!uden/eA443 $2"s
obse!.at"on "s *E.J.I.L. 99* bo!ne out by se.e!a# !onoun/ements o0 t2e Inte!nat"ona#
%ou!t o0 )ust"/e44 and "n "nte!nat"ona# a!b"t!at"ons44; Indeed, "n te!ms .e!y s"m"#a! to
A!t"/#e ;1 as 0"na##y d!a0ted, t2e I%) 2e#d "n +abc,'ovo-.agymaros Pro&ect t2at @t2e
e00e/ts o0 a /ounte!measu!e must be /ommensu!ate *"t2 t2e "nCu!y su00e!ed, ta?"n'
a//ount o0 t2e !"'2ts "n quest"onA J t2"s "s @t2e !oo!t"ona#"ty *2"/2 "s !equ"!ed by
"nte!nat"ona# #a*A443
)ust as t2e obCe/t".es o0 un"s2ment a!e !e#e.ant "n assess"n' t2e !o#e o0 !oo!t"ona#"ty
"n domest"/ senten/"n', t2e obCe/t".e o0 "mos"n' /ounte!measu!es "s /!u/"a# to t2e"!
.a#"d"ty and may !e0#e/t on *2et2e! t2ey meet t2e !equ"!ement o0 !oo!t"ona#"ty "n
"nte!nat"ona# #a*4 Unde! A!t"/#e 47819 o0 t2e I&% A!t"/#es, @FaGn "nCu!ed State may on#y
ta?e /ounte!measu!es a'a"nst a State *2"/2 "s !esons"b#e 0o! an "nte!nat"ona##y
*!on'0u# a/t "n o!de! to "ndu/e t2at State to /om#y *"t2 "ts ob#"'at"ons unde! Pa!t $*oA,
*2"/2 "n/#udes ob#"'at"ons to /ease t2e un#a*0u# a/t4D and to !o."de !ea!at"on 0o! t2e
"nCu!y44= A//o!d"n' to %!a*0o!d, @a /#ea!#y d"s!oo!t"onate measu!e may *e## be Cud'ed
not to 2a.e been ne/essa!y to "ndu/e t2e !esons"b#e State to /om#y *"t2 "ts ob#"'at"ons
but to 2a.e 2ad a un"t".e a"m and to 0a## outs"de t2e u!ose o0 /ounte!measu!es
enun/"ated "n a!t"/#e 47A447
P!oo!t"ona#"ty unde! A!t"/#e ;1 !"ma!"#y "n.o#.es an assessment o0 t2e !e#at"ons2"
bet*een t2e /ounte!measu!e and t2e "nCu!y su00e!ed as a !esu#t o0 t2e "n"t"a# *!on'0u#
a/t, *2"#e @ta?"n' "nto a//ountA t2e '!a."ty o0 t2e *!on'0u# a/t and t2e !"'2ts "n quest"on4
$2e '!a."ty o0 t2e a/t "s t2us sea!ated 0!om t2e "nCu!y "t /auses, e.en t2ou'2 one m"'2t
no!ma##y e:e/t t2e "nCu!y /aused to be a /omonent "n assess"n' t2e '!a."ty o0 t2e a/t4
$2e /ons"de!at"on o0 t2e '!a."ty o0 t2e a/t and t2e !"'2ts "n0!"n'ed, sea!ate#y 0!om t2e
"nCu!y su00e!ed, su''ests t2at /ounte!measu!es may se!.e some 0a"!ness o! !et!"but".e
u!oses, /ont!a!y to t2e u!e#y ut"#"ta!"an o! /onsequent"a#"st a!oa/2 su''ested by
%!a*0o!d and t2e te:t o0 A!t"/#e 474 %ann"BBa!o e:#a"ns t2"s @/ont!ad"/t"onA;0 as
"nd"/at"n' @t2at t2e I&% /on/e".es !oo!t"ona#"ty as a 0a/to! m"t"'at"n' t2e "nst!umenta#
natu!e o0 /ounte!measu!esA4;1 Anot2e! e:#anat"on *E.J.I.L. 99+ /ou#d be t2at t2e
d!a0te!s /ons"de!ed t2at dete!m"n"n' t2e #e.e# o0 /ounte!measu!es ne/essa!y to "ndu/e
/om#"an/e *ou#d be mo!e subCe/t".e o! d"00"/u#t t2an dete!m"n"n' 8"9 t2e "nCu!y su00e!ed,
and 8""9 t2e '!a."ty o0 t2e *!on'0u# a/t and t2e !"'2ts "n quest"on4 A//o!d"n'#y, t2ese t*o
0a/to!s a!e used as a !o:y "n "dent"0y"n' /ounte!measu!es ne/essa!y to "ndu/e
/om#"an/e4
$2e need 0o! !oo!t"ona#"ty to ta?e "nto a//ount nonJut"#"ta!"an u!oses a!"ses "n t2e
/onte:t o0 "nte!nat"ona# #a* on /ounte!measu!es "n mu/2 t2e same *ay as "t does "n t2e
/onte:t o0 domest"/ #a*s !e'a!d"n' un"s2ment4 I0 t2e 'oa# "s so#e#y ut"#"ta!"an, t2e
!esonse to an "nte!nat"ona##y *!on'0u# a/t 8o! an "nd"."dua#Ns o00en/e9 !"s?s be"n' 0a!
*o!se t2an t2e o!"'"na# b!ea/2, "0 t2at "s *2at "s !equ"!ed to !e.ent 0utu!e b!ea/2es4;2
$2us, as "n t2e domest"/ /!"m"na# #a* systems e:am"ned abo.e, 0a"!ness and !et!"but"on
!equ"!e !oo!t"ona#"ty, *2"/2 sets an abso#ute /e"#"n' on t2e se.e!"ty o0 /ounte!measu!es
a//o!d"n' to t2e @t2e "nCu!y su00e!edA;3 8t2at "s, t2e 2a!m /aused9, @ta?"n' "nto a//ount
t2e '!a."ty o0 t2e "nte!nat"ona##y *!on'0u# a/t and t2e !"'2ts "n quest"onA;4 8t2at "s, t2e
/u#ab"#"ty o0 t2e a/to!94
A!t"/#e ;1 add!esses /ounte!measu!es ta?"n' t2e 0o!m o0 @nonJe!0o!man/e 0o! t2e t"me
be"n' o0 "nte!nat"ona# ob#"'at"ons o0 t2e State ta?"n' t2e measu!es to*a!ds t2e
!esons"b#e StateA4;; It does not a##o* /ounte!measu!es "n.o#."n' t2e use o0 0o!/e,;3
*2"/2 aea! to be !o2"b"ted by A!t"/#e 2 o0 t2e Un"ted Nat"ons %2a!te! 8e:/et e!2as
"n t2e /onte:t o0 se#0Jde0en/e9;D and *2"/2 a!e #ess !e#e.ant "n t2e /onte:t o0 t2e ,$O4
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Ne.e!t2e#ess, "t "s *o!t2 not"n' t2at, e.en "n t2e /onte:t o0 *a!, t2e !"n/"#e o0
!oo!t"ona#"ty a#"es to t2e "mos"t"on o0 /ounte!measu!es 8o0ten /a##ed be##"'e!ent
!e!"sa#s94;=
* Proportionality and )emedies in WTO Law
In t2e ne:t t*o se/t"ons I assess t2e !o#e o0 !oo!t"ona#"ty "n #"m"t"n' t2e e:tent o0
!eta#"ato!y a/t"ons t2at ,$O +embe!s may ta?e a'a"nst ea/2 ot2e!4 Su/2 measu!es ta?e
t*o b!oad 0o!ms, *2"/2 I d"s/uss "n tu!n: 0"!st, t2e susens"on o0 /on/ess"ons 8u!suant
to t2e unde!stand"n' on Ru#es and P!o/edu!es 6o.e!n"n' t2e Sett#ement o0 -"sutes
8-"sute Sett#ement Unde!stand"n'99 "n !esonse to a 0a"#u!e by a +embe! to b!"n' "ts
,$OJ"n/ons"stent measu!es "nto /on0o!m"ty *"t2 t2e ,$O a'!eements as !e/ommended
"n a Pane# o! Ae##ate Hody !eo!t adoted by t2e -"sute Sett#ement Hody 8-SH95;7
se/ond, un"#ate!a# use o0 t!ade !emed"es "n !esonse to /e!ta"n ?"nds o0 *E.J.I.L. 99,
un0a"! /ondu/t o! ot2e! s"tuat"ons, u!suant to t2e A'!eement on Im#ementat"on o0
A!t"/#e VI o0 t2e 6A$$ 1774 8Ant"J-um"n' A'!eement9, t2e A'!eement on Subs"d"es and
%ounte!.a"#"n' +easu!es 8S%+ A'!eement9, o! t2e A'!eement on Sa0e'ua!ds4
A -ultilateral .e#edies for (/0 1iolations
$2e a"m o0 t2e ,$O d"sute sett#ement system "s @to se/u!e a os"t".e so#ut"on to a
d"suteA430 Idea##y, t2"s "s to be a/2"e.ed t2!ou'2 a mutua##y a'!eed so#ut"on bet*een
t2e a!t"es, o! *"t2d!a*a# o0 any measu!es o0 +embe!s t2at a!e "n/ons"stent *"t2 t2e
,$O a'!eements 8as dete!m"ned by Pane#s o! t2e Ae##ate Hody "n !eo!ts t2at a!e
adoted by t2e -SH94 Eo*e.e!, as a @#ast !eso!tA, "0 t2e +embe! 0a"#s to b!"n' t2e
"n/ons"stent measu!e "nto /on0o!m"ty *"t2"n a !easonab#e e!"od o0 t"me, t2e /om#a"nant
2as t2e oss"b"#"ty o0 @susend"n' t2e a#"/at"on o0 /on/ess"ons o! ot2e! ob#"'at"ons
unde! t2e /o.e!ed a'!eements on a d"s/!"m"nato!y bas"s ."sJPJ."s t2e ot2e! +embe!,
subCe/t to aut2o!"Bat"on by t2e -SHA431 Essent"a##y, t2e -SH "s !equ"!ed to '!ant su/2
aut2o!"Bat"on @*"t2"n 30 days o0 t2e e:"!y o0 t2e !easonab#e e!"od o0 t"me un#ess t2e
-SH de/"des by /onsensus to !eCe/t t2e !equestA432 +embe!s must 0o##o* t2e !e#e.ant
d"sute sett#ement !o/edu!es be0o!e susend"n' /on/ess"ons "n !esonse to a 0a"#u!e to
b!"n' an "n/ons"stent measu!e "nto /on0o!m"ty *"t2"n t2e !equ"!ed e!"od433
P!oo!t"ona#"ty "n !eta#"ato!y a/t"ons unde! t2e ,$O d"sute sett#ement system 2as
qua#"tat".e and quant"tat".e !equ"!ements4 $2e qua#"tat".e !equ"!ement !e#ates to t2e
0o!m o0 t2e !eta#"ato!y a/t"on4 S"'n"0"/ant#y, t2e u#t"mate san/t"on by a /om#a"nant
a'a"nst a !esondentNs ,$O ."o#at"on "s to /ease e!0o!m"n' some o0 "ts ,$O ob#"'at"ons
to*a!ds t2at +embe!4 $2"s @susens"on o0 /on/ess"onsA "s ana#o'ous to t2e 0o!m o0
/ounte!measu!es en."sa'ed by A!t"/#e 47829 o0 t2e I&% A!t"/#es 8@none!0o!man/e 0o! t2e
t"me be"n' o0 "nte!nat"ona# ob#"'at"onsA9 and t2e !esonse !o."ded 0o! "n A!t"/#e 308298b9
o0 t2e V"enna %on.ent"on on t2e &a* o0 $!eat"es 0o! a mate!"a# b!ea/2 o0 a t!eaty
8@susend"n' t2e oe!at"on o0 t2e t!eaty "n *2o#e o! "n a!tA94 In add"t"on, A!t"/#e 2243 o0
t2e -SU !o."des t2at t2e susens"on o0 /on/ess"ons s2ou#d !e0e!ab#y be "n t2e same
se/to! and, "0 t2"s "s not !a/t"/ab#e o! e00e/t".e, t2e susens"on s2ou#d be *"t2 !ese/t to
ot2e! se/to!s but unde! t2e same a'!eement4 On#y "0 t2"s "s not !a/t"/ab#e o! e00e/t".e,
and on#y "0 t2e /"!/umstan/es a!e se!"ous enou'2, may /on/ess"ons be susended unde!
anot2e! ,$O a'!eement4 $2"s qua#"tat".e !equ"!ement o0 !oo!t"ona#"ty may s!"n' 0!om
t2e same !at"ona#e as le# talionis 8"n0#"/t"on on t2e *!on'doe! o0 t2e "nCu!y t2e
*!on'doe! 2as /aused J s"m#y ut, an eye 0o! an eye9434
*E.J.I.L. 995 As to t2e #e.e# o0 susens"on o0 /on/ess"ons t2at t2e -SH aut2o!"Bes 8t2e
quant"tat".e !equ"!ement o0 !oo!t"ona#"ty9, A!t"/#e 2244 o0 t2e -SU !o."des t2at t2"s
must be @equ".a#ent to t2e #e.e# o0 nu##"0"/at"on o! "ma"!mentA4 $2e !e0e!en/e to
@nu##"0"/at"on o! "ma"!mentA de!".es 0!om A!t"/#e QQIII o0 t2e 6ene!a# A'!eement on
$a!"00s and $!ade 86A$$9 1774, *2"/2 !e0e!s to t2e sett#ement o0 d"sutes *2e!e a
+embe! /ons"de!s @t2at any bene0"t a//!u"n' to "t d"!e/t#y o! "nd"!e/t#y unde! t2"s
A'!eement "s be"n' nu##"0"ed o! "ma"!edA due to, 0o! e:am#e, anot2e! +embe!Ns
"n/ons"stent measu!e4 $2us, t2e #e.e# o0 nu##"0"/at"on o! "ma"!ment "s, b!oad#y sea?"n',
t2e amount o0 "nCu!y t2at t2e +embe! 2as su00e!ed due to t2e "n/ons"stent measu!e4 In
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t2at sense, t2e a"m "s to ensu!e t2at t2e ena#ty 8susens"on o0 /on/ess"ons9 "s not
d"s!oo!t"onate to t2e "nCu!y su00e!ed 8nu##"0"/at"on o! "ma"!ment943; $2us, as "n t2e
"nte!nat"ona# #a* o0 /ounte!measu!es, t2e 0o/us o0 t2e !oo!t"ona#"ty "nqu"!y "s on t2e
2a!m /aused !at2e! t2an t2e /u#ab"#"ty o0 t2e a/to! o! t2e need to "ndu/e /om#"an/e
8*2"/2 /ou#d *e"'2 "n 0a.ou! o0 a #o*e! o! 2"'2e! ena#ty94
I0 t2e +embe! obCe/ts to t2e #e.e# o0 susens"on !oosed by t2e /om#a"nant, o! /#a"ms
t2at t2e !"n/"#es and !o/edu!es set 0o!t2 "n A!t"/#e 2243 o0 t2e -SU 2a.e not been
0o##o*ed, t2e matte! "s !e0e!!ed to a!b"t!at"on unde! A!t"/#e 2243 o0 t2e -SU4 It "s u to
t2e a!b"t!ato!s 8'ene!a##y /om!"s"n' t2e o!"'"na# ane#9 to dete!m"ne *2et2e! t2e #e.e#
o0 susens"on !oosed "s equ".a#ent to t2e #e.e# o0 nu##"0"/at"on o! "ma"!ment and/o! to
/on0"!m *2et2e! t2e !"n/"#es o0 A!t"/#e 2243 2a.e been 0o##o*ed4
Unde! t2e S%+ A'!eement, se/"a# d"sute sett#ement !o/edu!es a#y and ta?e
!e/eden/e o.e! t2e usua# -SU !u#es433 Ko! a/t"onab#e subs"d"es t2at a!e not b!ou'2t
"nto /om#"an/e *"t2"n s": mont2s o0 adot"on, "n t2e absen/e o0 a'!eement on
/omensat"on, t2e -SH '!ants aut2o!"Bat"on to t2e /om#a"n"n' +embe!, by !e.e!se
/onsensus, to @ta?e /ounte!measu!es, /ommensu!ate *"t2 t2e de'!ee and natu!e o0 t2e
ad.e!se e00e/ts dete!m"ned to e:"stA, *2"/2 may be dete!m"ned by a!b"t!ato!s unde!
A!t"/#e 2243 o0 t2e -SU43D Ko! pro"ibited subsidies t2at a!e not b!ou'2t "nto
/om#"an/e *"t2"n t2e t"me0!ame se/"0"ed by t2e Pane#, t2e -SH '!ants aut2o!"Bat"on to
t2e /om#a"n"n' +embe!, by !e.e!se /onsensus, to @ta?e a!o!"ate
/ounte!measu!esA43= Kootnotes 7 and 10 to t2e S%+ A'!eement ma?e /#ea! t2at t2e
!e0e!en/e to @a!o!"ateA /ounte!measu!es @"s not meant to a##o* /ounte!measu!es t2at
a!e d"s!oo!t"onate "n #"'2t o0 t2e 0a/t t2at t2e subs"d"es dea#t *"t2 unde! t2ese
!o."s"ons a!e !o2"b"tedA4 $2"s "s one o0 t2e 0e* e:#"/"t !e0e!en/es to !oo!t"ona#"ty "n
t2e ,$O a'!eements4 A'a"n, A!t"/#e 2243 a!b"t!ato!s may dete!m"ne *2et2e! !oosed
/ounte!measu!es 0u#0"# *E.J.I.L. 996 t2"s !equ"!ement437 &ate! "n t2"s a!t"/#e, I /ons"de!
t2e s"'n"0"/an/e 0o! t2e !"n/"#e o0 !oo!t"ona#"ty o0 t2e d"00e!en/es bet*een t2ese
!o."s"ons unde! t2e S%+ A'!eement and t2e /o!!esond"n' !o."s"ons o0 t2e -SU4
& 2nilateral .e#edies for "ertain 0ther "onduct
An unusua# 0o!m o0 !eta#"ato!y a/t"on a.a"#ab#e "n t2e ,$O "s t2e t!ade !emedy o!
un"#ate!a# !emedy4 $2ese !emed"es, *2"/2 'ene!a##y ta?e t2e 0o!m o0 "n/!eased ta!"00s 8o!,
somet"mes, "mo!t quotas9, /ome "n t2!ee 'u"ses: ant"Jdum"n' measu!es, sa0e'ua!ds,
and /ounte!.a"#"n' measu!es4 Ea/2 "s "mosed 0o! a d"00e!ent !eason4
Ant"Jdum"n' and /ounte!.a"#"n' measu!es a!e /#osest to ena#t"es "n domest"/ #a* o!
/ounte!measu!es "n "nte!nat"ona# #a*, be/ause +embe!s may "mose t2em "n !esonse
to /ondu/t t2at "s a//eted as @un0a"!A 8dum"n' o! /e!ta"n 0o!ms o0 subs"dy94 $2us, t2e
+embe!s !e/o'n"Be t2at @dum"n', by *2"/2 !odu/ts o0 one /ount!y a!e "nt!odu/ed "nto
t2e /omme!/e o0 anot2e! /ount!y at #ess t2an t2e no!ma# .a#ue o0 t2e !odu/ts, "s to be
/ondemned "0 "t /auses o! t2!eatens mate!"a# "nCu!y to an estab#"s2ed "ndust!y "n t2e
te!!"to!y o0 a +embe!A4D0 $2ey a#so a'!ee t2at @FnGo +embe! s2ou#d /ause, t2!ou'2 t2e
use o0 any Fse/"0"/ subs"dyG, ad.e!se e00e/ts to t2e "nte!ests o0 ot2e! +embe!sA,
"n/#ud"n' @"nCu!y to t2e domest"/ "ndust!y o0 anot2e! +embe!A4D1 In !esonse to one
+embe!Ns dum"n' o! subs"d"Bat"on /aus"n' "nCu!y, anot2e! +embe! may t2e!e0o!e
8subCe/t to /e!ta"n st!"n'ent /ond"t"ons9 "mose ant"Jdum"n'D2 o! /ounte!.a"#"n'
measu!esD3 !ese/t".e#y4
Unde! A!t"/#e 743 o0 t2e Ant"J-um"n' A'!eement, a +embe! may not "mose an ant"J
dum"n' duty "n e:/ess o0 t2e ma!'"n o0 dum"n'4D4 S"m"#a!#y, unde! A!t"/#e 1744 o0 t2e
S%+ A'!eement, +embe!s must not "mose /ounte!.a"#"n' dut"es "n e:/ess o0 t2e
amount o0 t2e subs"dy4D; $2e /e"#"n' on t2e amount o0 ena#ty 8"n t2e 0o!m o0 dut"es9 "s
t2e!e0o!e set by t2e undes"!ab#e a/t 8dum"n' o! t2e "mos"t"on o0 /e!ta"n ?"nds o0
subs"d"es9, e.en "0 t2e "nCu!y /aused by t2at a/t "s 2"'2e!4 A +embe! /ou#d, o0 /ou!se,
/2oose to "mose no ant"Jdum"n' o! /ounte!.a"#"n' dut"es, e.en "0 "t 2ad t2e !"'2t to do
so4 +o!eo.e!, @F"Gt "s des"!ab#eA t2at t2e amount o0 dut"es "mosed be #ess t2an t2e
ma!'"n o0 dum"n' o! t2e amount o0 t2e subs"dy @"0 su/2 #esse! duty *ou#d be adequate
to !emo.e t2e "nCu!y to t2e domest"/ "ndust!yA4D3
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In t2e /onte:t o0 ant"Jdum"n' and /ounte!.a"#"n' measu!es, t2e d"00e!en/e bet*een t2e
undes"!ab#e a/t and t2e "nCu!y /aused "s /#ea!, and e.en otent"a##y quant"0"ab#e, a#t2ou'2
t2e ,$O a'!eements do not /u!!ent#y !equ"!e +embe!s to /a#/u#ate a ma!'"n *E.J.I.L.
997 o0 "nCu!y4 $2"s /ont!asts *"t2 t2e s"tuat"on "n domest"/ #a* o! /ustoma!y
"nte!nat"ona# #a*, *2e!e "t may be e:t!eme#y d"00"/u#t "n !a/t"/e to d"st"n'u"s2 bet*een
t2e se!"ousness o0 t2e a/t and t2e de'!ee o0 2a!m /aused4 In add"t"on, t2e de'!ee o0
!oo!t"ona#"ty !equ"!ed 0o! ant"Jdum"n' and /ounte!.a"#"n' measu!es "s e:a/t4 $2e
a!t"es may 2a.e d"00e!ent ."e*s as to t2e ma!'"n o0 dum"n' o! t2e amount o0 t2e
subs"dy, but on/e t2e +embe!Ns !e#e.ant aut2o!"t"es 2a.e dete!m"ned t2at #e.e# "n an
"n.est"'at"on "n a//o!dan/e *"t2 t2e ,$O !equ"!ements, t2e +embe! /annot "mose a
duty t2at e:/eeds "t4DD
Sa0e'ua!ds a!e a #"tt#e d"00e!ent4 +ost "mo!tant#y, sa0e'ua!ds a!e "mosed "n !esonse to
"n/!eased "mo!ts /aus"n' se!"ous "nCu!y4D= No un0a"!ness "s "n.o#.ed,D7 and a## +embe!s
a!e subCe/t to t2e sa0e'ua!ds4=0 $2e!e0o!e, sa0e'ua!ds a!e #ess ana#o'ous to ena#t"es
"mosed 0o! un#a*0u# a/t"ons4 Sa0e'ua!ds do "n.o#.e some so!t o0 !oo!t"ona#"ty
!equ"!ement, "n t2e sense t2at a +embe! may a#y sa0e'ua!ds @on#y to t2e e:tent
ne/essa!y to !e.ent o! !emedy se!"ous "nCu!y and to 0a/"#"tate adCustmentA4=1 Eo*e.e!,
as sa0e'ua!ds a!e not "mosed "n !esonse to an un#a*0u# o! undes"!ab#e a/t by any
ot2e! +embe!, and as a +embe! may /ont"nue to "mose sa0e'ua!ds to t2e e:tent
ne/essa!y @to 0a/"#"tate adCustmentA 8*2"/2 may bea! no !e#at"ons2" to t2e /ondu/t o0
ot2e! +embe!s9, t2ese /annot be seen as !et!"but".e measu!es o! measu!es "mosed to
"ndu/e /om#"an/e4 A//o!d"n'#y, I do not ."e* t2e /u!!ent ,$O !o."s"ons on t2e
"mos"t"on o0 sa0e'ua!ds as "n/o!o!at"n' t2e !"n/"#e o0 !oo!t"ona#"ty "n t2e sense
des/!"bed ea!#"e! "n t2"s a!t"/#e "n !e#at"on to /!"m"na# ena#t"es and "nte!nat"ona#
/ounte!measu!es4=2 I !etu!n to t2"s "ssue be#o* "n add!ess"n' /e!ta"n Ae##ate Hody
!onoun/ements !e'a!d"n' t2e !"n/"#e o0 !oo!t"ona#"ty4
*E.J.I.L. 998 + ,sin$ Proportionality in WTO Disputes
I no* e:am"ne 2o* ,$O $!"buna#s m"'2t use !oo!t"ona#"ty "n ,$O d"sutes4 I 0"!st
/ons"de! t2e !e#e.an/e o0 !oo!t"ona#"ty to t2e "mos"t"on o0 mu#t"#ate!a# !emed"es J t2at
"s, t2e susens"on o0 /on/ess"ons aut2o!"Bed by t2e -SH "n !esonse to e"t2e! a 'ene!a#
,$O ."o#at"on o! an a/t"onab#e o! !o2"b"ted subs"dy t2at 2as not been !emed"ed "n
a//o!dan/e *"t2 t2e !e/ommendat"ons and !u#"n's o0 t2e -SH "n a '".en d"sute4 I t2en
tu!n to !oo!t"ona#"ty "n /onne/t"on *"t2 un"#ate!a# !emed"es, name#y t2e "mos"t"on o0
sa0e'ua!d measu!es4
A General (/0 1iolations
As ment"oned ea!#"e!, A!t"/#e 2244 o0 t2e -SU !equ"!es t2at t2e #e.e# o0 susens"on o0
/on/ess"ons 0o! a a!t"/u#a! ,$O ."o#at"on be equ".a#ent to t2e #e.e# o0 nu##"0"/at"on o!
"ma"!ment /aused by t2at ."o#at"on4 In unde!stand"n' t2e !o#e o0 !oo!t"ona#"ty, "t "s
use0u# to /ons"de! t2e u!ose o0 t2"s !equ"!ement4 +ost o0 t2e "nte!!etat"on o0 t2e
A!t"/#e 2244 !equ"!ement o0 equ".a#en/e 2as /ome 0!om a!b"t!ato!s u!suant to A!t"/#e
2243 o0 t2e -SU4 Se.e!a# a!b"t!ato!s 2a.e su''ested t2at t2e u!ose o0 susend"n'
/on/ess"ons "s to "ndu/e /om#"an/e but t2at:
t2"s u!ose does not mean t2at t2e -SH s2ou#d '!ant aut2o!"Bat"on to susend
/on/ess"ons beyond *2at "s e/uivalent to t2e #e.e# o0 nu##"0"/at"on o! "ma"!ment4 In ou!
."e*, t2e!e "s not2"n' "n A!t"/#e 2241 o0 t2e -SU, #et a#one "n a!a'!a2s 4 and D o0
A!t"/#e 22, t2at /ou#d be !ead as a Cust"0"/at"on 0o! /ounte!Jmeasu!es o0 a punitive
natu!e4=3
$2e Ae##ate Hody 2as endo!sed t2"s ."e*4=4
Pa#mete! and A#e:and!o. a!'ue t2at t2e u!ose o0 !eta#"ato!y measu!es @"s not to "ndu/e
/om#"an/e, but to ma"nta"n t2e ba#an/e o0 !e/"!o/a# t!ade /on/ess"ons ne'ot"ated "n t2e
,$O a'!eementsA4=; In /ont!ast, %2a!no."tB /ons"de!s t2at susens"on o0 /on/ess"ons "n
t2e ,$O @"s /on/e".ed !"ma!"#y as a san/t"on, *2"#e t2e !eba#an/"n' "dea !eta"ns .est"'"a#
"n0#uen/eA4=3 In my ."e*, t2e susens"on o0 /on/ess"ons "s "ntended to "ndu/e
/om#"an/e4 $2"s "s /ons"stent *"t2 A!t"/#e 224= o0 t2e -SU, *2"/2 states t2at t2e
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susens"on o0 /on/ess"ons "s a temo!a!y measu!e a.a"#ab#e on#y unt"# t2e "n/ons"stent
measu!e 2as been !emo.ed4 It "s a#so /ons"stent *"t2 *E.J.I.L. 999 A!t"/#e 342 o0 t2e
-SU, *2"/2 "nd"/ates t2at, @F"Gn t2e absen/e o0 a mutua##y a'!eed so#ut"on, t2e 0"!st
obCe/t".e o0 t2e d"sute sett#ement me/2an"sm "s usua##y to se/u!e t2e *"t2d!a*a# o0 t2e
F"n/ons"stentG measu!esA4=D It "s t!ue t2at t2"s u!ose "s some*2at at odds *"t2 t2e 0a/t
t2at, u!suant to A!t"/#e 2244 o0 t2e -SU, t2e -SH /annot aut2o!"Be susens"on o0
/on/ess"ons beyond t2e #e.e# o0 nu##"0"/at"on o! "ma"!ment4== Eo*e.e!, t2"s !e0#e/ts a
st!"?"n'#y s"m"#a! a!oa/2 to t2e I&% A!t"/#es4 In bot2 /ases, t2e u!ose o0 t2e ena#ty
"s sa"d to be to "ndu/e /om#"an/e, but t2e ena#ty "tse#0 must not be d"s!oo!t"onate to
t2e 2a!m /aused, e.en "0 a '!eate! ena#ty *ou#d be !equ"!ed to "ndu/e /om#"an/e4 $2"s
/ont!ad"/t"on seems no *o!se unde! ,$O #a* t2an unde! "nte!nat"ona# #a*, and "t seems
to 0#o* 0!om t2e ,$O !o."s"ons t2emse#.es !at2e! t2an any 0au#ty "nte!!etat"on "n
d"sute sett#ement4
In t2e 0"!st A!t"/#e 2243 a!b"t!at"on, t2e a!b"t!ato!s e:#"/"t#y !e/o'n"Bed t2e @'ene!a#
"nte!nat"ona# #a* !"n/"#e o0 !oo!t"ona#"tyA4=7 $2ey !e#"ed on t2"s !"n/"#e "n
dete!m"n"n' 2o* to /a#/u#ate t2e #e.e# o0 nu##"0"/at"on o! "ma"!ment *2e!e a '".en ,$O
."o#at"on nu##"0"es o! "ma"!s bene0"ts a//!u"n' to se.e!a# +embe!s at on/e470 Se/"0"/a##y,
t2e a!b"t!ato!s 2e#d t2at t2e need 0o! !oo!t"ona#"ty !e/#uded @doub#e/ount"n'A o0 a
'".en amount o0 nu##"0"/at"on o! "ma"!ment471 On t2"s bas"s, t2e a!b"t!ato!s !e0used to
"n/#ude, "n t2e /a#/u#at"on o0 nu##"0"/at"on o! "ma"!ment su00e!ed by t2e Un"ted States as
a !esu#t o0 /e!ta"n measu!es o0 t2e Eu!oean %ommun"t"es "n !e#at"on to bananas, #ost
Un"ted States e:o!ts "n t2e 0o!m o0 "nuts 8su/2 as 0e!t"#"Be!9 "n t2e /u#t".at"on o0 &at"n
Ame!"/an bananas472 In t2e a!b"t!ato!sN ."e*, on#y t2e !e#e.ant &at"n Ame!"/an /ount!"es
/ou#d see? aut2o!"Bat"on to susend /on/ess"ons 0o! nu##"0"/at"on o! "ma"!ment su00e!ed
*"t2 !ese/t to &at"n Ame!"/an bananas473
Read"n' t2e !e#e.ant ,$O !o."s"ons "n #"'2t o0 t2e !"n/"#e o0 !oo!t"ona#"ty, "t "s /#ea!
t2at t2e ma:"mum #e.e# o0 susens"on o0 /on/ess"ons by a## ,$O +embe!s 0o! a '".en
."o#at"on /annot e:/eed t2e tota# #e.e# o0 nu##"0"/at"on o! "ma"!ment su00e!ed by t2ose
+embe!s4 Eo*e.e!, t2"s does not mean t2at t2e amount o0 nu##"0"/at"on o! "ma"!ment
su00e!ed by one +embe! must be !edu/ed a//o!d"n' to t2e amount o0 nu##"0"/at"on o!
"ma"!ment su00e!ed by ot2e! +embe!s4 $2e a!b"t!ato!s su''ested t2at @t2e same
amount o0 nu##"0"/at"on o! "ma"!ment "n0#"/ted on one +embe! /annot s"mu#taneous#y be
"n0#"/ted on another A474 >et t2"s "s 0a! 0!om se#0Je."dent4 A ,$O ."o#at"on may nu##"0y o!
"ma"! bene0"ts a//!u"n' to one +embe!, *2"#e at t2e same t"me nu##"0y"n' o! "ma"!"n'
bene0"ts a//!u"n' to anot2e! +embe!4 In t2at "nstan/e, t2e nu##"0"/at"on o! "ma"!ment
su00e!ed by one +embe! "s qu"te d"00e!ent 0!om t2e nu##"0"/at"on o! "ma"!ment su00e!ed
by anot2e! +embe!, e.en t2ou'2 "t !esu#ts 0!om t2e *E.J.I.L. %$$$ same a/t4
$2e!e0o!e, e!2as t2e a!b"t!ato!s /ou#d 2a.e bette! e:#a"ned t2e"! de/"s"on !e'a!d"n'
e:o!ts o0 Un"ted States "nuts "nto &at"n Ame!"/an bananas by e#abo!at"n' on *2y
e:o!ts o0 t2"s ?"nd d"d not /onst"tute a bene0"t a//!u"n' to t2e Un"ted States d"!e/t#y o!
"nd"!e/t#y unde! t2e ,$O a'!eements, "nstead o0 by !e0e!en/e to t2e !oo!t"ona#"ty
!"n/"#e4
In 0) - Offset Act 12yrd Amendment3, t2e a!b"t!ato!s stated t2at a ,$O ."o#at"on "s
d"st"n/t 0!om t2e nu##"0"/at"on o! "ma"!ment t2at may a!"se 0!om t2at ."o#at"on47; In
suo!t o0 t2"s /on/#us"on, t2e a!b"t!ato!s !e0e!!ed to A!t"/#e 34= o0 t2e -SU, *2"/2
!o."des t2at a ,$O ."o#at"on "s !esumed to nu##"0y o! "ma"! bene0"ts o0 ot2e! +embe!s4
A//o!d"n' to t2e a!b"t!ato!s, t2e 0a/t t2at t2e de0end"n' +embe! may !ebut t2"s
!esumt"on su''ests t2at t2e ."o#at"on does not o0 "tse#0 /onst"tute nu##"0"/at"on o!
"ma"!ment4 Rat2e!, @t2e bene0"t nu##"0"ed o! "ma"!ed must ne/essa!"#y be somet2"n'
e#seA473 As a !esu#t, t2e a!b"t!ato!s !e0used H!aB"#Ns su''est"on t2at t2e m"n"mum #e.e# o0
nu##"0"/at"on o! "ma"!ment /aused by t2e %ont"nued -um"n' and O00set A/t 8*2"/2 t2e
Pane# and Ae##ate Hody 2ad 0ound "n/ons"stent as su/2 *"t2 t2e Un"ted StatesN ,$O
ob#"'at"ons97D /o!!esonded to t2e amount o0 ayments made unde! t2at a/t47=
Unde! t2e -SU, t2e /on/et o0 nu##"0"/at"on o! "ma"!ment "s "ndeed sea!ate 0!om t2at o0
a ,$O "n/ons"sten/y o! ."o#at"on, and A!t"/#e 2244 o0 t2e -SU does !e.ent a +embe!
0!om "mos"n' a ena#ty 8"n t2e 0o!m o0 susens"on o0 /on/ess"ons9 t2at e:/eeds t2e
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2a!m /aused 8"n t2e 0o!m o0 nu##"0"/at"on o! "ma"!ment9477 Eo*e.e!, t2"s does not
ne/essa!"#y !e/#ude t2e oss"b"#"ty t2at t2e ."o#at"on "tse#0 may /onst"tute nu##"0"/at"on o!
"ma"!ment "n at #east some /"!/umstan/es4100 $2"s *ou#d s2o* 2o* /u#ab"#"ty may be
!e#e.ant to !oo!t"ona#"ty as a !"n/"#e o0 ,$O #a*, Cust as "t "s to !oo!t"ona#"ty as a
'ene!a# !"n/"#e o0 #a* and as a !"n/"#e o0 /ustoma!y "nte!nat"ona# #a*4
,2e!e t2e de'!ee o0 /u#ab"#"ty "s 2"'2 but t2e t!ade e00e/ts a!e #o*, a//et"n' t2at a
,$O ."o#at"on "tse#0 may be a 0o!m o0 nu##"0"/at"on o! "ma"!ment *ou#d !omote t2e
e00e/t".eness o0 susens"on o0 /on/ess"ons "n "ndu/"n' /om#"an/e and *ou#d !e/o'n"Be
t2e !et!"but".e e#ement o0 su/2 a/t"on4 %on.e!se#y, *2e!e t2e de'!ee o0 /u#ab"#"ty "s #o*
but t2e t!ade e00e/ts a!e 2"'2, "t /ou#d #a/e a 0u!t2e! #"m"t on !eta#"ato!y a/t"on4 6!anted,
+embe!s may "mose ant"Jdum"n' and /ounte!.a"#"n' measu!es beyond t2e #e.e# o0
2a!m /aused, *2"/2 seems to dea!t some*2at 0!om t2e !e.a"#"n' 'ene!a# and
"nte!nat"ona# #a* !"n/"#e o0 !oo!t"ona#"ty4 Eo*e.e!, t2"s 0o##o*s *E.J.I.L. %$$% 0!om
a /#ea! de/"s"on, e:!essed "n t2e te:t "tse#0, about t2e !e#e.an/e o0 2a!m to t2e ena#ty
"mosed4101 $2e same /annot be sa"d "n !e#at"on to *2et2e! nu##"0"/at"on o! "ma"!ment
"s !est!"/ted to t!ade o! e/onom"/ e00e/ts "ndeendent o0 t2e ."o#at"on4 It "s t2e!e0o!e
!e0e!ab#e to !ead t2e !equ"!ement o0 equ".a#en/e bet*een susens"on o0 /on/ess"ons
and nu##"0"/at"on o! "ma"!ment "n a manne! /ons"stent *"t2 !oo!t"ona#"ty as a 'ene!a#
!"n/"#e o0 #a* and a !"n/"#e o0 /ustoma!y "nte!nat"ona# #a*, su/2 t2at /u#ab"#"ty 8t2e
."o#at"on "tse#09 s2ou#d be /ons"de!ed "n assess"n' t2e #e.e# o0 nu##"0"/at"on o! "ma"!ment4
& Actionable and Prohibited 3ubsidies
I no* tu!n to 2o* !oo!t"ona#"ty may be used "n /onne/t"on *"t2 !eta#"ato!y a/t"on 0o!
0a"#u!e to b!"n' a/t"onab#e o! pro"ibited subsidies "nto /on0o!m"ty *"t2 t2e ,$O
a'!eements as !e/ommended "n a Pane# o! Ae##ate Hody !eo!t adoted by t2e -SH4
He'"nn"n' *"t2 a/t"onab#e subs"d"es, t2e !u#e seems 0a"!#y s"m"#a! to t2at 0o! usua# ,$O
."o#at"ons4 In bot2 /ases, t2e a//etab#e #e.e# o0 !eta#"at"on 0o/uses on t2e 2a!m /aused J
"n t2e /ase o0 an a/t"onab#e subs"dy, t2e 2a!m /aused "s @t2e de'!ee and natu!e o0 t2e
ad.e!se e00e/ts dete!m"ned to e:"stA4102 $2ese a!e @ad.e!se e00e/ts to t2e "nte!ests o0
ot2e! +embe!sA, "n t2e 0o!m o0 "nCu!y to t2e domest"/ "ndust!y o0 anot2e! +embe!,
nu##"0"/at"on o! "ma"!ment o0 bene0"ts a//!u"n' d"!e/t#y o! "nd"!e/t#y to ot2e! +embe!s, o!
se!"ous !eCud"/e to t2e "nte!ests o0 anot2e! +embe!4103 Eo*e.e!, t2e *o!d"n' o0 t2e
!oo!t"ona#"ty !equ"!ement 8@/ounte!measu!esA a!e to be @/ommensu!ate *"t2 t2e de'!ee
and natu!e o0 t2e ad.e!se e00e/ts dete!m"ned to e:"stA9104 seems to '!ant '!eate!
d"s/!et"on to t2e a!b"t!ato! t2an "n t2e usua# /ase unde! t2e -SU 8*2e!e t2e @#e.e# o0
susens"on o0 /on/ess"ons Is2a## be equ".a#ent to t2e #e.e# o0 nu##"0"/at"on o!
"ma"!mentA9410;
No a!b"t!ato!s 2a.e yet been /a##ed uon to dete!m"ne *2et2e! !oosed
/ounte!measu!es a!e /ommensu!ate *"t2 t2e ad.e!se e00e/ts4103 Eo*e.e!, as *"t2
'ene!a# ,$O ."o#at"ons, !ead"n' t2"s !equ"!ement "n #"'2t o0 t2e !"n/"#e o0
!oo!t"ona#"ty su''ests t2at /u#ab"#"ty 8and not Cust 2a!m /aused9 s2ou#d #ay some
!o#e4 $2"s "s /ons"stent *"t2 t2e 0a/t t2at t2e un#a*0u# /ondu/t '"."n' !"se to /u#ab"#"ty
8t2at "s, '!ant"n' an a/t"onab#e subs"dy9 "s "tse#0 de0"ned by !e0e!en/e to t2e 2a!m /aused
8t2at "s, ad.e!se e00e/ts to t2e "nte!ests o0 ot2e! +embe!s94 Se/"0"/a##y, unde! A!t"/#e ;
o0 t2e S%+ A'!eement, @FnGo +embe! s2ou#d /ause, t2!ou'2 t2e use o0 any Fse/"0"/
subs"dyG, ad.e!se e00e/ts to t2e "nte!ests o0 ot2e! +embe!sA4 $2us, "n "dent"0y"n'
/ounte!measu!es /ommensu!ate *"t2 t2e de'!ee and natu!e o0 su/2 ad.e!se e00e/ts, t2e
a!b"t!ato! o! !eta#"at"n' +embe! ta?es "nto a//ount not on#y t2e 2a!m /aused but a#so t2e
/u#ab"#"ty o0 t2e subs"d"B"n' +embe!4 It /ou#d be sa"d t2at t2e !"n/"#e o0 !oo!t"ona#"ty
not on#y "n0o!ms t2e "nte!!etat"on o0 A!t"/#e D47 o0 t2e S%+ A'!eement, *E.J.I.L. %$$*
but "s "n/o!o!ated "n t2e use o0 t2e te!m @/ounte!measu!esA 8*2"/2 "s a te!m o0 a!t "n
/ustoma!y "nte!nat"ona# #a*9 and "s t2e!e0o!e a!t o0 t2e a#"/ab#e #a*4
As 0o! pro"ibited subsidies, unde! A!t"/#e 4410 o0 t2e S%+ A'!eement,
/ounte!measu!es must be @a!o!"ateA, *2"/2 @e:!ess"on "s not meant to a##o*
/ounte!measu!es t2at a!e d"s!oo!t"onate "n #"'2t o0 t2e 0a/t t2at t2e subs"d"es dea#t
*"t2 unde! t2ese !o."s"ons a!e !o2"b"tedA 80ootnote 794 P!oo!t"ona#"ty, as a 'ene!a#
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!"n/"#e o0 #a* o! a !"n/"#e o0 /ustoma!y "nte!nat"ona# #a*, /ou#d "n0#uen/e t2e o!d"na!y
mean"n' o0 t2e *o!ds @/ounte!measu!esA and @d"s!oo!t"onateA4
$2!ee A!t"/#e 2243 a!b"t!at"ons 2a.e e:am"ned t2e !os/!"t"on o0 d"s!oo!t"ona#"ty "n
0ootnote 7 o0 t2e S%+ A'!eement4 As t2e a!b"t!ato!s "n t2e 0"!st o0 t2ese a!b"t!at"ons
82razil - Aircraft 9 o"nted out:
"t seems d"00"/u#t to /#ea!#y "dent"0y 2o* t2e se/ond a!t o0 t2e senten/e 8@"n #"'2t o0 t2e
0a/t t2at t2e subs"d"es dea#t *"t2 unde! t2ese !o."s"ons a!e !o2"b"tedA9 !e#ates to t2e
0"!st a!t o0 t2e senten/e 8@$2"s e:!ess"on "s not meant to a##o* /ounte!measu!es t2at
a!e d"s!oo!t"onateA94 $2"s "s !obab#y due to t2e use o0 t2e *o!ds @"n #"'2t o0 t2e 0a/t
t2atA410D
Indeed, one m"'2t 2a.e e:e/ted t2e d!a0te!s to state t2at /ounte!measu!es must not
be d"s!oo!t"onate @toA t2e '!a."ty o0 t2e o00en/e o! t2e 2a!m /aused4 Instead, t2e use
o0 t2e *o!ds @"n #"'2t o0 t2e 0a/t t2atA t2e subs"d"es a!e !o2"b"ted #ea.es oen t2e
quest"on o0 *2at "t "s t2at /ounte!measu!es must not be d"s!oo!t"onate to4 $2e
o!d"na!y mean"n' o0 a @/ounte!measu!eA does not !eso#.e t2"s quest"on 8as "t may be
d"!e/ted to*a!ds t2e "##e'a# subs"dy o! t2e 2a!m /aused by t2at subs"dy9410= Eo*e.e!,
!ead"n' 0ootnote 7 o0 t2e S%+ A'!eement /ons"stent#y *"t2 t2e !"n/"#e o0
!oo!t"ona#"ty "n 'ene!a# and "nte!nat"ona# #a* su''ests t2at bot2 /u#ab"#"ty and 2a!m
s2ou#d be /ons"de!ed "n assess"n' *2et2e! /ounte!measu!es a!e d"s!oo!t"onate4 $2e
!e0e!en/e to t2e 0a/t t2at t2e subs"d"es a!e !o2"b"ted "nd"/ates t2at t2e de'!ee o0
/u#ab"#"ty "s 0a"!#y 2"'2 0o! t2"s ?"nd o0 ,$O ."o#at"on4 In ot2e! *o!ds, t2e !o2"b"ted
natu!e o0 t2e subs"d"es "n quest"on "s an @a''!a.at"n'A !at2e! t2an a @m"t"'at"n'A
0a/to!4107 Hut t2at does not mean t2at /u#ab"#"ty a#one "s dete!m"nat".e "n assess"n'
!oo!t"ona#"ty4 Indeed, a#t2ou'2 a /om#a"n"n' +embe! need not demonst!ate t2at a
!o2"b"ted subs"dy "s /aus"n' 2a!m "n o!de! to estab#"s2 a ."o#at"on, t2"s may be be/ause
su/2 subs"d"es a!e !e'a!ded as "n2e!ent#y o! ne/essa!"#y 2a!m0u# !at2e! t2an be/ause
2a!m "s "!!e#e.ant4 $2"s /on/#us"on "s /ons"stent *"t2 Renou0Ns !e0e!en/e to t2e
@"!!ebuttab#e !esumt"on o0 t!ade e00e/t atta/2ed to pro"ibited subsidiesA4110
A!t"/#e 2243 a!b"t!ato!s 2a.e "nte!!eted 0ootnote 7 !at2e! d"00e!ent#y4 As ad.e!se e00e/ts
need not be demonst!ated to estab#"s2 t2e e:"sten/e o0 a !o2"b"ted subs"dy "n ."o#at"on
o0 A!t"/#e 3 o0 t2e S%+ A'!eement,111 t2e a!b"t!ato!s "n 0) - 4)$ su''ested *E.J.I.L.
%$$+ t2at /ounte!measu!es may e:/eed *2at "s ne/essa!y to /ounte! any su/2
e00e/ts4112 Instead, "n a## t2!ee a!b"t!at"ons on t2"s o"nt, t2e a!b"t!ato!s 2a.e sta!ted o!
ended t2e"! !oo!t"ona#"ty ana#ys"s *"t2 t2e amount o0 t2e !o2"b"ted subs"dy,113 *2"/2
/an be seen as !e!esent"n' t2e e:tent o0 t2e @*!on'0u# a/tA 114 o! /u#ab"#"ty o0 t2e
subs"d"B"n' +embe!4 Ea!m /aused by t2e !o2"b"ted subs"dy 8"n/#ud"n' "ts e00e/ts on t2e
/om#a"nantNs t!ade9 2as been !e#e'ated to t2e !o#e o0 a otent"a##y !e#e.ant 0a/to! !at2e!
t2an a ne/essa!y /ons"de!at"on411;
$2"s "nte!!etat"on o0 0ootnote 7 "s not me!e#y at odds *"t2 t2e !"n/"#e o0
!oo!t"ona#"ty, *2"/2 "s "n0o!med by not"ons o0 Cust"/e and 0a"!ness5 "t a#so !a"ses se!"ous
!ob#ems '".en t2at t2e ,$O "s a mu#t"#ate!a# a'!eement "n *2"/2 nume!ous ,$O
+embe!s may /2a##en'e a !o2"b"ted subs"dy4 I0 2a!m does not #ay a #"m"t"n' !o#e "n
assess"n' t2e !oo!t"ona#"ty o0 /ounte!measu!es, t2"s means t2at t2e 0"!st /om#a"nant
may !eta#"ate beyond t2e #e.e# "t 2as su00e!ed and u to t2e 0u## amount o0 t2e
subs"d"B"n' +embe!Ns /u#ab"#"ty4 &ate! /om#a"nants *"## e"t2e! 2a.e to !e#y on t2e 0"!st
/om#a"nantNs de/"s"on about *2et2e! to "mose /ounte!measu!es as aut2o!"Bed by t2e
-SH, o! t2ey *"## be '!anted an add"t"ona# !"'2t to "mose /ounte!measu!es, mean"n'
t2at t2e subs"d"B"n' +embe! must ay se.e!a# t"mes o.e! 0o! "ts ."o#at"on4 A!t"/#e 2243
a!b"t!ato!s 2a.e su''ested t2at t2"s !ob#em /an be a.o"ded and t2e /ounte!measu!es
aut2o!"Bed *"## deend on t2e numbe! o0 /om#a"nants4113 Eo*e.e!, t2"s assumes t2at
a## /2a##en'es to a a!t"/u#a! !o2"b"ted subs"dy *"## be b!ou'2t at t2e same t"me4 It a#so
seems st!an'e t2at t2e quest"on *2et2e! a '".en /ounte!measu!e !oosed by a ,$O
+embe! /om#"es *"t2 t2e !oo!t"ona#"ty !equ"!ement *"## deend on ot2e! +embe!sN
/om#a"nts about t2e same measu!e4
In $anada - Aircraft, t2e a!b"t!ato!s dete!m"ned t2at /ounte!measu!es amount"n' to 120
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e! /ent o0 t2e amount o0 t2e !o2"b"ted subs"dy *e!e not d"s!oo!t"onate411D $2e
a!b"t!ato!s m"'2t 2a.e /2osen to base t2"s de/"s"on on a 0"nd"n' t2at %anadaNs /u#ab"#"ty
"n '!ant"n' t2e !o2"b"ted subs"dy, and t2e 2a!m /aused by t2at subs"dy, *ent beyond
t2e amount o0 t2e subs"dy4 $2"s *ou#d 2a.e been /ons"stent *"t2 t2e !"n/"#e o0
!oo!t"ona#"ty4 Eo*e.e!, t2"s *as not t2e"! !at"ona#e4 Rat2e!, t2e a!b"t!ato!s added t2e
add"t"ona# 20 e! /ent @to ta?e "nto a//ount t2e 0a/t t2at %anada, unt"# no*, 2as stated
t2at "t does not "ntend to *"t2d!a* t2e subs"dy at "ssue and t2e need to !ea/2 a #e.e# o0
/ounte!measu!es *2"/2 /an !easonab#y /ont!"bute to "ndu/e /om#"an/eA411= A## A!t"/#e
2243 a!b"t!ato!s 2a.e su''ested t2at t2e u!ose o0 *E.J.I.L. %$$, /ounte!measu!es
unde! A!t"/#e 4410 o0 t2e S%+ A'!eement "s to "ndu/e /om#"an/e t2!ou'2 t2e *"t2d!a*a#
o0 t2e !o2"b"ted subs"dy4117
In t2"s /onte:t, I a'!ee *"t2 Pa#mete! and A#e:and!o. t2at t2e a!b"t!ato!s *ent too
0a!4120 E.en assum"n' t2at t2e u!ose o0 /ounte!measu!es 0o! pro"ibited subsidies "s
to "ndu/e /om#"an/e, to use t2"s as a Cust"0"/at"on 0o! "n/!eas"n' /ounte!measu!es
beyond t2e de'!ee o0 /u#ab"#"ty o! 2a!m "s #a"n#y /ont!a!y to t2e !"n/"#e o0
!oo!t"ona#"ty4 As I su''ested ea!#"e! "n !e#at"on to !oo!t"ona#"ty as a 'ene!a# !"n/"#e
o0 #a*, nonJ/oma!at".e !oo!t"ona#"ty sets an abso#ute /e"#"n' on t2e amount o0 t2e
ena#ty "mosed 0o! a '".en o00en/e, based on t2e se!"ousness o0 t2e o00en/e and t2e
"nCu!y "t /auses4 $2e a!b"t!ato!s "n $anada - Aircraft 2ad d"s/!et"on to "dent"0y t2"s /e"#"n'
and, be#o* t2"s /e"#"n', to adCust t2e amount o0 t2e /ounte!measu!es a//o!d"n' to
/oma!at".e !oo!t"ona#"ty 8t2at "s, /ounte!measu!es a##o*ed "n s"m"#a! /ases, *2"/2 t2e
a!b"t!ato!s d"d /ons"de!9121 and ot2e! 0a/to!s su/2 as ut"#"ta!"an obCe/t".es, "n/#ud"n'
dete!!en/e and "ndu/"n' /om#"an/e4
" 3afe)uards
In t*o t!ade !emedy d"sutes, t2e Ae##ate Hody 2as !e/o'n"Bed t2e !"n/"#e o0
!oo!t"ona#"ty as a !"n/"#e o0 /ustoma!y "nte!nat"ona# #a*4122 K"!st, "t d"d so "m#"/"t#y
"n 0) - $otton 5arn "n 2001, based on A!t"/#e ;1 o0 t2e I&% A!t"/#es 8t2en "n d!a0t
0o!m94123 Ne:t, "t d"d so e:#"/"t#y "n 0) - 6ine Pipe "n 2002, based not on#y on A!t"/#e ;1
but a#so on t*o I%) de/"s"ons4124 In t2at /ase, t2e Ae##ate Hody a#so @obse!.edA t2at
t2e Un"ted States "tse#0 2ad !e/o'n"Bed t2e e:"sten/e o0 su/2 a !"n/"#e "n /ustoma!y
"nte!nat"ona# #a* "n "ts /omments on t2e d!a0t I&% A!t"/#es and "n an "nte!nat"ona# a!b"t!a#
t!"buna#412; O0 "tse#0, t2e Ae##ate HodyNs !e/o'n"t"on o0 t2e !oo!t"ona#"ty !"n/"#e
may not be a!t"/u#a!#y !ema!?ab#e4 Eo*e.e!, "n bot2 /ases t2e Ae##ate Hody used t2e
!"n/"#e o0 !oo!t"ona#"ty "n an unusua# *ay4
In 0) - $otton 5arn, t2e Ae##ate Hody *as e:am"n"n' t2e @se/"0"/ t!ans"t"ona#
sa0e'ua!d me/2an"smA123 !o."ded unde! A!t"/#e 3 o0 t2e no* de0un/t A'!eement on
$e:t"#es and %#ot2"n' 8A$%9412D $2"s me/2an"sm enab#ed a +embe! to "mose a
sa0e'ua!d "0 a !odu/t *as be"n' "mo!ted "nto "ts te!!"to!y "n su/2 "n/!eased quant"t"es
as to /ause se!"ous dama'e to t2e domest"/ "ndust!y !odu/"n' #"?e o! d"!e/t#y
/omet"t".e *E.J.I.L. %$$5 !odu/ts412= A!t"/#e 344 o0 t2e A$% stated t2at +embe!s
2ad to a#y sa0e'ua!d measu!es @on a +embe!JbyJ+embe! bas"sA, su/2 t2at @+embe!s
to *2om se!"ous dama'e "s att!"buted Is2a## be dete!m"ned on t2e bas"s o0 a s2a! and
substant"a# "n/!ease "n "mo!ts I0!om su/2 I+embe!s "nd"."dua##yA4 $2"s /ont!asts *"t2
t2e +KN !u#e "n A!t"/#e 242 o0 t2e A'!eement on Sa0e'ua!ds, *2"/2 states t2at sa0e'ua!ds
"mosed unde! t2at a'!eement @s2a## be a#"ed to a !odu/t be"n' "mo!ted "!!ese/t".e
o0 "ts sou!/eA4 Hased !"ma!"#y on A!t"/#e 344, t2e Ae##ate Hody /on/#uded t2at @t2e a!t
o0 t2e tota# se!"ous dama'e att!"buted to an e:o!t"n' +embe!A 8and, 2en/e, t2e #e.e# o0
t2e sa0e'ua!d a#"ed to t2at +embe!9 @must be !oo!t"onate to t2e dama'e /aused by
t2e "mo!ts 0!om t2at +embe!A4127 $2"s seems to 0o##o* 0!om t2e te:t o0 t2e !o."s"on,
a!t"/u#a!#y *2en !ead "n /onte:t4
$2e Ae##ate Hody /ou#d *e## 2a.e ended "ts ana#ys"s 2e!e4 Eo*e.e!, "t *ent on to
suo!t "ts "nte!!etat"on o0 A!t"/#e 344 o0 t2e A$% by !e0e!en/e to t2e !oo!t"ona#"ty
!"n/"#e4 $2e Ae##ate Hody su''ested t2at A!t"/#e 2244 o0 t2e -SU "n/o!o!ates t2"s
!"n/"#e by !equ"!"n' susens"on o0 /on/ess"ons to be equ".a#ent to t2e #e.e# o0
nu##"0"/at"on o! "ma"!ment4130 I /ame to a s"m"#a! /on/#us"on abo.e4 Hut *2at does t2at
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2a.e to do *"t2 t2e t!ans"t"ona# sa0e'ua!d unde! t2e A$%O Not"n' t2at sa0e'ua!ds a!e not
"mosed "n !esonse to un0a"! t!ade, t2e Ae##ate Hody stated:
It *ou#d be absu!d "0 t2e b!ea/2 o0 an "nte!nat"ona# ob#"'at"on *e!e san/t"oned by
!oo!t"onate /ounte!measu!es, *2"#e, "n t2e absen/e o0 su/2 b!ea/2, a ,$O +embe!
*ou#d be subCe/t to a d"s!oo!t"onate and, 2en/e, @un"t".eA, att!"but"on o0 se!"ous
dama'e not *2o##y /aused by "ts e:o!ts4 In ou! ."e*, su/2 an e:o!b"tant de!o'at"on
0!om t2e !"n/"#e o0 !oo!t"ona#"ty "n !ese/t o0 t2e att!"but"on o0 se!"ous dama'e /ou#d
be Cust"0"ed on#y "0 t2e d!a0te!s o0 t2e AT$ 2ad e:!ess#y !o."ded 0o! "t, *2"/2 "s not t2e
/ase4131
A#t2ou'2 t2e Ae##ate Hody d"d not !e0e! to t2e !"n/"#e o0 !oo!t"ona#"ty "n t2e
/onte:t o0 ant"Jdum"n' o! /ounte!.a"#"n' measu!es, t2e !"n/"#e "t a#"ed *as s"m"#a!
to t2at e:"st"n' unde! t2e Ant"J-um"n' A'!eement and Pa!t V o0 t2e S%+ A'!eement4
Put s"m#y, "t /on/#uded t2at te:t"#e sa0e'ua!ds /ou#d not be a#"ed to a +embe! 0!om
*2om "mo!ts 2ad not "n/!eased 8Cust as ant"Jdum"n' dut"es /annot 'ene!a##y be
"mosed a'a"nst a /omany *2ose e:o!ts 2a.e not been dumed, and /ounte!.a"#"n'
dut"es /annot 'ene!a##y be "mosed a'a"nst a /omany *2ose e:o!ts 2a.e not been
subs"d"Bed94 Intu"t".e#y, t2"s seems #"?e a 0a"! and sens"b#e !esu#t, and "t may *e## 0#o*
0!om a !oe! !ead"n' o0 A!t"/#e 344 o0 t2e A$%, as ment"oned ea!#"e!4 Eo*e.e!, "t seems
to me t2at t2e Ae##ate HodyNs "n.o/at"on o0 t2e !oo!t"ona#"ty !"n/"#e "n t2"s /onte:t
*as not on#y unne/essa!y but a#so "na!o!"ate4
It *ou#d 2a.e been one t2"n' 0o! t2e Ae##ate Hody to !eason t2at ant"Jdum"n' dut"es
/annot e:/eed t2e dum"n' ma!'"n, and /ounte!.a"#"n' dut"es /annot e:/eed t2e amount
o0 t2e subs"dy, 8!e0#e/t"n' t2e !"n/"#e o0 !oo!t"ona#"ty9, and t2e!e0o!e "t *ou#d not
ma?e sense 0o! sa0e'ua!ds to e:/eed t2e "n/!ease "n "mo!ts Cust"0y"n' *E.J.I.L. %$$6
t2e"! a#"/at"on4 It *as qu"te anot2e! 0o! t2e Ae##ate Hody to a#y t2e !oo!t"ona#"ty
!"n/"#e "n "nte!!et"n' A!t"/#e 344 o0 t2e A$%, *2"/2 "s *2at "t d"d, stat"n' t2at t2"s
!o."s"on @"s to be seen "n t2e #"'2t o0 t2e !"n/"#e o0 !oo!t"ona#"ty as t2e means o0
dete!m"n"n' t2e s/oe o! assess"n' t2e a!t o0 t2e tota# se!"ous dama'e t2at /an be
att!"buted to an e:o!t"n' +embe!A4132 %u#ab"#"ty #ays an essent"a# !o#e "n t2e !"n/"#e
o0 !oo!t"ona#"ty, *2e!e e.e!y "nstan/e "n.o#.es /u#ab"#"ty t2!ou'2 an un#a*0u# o!
undes"!ab#e a/t4 In t2e absen/e o0 /u#ab"#"ty, san/t"ons /an 2a.e no !et!"but".e u!ose
o! e00e/t4 $2e Ae##ate Hody e:!ess#y !e/o'n"Bed t2at sa0e'ua!ds a!e not !esonses to
un0a"! o! /u#ab#e /ondu/t, but "t a#"ed t2e !"n/"#e o0 !oo!t"ona#"ty any*ay4 It "s not
/#ea! *2at mean"n' t2at !"n/"#e /an 2a.e *2en d".o!/ed 0!om one o0 "ts /o!e e#ements
and !at"ona#es4
$2e se/ond /ase "n *2"/2 t2e Ae##ate Hody !e/o'n"Bed t2e !"n/"#e o0 !oo!t"ona#"ty
"n /onne/t"on *"t2 sa0e'ua!ds *as 0) - 6ine Pipe. In t2at /ase, t2e Ae##ate Hody *as
e:am"n"n' A!t"/#e ;41 o0 t2e A'!eement on Sa0e'ua!ds, *2"/2 !equ"!es +embe!s to
"mose sa0e'ua!ds @on#y to t2e e:tent ne/essa!y to !e.ent o! !emedy se!"ous "nCu!y and
to 0a/"#"tate adCustmentA4133 $2e Ae##ate Hody /2a!a/te!"Bed t2e quest"on be0o!e "t as
@*2et2e! t2e e!m"ss"b#e e:tent o0 a sa0e'ua!d measu!e "s #"m"ted to t2e "nCu!y t2at /an
be att!"buted to "n/!eased "mo!ts, o! *2et2e! a sa0e'ua!d measu!e may a#so add!ess
t2e "nCu!"ous e00e/ts /aused by ot2e! 0a/to!sA4134 In ans*e!"n' t2"s quest"on, t2e
Ae##ate Hody 0"!st noted t2at A!t"/#e 4428b9 o0 t2e A'!eement on Sa0e'ua!ds states
t2at, @F*G2en 0a/to!s ot2e! t2an "n/!eased "mo!ts a!e /aus"n' "nCu!y to t2e domest"/
"ndust!y at t2e same t"me, su/2 "nCu!y s2a## not be att!"buted to "n/!eased "mo!tsA4 It
su''ested t2at t2"s !o."s"on @"n0o!ms t2e e!m"ss"b#e e:tent to *2"/2 t2e sa0e'ua!d
measu!e may be a#"ed u!suant to A!t"/#e ;41A413;
$2e Ae##ate Hody quoted /e!ta"n assa'es !e#at"n' to !oo!t"ona#"ty "n 0) - $otton
5arn and stat"n' t2at @t2e same !eason"n' a#"es 2e!eA4133 In add"t"on to /oma!"n' t2e
"mos"t"on o0 sa0e'ua!ds to t2e susens"on o0 /on/ess"ons, as "t 2ad done "n 0) - $otton
5arn, t2e Ae##ate Hody /oma!ed t2e "mos"t"on o0 sa0e'ua!ds to t2e "mos"t"on o0
ant"Jdum"n' o! /ounte!.a"#"n' measu!es:
I0 t2e a"n "n0#"/ted on e:o!te!s by a sa0e'ua!d measu!e *e!e e!m"tted to 2a.e e00e/ts
beyond t2e s2a!e o0 "nCu!y /aused by "n/!eased "mo!ts, t2"s *ou#d "m#y t2at an
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e:/et"ona# !emedy, *2"/2 "s not meant to !ote/t t2e "ndust!y o0 t2e "mo!t"n' /ount!y
0!om un0a"! o! "##e'a# t!ade !a/t"/es, /ou#d be a#"ed "n a mo!e t!adeJ!est!"/t".e manne!
t2an /ounte!.a"#"n' and ant"Jdum"n' dut"es4 On *2at bas"s s2ou#d t2e WTO Agreement
be "nte!!eted to #"m"t a /ounte!measu!e to t2e e:tent o0 t2e "nCu!y /aused by un0a"!
!a/t"/es o! a ."o#at"on o0 t2e t!eaty but not so #"m"t a /ounte!measu!e *2en t2e!e 2as
not e.en been an a##e'at"on o0 a ."o#at"on o! an un0a"! !a/t"/eO13D
$2e Ae##ate Hody t2e!e0o!e !ead A!t"/#e ;41 as !equ"!"n' sa0e'ua!ds to be #"m"ted to t2e
e:tent ne/essa!y to !e.ent o! !emedy se!"ous "nCu!y att!"buted to "n/!eased *E.J.I.L.
%$$7 "mo!ts413= It "s "nte!est"n' to note t2at t2e Ae##ate Hody 2e!e !e0e!!ed to
/ounte!measu!es, e.en t2ou'2 t2e A'!eement on Sa0e'ua!ds does not !e0e! to
sa0e'ua!ds as /ounte!measu!es4 Indeed, t2e on#y !e0e!en/e to /ounte!measu!es "n t2e
,$O a'!eements "s, as des/!"bed abo.e, "n /onne/t"on *"t2 subs"d"es t2at 2a.e been
0ound "n/ons"stent *"t2 Pa!t II o! III o0 t2e S%+ A'!eement 8!e'a!d"n' !o2"b"ted and
a/t"onab#e subs"d"es !ese/t".e#y94137
$2e Ae##ate HodyNs use o0 !oo!t"ona#"ty "n t2e /onte:t o0 t2e A'!eement on
Sa0e'ua!ds su00e!s 0!om t2e same de0"/"en/y as "ts use o0 !oo!t"ona#"ty "n t2e /onte:t
o0 t2e A$%: t2e absen/e o0 /u#ab"#"ty !ende!s t2e !"n/"#e a#most mean"n'#ess4
Eo*e.e!, t2e de0"/"en/y "s e.en '!eate! unde! t2e A'!eement on Sa0e'ua!ds4 As a#!eady
e:#a"ned, "0 a +embe! de/"des to a#y sa0e'ua!ds unde! t2"s a'!eement be/ause a
@!odu/t "s be"n' "mo!ted "nto "ts te!!"to!y "n su/2 "n/!eased quant"t"es Iand unde! su/2
/ond"t"ons as to /ause Ise!"ous "nCu!y to t2e domest"/ "ndust!yA,140 t2e +embe! must
a#y sa0e'ua!ds to ea/2 "mo!t o0 t2at !odu/t @"!!ese/t".e o0 "ts sou!/eA4141 In 0) -
6ine Pipe, t2e Ae##ate Hody *as t2e!e0o!e not add!ess"n' t2e att!"but"on to d"00e!ent
+embe!s o0 "n/!eased "mo!ts4 Rat2e!, "t *as add!ess"n' t2e att!"but"on to @"n/!eased
"mo!tsA 8as oosed to ot2e! 0a/to!s9 o0 "nCu!y su00e!ed by t2e domest"/ "ndust!y4142 A
sa0e'ua!d "mosed unde! t2e A'!eement on Sa0e'ua!ds "s t2e!e0o!e e.en #ess #"?e a
ena#ty t2an t2e t!ans"t"ona# sa0e'ua!d unde! t2e A$% t2at t2e Ae##ate Hody add!essed
"n 0) - $otton 5arn.
It seems /#ea! 0!om t2e te!ms o0 A!t"/#e ;41 "tse#0 t2at sa0e'ua!ds /an 'o beyond *2at "s
needed to !e.ent o! !emedy se!"ous "nCu!y J t2ey /an be used a#so to t2e e:tent
ne/essa!y @to 0a/"#"tate adCustmentA4143 Putt"n' t2"s to one s"de, t2e Ae##ate Hody "s
!obab#y /o!!e/t t2at t2e @se!"ous "nCu!yA des/!"bed "n A!t"/#e ;41 "s se!"ous "nCu!y /aused
by "n/!eased "mo!ts4 >et, as "n 0) - $otton 5arn, "t d"d not need to !e#y on t2e
!oo!t"ona#"ty !"n/"#e to !ea/2 t2"s /on/#us"on4 As t2e Ae##ate Hody /o!!e/t#y o"nted
out,144 A!t"/#e 4428b9 o0 t2e A'!eement on Sa0e'ua!ds /on0"!ms t2at t2e se!"ous "nCu!y
t2at "s !e#e.ant "s t2at /aused by "n/!eased "mo!ts4 Ku!t2e!mo!e, A!t"/#e QIQ:18a9 o0
6A$$ 1774, 0!om *2"/2 t2e A'!eement on Sa0e'ua!ds de!".es, !o."des:
I0 Iany !odu/t "s be"n' "mo!ted "nto t2e te!!"to!y o0 Fa +embe!G "n su/2 "n/!eased
quant"t"es and unde! su/2 /ond"t"ons as to /ause o! t2!eaten se!"ous "nCu!y to domest"/
!odu/e!s "n t2at te!!"to!y o0 #"?e o! d"!e/t#y /omet"t".e !odu/ts, t2e +embe! s2a## be
0!ee Fto "mose a sa0e'ua!dG "n !ese/t o0 su/2 !odu/t Ito t2e e:tent and 0o! su/2 t"me
as may be ne/essa!y to !e.ent o! !emedy su/2 "nCu!y4
*E.J.I.L. %$$8 E."dent#y, t2e te!m @su/2 "nCu!yA "n t2"s !o."s"on !e0e!s to t2e se!"ous
"nCu!y des/!"bed ea!#"e! "n t2e assa'e, /on0"!m"n' t2at t2e "nCu!y !e#e.ant to t2e "nqu"!y
"s se!"ous "nCu!y /aused by "n/!eased "mo!ts4
$2e Un"ted StatesN a!t"/u#a!#y .e2ement !ea/t"on to 0) - 6ine Pipe14; may 2a.e
stemmed 0!om t2e Ae##ate HodyNs !e/o'n"t"on o0 t2e !"n/"#e o0 !oo!t"ona#"ty o!,
mo!e se/"0"/a##y, "ts use o0 t2at !"n/"#e "n "nte!!et"n' t2e ,$O a'!eements4 In t2"s
se/t"on, I 2a.e 2"'2#"'2ted se.e!a# d"00"/u#t"es *"t2 t2e Ae##ate HodyNs use o0 t2e
!oo!t"ona#"ty !"n/"#e "n 0) - 6ine Pipe, as *e## as 0) - $otton 5arn. $2"s !o."des an
e:am#e o0 t2e dan'e!s o0 us"n' !"n/"#es *"t2 "nsu00"/"ent !e/"s"on4
- %onlusion
$2"s a!t"/#e 2as !o."ded /e!ta"n e."den/e to su''est t2at !oo!t"ona#"ty /ou#d be
/2a!a/te!"Bed as a 'ene!a# !"n/"#e o0 #a* and a !"n/"#e o0 /ustoma!y "nte!nat"ona# #a*4
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+o!e "mo!tant#y, "t 2as demonst!ated 2o* t2e !"n/"#e o0 !oo!t"ona#"ty /ou#d be used
"n !e#at"on to ,$O d"sutes, a!t"/u#a!#y "n e.a#uat"n' t2e #e.e# and tye o0 mu#t"#ate!a#
and un"#ate!a# !emed"es t2at ,$O +embe!s may 2a.e "n !esonse to a ,$O ."o#at"on o!
ot2e! /ondu/t t2at "s /#ass"0"ed as un0a"! "n t2e ,$O a'!eements4
P!oo!t"ona#"ty /ou#d be used "n a nonJ"nte!!etat".e manne! as a!t o0 t2e a#"/ab#e
#a*, to t2e e:tent t2at "t "s "n/o!o!ated "n /e!ta"n ,$O !o."s"ons su/2 as 0ootnote 7 o0
t2e S%+ A'!eement4 Hut t2e most ob."ous *ay "n *2"/2 t2e !"n/"#e o0 !oo!t"ona#"ty
/ou#d be used "s "n "nte!!et"n' t2e ,$O a'!eements4 In t2"s !e'a!d, "t /on0"!ms t2e
u!ose o0 susens"on o0 /on/ess"ons as "ndu/"n' /om#"an/e, as *e## as t2e #"m"t on
!eta#"at"on estab#"s2ed by t2e 2a!m /aused by and /u#ab"#"ty asso/"ated *"t2 t2e ,$O
."o#at"on "n quest"on4
$2"s a!t"/#e 2as a#so !e.ea#ed t2at !"n/"#es su/2 as !oo!t"ona#"ty s2ou#d be used *"t2
/aut"on "n ,$O d"sutes4 ,2e!e t2e te:t o0 a ,$O !o."s"on "s /#ea!#y /ont!a!y to a
'ene!a# !"n/"#e o0 #a* o! a !"n/"#e o0 /ustoma!y "nte!nat"ona# #a*, t2e !"n/"#e /annot
be used to "nte!!et t2"s d"st"n/t"on a*ay4 $2us, !oo!t"ona#"ty /annot be used "n an
"nte!!etat".e manne! to /2an'e t2e /#ea! "ntent"on o0 t2e d!a0te!s o0 t2e Ant"J-um"n'
A'!eement and t2e S%+ A'!eement t2at +embe!s s2ou#d be ent"t#ed to "mose ant"J
dum"n' o! /ounte!.a"#"n' measu!es beyond t2e #e.e# o0 2a!m /aused by t2e /2a##en'ed
dum"n' o! subs"d"Bat"on 8!o."ded t2at t2e measu!es /om#y *"t2 t2e ot2e! /ond"t"ons
o0 t2e a'!eements94 K"na##y, "0 ,$O $!"buna#s a!e to use !"n/"#es to "n0o!m t2e"!
"nte!!etat"on o0 a!t"/u#a! !o."s"ons, t2ey must ensu!e t2at t2ey 2a.e se/u!e '!ounds
0o! do"n' so4 As e:#a"ned "n t2"s a!t"/#e, I !e'a!d !oo!t"ona#"ty as 2a."n' no !e#e.an/e
to t2e "mos"t"on o0 sa0e'ua!ds, be/ause sa0e'ua!ds a!e not "mosed "n !esonse to any
"##e'a# o! un0a"! a/t, and !oo!t"ona#"ty "n 'ene!a# and "nte!nat"ona# #a* /ent!es on bot2
2a!m and /u#ab"#"ty4 A//o!d"n'#y, ,$O $!"buna#s 2a.e e!!ed "n t2e"! use o0 t2e !"n/"#e
o0 !oo!t"ona#"ty "n t2"s /onte:t4
P2- 8%antab9, &&+ 8Ea!.9, &&H 8Eons9 8+e#b9, H%om 8Eons9 8+e#b95 Sen"o! &e/tu!e!,
Ka/u#ty o0 &a*, Un".e!s"ty o0 +e#bou!ne5 Ha!!"ste! and So#"/"to!, Su!eme %ou!t o0
V"/to!"a4 $2"s a!t"/#e d!a*s on a #a!'e! *o!? by t2e aut2o! on t2e !o#e o0 #e'a# !"n/"#es
"n ,$O d"sute sett#ement 86egal Principles in WTO 7isputes 9, *2"/2 *"## be ub#"s2ed
by %amb!"d'e Un".e!s"ty P!ess "n ea!#y 200D4 $2e aut2o! *ou#d #"?e to t2an? -! $an"a
Voon 0o! 2e! 2e#0u# /omments and su''est"ons4 Ema"#: a4m"t/2e##Run"me#b4 edu4au4
E4)4I4&4 2003, 1D8;9, 7=;J100=
14
%ann"BBa!o, @$2e Ro#e o0 P!oo!t"ona#"ty "n t2e &a* o0 Inte!nat"ona# %ounte!measu!esA, 12
*8%6 820019 ==7, at 7034
24
,4 $!umb#e and A4 Ste.enson 8eds49, )horter O#ford *nglish 7ictionary on !istorical
Principles 8;t2 edn, 20029, "", at 23D14
34
P4 Ny'2 and P4 Hutt 8eds9, Australian 6egal 7ictionary 8177D9, at 7414
44
("!?, @%onst"tut"ona# 6ua!antees, %2a!a/te!"Bat"on and t2e %on/et o0 P!oo!t"ona#"tyA, 21
Melbourne 0. 6a" 9ev. 8177D9 1, at 24
;4
Ko! d"00e!ent ."e*s on t2"s quest"on, see t2e sou!/es /"ted "n 6a!dam, @P!oo!t"ona#"ty as
a Rest!a"nt on t2e Use o0 Ko!/eA, 20 Australian 5earboo' %nt:l 6a" 817779 131, at 1314 On
one ."e*, t2e !"n/"#e @2as 0ound a#most un".e!sa# a//etan/e "n some *ay o! anot2e! "n
domest"/ #e'a# o!de!sA: -e#b!S/?, @P!oo!t"ona#"tyA, "n R4 He!n2a!dt 8ed49, *ncyclopaedia
of Public %nternational 6a" 820039, """, 1140, at 11414
34
On t2"s quest"on, see 6!"e', @Re/"!o/"ty, P!oo!t"ona#"ty, and t2e &a* o0 $!eat"esA, 34
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;irginia 8. %nt:l 6a" 817749 27;, at 322J3244 A'a"n, on one ."e*, @t2e *"des!ead
a//etan/e o0 t2e !"n/"#e "n .a!"ous a!eas o0 "nte!nat"ona# #a* and "ts 0undamenta#
"mo!tan/e 0o! t2e "nte!nat"ona# #a*Ja#y"n' !o/ess su''ests t2at !oo!t"ona#"ty /an
a#!eady be /2a!a/te!"Bed as a 'ene!a# !"n/"#e o0 "nte!nat"ona# #a*A: -e#b!S/?, supra note
;, at 11444
D4
See, e4'4, de HT!/a, @Subs"d"a!"ty and P!oo!t"ona#"ty as 6ene!a# P!"n/"#es o0 &a*A, "n )4
Ne!'e#"us and U4 He!n"tB 8eds9, The +eneral Principles of *$ 6a" 820009, at 7D5
He!mann, @$2e P!"n/"#e o0 P!oo!t"ona#"tyA, 23 American 8. $omp. 6a" )upp. 817DDJ
17D=9 41;4
=4
See, e4'4, Pa!?, @(o!ean P!"n/"#e o0 P!oo!t"ona#"ty, Ame!"/an +u#t"J#e.e#ed S/!ut"ny, and
Em"!"/"st E#ements "n USJ(o!ean %onst"tut"ona# )u!"s!uden/eA, 1 8. <orean 6a" 820019
10;, at 107J1105 ("!?, @%onst"tut"ona# 6ua!antees, %2a!a/te!"Bat"on and t2e %on/et o0
P!oo!t"ona#"tyA, 21 Melbourne 0. 6a" 9ev. 8177D9 1, at ;J74
74
See, e4'4, UN, 0niversal 7eclaration of !uman 9ights, 6A Res 21DA8III9 810 -e/4 174=9,
A!t4 278295 %nternational $ovenant on $ivil and Political 9ights, 777 UN$S 1D1 8adoted
13 -e/4 17339, A!ts 21, 228194
104
See, e4'4, $H$ A'!eement, A!ts 244, ;445 SPS A'!eement, A!t4 2445 6A$$ 1774, A!t4 QQ5
Sy?es, @$2e &east Rest!"/t".e +eansA, D0 0. $hicago 6a" 9ev. 820039 4035 Neumann and
$S!?, @Ne/ess"ty Re."s"ted: P!oo!t"ona#"ty "n ,o!#d $!ade O!'an"Bat"on &a* A0te! (o!eaJ
Hee0, E%JAsbestos and E%JSa!d"nesA, 3D 8. World Trade 820039 1774
114
E"#0, @Po*e!, Ru#es and P!"n/"#es J ,2"/2 O!"entat"on 0o! ,$O/6A$$ &a*OA, 4 8. %nt:l *con.
6a" 820019 111, at 120J121 80ootnote om"tted94
124
-esmedt, @P!oo!t"ona#"ty "n ,$O &a*A, 4 8. %nt:l *con. 6a" 820019 441, at 442J4434
134
Prosecutor v. 2las'ic 8I$J7;J149 Inte!nat"ona# %!"m"na# $!"buna# 0o! t2e 0o!me!
>u'os#a."a, )ud'ment o0 3 +a!4 2000, at a!a4 D734
144
(4 Ea## 8ed49, O#ford $ompanion to the )upreme $ourt of the 0nited )tates 817729, at
24D4
1;4
)olem v. !elm, 4;4 US 2DD, at 2=4J2=3 817=39 8maCo!"ty: Po*e## ), Co"ned by H!ennan,
+a!s2a##, H#a/?mun, and Ste.ens ))9 80ootnote om"tted94
134
*"ing v. $alifornia, ;3= US 11, at 33 820039 8Ste.ens ), Co"ned by Soute!, 6"nsbu!', and
H!eye! ))9 8quot"n' )olem v. !elm, supra note 1;94
1D4
See, e4'4, $o'er v. +eorgia, 433 US ;=4, at ;72 817DD9 8#u!a#"ty: ,2"te ), Co"ned by
Ste*a!t, H#a/?mun, and Ste.ens ))95 *nmund v. 4lorida, 4;= US D=2, at D7DJD7= 817=29
8maCo!"ty: ,2"te ), Co"ned by H!ennan, +a!s2a##, H#a/?mun, and Ste.ens ))94
1=4
See, e4'4, !armelin v. Michigan, ;01 US 7;D, at 774 817719 8S/a#"a ), /on/u!!"n' "n t2e
Cud'ment, Co"ned by Re2nqu"st %)95 *"ing v. $alifornia, supra note 13 8$2omas ),
/on/u!!"n' "n t2e Cud'ment94
174
%bid., at 3; 8Ste.ens ), Co"ned by Soute!, 6"nsbu!', and H!eye! ))9 8stat"n' t2at @a b!oad
21/04/2013 Delivery | Westlaw India
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and bas"/ !oo!t"ona#"ty !"n/"#eA a#"es, !at2e! t2an a na!!o* !oo!t"ona#"ty !"n/"#e
as 2e#d by a #u!a#"ty o0 t2e %ou!t "n t2at /ase94
204
6oc'yer v. Andrade, ;3= US 33, at D2 820039 8maCo!"ty: ON%onno! ), Co"ned by Re2nqu"st
%), and S/a#"a, (ennedy, and $2omas ))94 See a#so !armelin v. Michigan, supra note 1=,
at 1001 8(ennedy ), Co"ned by ON%onno! and Soute! ))95 *"ing v. $alifornia, supra note
13, at 23J24 8#u!a#"ty: ON%onno! ), Co"ned by Re2nqu"st %) and (ennedy )95 Pate!,
@St!u/? out &oo?"n': %ont"nued %on0us"on "n E"'2t2 Amendment P!oo!t"ona#"ty Re."e*
a0te! *"ing v $alifornia, 123 S4 %t4 11D7 820039A, 2D !arvard 8. 6a" = Public Policy
82003J20049 3774
214
6oc'yer v. Andrade, supra note 20, at D3 8maCo!"ty: ON%onno! ), Co"ned by Re2nqu"st %),
and S/a#"a, (ennedy, and $2omas ))94
224
*"ing v. $alifornia, supra note 13, at 20 8#u!a#"ty: ON%onno! ), Co"ned by Re2nqu"st %)
and (ennedy )94
234
)olem v. !elm, supra note 1;, at 270 8maCo!"ty: Po*e## ), Co"ned by H!ennan, +a!s2a##,
H#a/?mun, and Ste.ens ))94 See a#so !armelin v. Michigan, supra note 1=, at 1001
8(ennedy ), Co"ned by ON%onno! and Soute! ))9 8!e0e!!"n' to t2e @!"ma/y o0 t2e
#e'"s#atu!eA94
244
%bid., at 1001 8(ennedy ), Co"ned by ON%onno! and Soute! ))94
2;4
)olem v. !elm, supra note 1;, at 272 8maCo!"ty: Po*e## ), Co"ned by H!ennan, +a!s2a##,
H#a/?mun, and Ste.ens ))94
234
!oare v. The >ueen 817=79 13D %&R 34=, at a!a4 FDG 8see a#so a!a4 F20G94
2D4
2ugmy v. The >ueen 817709 137 %&R ;2;, at a!a4 F24G 8+ason %) and +/Eu'2 ),
d"ssent"n'95 see a#so FDG 8maCo!"ty: -a*son, $oo2ey, and 6aud!on ))94
2=4
See 'ene!a##y Ko:, @$2e +ean"n' o0 P!oo!t"ona#"ty "n Senten/"n'A, 17 Melbourne 0. 6a"
9ev. 817749 4=74
274
2ugmy v. The >ueen, supra note 2D, at a!a4 F13G 8maCo!"ty: -a*son, $oo2ey, and
6aud!on ))95 at a!a4 F20G 8+ason %) and +/Eu'2 ), d"ssent"n'94 See a#so The >ueen v.
)hrestha 817719 1D3 %&R 4=5 100 A&R D;D, at D3= 8H!ennan and +/Eu'2 )),
d"ssent"n'94
304
2ugmy v. The >ueen, supra note 2D, at a!a4 F12G 8maCo!"ty: -a*son, $oo2ey, and
6aud!on ))94
314
The >ueen v. )hrestha, supra note 275 at DD2 8A&R9 8-eane, -a*son, and $oo2ey ))94
324
2ugmy v. The >ueen, supra note 2D, at a!a4 F23G 8+ason %) and +/Eu'2 ), d"ssent"n'95
see a#so at a!a4 F7G 8maCo!"ty: -a*son, $oo2ey, and 6aud!on ))94
334
H4 6a!ne! 8ed49, 2lac':s 6a" 7ictionary 8Dt2 edn4, 17779, at 131=4
344
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*"ing v. $alifornia, supra note 13, at 31J32 8S/a#"a ), /on/u!!"n' "n t2e Cud'ment94
3;4
A#e:ande!, @$2e P2"#oso2y o0 %!"m"na# &a*A, "n )4 %o#eman and S4 S2a"!o 8eds9, The
O#ford !andboo' of 8urisprudence = Philosophy of 6a" 820029, at =1;, =134
334
Von E"!s/2, @P!oo!t"ona#"ty "n t2e P2"#oso2y o0 Pun"s2mentA, 13 $rime = 8ustice 817729
;;, at ;34
3D4
A#e:ande!, supra note 3;, at =1=5 Von E"!s/2, supra note 33, at D3JDD4
3=4
Von E"!s/2, supra note 33, at =14
374
See 'ene!a##y ibid. 5 ,a#?e!, @&e'"s#at"n' t2e $!ans/endenta#: Von E"!s/2Ns
P!oo!t"ona#"tyA, ;1 $ambridge 6a" 8. 817729 ;304
404
+4 %o2en, 9eason and 6a" 817319, at ;34
414
O00"/"a# Re/o!ds o0 t2e 6ene!a# Assemb#y, ;3t2 sess"on, Su#ement No4 10, UN -O%4
A/;3/10, %24 V4
424
See, e4'4, ,2"te and Abass, @%ounte!measu!es and San/t"onsA, "n +4 E.ans, %nternational
6a" 820039, at ;0;, ;0D 8!e0e!!"n' to @t2e /od"0"/at"on o0 /ounte!measu!es by t2e
Inte!nat"ona# &a* %omm"ss"onA94
434
)4 %!a*0o!d, The %nternational 6a" $ommission:s Articles on )tate 9esponsibility?
%ntroduction, Te#t and $ommentaries 820029, at 2744
444
See, e4'4, Military and Paramilitary Activities in and against .icaragua 1.icaragua .
0nited )tates of America3 F17=3G I%) Re 14, at a!a4 247 8!e0e!!"n' to @!oo!t"onate
/ounte!Jmeasu!esA94
4;4
See, e4'4, .aulilaa 19esponsibility of +ermany for damage caused in the Portuguese
colonies in the south of Africa3 8172=9 II Reo!ts o0 Inte!nat"ona# A!b"t!a# A*a!ds 10135
Air )ervices Agreement of @A March (BCD 10nited )tates v. 4rance3 817D=9 QVIII Reo!ts
o0 Inte!nat"ona# A!b"t!a# A*a!ds 41D 8/"ted "n %!a*0o!d, supra note 43, at 27494
434
+abc,'ovo-.agymaros Pro&ect 1!ungary E )lova'ia3 F177DG I%) Re D, at a!a4 =;4
4D4
I&% A!ts, UN, 9eport of the %nternational 6a" $ommission, A/;3/10 SUPP 81 O/t4 20019,
A!t 304
4=4
Rea!at"on may ta?e t2e 0o!m o0 !est"tut"on, /omensat"on, o! sat"s0a/t"on, *2"/2
t2emse#.es "n/o!o!ate a !equ"!ement o0 !oo!t"ona#"ty: ibid., A!ts 31, 34J3D4
474
%!a*0o!d, supra note 43, at 2734 Ee!e, %!a*0o!d seems to assume t2at a
/ounte!measu!e t2at "s d"s!oo!t"onate to t2e "nCu!y su00e!ed, *"t2"n t2e mean"n' o0
A!t4 ;1, *"## a#so be d"s!oo!t"onate to t2e need to "ndu/e /om#"an/e, *"t2"n t2e
mean"n' o0 A!t4 474 See a#so at 2=4 8@F/Gounte!measu!es a!e not "ntended as a 0o!m o0
un"s2ment 0o! *!on'0u# /ondu/t but as an "nst!ument 0o! a/2"e."n' /om#"an/e *"t2 t2e
ob#"'at"ons o0 t2e !esons"b#e State unde! Pa!t $*oA94
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;04
,2"te and Abass, supra note 42, at ;13 8@t2e!e aea!s to be a /ont!ad"/t"on "n t2e
a!oa/2 o0 t2e I&%4 $2e "ssue ou'2t not to be one o0 !oo!t"ona#"ty to t2e "nCu!y
/aused, be/ause t2"s *ou#d su''est t2at /ounte!measu!es a!e ta?en to un"s2 t2e
!esons"b#e StateA94
;14
%ann"BBa!o, supra note 1, at =744
;24
See ibid., at =72, 70;5 .on E"!s/2, supra note 33, at 33J344
;34
I&% A!ts, supra note 4D, A!t ;14
;44
%bid.
;;4
%bid., A!t 478294
;34
%bid., A!ts 22, ;08198a94
;D4
+"t/2e##, @-oes One I##e'a#"ty +e!"t Anot2e!O $2e &a* o0 He##"'e!ent Re!"sa#s "n
Inte!nat"ona# &a*A, 1D0 Military 6a" 9ev. 820019 1;;, at 1;=4
;=4
%bid. , at 130J1314 On !oo!t"ona#"ty "n t2e #a*s o0 *a!, see a#so Ken!"/?, @$2e Ru#e o0
P!oo!t"ona#"ty and P!oto/o# "n %on.ent"ona# ,a!0a!eA, 7= Military 6a" 9ev. 817=29 715
6a!dam, supra note ;4
;74
See 'ene!a##y )S!'ensen, @%!"me and Pun"s2ment: Reta#"at"on unde! t2e ,o!#d $!ade
O!'an"Bat"on -"sute Sett#ement SystemA, 37 8. World Trade 8200;9 32D4
304
-SU, A!t4 34D4
314
%bid. See a#so A!t4 22414 Susens"on o0 /on/ess"ons *as a#so !o."ded as a #ast !eso!t
unde! 6A$$ 174D 8A!t4 QQIII:294
324
-SU, A!t4 22434
334
%bid., A!t4 22438/94 See a#so Pane# Reo!t, 0) - $ertain *$ Products, ,$/-S13;/R U Add
8adoted 10 )an4 20019, -SR 2001:I, 313, at a!a4 34=D 8"ssue not aea#ed J Ae##ate
Hody Reo!t, 0) - $ertain *$ Products, ,$/-S13;/AH/R, adoted 10 )an4 2001, -SR
2001:II, 413, at a!a4 11D94
344
Ko:, @$2e +ean"n' o0 P!oo!t"ona#"ty "n Senten/"n'A, 17 Melbourne 0. 6a" 9ev. 817749
4=7, at 4705 6a!ne! 8ed9, supra note 33, at 7244
3;4
$*o unusua# 0eatu!es o0 t2e ,$O d"sute sett#ement system a!e t2at t2e "nCu!y "s
measu!ed on#y 0!om t2e e:"!y o0 t2e !easonab#e e!"od o0 t"me and not !et!ose/t".e#y
0!om t2e t"me *2en t2e "n/ons"sten/y be'an, and t2at t2e ena#ty "mosed on t2e
+embe! a/t"n' "n/ons"stent#y may a#so 2a!m t2e /om#a"n"n' +embe!4 Ko! 0u!t2e!
d"s/uss"on o0 t2ese and !e#ated !ob#ems *"t2 t2e /om#"an/e me/2an"sm, see 'ene!a##y
Eo!#"/?, @P!ob#ems *"t2 t2e %om#"an/e St!u/tu!e o0 t2e ,$O -"sute Reso#ut"on P!o/essA,
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"n -4 (ennedy and )4 Sout2*"/?, The Political *conomy of %nternational Trade 6a"?
*ssays in !onor of 9obert *. !udec 820029, at 3335 %2a!no."tB, @S2ou#d t2e $eet2 be
Pu##edO An Ana#ys"s o0 ,$O San/t"onsA, "n ibid., at 302, 317J32D5 Ande!son, @Pe/u#"a!"t"es
o0 Reta#"at"on "n ,$O -"sute Sett#ementA, 1 World Trade 9ev. 820029 1234
334
-SU, A!t4 142 and A4 24
3D4
S%+ A'!eement, A!ts D47JD4104
3=4
%bid., A!t4 44104
374
%bid., A!t4 44114
D04
6A$$ 1774, A!t4 VI4 $2e no!ma# .a#ue o0 a dumed !odu/t "s @t2e /oma!ab#e !"/e, "n
t2e o!d"na!y /ou!se o0 t!ade, 0o! t2e #"?e !odu/t *2en dest"ned 0o! /onsumt"on "n t2e
e:o!t"n' /ount!yA: Ant"J-um"n' A'!eement, A!t4 2414
D14
S%+ A'!eement, A!t4 ;4
D24
Ant"J-um"n' A'!eement, A!t4 74
D34
S%+ A'!eement, A!t4 174
D44
See a#so 6A$$ 1774, A!t4 VI:24 $2e ma!'"n o0 dum"n' "s t2e d"00e!en/e bet*een t2e
no!ma# .a#ue and t2e e:o!t !"/e o0 t2e !odu/t4
D;4
See a#so ibid., A!t4 VI:34
D34
Ant"J-um"n' A'!eement, A!t4 7415 S%+ A'!eement, A!t4 17424
DD4
$2e !e/"s"on o0 t2"s e:e!/"se may be d"m"n"s2ed "n /e!ta"n /"!/umstan/es, 0o! e:am#e
*2e!e t2e "n.est"'at"on aut2o!"t"es #"m"t t2e"! e:am"nat"on be/ause t2e numbe! o0
e:o!te!s, !odu/e!s, "mo!te!s, o! tyes o0 !odu/ts "s so #a!'e as to !ende! "m!a/t"/a#
a dete!m"nat"on o0 "nd"."dua# dum"n' ma!'"ns: Ant"J-um"n' A'!eement, A!ts 3410,
7444
D=4
A'!eement on Sa0e'ua!ds, A!t4 2414
D74
$2e Ae##ate Hody 2as !e/o'n"Bed t2"s d"st"n/t"on bet*een sa0e'ua!ds, on t2e one 2and,
and ant"dum"n' o! /ounte!.a"#"n' measu!es, on t2e ot2e! 2and4 See, e4'4, Ae##ate
Hody Reo!t, Argentina--4oot"ear 1*$3, ,$/-S121/AH/R, adoted 12 )an4 2000, -SR
2000:I, ;1;, at a!a4 744
=04
A'!eement on Sa0e'ua!ds, A!t4 2424 Some un/e!ta"nty su!!ounds t2e a#"/at"on o0
sa0e'ua!ds to !odu/ts 0!om a!tne!s 0!om a !e'"ona# t!ade a'!eement 0a##"n' *"t2"n A!t4
QQIV o0 6A$$ 1774, supra note 104 See 'ene!a##y Pau*e#yn, @$2e PuBB#e o0 ,$O
Sa0e'ua!ds and Re'"ona# $!ade A'!eementsA, D 8. %nt:l *con. 6a" 820049 1075 &o/?2a!t
and +"t/2e##, @Re'"ona# $!ade A'!eements Unde! 6A$$ 1774: An E:/et"on and Its &"m"tsA,
"n A4 +"t/2e## 8ed49, $hallenges and Prospects for the WTO 8200;9, at 21D4
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=14
A'!eement on Sa0e'ua!ds, A!t4 ;414 See a#so A!t4 D414 In add"t"on, A!t4 =41 o0 t2e
A'!eement on Sa0e'ua!ds !equ"!es a +embe! !oos"n' to a#y a sa0e'ua!d to
@endea.ou! to ma"nta"n a substant"a##y equ".a#ent #e.e# o0 /on/ess"ons and ot2e!
ob#"'at"ons to t2at e:"st"n' unde! 6A$$ 1774 bet*een "t and t2e e:o!t"n' +embe!s
*2"/2 *ou#d be a00e/ted by su/2 a measu!eA4
=24
$2e A'!eement on Sa0e'ua!ds, !o."des 0o! an add"t"ona# un"#ate!a# !emedy *2en t2e
+embe! a#y"n' a sa0e'ua!d "s unab#e to a'!ee *"t2 ot2e! +embe!s on 2o* to a/2"e.e
a @substant"a##y equ".a#ent #e.e# o0 /on/ess"ons and ot2e! ob#"'at"onsA as se/"0"ed "n A!t4
=414 Se/"0"/a##y, uon sat"s0a/t"on o0 /e!ta"n /ond"t"ons, @t2e a00e/ted e:o!t"n' +embe!s
s2a## be 0!ee Ito susend It2e a#"/at"on o0 substant"a##y equ".a#ent /on/ess"ons o!
ot2e! ob#"'at"ons unde! 6A$$ 1774, to t2e t!ade o0 t2e +embe! a#y"n' t2e sa0e'ua!d
measu!eA: ibid., A!t4 =424 A'a"n, t2e !equ"!ement o0 equ".a#en/e "nt!odu/es t2e not"on o0
!oo!t"ona#"ty, but t2"s ?"nd o0 un"#ate!a# !emedy does not "n.o#.e a !esonse to un#a*0u#
o! undes"!ab#e /ondu/t, assum"n' t2at t2e sa0e'ua!d *as "mosed "n a manne!
/ons"stent *"t2 t2e A'!eement on Sa0e'ua!ds4 A//o!d"n'#y, I do not !e'a!d ibid., A!t4 =
as "n/o!o!at"n' t2e !"n/"#e o0 !oo!t"ona#"ty "n t2e sense des/!"bed "n t2"s a!t"/#e4
=34
-e/"s"on by t2e A!b"t!ato!s, *$ - 2ananas %%% 10)3 1Art. @@.D - *$3, at a!a4 3434 See a#so
-e/"s"on by t2e A!b"t!ato!s, 2razil - Aircraft 1Art. @@.D - 2razil3, at a!a4 34;;5 -e/"s"on
by t2e A!b"t!ato!s, *$ - !ormones 10)3 1Art. @@.D - *$3, at a!a4 405 -e/"s"on by t2e
A!b"t!ato!s, 0) - (B(D Act 1Art. @@.D - 0)3, at a!as ;4;J;4=5 -e/"s"on by t2e A!b"t!ato!s,
*$ - 2ananas %%% 1*cuador3 1Art. @@.D - *$3, at a!a4 D34 Eo*e.e!, "n -e/"s"on by t2e
A!b"t!ato!s, 0) - Offset Act 12yrd Amendment3 12razil3 1Art. @@.D - 0)3, at a!as 34D3J
34D4, 342J344, t2e a!b"t!ato!s su''ested t2at "ndu/"n' /om#"an/e "s s"m#y one o0
se.e!a# oss"b#e u!oses4
=44
Ae##ate Hody Reo!t, 0) - $otton 5arn, ,$/-S172/AH/R, adoted ; No. 2001, -SR
2001:QII, 302D, at a!a4 120 and n4 725 Ae##ate Hody Reo!t, 0) - 6ine Pipe, ,$O
-S202/AH/R, adoted = +a!4 2002, -SR 2002:IV, 1403, at n4 2;24 See a#so Pau*e#yn,
@En0o!/ement and %ounte!measu!es "n t2e ,$O: Ru#es a!e Ru#es J $o*a!d a +o!e
%o##e/t".e A!oa/2A, 74 A8%6 820009 33;, at 3434
=;4
Pa#mete! and A#e:and!o., L@Indu/"n' %om#"an/eM "n ,$O -"sute Sett#ementA, "n
(ennedy and Sout2*"/?, supra note 3;, at 343, 34D4
=34
%2a!no."tB, supra note 3;, at 3114
=D4
Pa#mete! and A#e:and!o. d"sa'!ee: see supra note =;, at 3;04
==4
%2a!no."tB, supra note 34, at 3145 Pau*e#yn, supra note =3, at 343J3444
=74
*$ - 2ananas %%% 10)3 1Art. @@.D - *$3, supra note =3, at a!a4 34134
704
%bid., at a!a4 341;4
714
%bid., at a!as 341;J3413 8em2as"s om"tted94
724
%bid., at a!a4 34124
734
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Page23
%bid., at a!a4 34144
744
%bid., at a!a4 34134
7;4
See, e4'4, 0) - Offset Act 12yrd Amendment3 12razil3 1Art. @@.D - 0)3, supra note =3, at
a!as 3420J3423, 3430, 3432, 34;44
734
See, e4'4, ibid., at a!as4 3421J3423, 3434, 34;;4
7D4
Pane# Reo!t, 0) - Offset Act 12yrd Amendment3, ,$/-S21D/R, ,$/-S234/R, adoted
2D )an4 2003, at a!a4 =415 Ae##ate Hody Reo!t, 0) - Offset Act 12yrd Amendment3,
,$/-S21D/AH/R, ,$/-S234/AH/R4 adoted 2D )an4 2003, at a!a4 31=8a9, 8b94
7=4
See, e4'4, 0) - Offset Act 12yrd Amendment3 12razil3 1Art. @@.D - 0)3, supra note =3, at
a!as 3410, 3413, 34;34
774
See +a.!o"d"s, @Remed"es "n t2e ,$O &e'a# System: Het*een a Ro/? and a Ea!d P#a/eA,
11 *8%6 820009 D33, at DD3, =00J=01, =0D4
1004
See Pau*e#yn, supra note =4, at n4 434
1014
Ant"J-um"n' A'!eement, A!t4 7415 S%+ A'!eement, A!t4 17424
1024
%bid., A!t4 D474
1034
%bid., A!t4 ;4
1044
%bid., A!t4 D474
10;4
-SU, A!t4 22444
1034
S%+ A'!eement, A!t4 D4104
10D4
2razil - Aircraft 1Art. @@.D - 2razil3, supra note =3, at a!a4 34;14
10=4
-e/"s"on by t2e A!b"t!ato!s, 0) - 4)$ 1Art. @@.D - 0)3, at a!a4 ;434
1074
2razil - Aircraft 1Art. @@.D - 2razil3, supra note =3, at a!a4 34;15 0) - 4)$ 1Art. @@.D -
0)3, supra note 10D, at a!a4 ;4234
1104
Renou0, @A H!"e0 Int!odu/t"on to %ounte!measu!es "n t2e ,$O -"sute Sett#ement
SystemA, "n R4 >e!:a and H4 ,"#son 8eds9, <ey %ssues in WTO 7ispute )ettlement? The
4irst Ten 5ears 80o!t2/om"n' 200;9, at D;, =04
1114
0) - 4)$ 1Art. @@.D - 0)3, supra note 10D, at a!a4 ;4374
1124
%bid., at a!as ;441, ;447, ;4314
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Page24
1134
2razil - Aircraft 1Art. @@.D - 2razil3, supra note =3, at a!a4 34305 0) - 4)$ 1Art. @@.D -
0)3, supra note 10D, at a!as 3410J34115 -e/"s"on by t2e A!b"t!ato!s, $anada - Aircraft
1Art. @@.D - $anada3, at a!a4 34;14 See a#so Renou0, supra note 110, at =04
1144
0) - 4)$ 1Art. @@.D - 0)3, supra note 10=, at a!a4 34114
11;4
%bid., at a!as ;423, 3410, 3433J343;4
1134
2razil - Aircraft 1Art. @@.D - 2razil3, supra note =3, at a!a4 34;75 0) - 4)$ 1Art. @@.D -
0)3, supra note 10=, at a!as 342DJ342=, 34324
11D4
$anada - Aircraft 1Art. @@.D - $anada3, supra note 113, at a!a4 341214
11=4
%bid., at a!a4 341174
1174
%bid., at a!a4 34;75 0) - 4)$ 1Art. @@.D - 0)3, supra note 10=, at a!a4 ;4;D5 2razil -
Aircraft 1Art. @@.D - 2razil3, supra note =3, at a!a4 34444
1204
Pa#mete! and A#e:and!o., supra note =;, at 3;3J3;44
1214
Ae##ate Hody Reo!t, $anada - Aircraft, ,$/-SD0/AH/R,, adoted 4 Au'4 2000, -SR
2000:IQ, 4277, at a!as 3440J34414
1224
Ae##ate Hody Reo!t, 0) - $otton 5arn, supra note =4, at a!as 120J1225 Ae##ate
Hody Reo!t, 0) - 6ine Pipe, supra note =4, at a!a4 2;74
1234
0) - $otton 5arn, supra note 122, at n4 704
1244
0) - 6ine Pipe, supra note =4, at a!a4 2;7 and n4 2;3 8/"t"n' .icaragua v. 0nited )tates
of America, supra note 44, at a!a4 247 and +abc,'ovo-.agymaros Pro&ect, supra note
43, at 22094
12;4
0) - 6ine Pipe, supra note =4, at a!a4 2;7 and n 2;D 8!e0e!!"n' to t2e A!b"t!a# $!"buna#
estab#"s2ed by t2e %om!om"se o0 11 )u#y 17D= "n t2e Air )ervices Agreement of @A
March (BCD 10nited )tates v. 4rance3, supra note 4;94
1234
A$%, a!t 3414
12D4
$2"s a'!eement *as te!m"nated, "n a//o!dan/e *"t2 "ts A!t4 7, on 1 )an4 200;4
12=4
%bid. , A!t4 3424
1274
0) - $otton 5arn, supra note =4, at a!a4 1174
1304
%bid., at a!a4 1204
1314
%bid., at a!a4 1204
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Page25
1324
%bid., at a!a4 1224
1334
0) - 6ine Pipe, supra note =4, at a!a4 23D4
1344
%bid., at a!a4 241 8em2as"s om"tted94
13;4
%bid., at a!a4 2;24
1334
%bid., at a!as 2;4J2;D4
13D4
%bid., at a!a4 2;D4
13=4
%bid., at a!a4 2304
1374
A!t4 744 o0 t2e S%+ A'!eement a#so !e0e!s to /ounte!measu!es "n /onne/t"on *"t2 @nonJ
a/t"onab#e subs"d"esA4 A!t4 744 8and t2e /ate'o!y o0 nonJa/t"onab#e subs"d"es "n Pa!t IV o0
t2e S%+ A'!eement9 e:"!ed at t2e end o0 1777 "n a//o!dan/e *"t2 A!t4 31 o0 t2e S%+
A'!eement4
1404
A'!eement on Sa0e'ua!ds, A!t4 2414
1414
%bid., A!t4 2424
1424
0) - 6ine Pipe, supra note =4, at a!a4 241 8em2as"s om"tted94
1434
$2e Ae##ate Hody does not aea! to a//ount 0o! t2e *o!ds @to 0a/"#"tate adCustmentA "n
"ts !ead"n' o0 A!t4 ;41 "n ibid., at a!a4 2304
1444
%bid., at a!a4 2;24
14;4
See ,$/-SH/+/121, +"nutes o0 t2e -SH meet"n' 2e#d on = +a!4 2002, at a!a4 3;4
1 2013 O:0o!d Un".e!s"ty P!ess