WORLD TRADE
ORGANIZATIONTN/DS/W/52
14 March 2003
(03-1416)
Dispute Settlement Body
Special SessionOriginal:  English
NEGOTIATIONS ON IMPROVEMENTS AND CLARIFICATIONS OF
THE DISPUTE SETTLEMENT UNDERSTANDING ON
IMPROVING FLEXIBILITY AND MEMBER CONTROL
IN WTO DISPUTE SETTLEMENT
Textual Contribution by Chile and the United States
The following communication, dated 11 March 2003, has been received from the Permanent
Missions of Chile and the United States.
_______________
(a) making provision for interim reports at the Appellate Body stage, thus allowing parties to
comment to strengthen the final report
Proposed text :
Paragraph 5 of Article 17 is amended as follows:
“5. (a) As a general rule, the proceedings shall not exceed 60  90 days from the date a
party to the dispute formally notifies its decision to appeal to the date the
Appellate Body circulates its report.  In fixing its timetable the Appellate
Body shall take into account the provisions of paragraph 9 of Article 4, if
relevant.  When the Appellate Body considers that it cannot provide its report
within 60  90 days, it shall inform the DSB in writing of the reasons for the
delay together with an estimate of the period within which it will submit its
report.  In no case shall the proceedings exceed 90  120 days.
(b) Following the consideration of submissions and oral arguments, the
Appellate Body shall issue an interim report to the parties, including both the
descriptive sections and the Appellate Body's findings and conclusions.
Within a period of time set by the Appellate Body, a party may submit a
written request for the Appellate Body to review precise aspects of the
interim report prior to circulation of the final report to the Members.  At the
request of a party, the Appellate Body  shall hold a further meeting with the
parties on the issues identified in the written comments.  If no comments are
received from any party within the co mment period, the interim report shall
be considered the final report and circulated promptly to the Members.  The
final Appellate Body report shall include a discussion of the arguments made
at the interim review stage.1
                                                     
1 [NOTE TO READERS: this proposed la nguage replicates the language in DSU Article 15.2.]TN/DS/W/52
Page 2
(b) providing a mechanism for parties, after review  of the interim report, to delete by mutual
agreement findings in the report that are not necessary or helpful to resolving the dispute,
thus continuing to allow the parties to retain control over the terms of reference
Proposed text :
Paragraph 7 of Article 12 is amended by inserting after the second sentence the following new
sentence:
“The panel shall not include in the final panel report any finding, or basic rationale behind a
finding, that the parties have agreed is not to be included.”
Paragraph 13 of Article 17 is amended to read as follows:
“Where the parties to the dispute have failed to develop a mutually satisfactory solution, the
Appellate Body shall submit its findings in the form of a written report to the DSB.  In such
cases, the report of the Appellate Body shall set out the applicability of relevant provisions
and the basic rationale behind any findings and recommendations that it makes.2   T h e
Appellate Body may uphold, modify or reverse the legal findings and conclusions of the
panel.  The Appellate Body shall not include in the final report any finding, or basic rationale
behind a finding, that the parties have agreed is not to be included.”
(c) making provision for some form of “partia l adoption” procedure, where the DSB would
decline to adopt certain parts of reports while still allowing the parties to secure the DSB
recommendations and rulings necessary to help resolve the dispute
Paragraph 4 of Article 16 is amended to read as follows:“4. Within 60 days after the date of circulation of a panel report to the Members, the
report shall be adopted at a DSB meeting
3 unless a party to the dispute formally notifies the
DSB of its decision to appeal or the DSB decides by consensus not to adopt the report.
However, the DSB may by consensus decide not to adopt a finding in the report or the basic
rationale behind a finding.  If a party has notified its decision to appeal, the report by the
panel shall not be considered for adoption by the DSB until after completion of the appeal.This adoption procedure is without prejudice to the right of Members to express their views
on a panel report.”
Paragraph 14 of Article 17 is amended as follows:
“14. An Appellate Body report shall be adopted by the DSB and unconditionally accepted
by the parties to the dispute unless the DSB decides by consensus not to adopt the Appellate
Body report within 30 days following its circulation to the Members.
4   However, the DSB
may by consensus decide not to adopt a finding in the report or the basic rationale behind a
finding.  A party to the dispute does not need to accept any finding or basic rationale that the
DSB has not adopted.  This adoption procedure is without prejudice to the right of Members
to express their views on an Appellate Body report.”
                                                     
2 [NOTE TO READERS: the proposed new sentences replicates the language in the first two sentences
of DSU Article 12.7.]
3 [No change proposed to footnote in current DSU.]
4 [No change proposed to footnote in current DSU.]TN/DS/W/52
Page 3
DSB decision on the procedure for partial adoption:
“A Member proposing that a finding, or basic rationale behind a finding, in a panel or
Appellate Body report should not be adopted by the Dispute Settlement Body shall submit the
proposal in writing to the Dispute Settlement Body no later than 3 days (or the WTO workingday following the 3rd day if the 3rd day is a non-working day for the WTO) after the issuance
of the airgram convening the meeting at which the report is proposed to be considered.
5   The
Member shall specify in the proposal the finding, or the basic rationale, behind a finding at
issue and give a brief description of the reason not to adopt.”
(d) providing the parties a right, by mutual agreement, to suspend panel and Appellate Body
procedures to allow time to continue to work on resolving the dispute
Paragraph 12 of Article 12 is amended as follows:“12. The panel may suspend its work at any time at the request of the complaining party
for a period not to exceed 12 months.  The panel shall suspend its work where the parties so
agree.  In the event of such a suspension, the time-frames set out in paragraphs 8 and 9 of this
Article,  paragraph 1 of 6 Article 20, and paragraph 4 of Article 21 shall be extended by the
amount of time that the work was suspended.  If the work of the panel has been suspended for
more than 12 months, the authority for establishment of the panel shall lapse.”
In addition to the amendment under item (a) above, paragraph 5 of Article 17 is amended by
adding at the end:
“(c) The Appellate Body shall suspend its work where the parties so agree.  In the event of
such a suspension, the time-frames set out in this paragraph, Article 20, and paragraph 4 ofArticle 21 shall be extended by the amount of time that the work was suspended.”
(e) ensuring that the members of panels have appropriate expertise to appreciate the issues
presented in a dispute
Paragraph 2 of Article 8 is amended as follows:
“2. Panel members should be selected with a view to ensuring the independence of the
members, expertise to examine the matter at issue in the dispute, a sufficiently diverse
background and a wide spectrum of experience.”
[Further elaboration could be developed in discussions with Members.]
                                                     
5 In the case of a panel report, the Member shall submit the proposal no later than 3 days (or the WTO
working day following the 3rd day if the 3rd day is a non-working day for the WTO) after the issuance of the
airgram convening either:  (1) the meeting at which the panel report is proposed to be considered if no party hasfiled a notice of appeal;  or (2) the meeting at which the panel report together with the Appellate Body report is
proposed to be considered if a party has filed a notice of appeal.
6 NOTE TO READERS:  proposed deletion of “paragraph 1 of” is to correct an error in the current
DSU since Article 20 only has one paragraph.]TN/DS/W/52
Page 4
(f) providing some form of additional guidan ce to WTO adjudicative bodies concerning (i) the
nature and scope of the task presented to them (for example when the exercise of judicial
economy is most useful) and (ii) rules of interpretation of the WTO agreements
[To be supplied after further discussions with Members.]
__________