WT/DS456/AB/R  
 
16 September 2016  
(16-4918) Page: 1/59 
  Original: English  
 
 INDIA – CERTAIN MEASURES REL ATING TO SOLAR  CELLS  
AND SOLAR MODULES  
 
AB-2016-3 
Report of the Appellate Body  
 
 WT/DS456/AB/R  
 
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  Table of Contents  
 
1   INTRODUCTION  ................................ ................................ ................................ ..........  7 
2   ARGUMENTS OF THE PAR TICIPANTS  ................................ ................................ .........  10 
3   ARGUMENTS OF THE THI RD PARTICIPANTS  ................................ ..............................  10 
4   ISSUES RAISED IN THI S APPEAL  ................................ ................................ ..............  10 
5   ANALYSIS OF THE APPE LLATE BODY  ................................ ................................ .........  11 
5.1    Article  III:8(a) of the GATT  1994 ................................ ................................ ................... 11 
5.1.1     The Panel's findings  ................................ ................................ ................................ .11 
5.1.2     India's claims on appeal  ................................ ................................ ........................... 14 
5.1.3     The scope of application of Article  III:8(a) of the GATT  1994 ................................ ........ 16 
5.1.4     India's challenge to the Panel's approach to India's claims under Article  III:8(a) of 
the GATT  1994 ................................ ................................ ................................ .......18 
5.1.5     Conclusion  ................................ ................................ ................................ ............. 23 
5.1.6     The remaining elements under Article  III:8(a) of the GATT 1994  ................................ ..23 
5.2   Article XX(j) of the GATT  1994 – "general or local short supply"  ................................ ........ 24 
5.2.1     The Panel's findings  ................................ ................................ ................................ .24 
5.2.2    India's claims on appe al ................................ ................................ ........................... 26 
5.2.3     The legal standard under Article XX(j) of the GATT 1994  ................................ .............. 27 
5.2.4     Whether the Panel erred in finding that solar  cells and modules are not products 
in short supply in India  ................................ ................................ ............................ 32 
5.2.5     Whether the Panel acted inconsistently with Article 11 of the DSU in addressing 
India's arguments and evidence regardin g the domestic manufacturing capacity  ............. 35 
5.2.6     Conclusion  ................................ ................................ ................................ ............. 36 
5.3    Article XX(d) of the GATT 1994  ................................ ................................ ..................... 37 
5.3.1     The Panel's findings  ................................ ................................ ................................ .37 
5.3.2     The legal standard under Article XX(d) of the GATT 1994  ................................ ............. 41 
5.3.3     Whether the Panel erred in its assessment of the domestic instruments identified 
by India  ................................ ................................ ................................ ................. 43 
5.3.4     Whether the Panel erred in its assessment of the international inst ruments 
identified by India  ................................ ................................ ................................ ...49 
5.3.5     Conclusion  ................................ ................................ ................................ ............. 53 
5.4   "Essentiality" and "necessity" under Articles XX(j) and XX(d), and t he chapeau of   
Article XX of the GATT 1994 ................................ ................................ .......................... 53 
5.5   Separate opinion of one Appellate  Body Member  ................................ ............................. 54 
6   FINDINGS AND CONCLUS IONS ................................ ................................ ..................  56 
6.1   Article III:8(a) of the GATT 1994  ................................ ................................ ................... 56 
6.2   Article XX(j) of the GATT 1994  ................................ ................................ ...................... 57 
6.3   Article XX(d) of the GATT 1994  ................................ ................................ ..................... 58 
 
 
 WT/DS456/AB/R  
 
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ABBREVIATIONS USED I N THIS REPORT  
Abbreviation  Description  
c-Si crystalline silicon  
DCR measures  Domestic content requirements imposed under Phase I (B atch 1), 
Phase I (Batch 2), and Phase II (Batch 1 -A) of India's Jawaharlal 
Nehru National Solar Mission  
DSB Dispute Settlement Body  
DSU Understanding on Rules and Procedures Governing the Settlement of 
Disputes  
Electricity  Act, 2003  Parliament of India,  The Electricity Act, 2003 [No. 36 of 2003] 
(26 May 2003) (Panel Exhibit USA -20) 
GATT 1994  General Agreement on Tariffs and Trade 1994  
National Action Plan on 
Climate Change  Government of India, National Action Plan on Climate Change 
(June  2008) (Panel E xhibit IND -2) 
National Electricity Plan  Government of India, Ministry of Power, Central Electricity Authority,  
National Electricity Plan , Vol. 1 – Generation (January 2012) 
(Panel  Exhibit IND -16) 
National Electricity Policy  Government of India, Ministry of Power, National Electricity Policy , 
Resolution No.  23/40/2004 -R&R (Vol.  II) (12 February 2005) 
(Panel  Exhibit IND -14) 
National Solar Mission,  
or NSM  Jawaharlal Nehru National Solar Mission  
Panel  Panel is these proceedings  
Panel Report  Panel Report, India – Certain Measures Relating to Solar Cells and 
Solar Modules , WT/DS456/R  
PPA power purchase agreement  
PV photovoltaic  
SPD solar power developer  
TRIMs Agreement  Agreement on Trade -Related Investment Measures  
Working Procedures  Working Procedures for Appellate Review, WT/AB/WP/6 , 16 August 
2010 
WTO World Trade Organization  
WTO Agreement  Marrakesh Agreement Establishing the World Trade Organization  
 WT/DS456/AB/R  
 
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PANEL EXHIBITS CITED  IN THIS REPORT  
Panel Exhibit(s)  Description  
IND-2 Government of India, National Action Plan on Climate Change  
(June  2008)  
IND-3 United Nations  Framework Convention on Climate Change , done at 
New York, 9  May 1992,  UN Treaty Series, Vol. 1771, p. 107  
IND-14 Government of India, Ministry of Power, National Electricity Policy , 
Resolution No.  23/40/2004 -R&R (Vol.  II) (12 February 2005)  
IND-16 Government of India, Ministry of Power, Central Electricity Authority,  
National Electricity Plan , Vol. 1 – Generation (January 2012)   
IND-28 United Nations General Assembly Resolution A/RES/ 66/288 (adopted 
27 July 2012) (Rio+20 Document: "The Future We Want")  
IND-35 Rio Declaration on Environment and  Development, adopted by the 
UN General Assembly in  1992  
IND-36 G. Sundarrajan v. Union of India and Others, 2013 (6) SCC 620  
(excerpts)  
USA-4 Government of India, Ministry of New and Renewable Energy, 
Resolution No. 5/14/2008, Jawaharlal Nehru National Solar Mission 
(11 January 2010)  
USA-20 Parliament of India, The Electricity Act, 2003 [No. 36 of 2003] 
(26 May 2003)  
 
CASES CITED IN THIS REPORT 
Short Title  Full Case Title and Citation  
Argentina – Financial Services  Appellate Body Report, Argentina – Measures Relating to Trade in Goods and 
Services , WT/DS453/AB/R  and Add.1,  adopted 9 May 2016  
Australia – Salmon  Appellate Body Report, Austral ia – Measures Affecting Importation of Salmon , 
WT/DS18/AB/R , adopted 6 November 1998, DSR 1998:VIII, p. 3327  
Brazil – Retreaded Tyres  Appellate Body Report, Brazil – Measures Affecting Imports of Retreaded 
Tyres , WT/DS332/AB/R , adopted 17 December 2007, D SR 2007:IV, p. 1527  
Canada – Periodicals  Panel Report, Canada – Certain Measures Concerning Periodicals , WT/DS31/R  
and Corr.1, adopted 30 July 1997, as modified by Appellate Body Report 
WT/DS31/AB/R, DSR 1997:I, p. 481  
Canada – Renewable Energy 
/ Canada – Feed-in Tariff 
Program  Appellate Body Reports, Canada – Certain Measures Affecting the Renewable 
Energy Generation Sector / Canada – Measures Relating to the Feed -in Tariff 
Program , WT/DS412/AB/R  / WT/DS426/AB/R , adopted 24 May 2013, DSR 
2013:I, p. 7  
Canada – Renewable Energy 
/ Canada – Feed-in Tariff 
Program  Panel Reports, Canada – Certain Measures Affecting the Renewable Energy 
Generation Sector / Canada – Measures Relating to the Feed -in Tariff Program , 
WT/DS412/R  and Add.1 / WT/DS426/R  and Add.1, ado pted 24 May 2013, as 
modified by Appellate Body Reports WT/DS412/AB/R / WT/DS426/AB/R, DSR 
2013:I, p. 237  
Canada – Wheat Exports and 
Grain Imports  Appellate Body Report, Canada – Measures Relating to Exports of Wheat and 
Treatment of Imported Grain , WT/DS 276/AB/R , adopted 27 September 2004, 
DSR 2004:VI, p. 2739  
Canada – Wheat Exports and 
Grain Imports  Panel Report, Canada – Measures Relating to Exports of Wheat and Treatment 
of Imported Grain , WT/DS276/R , adopted 27 September 2004, upheld by 
Appellate Bod y Report WT/DS276/AB/R, DSR 2004:VI, p. 2817  
Chile – Price Band System 
(Article 21.5 – Argentina)  Appellate Body Report, Chile – Price Band System and Safeguard Measures 
Relating to Certain Agricultural Products – Recourse to Article 21.5 of the DSU 
by Ar gentina , WT/DS207/AB/RW , adopted 22 May 2007, DSR 2007:II, p. 513  WT/DS456/AB/R  
 
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  Short Title  Full Case Title and Citation  
China – Auto Parts  Appellate Body Reports, China – Measures Affecting Imports of Automobile 
Parts, WT/DS339/AB/R  / WT/DS340/AB/R  / WT/DS342/AB/R , adopted 
12 January 2009, DSR 2009:I, p. 3  
China – Auto Parts  Panel Reports, China – Measures Affecting Imports of Automobile Parts , 
WT/DS339/R , Add.1 and Add.2 / WT/DS340/R , Add.1 and Add.2 / 
WT/DS342/R , Add.1 and Add.2, adopted 12 January 2009, upheld 
(WT/DS339/R) and as modified (WT/DS340/R / WT /DS342/R) by Appellate 
Body Reports WT/DS339/AB/R / WT/DS340/AB/R / WT/DS342/AB/R, DSR 
2009:I, p. 119  
China – Rare Earths  Appellate Body Reports, China – Measures Related to the Exportation of Rare 
Earths, Tungsten, and Molybdenum , WT/DS431/AB/R  / WT/DS43 2/AB/R  / 
WT/DS433/AB/R , adopted 29 August 2014, DSR 2014:III, p. 805  
China – Rare Earths  Panel Reports, China – Measures Related to the Exportation of Rare Earths, 
Tungsten, and Molybdenum , WT/DS431/R  and Add.1 / WT/DS432/R  and Add.1 
/ WT/DS433/R  and Add. 1, adopted 29 August 2014, upheld by Appellate Body 
Reports WT/DS431/AB/R / WT/DS432/AB/R / WT/DS433/AB/R, DSR 2014:IV, 
p. 1127  
China – Raw Materials  Appellate Body Reports, China – Measures Related to the Exportation of 
Various Raw Materials , WT/DS394/AB /R / WT/DS395/AB/R  / WT/DS398/AB/R , 
adopted 22 February 2012, DSR 2012:VII, p. 3295  
Colombia – Ports of Entry  Panel Report, Colombia – Indicative Prices and Restrictions on Ports of Entry , 
WT/DS366/R  and Corr.1, adopted 20 May 2009, DSR 2009:VI, p. 2535  
Colombia – Textiles  Appellate Body Report, Colombia – Measures Relating to the Importation of 
Textiles, Apparel and Footwear , WT/DS461/AB/R  and Add. 1, adopted 22 June 
2016 
Dominican Republic – Import 
and Sale of Cigarettes  Appellate Body Report, Dominican  Republic – Measures Affecting the 
Importation and Internal Sale of Cigarettes , WT/DS302/AB/R , adopted 19 May 
2005, DSR 2005:XV, p. 7367  
EC – Fasteners (China)  Appellate Body Report, European Communities – Definitive Anti -Dumping 
Measures on Certain Iron or Steel Fasteners from China , WT/DS397/AB/R , 
adopted 28 July 2011, DSR 2011:VII, p. 3995  
EC – Hormones  Appellate Body Report, EC Measures Concerning Meat and Meat Products 
(Hormones) , WT/DS26/AB/R , WT/DS48/AB/R , adopted 13 February 1998, DSR 
1998:I, p. 1 35 
EC – Poultry  Appellate Body Report, European Communities – Measures Affecting the 
Importation of Certain Poultry Products , WT/DS69/AB/R , adopted 23 July 
1998, DSR 1998:V, p. 2031  
EC – Seal Products  Appellate Body Reports, European Communities – Measur es Prohibiting the 
Importation and Marketing of Seal Products , WT/DS400/AB/R  / 
WT/DS401/AB/R , adopted 18 June 2014, DSR 2014:I, p. 7  
EC – Trademarks and 
Geographical Indications 
(US) Panel Report,  European Communities – Protection of Trademarks and 
Geogra phical Indications for Agricultural Products and Foodstuffs, Complaint 
by the United States , WT/DS174/R , adopted 20 April 2005, DSR 2005:VIII, p. 
3499 
EEC – Parts and Components  GATT Panel Report, European Economic Community – Regulation on Imports 
of Par ts and Components , L/6657, adopted 16  May 1990, BISD  37S, page  132 
India – Solar Cells  Panel Report, India – Certain Measures Relating to Solar Cells and Solar 
Modules , WT/DS456/R  and Add.1, circulated to WTO Members 24 February 
2016  
Japan – Alcoholic 
Beverages  II Appellate Body Report, Japan – Taxes on Alcoholic Beverages , WT/DS8/AB/R , 
WT/DS10/AB/R , WT/DS11/AB/R , adopted 1 November 1996, DSR 1996:I, 
p. 97 
Korea – Various Measures on 
Beef Appellate Body Report, Korea – Measures Affecting Imports of Fres h, Chilled 
and Frozen Beef , WT/DS161/AB/R , WT/DS169/AB/R , adopted 10 January 
2001, DSR 2001:I, p. 5  
Korea – Various Measures on 
Beef Panel Report, Korea – Measures Affecting Imports of Fresh, Chilled and Frozen 
Beef, WT/DS161/R , WT/DS169/R , adopted 10 Jan uary 2001, as modified by 
Appellate Body Report WT/DS161/AB/R, WT/DS169/AB/R, DSR 2001:I, p. 59  WT/DS456/AB/R  
 
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  Short Title  Full Case Title and Citation  
Mexico – Taxes on Soft 
Drinks  Appellate Body Report, Mexico – Tax Measures on Soft Drinks and Other 
Beverages , WT/DS308/AB/R , adopted 24 March 2006, DSR 2006:I , p. 3  
Mexico – Taxes on Soft 
Drinks  Panel Report, Mexico – Tax Measures on Soft Drinks and Other Beverages , 
WT/DS308/R , adopted 24 March 2006, as modified by Appellate Body Report 
WT/DS308/AB/R, DSR 2006:I, p. 43  
Philippines – Distilled Spirits  Appellat e Body Reports, Philippines – Taxes on Distilled Spirits , 
WT/DS396/AB/R  / WT/DS403/AB/R , adopted 20 January 2012, DSR 
2012:VIII, p. 4163  
US – Carbon Steel (India)  Appellate Body Report, United States – Countervailing Measures on Certain 
Hot-Rolled Carbon  Steel Flat Products from India , WT/DS436/AB/R , adopted 
19 December 2014, DSR 2014:V, p. 1727  
US – Continued Zeroing  Appellate Body Report, United States – Continued Existence and Application of 
Zeroing Methodology , WT/DS350/AB/R , adopted 19 February 2009 , DSR 
2009:III, p. 1291  
US – Corrosion -Resistant 
Steel Sunset Review  Appellate Body Report, United States – Sunset Review of Anti -Dumping Duties 
on Corrosion -Resistant Carbon Steel Flat Products from Japan , 
WT/DS244/AB/R , adopted 9 January 2004, DSR 2004: I, p. 3  
US – Countervailing and 
Anti-Dumping Measures 
(China)  Panel Report, United States – Countervailing and Anti -Dumping Measures on 
Certain Products from China , WT/DS449/R  and Add.1, adopted 22 July 2014, 
as modified by Appellate Body Report WT/DS449/ AB/R, DSR 2014:VIII, 
p. 3175 
US – Gambling  Appellate Body Report, United States – Measures Affecting the Cross -Border 
Supply of Gambling and Betting Services , WT/DS285/AB/R , adopted 20 April 
2005, DSR 2005:XII, p. 5663 (and Corr.1, DSR 2006:XII, p. 5475)  
US – Gasoline  Appellate Body Report, United States – Standards for Reformulated and 
Conventional Gasoline , WT/DS2/AB/R , adopted 20 May 1996, DSR 1996:I, p. 3  
US – Hot-Rolled Steel  Appellate Body Report, United States – Anti-Dumping Measures on Certain 
Hot-Rolled Steel Products from Japan , WT/DS184/AB/R , adopted 23 August 
2001, DSR 2001:X, p. 4697  
US – Large Civil Aircraft 
(2nd complaint)  Appellate Body Report, United States – Measures Affecting Trade in Large Civil 
Aircraft (Second Complaint) , WT/DS353/A B/R, adopted 23 March 2012, DSR 
2012:I, p. 7  
US – Shrimp  Appellate Body Report, United States – Import Prohibition of Certain Shrimp 
and Shrimp Products , WT/DS58/AB/R , adopted 6 November 1998, DSR 
1998:VII, p. 2755  
US – Softwood Lumber IV  Appellate Body Report, United States – Final Countervailing Duty 
Determination with Respect to Certain Softwood Lumber from Canada , 
WT/DS257/AB/R , adopted 17 February 2004, DSR 2004:II, p. 571  
US – Stainless Steel (Mexico)  Appellate Body Report, United States – Final An ti-Dumping Measures on 
Stainless Steel from Mexico , WT/DS344/AB/R , adopted 20 May 2008, DSR 
2008:II, p. 513  
US – Steel Safeguards  Appellate Body Report, United States – Definitive Safeguard Measures on 
Imports of Certain Steel Products , WT/DS248/AB/R , WT/DS249/AB/R , 
WT/DS251/AB/R , WT/DS252/AB/R , WT/DS253/AB/R , WT/DS254/AB/R , 
WT/DS258/AB/R , WT/DS259/AB/R , adopted 10 December 2003, DSR 
2003:VII, p. 3117  
US – Tyres (China)  Appellate Body Report, United States – Measures Affecting Imports of Certain 
Passenger  Vehicle and Light Truck Tyres from China , WT/DS399/AB/R , 
adopted 5 October 2011 , DSR 2011:IX, p. 4811  WT/DS456/AB/R  
 
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  WORLD TRADE ORGANIZATION  
APPELLATE BODY 
 
 
India – Certain Measures Relating to Solar 
Cells and Solar Modules  
 
India, Appellant  
United States, Appellee  
 
Brazil, Third Participant  
Canada, Third Participant  
China, Third Participant  
Ecuador, Third Participant  
European Union, Third Participant  
Japan, Third Participant  
Korea, Third Participant  
Malaysia, Third Participant  
Norway, Third Participant  
Russia, Third Participant  
Saudi Arabia, Third Participant  
Separate Customs Territory of Taiwan, Penghu,  
Kinmen and Matsu , Third Participant  
Turkey, Third Participant  AB-2016-3 
 
Appellate Body Division:  
 
Van den Bossche, Presiding Member  
Chang, Member  
Graham, Member  
 
 
 
1  INTRODUCTION  
1.1.  India appeals certain issues of law and legal interpretations developed in the Panel Report, 
India – Certain Measures Relating to Solar Cells and Solar Modules1 (Panel Report). The Panel was 
established on 23 May 2014 to consider a complaint  by the United States2 against certain domestic 
content requirements (DCR measures) imposed by India on solar power developers (SPDs) selling 
electricity to government al agencies under its Jawaharlal Nehru National Solar Mission  (NSM) .3 The 
DCR measures at  issue require that certain types of solar cells and modules used by SPDs be 
made in India.4 
1.2.  The NSM was launched by the Central Government of India in 2010, and aims to generate 
100,000  megawatts of grid -connected solar power capacity by 2022.5 The stated  objective of the 
NSM is "to establish India as a global leader in solar energy, by creating the policy conditions for 
its diffusion across the country as quickly as possible ."6 The NSM is being implemented in several 
successive "Phases", with each phase t hus far initiated being further divided into "Batches".  
1.3.  The DCR measures in Phase I (Batch 1), Phase I (Batch 2), and Phase II (Batch 1 -A) are 
each set forth, reproduced, or otherwise reflected in a series of different documents, including the 
so-called "Guidelines " and "Request for Selection " documents7, the model power purchase 
agreement  (PPA) , and the individually executed PPAs between the relevant Indian government al 
agencies8 and the SPDs.9 Each individually executed  PPA sets out a guaranteed rate for a 25-year 
term at which the electricity generated by the SPD will be bought by the Central Government. The 
                                                
1 WT/DS456/R , 24 February 2016 . 
2 Request for  the Establishment of a Pan el by the United States of 14 April 2014, WT/DS456/5 . 
3 Panel Report, para. 2.1.  
4 Solar cells are photovoltaic (PV) devices that are components of solar modules, also known as solar 
panels . Solar PV technology transforms sunl ight directly into electricity . 
5 Panel Report, para. 7.1.  
6 Panel Report, para. 7.1  (quoting Government of India, Ministry of New and Renewable Energy , 
Resolution  No. 5/14/2008 , Jawaharlal Nehru National Solar Mission  (11 January 2010)  (Panel Exhibit USA -4), 
para. 2). 
7 Panel Report, para. 7.8 and fn 81 thereto . 
8 Under Phase I (Batch 1) and Phase I (Batch 2), Vidyut Vyapar Nigam Limited  was the agency 
responsible for implementing the solar power project selection process. Under Phase II (Batch 1 -A), the Solar 
Energy Corporation of Ind ia was selected to perform the same functions . (Panel Report, para. 7.4)  
9 Panel Report, para. 7.2.  WT/DS456/AB/R  
 
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  government resells the electricity that it purchases to downstream distribution companies, which in 
turn resell it to the ultimate consumer.10 
1.4.  The Pan el, having reviewed all of the evidence provided relating to each Batch, carried out its 
analysis on the understanding that, for each Batch, the measure at issue is the DCR  measure 
reflected or incorporated in the various documents for each Batch, read tog ether in a "holistic" 
manner.11 The Panel therefore did not treat the separate documents in each Batch as distinct 
measures.12 
1.5.  A mandatory DCR was imposed on SPDs participating in Phase I (Batch es 1 and 2) and 
Phase  II (Batch 1 -A) of the NSM. The scope and c overage of the DCR differed, however, across the 
different Batches.13 Under Phase I (Batch 1), it was mandatory for all projects based on crystalline 
silicon (c -Si) technology to use c -Si modules manufactured in India, while the use of foreign c -Si 
cells an d foreign thin -film modules or concentrator photovoltaic (PV) cells was permitted.14 Under 
Phase I (Batch 2), it was mandatory for all projects based on c -Si technology to use c -Si cells and 
modules manufactured in India, while the use of domestic or foreig n modules made from thin -film 
technologies or concentrator PV cells was permitted.15 Under Phase II (Batch 1 -A), any solar cells 
and modules used by the SPDs had to be made in India, irrespective of the type of technology 
used.16 
1.6.  The United States claimed be fore the Panel that the DCR measures imposed by India are 
inconsistent with Article III:4 of the General Agreement on Tariffs and Trade 1994 ( GATT 1994 ) 
and Article 2.1 of the Agreement on Trade -Related Investment Measures ( TRIMs Agreement ). The 
United Sta tes further requested the Panel to recommend that India bring its measures into 
conformity with its WTO obligations pursuant to Article 19.1  Understanding on Rules and 
Procedures Governing the Settlement of Disputes (DSU).17 
1.7.  India requested the Panel  to find that the DCR measures at issue are not inconsistent with 
Article  III:4 of the GATT 1994 or Article 2.1 of the TRIMs Agreement. India further requested the 
Panel to find that the derogation under Article  III:8(a) of the GATT  1994 is applicable to the 
meas ures at issue  in this dispute . In the event that the Panel were to find that the measures at 
issue are inconsistent with any of the obligations under Article  III:4 of the GATT 1994 or 
Article  2.1 of the TRIMs Agreement, India requested that the Panel  determine that any such 
inconsistency w ould be justified under Article  XX(j) and/or Article XX(d) of GATT 1994.18 
1.8.  In the Panel Report, circulated to Members of the World Trade Organization (WTO) on 
24 February 2016, the Panel found that:  
a. the DCR measures are inc onsistent with Article 2.1 of the TRIMs Agreement and 
Article  III:4 of the GATT 199419;  
 
b. the DCR measures are not covered by the derogation in Article  III:8(a) of the 
GATT  199420; and  
 
                                                
10 Panel Report, para. 7.2.  
11 In response to India's request for a preliminary ruling on the scope of the measures at issue, the 
United States confirmed that , with respect to Phase I (Batch 1), Phase I (Batch 2), and Phase II (Batch  1-A), 
the measures at issue are only the specific DCRs  imposed under each Batch, and do not include any other 
element of  the NSM. ( Panel Report, para. 7.22 ) 
12 Panel Report, paras. 7.29-7.31. 
13 Panel Re port, para. 7.7 . 
14 Panel Report, para. 7.8.  
15 Panel Report, para. 7.9.  
16 Panel Report, para. 7.10 . Under Phase II (Batch 1 -A), the SPDs could bid for a PPA "Part A" (subject 
to a DCR), "Part B" (not subject  to a DCR), or both. The  United States challenged only the DCR measure 
imposed under Part A . (Ibid.)  
17 Panel Report, para. 3.1.  
18 Panel Report, para. 3.2.  
19 Panel Report, para. 8.2.a.  
20 Panel Report, para. 8.2.a.  WT/DS456/AB/R  
 
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  c. the DCR measures are not justified under the general exceptions in Artic le XX(j) or 
Article XX(d) of the GATT 1994.21  
1.9.  On 20 April 2016, India notified the Dispute Settlement Body ( DSB), pursuant to Articles  16.4 
and 17 of the DSU, of its intention to appeal certain issues of law covered in the Panel Report and 
certain legal in terpretations developed by the Panel  and filed a Notice of Appeal22 and an 
appellant's submission pursuant to Rule  20 and Rule 21, respectively, of the Working Procedures 
for Appellate  Review23 (Working Procedures).  
1.10.   On 2 May 2016, the United States sent a l etter to the Appellate Body Division hearing this 
appeal requesting an extension of the deadline for the filing of its appellee's submission in this 
appeal by one day. The United  States noted that its appellee's submission in another pending 
appellate proc eeding, namely, United States – Anti-Dumping and Countervailing Measures on 
Large Residential Washers from Korea (DS464), was also due on 9 May 2016, i.e.  the same day as 
the deadline for filing its appellee's submission in the present appeal. Referring to  the size of the 
appeals in these two disputes, the United States indicated that its submissions may be significant 
in scope. The United States also pointed to the large number of print copies of its appellee's 
submissions to be prepared for the Divisions and to be served on the participants and third 
participants in these two appeals. The United  States therefore requested that the deadline for the 
filing of the appellee's submission  in this appeal be extended by one day, such that it would be due 
on 10 May  2016.  
1.11.   On 3 May 2016, the Appellate Body Division hearing this appeal invited India and the third 
parties  to comment on the United  States' request. No objections to the United  States' request 
were received by the Division. Norway submitted , that if the Uni ted States' request were granted, 
the deadline for the filing of the third participants' submissions should similarly be extended to 
ensure that the third participants c ould contribute in an informed and efficient manner in the 
appellate proceedings.  
1.12.   On 4 May 2016, the Division issued a Procedural Ruling, extending the deadline for the 
United  States to file its appellee's submission by one day to 10 May 2016.24 The Division 
considered the reasons identified by the United States, in particular the need for th e United  States 
to file appellee's submissions in two separate appeal proceedings on the same day, to be relevant 
factors in its assessment of "exceptional circumstances, where strict adherence to a time -period … 
would result in a manifest unfairness" purs uant to Rule 16(2) of the Working  Procedures. The 
Division also noted that neither India, nor the third parties , had raised any objections to the 
United  States' request. Moreover, in order to provide the third participants sufficient time to 
incorporate re actions to the appellee's submission into their third participants' submissions, the 
Division decided, pursuant to Rule  16(2) of the Working Procedures, to extend the deadline for the 
filing of the third participants' submissions and third participants' no tifications to 12 May 2016.  
1.13.   On 10 May 2016, the United States filed an appellee's submission.25 On 12  May 2016, 
Brazil, the European Union, and Japan each filed a third participant's submission.26 On the same 
day, Canada, China, Malaysia, Norway, Russia,  and Saudi  Arabia notified their intention to appear 
at the oral hearing as a third participant.27 Subsequently, the Separate Customs Territory of 
Taiwan, Penghu, Kinmen and Matsu ; Ecuador ; Korea ; and Turkey each  notified its intention to 
appear at the oral hea ring as  a third participant.28 
                                                
21 Panel Report, para. 8.2.b.  
22 WT/DS456/9 . 
23 WT/AB/WP/6 , 16 August 2010.  
24 Contained in Annex D -1 of the Addendum to this Report (WT/DS456/AB/R/Add.1).  
25 Pursuant to Rule 22  of the Working Procedures.  
26 Pursuant to Rule 24(1)  and Rule 16(2) of the Working Procedures.  
27 Pursuant to Rule 24(2) of the Working Procedures.  
28 On 28 June, 30 June, 30 June, and 29 June 2016, respectively, the Separate Customs Territory of 
Taiwan, Penghu, Kinmen and Matsu ; Ecuador ; Korea ; and Turkey each submitted its delegation list for the oral 
hearing to the Appellate  Body Secretariat and the partici pants and third participants in this dispute. For the 
purposes of this appeal, we have interpreted these actions as notifications expressing the intention of  the 
Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu ; Ecuador ; Korea ; and Turkey to attend the 
oral hearing pursuant to Rule 24(4) of the Working Procedures.  WT/DS456/AB/R  
 
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  1.14.   By letter of 17 June 2016, the Chair of the Appellate Body notified the Chair of the DSB that 
the Appellate Body would not be able to circulate its Report in this appeal within the 60 -day period 
pursuant to Article  17.5 of the  DSU, or within the 90 -day period pursuant to the same provision. 
The Chair of the Appellate Body explained that this was due to a number of factors, including the 
substantial workload of the Appellate Body in 2016, scheduling difficulties arising from ove rlap in 
the composition of the Divisions hearing the different appeals, the number and complexity of the 
issues raised in this and concurrent appellate proceedings, together with the demands that these 
concurrent appeals place on the WTO Secretariat's tran slation services, and the shortage of staff in 
the Appellate Body Secretariat.29 By letter of 8 July 2016, the Chair of the Appellate Body informed 
the Chair of the DSB that the Appellate Body Report in these proceedings would be circulated no 
later than 16  September 2016.30 
1.15.   The oral hearing in this appeal was held on 4 -5 July 2016. The participants and three of the 
third participants (the European Union, Japan, and Norway) made opening  and/or closing  oral 
statements. The participants and third participants r esponded to questions posed by the Members 
of the Appellate  Body Division hearing the appeal.  
2  ARGUMENTS OF THE PAR TICIPANTS  
2.1.  The claims and arguments of the participants are reflected in the executive summaries of 
their written submissions provided to the Appellate Body.31 The Notice of Appeal and the executive 
summaries of the participants' written submissions are contained, respectively, in Annexes A and B 
of the Addendum to this Report.32 
3  ARGUMENTS OF THE THI RD PARTICIPANTS  
3.1.  The arguments of Brazil, the Eur opean Union, and Japan,  as third participants, are reflected 
in the executive summaries of their written submissions provided to the Appellate Body33, and are 
contained in Annex C of the Addendum to this Report.34 
4  ISSUES RAISED IN THIS APPEAL  
4.1.  The following i ssues are raised in this appeal:  
a. with respect to Article III:8(a) of the GATT 1994:  
i. whether the Panel acted inconsistently with Article 11 of the DSU in finding that the 
DCR measures at issue in this dispute  are not covered by the derogation under 
Article  III:8(a), and that consequently India could not rely on that provision to 
exclude the application of Article  III:4 of the GATT 1994 and Article  2.1 of the TRIMs 
Agreement to the DCR measures; and 
ii. if the Appellate Body reverses the Panel's finding that the DCR measures are not 
covered by the derogation under  Article  III:8(a) of the GATT  1994, then whether the 
Appellate Body can complete the legal analysis and find that they satisfy the 
remaining legal elements under that provision;  
b. with respect to Article XX (j) of the GATT 1994:  
i. whether the Panel erred in its interpretation and application of Article  XX(j), and 
under Article 11 of the DSU, in finding that solar cells and modules are not "products 
                                                
29 WT/DS456/10.  
30 WT/DS456/11.  
31 Pursuant to the Appellate Body Communication on "Executive Summaries of Written Submissions in 
Appellate Proceedings" and "Guidelines in Respect of Ex ecutive Summaries of Written Submissions in Appellate 
Proceedings". (WT/AB/23, 11 March 2015)  
32 WT/DS4 56/AB/R/Add.1.  
33 Pursuant to the Appellate Body Communication on "Executive Summaries of Written Submissions in 
Appellate Proceedings" and "Guidelines in Respect of Executive Summaries of Written Submissions in Appellate 
Proceedings". (WT/AB/23, 11 March 2015)  
34 WT/DS4 56/AB/R/Add.1.  WT/DS456/AB/R  
 
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  in general or local short supply" in India, and that consequent ly the DCR measures 
are not justified under Article XX(j);  and 
ii. if the Appellate Body reverses the Panel's finding that solar cells and modules are not 
"products in general or local short supply" in India within the meaning of 
Article  XX(j), then whether th e Appellate Body can complete the legal analysis and 
find that the DCR measures meet the requirements for provisional justification under 
Article XX(j) and satisfy the requirements of the chapeau of Article  XX of the 
GATT  1994; and 
c. with respect to Article XX(d) of the GATT 1994:  
i. whether the Panel erred in its interpretation and application of Article  XX(d) in 
finding that the DCR measures are not measures "to secure compliance with laws or 
regulations which are not inconsistent with the provisions of [the G ATT 1994]" within 
the meaning of Article  XX(d); and that consequently the DCR  measures are not 
justified under that provision ; and  
ii. if the Appellate Body reverses the Panel's finding that the DCR measures are not 
measures "to secure compliance with laws or  regulations which are not inconsistent 
with the provisions of [the GATT 1994]" within the meaning of Article XX(d), then 
whether the Appellate Body can complete the legal analysis and find that the 
DCR measures meet the requirements for provisional justif ication under Article XX(d) 
and satisfy the requirements of the chapeau of Article  XX of the GATT  1994.  
5  ANALYSIS OF THE APPE LLATE BODY  
5.1  Article  III:8(a) of the GATT  1994  
5.1.  India appeals the Panel's finding that the DCR measures are not covered by the governm ent 
procurement derogation under Article  III:8(a) of the GATT  1994 because India's government 
purchases electricity , and the discrimination under the DCR measures relates to solar cells and 
modules.35 India argues that the Panel acted inconsistently with it s obligations under Article 11 of 
the DSU by failing to make an objective assessment of the matter before it, including of India's 
arguments and related evidence that: ( i) solar cells and modules are indistinguishable from solar 
power generation; ( ii) sola r cells and modules can be characterized as inputs for solar power 
generation; and ( iii) Article  III:8(a) cannot be applied in a narrow manner that would require 
direct acquisition of the product purchased in all cases.36 India requests us to reverse the Pa nel's 
finding and find that the DCR measures are covered by the derogation under Article  III:8(a).37 
5.2.  In the event that we find that the DCR measures are covered by the government 
procurement derogation under Article  III:8(a), India further requests that we complete the legal 
analysis of the remaining elements under this provision.38 In particular, India requests that we 
reaffirm the Panel's findings that the DCR measures are laws, regulations or requirements 
"governing" procurement and that the procurement un der the DCR measures is "by governmental 
agencies", and that we find that the procurement under the DCR measures is of products 
purchased "for governmental purposes" and "not with a view to commercial resale".39 
5.3.  We begin by summarizing the Panel's findings and the issues appealed. We then address the 
interpretation of Article III:8(a) of the GATT 1994, before turning to consider the Panel's analysis 
as challenged by India on appeal . 
5.1.1   The Panel's findings  
5.4.  The Panel began by reviewing the requirements set out i n the text of Article  III:8(a) of the 
GATT  1994 in order for a measure to be exempted from the national treatment obligations of 
                                                
35 India's appellant's submission, para. 35(a) . 
36 India's appellant's submission, para. 35(b).  
37 India's appellant's submission , para. 35(c) . 
38 India's appellant's submission, para. 36.  
39 India's appellant's submission, paras. 61 -62. WT/DS456/AB/R  
 
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  Article  III:4 of the GATT  1994 and Article  2.1 of the TRIMs Agreement.40 The Panel observed that, 
in addition to those factors, there is a "threshold matter" of the applicability of Article  III:8(a) in 
respect of the "products purchased" under the DCR measures.41 For the Panel, this was the 
"dispositive" factor of the Appellate Body's analysis in  Canada  ‒ Renewable Energy / Canada – 
Feed-in Tariff Program , and the pertinence, or distinguishability, of the Appellate Body's findings 
and reasoning in those cases  was a primary issue of contention between the parties during the 
Panel proceedings in the present dispute.42 The Panel noted , in this regard , that the 
Appellate  Body framed the applicability of Article  III:8(a) "according to whether the particular 
products subject to discrimination are in a 'competitive relationship' with the products purchased 
under the measures in question".43 Recalling that the products subject to discrimination in the 
present dispute are solar cells and modules originating in the United  States and that India 
purchases the electricity generated from solar cells and modules, rat her than the solar cells and 
modules themselves, the Panel observed that "an  approach paralleling that of the Appellate  Body 
in Canada  ‒ Renewable Energy / [Canada – ] Feed-in Tariff Program would entail a comparison of 
solar cells and modules with the gen erated electricity that is purchased in order to ascertain 
whether these products are in a 'competitive relationship'."44 
5.5.  The Panel further noted that India had not argued that electricity , on the one hand, and solar 
cells and modules , on the other hand, are in a competitive relationship, and had not requested 
that the Panel depart from the reasoning of the Appellate  Body in  Canada – Renewable Energy / 
Canada – Feed-in Tariff Program . Rather, India sought to distinguish the DCR measures from the 
measures at issue in those cases by submitting that the Central Government was "effectively 
procuring" solar cells and modules by purchasing electricity generated from such cells and 
modules.45  
5.6.  Regarding India's contention that Article  III:8(a) of the GATT  1994 does n ot require in every 
case a "competitive relationship" between the product that is procured and the product that is 
discriminated against, the Panel observed that the Appellate  Body in Canada – Renewable Energy / 
Canada – Feed-in Tariff Program  referred to "consideration of inputs and processes of production" 
as being potentially relevant to " [w]hat constitutes a competitive relationship between products ".46 
For the Panel, this reference to "inputs and processes of production" seemed to elaborate, rather 
than displace, what the Appellate Body had referred to as the "competitive relationship" standard, 
leaving open the possibility that a consideration of inputs and processes of production would 
inform an assessment of whether the products subject to discriminat ion are "like" and/or "directly 
competitive to or substitutable with the product purchased under the challenged measure".47 The 
Panel did not understand India to disagree with this proposition.48 Instead, it understood India to 
argue that , "when the Appellat e Body … referred to (and expressly declined to decide) whether 
'the cover of Article III:8(a) may also extend to discrimination relating to inputs and processes of 
production used in respect of products purchased by way of government procurement', it was no 
longer referring to the question of '[w]hat constitutes a competitive relationship between 
products', but was rather introducing the possibility of an alternative to the 'competitive 
relationship' standard in a situation involving discrimination against  'inputs and processes of 
                                                
40 Panel Report, para.  7.105 (referring to Appellate  Body Reports, Canada  ‒ Renewable Energy / 
Canada  – Feed-in Tariff Program , paras. 5.57, 5.69, and  5.74). 
41 Panel Report, para. 7.106.  
42 Panel Report, para. 7.106.  
43 Panel Report, para. 7.113.  
44 Panel Report, para.  7.113.  
45 Panel Report, para.  7.114 ( quoting  India's opening statement at the first Panel meeting, para.  26). In 
particular, India argued th at the fundamental characteristics of solar cells and modules in absorbing light 
energy, which releases electrons and thereby generates electricity, define their integral role in solar power 
generation . (Panel Report, fn 292 to para.  7.114 (referring to India's first written submission to the Panel, 
para. 110; second written submission to the Panel, para.  19; and comments to the United  States' response to 
Panel Question No. 43, para.  11)) 
46 Panel R eport, para.  7.118  (quoting Appellate  Body Report s, Canada – Renewable Energy / Canada – 
Feed-in Tariff Program , para. 5.63). (emphasis added by the Panel)  
47 Panel R eport, para.  7.118  (quoting Appellate  Body Report s, Canada – Renewable Energy / Canada – 
Feed-in Tariff Program , para. 5.63). The Panel referred to the  United  States' suggestion that this could be 
understood to mean that , "where product A and product B are comprised of similar inputs (or manufactured 
through similar processes), this might  suggest that product A and product B are 'like products' or in a 
competitive relationship" . (Ibid., fn 300 to para.  7.118  (quoting United  States' response to Panel question 
No. 41, para.  4 (emphasis original)) ) 
48 Panel Report, para. 7.118.  WT/DS456/AB/R  
 
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  production'."49 The Panel, however, did not find it necessary "to resolve whether the 
Appellate  Body left room for an alternative to the 'competitive relationship' standard", considering 
that, "[i]n applying Article  III:8(a) to clo sely analogous facts that involved the purchase of 
electricity and discrimination against generation equipment, the Appellate  Body stated that the 
derogation 'extends' to products in a 'competitive relationship' and disposed of the case on the 
grounds that  'electricity' and 'generation equipment' are not in such a relationship."50  
5.7.  Concerning the issue of whether solar cells and modules can be characterized as "inputs" in 
relation to electricity, the Panel recalled the United States' argument that India "rel ies on a factual 
assumption that solar panels and modules are an input to the generation of solar power, but they 
are actually capital equipment that is not consumed or incorporated in the power generated".51 
The Panel further noted the United States' posit ion that an "input" should be "incorporated into or 
otherwise physically detectable" in a finished product , and India's position that it could "refer to 
any resources or materials that are required to obtain a desired output".52 The Panel considered 
that the parties' disagreement turned on issues that the Appellate Body did not consider necessary 
to resolve in  Canada – Renewable Energy / Canada – Feed-in Tariff Program , and found that it was 
similarly unnecessary to resolve these issues in the present disput e.53 
5.8.  The Panel noted that India's arguments also hinge upon whether "solar cells and modules are 
integral inputs  for the generation system" , as contrasted with "all other components of a PV 
generation plant [that] can be classified as ancillary equipment".54 The Panel stated that the 
"generation equipment" at issue in Canada – Renewable Energy / Canada – Feed-in Tariff Program  
included the "exact same" products, i.e. solar cells and modules, which were used to generate 
electricity purchased by the government.55 The Panel found it noteworthy that the Appellate  Body 
had given "no indication of these, or any other type of equipment, being an 'input' that would be 
relevant to the analysis under Article  III:8(a) of the GATT  1994, nor did it make any distinction 
between inputs of an 'integral' or 'ancillary' nature ."56 Furthermore, the measures in  those cases 
effectively imposed a requirement to use domestically  sourced "goods" or "generation equipment 
and components" in order to achieve the necessary level of domestic  content.57 
5.9.  On this basis, the Panel concluded that " Canada – Renewable Energy / [Canada – ] Feed-in 
Tariff Program entailed discrimination against the same 'generation equipment' that is at issue in 
the present dispute, namely solar cells and modules".58 Referring to the panel and Appellate Body 
reports in  those disputes,  the Panel was not persuaded that India's arguments in the present case 
rose to "anything more than the 'close relationship' between generation equipment and electricity 
that the Appellate  Body rejected as the relevant standard under Article III:8(a)" in those 
proceedings .59 The Panel added that , "[t]o whatever extent Article  III:8(a) applies to 'inputs' 
(however that term is defined) that are not in a competitive relationship with the product  
                                                
49 Panel Report, para.  7.119.  
50 Panel Report, para.  7.120  (quoting Appellate  Body R eports, Canada – Renewable Energy / Canada – 
Feed-in Tariff Program , paras.  5.63 and 5.79, respectively) . 
51 Panel Report, para.  7.121  (quoting United States' second written submission to the Panel, para. 17). 
52 Panel Report, para.  7.121 (referring to  United States' second written submission to the Panel, 
para. 20; and quoting India's response to Panel question No. 42, paras. 8 and 10 ). 
53 Panel Report, para.  7.121.  
54 Panel Report, para.  7.122  (quoting India's second written submission  to the Panel , para.  20 
(emphasis  original) ). 
55 Panel Report, para.  7.123.  
56 Panel Report, para.  7.123.  
57 Panel Report, para.  7.125 (quoting Panel Reports, Canada – Renewable Energy / Canada – Feed-in 
Tariff Program , para.  7.163). For the Panel, although the requirements in Canad a – Renewable Energy / 
Canada – Feed-in Tariff Program  pertained to other activities for the development and construction of facilities 
that are not covered by the DCR measures in the present dispute, such other activities could not alone meet 
the "Qualify ing Percentages" for the Minimum Required Domestic Content Level. (Ibid.)  
58 Panel Report, para.  7.126.  
59 Panel Report, para.  7.128. WT/DS456/AB/R  
 
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  purchased by way of procurement, … the Appellate  Body did not find such considerations germane 
to its evaluation of electricity and generation equipment that included solar cells and modules."60  
5.10.   The Panel also addressed India's concern that , to read "proc urement" in Article  III:8(a) as 
requiring "direct acquisition of the product" , would be an unnecessary intrusion into the nature and 
exercise of government al actions relating to procurement of solar power.61 The Panel reasoned 
that it is by no means self -evident that the scenarios referred to by India62 involving the "direct 
acquisition" of solar cells and modules by governmental agencies would meet the other 
requirements of Article  III:8(a), notably the requirements for products to be purchased "for 
governme ntal purposes and not with a view to commercial resale or with a view to use in the 
production of goods for commercial sale".63  
5.11.   Having "considered the specific basis" upon which India sought to distinguish the facts and 
circumstances of the present dispute , the Panel was not persuaded that the DCR measures are 
"distinguishable in any relevant respect" from the measures examined by the Appellate  Body in  
Canada – Renewable Energy / Canada – Feed-in Tariff Program .64 Referring to the 
"Appellate  Body's legal int erpretation of Article  III:8(a) as applied to the governmental purchase of 
electricity and discrimination against foreign generation equipment", the Panel thus found that "the 
discrimination relating to solar cells and modules under the DCR measures is not  covered by the 
derogation of Article  III:8(a) ."65 
5.1.2   India's claims on appeal  
5.12.    India appeals the Panel's conclusion that the DCR measures at issue are not covered by the 
derogation under Article III:8(a) of the GATT  1994. Central to India's appeal is its cont ention that 
the Panel acted inconsistently with its duties under Article 11 of the DSU because it "mechanically 
applied the Appellate  Body's test of competitive relationship" developed in  Canada – Renewable 
Energy / Canada – Feed-in Tariff Program66 and "re fused to consider the facts, evidence and legal 
arguments advanced by India"67 in this case.68 
5.13.   India presents several arguments in support of its contention . India maintains that the Panel 
"ignored a fundamental basis of India's argument" that solar cells an d modules are 
                                                
60 Panel Report, para.  7.128. Similarly, the Panel rejected India's argument that , since the tariff for the 
power purchased u nder the PPAs incorporates within it the cost for the solar cells and modules, "India's 
purchase of electricity generated from solar cells and modules … constitutes an effective purchase  of the cells 
and modules themselves", considering that the argument s eemingly conflicted with India's primary argument 
that "integral inputs", but not other "ancillary equipment" whose costs also may be reflected in the electricity 
tariff, are "effectively procured" . (Panel Report, para.  7.129 (quoting India's response to P anel question No. 41, 
para. 7 (emphasis added by the Panel))  
61 Panel Report, para.  7.130 ( referring to India's first written submission to the Panel, para s. 118 and 
120; and opening statement at the first Panel meeting, para. 29). 
62 According to India, for a government to procure effectively solar cells and modules under 
Article  III:8(a), it would need to either purchase these products by itself and generate the electricity from 
them, or purchase the products and provide th em to SPDs for power generation.  (Panel Report, para.  7.130 
(quoting India's first written submission to the Panel, para.  117))  
63 Panel Report, para.  7.132. India also argued that "procurement" should not be interpreted to require 
direct acquisition in view of the Appellate  Body's statemen t in Canada – Renewable Energy / Canada – Feed-in 
Tariff Program  that, "if procurement was understood to refer simply to any acquisition, it would not add any 
meaning to Article III:8(a) in addition to what is already expressed by the word purchased." The Panel, 
however, considered that this reference is misplaced and "reverses the logic of the Appellate Body" by 
subsuming the concept of "purchase" under a broader category of "procureme nt". (Panel Report, para. 7.133  
(quoting Appellate Body Reports, Canada – Renewable Energy / Canada – Feed-in Tariff Program , para. 5.59; 
and European  Union's third -party submission to the Panel, para.  40)) 
64 Panel Report, para.  7.135.  
65 Panel Report, para.  7.135.  
66 India's appellant's submission, para.  6. See also para s. 17 and 26. 
67 India's appellant's submission, para. 24.  
68 Thus, we understand India to argue that, in relying on the Appellate Body's finding in those disputes 
and not coming to any conclusions with regard to India's claims and arguments relating to solar cells  and 
modules,  the Panel failed "to make an objective assessment of the facts of the case, and the applicability of 
and conformity with the relevant provisions of the covered agreements". (India's appellant's submission, 
paras.  24 and 28; and responses to q uestioning at the oral hearing)  WT/DS456/AB/R  
 
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  "indistinguishable" from solar power generation.69 India also submits that the Panel erred "in its 
factual and legal assessment that it is not necessary to consider whether solar cells and modules 
qualify as 'inputs' for solar power generation " and "in its application of the relevant tests for 
consideration regarding whether or not solar cells and modules can be characterized as inputs ".70 
Furthermore, India alleges that the Panel erred in dismissing its arguments that sole reliance on 
the "comp etitive relationship" test would unduly restrict the scope of Article  III:8(a) , and that 
Article  III:8(a) should not be interpreted to envisage direct acquisition of products purchased, in 
all cases.71 Finally, India contends that the Panel erred in "reason ing that it cannot go beyond the 
tests applied by the Appellate  Body in Canada – Renewable Energy / Canada – Feed-in Tariff 
Program  since India had not asked it to deviate from this reasoning"72, and thus failed to ensure "a 
meaningful interpretation of Art icle III:8(a)".73  
5.14.   For its part, the United States considers that India's arguments under Article 11 of the DSU 
"are without merit, because … the Panel thoroughly engaged [ with] all of the evidence and 
arguments advanced by India", even though it did not ac cord "such evidence the weight India 
thought it should have".74 The United States further submits that the Panel's interpretation of 
Article  III:8(a) is consistent with its text and accords with the legal standard articulated by the 
Appellate Body in  Canada  – Renewable Energy / Canada – Feed-in Tariff Program , and that the 
Panel properly understood that provision as "exempting from Article III only procurements of 
products directly competitive with the import subject to discrimination".75 In the United States ' 
view, "[h]aving rejected the proposition that India could be understood to 'procure' solar cells and 
modules without actually purchasing, acquiring, or otherwise taking custody of any solar cells and 
modules, it was unnecessary for the Panel to consider or resolve the theoretical question of 
whether solar cells and modules can be distinguished from solar power generation."76 
5.15.   We recall that Article 11 of the DSU imposes upon panels a comprehensive  obligation to 
make an "objective assessment of the matter", which embraces all aspects of a panel's 
examination of the "matter", both factual and legal.77 Thus, panels are required to make an 
objective assessment of "the facts", the "applicability" of the covered agreements, and the 
"conformity" of the measure at is sue with the covered agreements.78 With respect to "the 
applicability of and conformity with the relevant covered agreements", a panel is required to 
conduct an objective assessment of whether the obligations in the covered agreements, with which 
an inconsi stency is claimed, are relevant and applicable to the case at hand, and whether the 
measures at issue conform to, or are inconsistent with, the specific obligations provided for in 
those agreements.79 That said, a panel has the discretion "to address only t hose arguments it 
deems necessary to resolve a particular claim" , and "the fact that a particular argument relating to 
that claim is not specifically addressed in the 'Findings' section of a panel report will not, in and of 
itself, lead to the conclusion t hat that panel has failed to make the 'objective assessment of the 
                                                
69 India's appellant's submission, para s. 6 and 8, respectively . In particular, India argues that 
"Article  III:8(a) would apply in situations where the physical form of the product purchased by the government 
is not identical  to the product discriminated against, when it is established that there is really no difference 
between the products discriminated against (i.e. solar cells and modules) and the product purchased (i.e. solar 
power)." (Ibid.)  
70 India's appellant's submissi on, heading  IIB, and para. 10 , respectively . (emphasis original)  
71 India's appellant's submission, paras.  21-23. 
72 India's appellant's submission, heading  IIE. 
73 India's appellant's submission, para. 34.  
74 United States' appellee's submission, para. 47.  
75 United States' appellee's submission, para. 62.  
76 United States' appellee's submission, para. 52. (emphasis original)  
77 Appellate  Body Report, Colombia – Textiles , para. 5.17 (referring to Appellate Body Report, US – 
Hot-Rolled Steel , para. 54).  
78 Appellat e Body Report, Colombia – Textiles , para. 5.17 (referring to Appellate Body Report, US – 
Hot-Rolled Steel , para. 54).  
79 See Appellate  Body Report, Colombia – Textiles , para. 5.17. In order to make an "objective 
assessment of the applicability of specific p rovisions of the covered agreements to a measure properly before 
it", a panel must "thoroughly scrutinize the measure before it, both in its design and in its operation, and 
identify  its principal characteristics".  (Appellate Body Reports, China – Auto Par ts, para.  171) WT/DS456/AB/R  
 
- 16 - 
 
  matter before it' required by Article  11 of the DSU."80 Finally, a challenge to a panel's assessment 
of the facts cannot be sustained simply by asserting that a panel did not agree with argu ments or 
evidence  that had been presented before it , but must be clearly articulated and substantiated with 
specific arguments, including an explanation of why the alleged error has a bearing on the 
objectivity of the panel's factual assessment.81 
5.16.   As noted,  the Panel did not consider it necessary in the present dispute "to resolve whether 
the Appellate Body left room for an alternative to the 'competitive relationship' standard, or to 
decide, in the abstract, the meaning of 'inputs and processes of productio n' as used by the 
Appellate Body in Canada – Renewable Energy / [Canada – ] Feed-In Tariff Program ."82 This was 
because the Panel concluded that the DCR measures at issue in this dispute are not 
"distinguishable in any relevant respect from those examined b y the Appellate Body" in those 
earlier disputes.83 Under Article 11 of the DSU , the Panel was required, in making an objective 
assessment of the matter before it, to consider all factual and legal arguments of the parties that 
were pertinent for ruling on w hether the DCR measures are covered by the derogation under 
Article  III:8(a). As a first step in addressing India 's challenge to the Panel's analysis , we will 
examine the scope of application of Article III:8(a) of the GATT  1994.  
5.1.3   The scope of application o f Article  III:8(a) of the GATT  1994  
5.17.   Article  III:8(a) of the GATT  1994 provides:  
The provisions of this Article  shall not apply to laws, regulations or requirements 
governing the procurement by governmental agencies of products purchased for 
governmental p urposes and not with a view to commercial resale or with a view to use 
in the production of goods for commercial sale.  
5.18.   We recall that Article  III:8(a) sets out a derogation from the national treatment obligation 
contained in Article  III of the GATT  1994, e xempting from that obligation certain measures that 
contain rules regarding the process by which governmental agencies purchase products. The 
measures within the scope of Article  III:8(a) are "laws, regulations or requirements governing … 
procurement" , and the entity purchasing products needs to be a "governmental agency".  
Furthermore, the scope of Article  III:8(a) is limited to "products purchased for governmental 
purposes", and "not with a view to commercial resale or with a view to use in the production of 
goods for commercial sale".84 
5.19.   As noted, a primary issue of contention between the parties in the Panel proceedings was 
the pertinence of the reasoning and findings of the Appellate  Body in Canada – Renewable Energy 
/ Canada – Feed-in Tariff Program  regar ding the scope of Article  III:8(a) of the GATT  1994 with 
respect to "products purchased". For India, the test of competitive relationship between the 
product discriminated against and the product purchased " is not a single inflexible rule  to be 
applied in all circumstances for consideration under Article  III".85 India recalls , in this regard , that 
the Appellate  Body explicitly noted that "[w]hether the derogation in Article  III:8(a) can extend 
                                                
80 Appellate  Body Report, EC – Poultry , para.  135. (emphasis omitted) See also Appellate  Body Report, 
EC – Fasteners (China) , para.  511. Furthermore, with regard to a panel's evaluation of the evidence, a panel is 
required to "consider all th e evidence presented to it, assess its credibility, determine its weight, and ensure 
that its factual findings have a proper basis in that evidence" . (Appellate  Body Report, Brazil – Retreaded 
Tyres , para.  185 (referring to Appellate  Body Report, EC ‒ Horm ones, paras.  132 and 133)) Within these 
parameters, however, "it is generally within the discretion of the [p]anel to decide which evidence it chooses to 
utilize in making findings", and the mere fact that a panel does not explicitly refer to each and ever y piece of 
evidence in its reasoning is insufficient to support a claim of violation under Article  11 of the  DSU. 
(Appellate  Body Reports, EC – Hormones , para.  135. See also Appellate Body Report,  EC – Fasteners (China) , 
para. 442) 
81 Appellate Body Reports , China – Rare Earths , para. 5.227 (referring to Appellate Body Reports,  Chile 
– Price Band System (Article 21.5 – Argentina) , para. 238; US – Steel Safeguards , para. 498; US – Tyres 
(China) , para. 321; and EC – Fasteners (China) , paras. 499 and 500). See also Appellate Body Report, US – 
Large Civil Aircraft (2nd complaint) , para. 722 (referring to Appellate Body Report, EC – Fasteners (China ), 
para. 442). 
82 Panel Report, para. 7.120.  
83 Panel Report, paras. 7.120 and 7.134 -7.135.  
84 See Appellate  Body Report s, Canada  ‒ Renewable Energy / Canada – Feed-in Tariff Program , 
para. 5.74. 
85 India's appellant's submission, para. 9.  See also para. 4.  WT/DS456/AB/R  
 
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  also to discrimination [relating to inputs and processes of produ ction used in respect of products 
purchased by way of procurement] is a matter we do not decide in this case."86 According to India, 
this "left space for legal reasoning on the issue of inputs".87  
5.20.   For its part, the United States underscores that the Appella te Body has found that 
"Article  III:8(a) does not apply when a Member purchases one product, but discriminates against 
another, different product" and, as read in conjunction with the other paragraphs of Article III, 
requires that the product "subject to d iscrimination" and the "product that is purchased" by the 
government must be: "(1) identical products; (2) 'like' products; or (3) products that are directly  
competitive or substitutable", or, in other words, "products that are in a competitive 
relationshi p".88 The United States argues that the Panel was properly guided in the present case by 
the Appellate  Body's interpretation of Article III:8(a) in Canada – Renewable Energy / Canada – 
Feed-in Tariff Program , given that both those and the present dispute in volve measures under 
which the government purchase s electricity, but discriminate s against foreign generation 
equipment.89  
5.21.   As observed by the Appellate  Body in  Canada – Renewable Energy / Canada – Feed-in Tariff 
Program , Article  III:8(a) begins with the ph rase "[t]he provisions of this Article  shall not apply 
to …". This introductory clause of Article  III:8(a) establishes "a linkage with the remainder of 
Article  III", and the words "[t]he provisions of this Article" encompass the overarching principle in 
Article III:1 that internal measures "should not be applied … so as to afford protection to domestic 
production".90 For government procurement activities falling within its scope, Article  III:8(a) 
establishes a derogation from the national treatment obligatio n under Article  III.91 That is why, as 
the Appellate  Body stated, the derogation in Article  III:8(a) "becomes  relevant only if there is 
discriminatory treatment of foreign products that are covered by the obligations in Article  III".92 In 
this regard, the Ap pellate  Body stated:  
Because Article  III:8(a) is a derogation from the obligations contained in other 
paragraphs of Article  III, … the same discriminatory treatment must be considered 
both with respect to the obligations of Article  III and with respect to the derogation of 
Article  III:8(a). Accordingly, the scope of the terms "products purchased" in 
Article  III:8(a) is informed by the scope of "products" referred to in the obligations set 
out in other paragraphs of Article  III. Article  III:8(a) thus concern s, in the first 
instance, the product that is subject to the discrimination.93 
5.22.   The coverage of Article  III:8(a) thus extends to products purchased that are "like" the 
products discriminated against under Article III:2 and III:4, or, in accordance with the Ad Note to 
Article  III:2, to products that are "directly competitive " with or "substitutable" for such products. It 
is these products that the Appellate  Body described as "products that are in a competitive 
relationship"94, using the term "competitive relati onship" as a shorthand for delineating the scope 
of "like", or "directly competitive or substitutable"95. In other words, since "the derogation of 
Article  III:8(a) must be understood in relation to the obligations stipulated in Article  III", the 
product of foreign origin must be either "like" , or "directly competitive " with or "substitutable" for 
– i.e. in a "competitive relationship" with  – "the product purchased".96 We do not consider that the 
                                                
86 Appellate  Body Reports, Canada – Renewable Energy / Canada – Feed-in Tariff Program , para.  5.63. 
87 India's appellant' s submission, para.  4. See also para. 9  (quoting Appellate  Body Reports, Canada – 
Renewable Energy / Canada – Feed-in Tariff Program , para.  5.63). (fn omitted)  
88 United States' appellee's submission, paras. 38 and 4 2 (referring to  Appellate  Body Reports, Canada – 
Renewable Energy / Canada – Feed-in Tariff Program , para.  5.63).  
89 United States' appellee's submission, para. 66 (referring Panel Report, para. 7.120) and para. 69 
(referring to Panel Report, para. 7.135).  
90 Appellate  Body Reports, Canada – Renewa ble Energy / Canada – Feed-in Tariff Program , para.  5.55 
(quoting  Appellate  Body Report, Japan – Alcoholic Beverages II , p. 18, DSR 1996:I, p.  111; and referring to 
Appellate Body Report, EC ‒ Asbestos , para.  93). 
91 Appellate  Body Reports, Canada – Renewab le Energy / Canada – Feed-in Tariff Program , para.  5.56. 
92 Appellate  Body Reports, Canada – Renewable Energy / Canada – Feed-in Tariff Program , para.  5.63. 
93 Appellate  Body Reports, Canada – Renewable Energy / Canada – Feed-in Tariff Program , para.  5.63. 
94 Appellate  Body Reports, Canada – Renewable Energy / Canada – Feed-in Tariff Program , 
paras.  5.62-5.63. 
95 See Appellate Body Reports, Canada – Renewable Energy / Canada – Feed-in Tariff Program, 
para. 5.74. 
96 See Appellate  Body Reports, Canada – Renewable Energy / Canada – Feed-in Tariff Program , 
para. 5.74. WT/DS456/AB/R  
 
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  scope of a derogation can extend beyond the scope of the obligat ion from which derogation is 
sought.  
5.23.   India submits that the Panel erred in equating India's argument that solar cells and modules 
constitute "inputs" for solar power generation with th e "close relationship" standard  that was used 
by the panel in  Canada – Renewable Energy / Canada – Feed-in Tariff Program .97 In those 
disputes , the panel found that "the very same equipment " was "needed and used to produce the 
electricity that [was]  allegedly procured" and that there was "very clearly a close relationship  
betwe en ... renewable energy generation equipment" and the product purchased (electricity).98 
While the Appellate Body agreed that a "close relationship" could be relevant for a separate 
element of Article  III:8(a) – i.e. assessing whether a measure can be said to be "governing" 
procurement of products purchased – it did not consider this dispositive of whether Article  III:8(a) 
applie d, because the products purchased were not in a "competitive relationship" with the products 
being discriminated against.99  
5.24.   On appe al in this dispute , India argues that the Appellate Body in Canada – Renewable 
Energy / Canada – Feed-in Tariff Program  suggested that the scope of Article  III:8(a) may extend, 
in some cases, to "inputs" and "processes of production" , regardless of whether  the product 
subject to discrimination is in a competitive relationship with the product purchased . We disagree 
with India's reading of the Appellate Body report in Canada  ‒ Renewable Energy / [Canada – ] 
Feed-in Tariff Program .100 The Appellate Body explici tly stated that it was not deciding whether 
"the cover of Article III:8(a) may also extend to discrimination relating to inputs and processes of 
production used in respect of products purchased by way of procurement ."101 This question arises 
only after the p roduct subject to discrimination has been found to be like, directly competitive 
with, or substitutable for – in other words, in a competitive relationship with  – the product 
purchased . In respect of th e latter  issue,  although  a consideration of inputs and  processes of 
production may inform  the question of whether the product purchased is in a competitive 
relationship with the product being discriminated against, it does not displace  the competitive 
relationship standard . Under Article  III:8(a) of the GATT 1994, the foreign product discriminated 
against must necessarily be in a competitive relationship with the product purchased by way of 
procurement.  
5.1.4   India's challenge to the Panel's approach to India's claims under Article  III:8(a) 
of the GATT  1994  
5.25.   India's appeal under Article  III:8(a) of the GATT  1994 hinges largely on its reading of that 
provision , and in particular on what India sees as the limited scope of the competitive relationship 
standard, as developed by the Appellate Body in  Canada – Renewable Ene rgy / Canada – Feed-in 
Tariff Program . We have rejected India's reading of Article  III:8(a) above and have found that a 
competitive relationship between the product discriminated against and the product purchased 
must be established in all cases. We furthe r recall that India did not argue before the Panel that a 
competitive relationship exists between electricity , on the one hand,  and solar cells and modules , 
on the other hand,  or that the government  takes title or custody of solar cells and modules.102 This 
is sufficient to address India's appeal to the extent that its arguments rely on the existence of an 
alternative to the competitive relationship standard . However, i n order to dispose fully of the 
issues raised by India on appeal, we proceed to examine Ind ia's arguments to the extent that they 
relate to the approach taken by the Panel in its review of India's claims under Articl e III:8(a).  
                                                
97 India's appellant's submission, para. 19.  
98 Panel Reports, Canada – Renewable Energy / Canada – Feed-in Tariff Program , para.  7.127 . 
(emphasis added)  
99 See Appellate  Body Reports, Canada – Renewable E nergy / Canada – Feed-in Tariff Program , 
paras . 5.78-5.79. 
100 Appellate  Body Reports, Canada – Renewable Energy / Canada – Feed-in Tariff Program , para.  5.63. 
101 Appellate  Body Reports, Canada – Renewable Energy / Canada – Feed-in Tariff Program , para.  5.63. 
(fn omitted) Conditions imposed in the context of government procurement relating to inputs and processes of 
production of products purchased, such as conditions regarding "the environmental profile or the 
environmental attributes that a particular produc t may incorporate … could legitimately form part of the 
requirements of the product purchased that are closely related to the subject matter of the contract." Such 
conditions may thus be relevant to the analysis under Article III:8(a) insofar as they can b e said to be 
"governing" the relevant procurement process.  (Ibid., fn 499 to para. 5.63)  
102 Panel Report, para. 7.114 (referring to India's opening statement at the first Panel meeting, 
para. 28). See also para. 7.129.  WT/DS456/AB/R  
 
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  5.26.   We recall that the Panel did not consider it necessary in the present dispute to resolve 
whether the Appellate  Body in Canada – Renewable Energy / Canada – Feed-in Tariff Program  had 
left room for an alternative to the "competitive relationship" standard, since , in applying 
Article  III:8(a) to "closely analogous" facts, the Appellate  Body had disposed of the relevant issue  
in those disputes on the ground that "electricity" and "generation equipment" are not in a 
competitive relationship.103 The Panel also found it unnecessary to decide the issue of whether 
solar cells and modules can be characterized as "inputs" for electrici ty. The Panel noted , in this 
regard , that the considerations advanced by India did not rise "to anything more than the 'close 
relationship' between generation equipment and electricity that the Appellate  Body rejected as the 
relevant standard under Article  III:8(a)" in those disputes.104 Ultimately, the Panel found:  
To whatever extent Article III:8(a) applies to "inputs" (however that term is defined) 
that are not in a competitive relationship with the product purchased by way of 
procurement, it is evident t hat the Appellate Body did not find such considerations 
germane to its evaluation of electricity and generation equipment that included solar 
cells and modules. We therefore reject India's argument under Article III:8(a) that 
solar cells and modules "canno t be treated as distinct from solar power" and that, "by 
purchasing electricity generated from such cells and modules, [India] is effectively 
procuring the cells and modules".105 
5.27.   The Panel focused its analysis on the issue of "how the Appellate  Body's findin gs and 
reasoning under Article III:8(a) should apply to the DCR measures at issue in this dispute"106, 
instead of "whether the Appellate Body left room for an alternative to the 'competitive relationship' 
standard".107 The Panel's approach appears to have been  prompted by the arguments of the 
parties that focused on drawing parallels with, or distinctions from,  Canada – Renewable Energy / 
Canada – Feed-in Tariff Program .108 The Panel also found that the facts in the present case were 
not "distinguishable in any r elevant respect" from those before the Appellate  Body in  Canada – 
Renewable Energy / Canada – Feed-in Tariff Program .109  
5.28.   India submits that the Panel failed to consider "the fundamental characteristics of solar cells 
and modules" and disregarded India's arg ument that solar cells and modules "are indistinguishable 
from solar power generation" , and hence failed to make an objective assessment of the matter 
before it.110 Contrary to what India appears to suggest, the Panel noted India's explanation that , 
while the government  "does not take title or custody of solar cells and modules , by purchasing 
electricity generated from such cells and modules, it is effectively procuring" them.111 The Panel 
observed that India's argument  rests on what India considered "to be a ' key factual distinction' 
with Canada – Renewable Energy / [Canada – ] Feed-in Tariff Program " involving "the nature of 
the products in question".112 The Panel proceeded to examine the generation equipment at issue in 
Canada – Renewable Energy / Canada – Feed-in Tariff Program , and explained why it considered 
that those cases "entailed discrimination against the same 'generation equipment' that is at issue 
in the present dispute".113 In doing so, the Panel explicitly rejected India's argument that "solar 
cells a nd modules 'cannot be treated as distinct from solar power' "114 and that, "by purchasing 
                                                
103 Panel Report, para.  7.120  (referring  to Appellate  Body Reports, Canada – Renewable Energy / 
Canada – Feed-in Tariff Program , para.  5.79). 
104 Panel Report, para.  7.128.  
105 Panel Report, para. 7.128. (fns omitted)  
106 Panel Report, para. 7.115.  
107 Panel Report, para. 7.120.  
108 See Panel Report, para s. 7.107 -7.109 and 7.115.  
109 Panel Report, para. 7.135.  
110 India's appellant's submission, para. 6 and heading  IIA, respectively . 
111 Panel Report, para.  7.114 (quoting India's opening statement at the first Panel meeting, para.  28). 
112 Panel Report, para.  7.114. (fn omitted)  
113 Panel Report, para.  7.126.  
114 Panel Report, para.  7.128 ( quoting  India's response s to Panel question s No. 19 , and No. 41, para.  7; 
opening statement at the second Panel meeting, para.  8; and opening statement at the first Panel meeting, 
para. 28). (further text in fn omitted)  WT/DS456/AB/R  
 
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  electricity generated from such cells and modules, [ the government ] is effectively procuring the 
cells and modules."115 
5.29.   The Panel also recognized the close connection betw een India's arguments that solar cells 
and modules are "indistinguishable from", and/or "inputs" for , solar power generation. In 
particular, the Panel noted that India had used "various formulations in its characterization of solar 
cells and modules, for e xample referring to them as 'so fundamental, integral and intrinsic to 
generation of electricity, they cannot be treated as distinct or separate from the purchase of 
electricity itself'".116 While the Panel referred in more detail to India's argument that so lar cells and 
modules can be characterized as "inputs" for solar power generation, it seems to us that the Panel 
sufficiently considered India's arguments and evidence regarding the fundamental characteristic s 
of these products and their "indistinguishable " nature from the generation of solar power.117 
5.30.   In a related line of argumentation, India contends that the Panel erred by summarily  
dismissing its argument that solar cells and modules can be characterized as "inputs" for solar 
power generation and, in part icular, that they are " integral inputs  for the generation system" as 
contrasted with "all  other components of a PV generation plant [that] can be classified as ancillary 
equipment".118 However, the Panel observed that the "generation equipment" at issue in 
Canada  ‒ Renewable Energy / [Canada – ] Feed-in Tariff Program included the exact same 
products, i.e. solar cells and modules, which were used to generate electricity purchased by the 
government.119 The Panel further recalled that the measures at issue in Canada ‒ Renewable 
Energy / [Canada – ] Feed-in Tariff Program , similarly to the present case,  involved a requirement 
to use domestically  sourced "generation equipment and components" in order to achieve the 
necessary level of domestic content120, and noted tha t neither the panel nor the Appellate  Body in 
those disputes had found any type of equipment "being an 'input' that would be relevant to the 
analysis under Article III:8(a)".121  
5.31.   Moreover, the Panel discussed the parties' arguments over the nature of the "in tegral" and 
"ancillary" inputs , and pointed to the tension between India's classification of certain equipment as 
"ancillary" and its descriptions of solar power generation.122 The Panel further explained that it was 
not "persuaded that the inclusion of othe r equipment and services under the measure in [ Canada – 
Renewable Energy / Canada – Feed-in Tariff Program ] was of any relevance to the 
Appellate  Body's implicit finding that the solar cells and modules subject to the measure did not 
constitute 'inputs and  processes of production' for the purposes of Article  III:8(a)."123 We therefore 
consider that the Panel sufficiently considered this aspect of India's argumentation.  
5.32.   India also maintains that the Panel "selectively cited" the parties' arguments, and simply  
dismissed India's arguments on the basis that the Appellate  Body did not draw a distinction 
between the particular categories of equipment or goods specified under the measure at issue in  
                                                
115 Panel Report, para.  7.128  (quoting India's opening statement at the first Panel meeting, para. 28). 
The Panel was similarly unpersuaded by India's argument that "[t]he tariff for the power purchased under the 
PPAs in corporates within it the cost for the solar cells and modules", and that "India's  purchase of electricity 
generated from solar cells and modules therefore constitutes an effective purchase  of the cells and modules 
themselves." ( Ibid., para.  7.129 (quoting India's response to Panel question No. 41, para.  7) (emphasis  added 
by the Panel))  
116 Panel Report, fn 326 to para. 7.128 (quoting India's second written submission to the Panel, 
para. 23). 
117 See Panel Report, paras. 7.114 and 7.120 -7.129.  
118 Panel Report, p ara. 7.122 (quoting India's second written submission to the Panel, para.  20 
(emphasis original) ). In this regard , India pointed to the "indispensability" of solar cells and modules for the 
generation of solar power and the exclusivity of their function fo r that purpose . (Panel Report, para.  7.122  
(referring to India's second written submission to the Panel, para.  21)) 
119 Panel Report, para.  7.123.  
120 Panel Report, para.  7.125 (quoting Panel Reports, Canada – Renewable Energy / Canada – Feed-in 
Tariff Program , para.  7.163 ). 
121 Panel Report, para.  7.123. See also para. 7.126.  
122 See Panel Report, fn  320 to para.  7.127 ( referring to  India's comments on the United  States' 
response to Panel question No. 41 -43, para.  11). The Panel observed inter alia  that India's co ntention that 
"silicon" and "silicon ingots and wafer" are "ancillary" equipment is "in tension with its descriptions of solar 
energy generation", including the essentiality of "silicon" for the functioning of solar cells and modules, and 
"reflective of th e difficulty of drawing a distinction between 'integral' and 'ancillary' inputs" (Ibid., fn  320 to 
para. 7.127)  
123 Panel Report, para. 7.128.  (fn omitted)  WT/DS456/AB/R  
 
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  Canada – Renewable Energy / Canada – Feed-in Tariff Program .124 Contr ary to what India 
suggests, the Panel recognized the parties' disagreement regarding the concept of "inputs", but 
found that this disagreement "turns on issues that the Appellate  Body consider ed it unnecessary to 
resolve in  Canada – Renewable Energy / Cana da – Feed-in Tariff Program ", and which the Panel 
similarly considered unnecessary to resolve for the purposes of the present dispute.125 The Panel 
rightly relied on the interpretation of Article  III:8(a) developed by the Appellate  Body in Canada – 
Renewable  Energy / Canada – Feed-in Tariff Program , and therefore properly rejected India's 
argument on the relevance of "inputs" for the analysis of the competitive relationship under 
Article  III:8(a).126  
5.33.   India also contends that the Panel erred in dismissing India 's arguments that an overly 
restrictive interpretation of Article III:8(a) would result in imposing "unnecessary fetters" on 
government al actions and that the term "procurement" should not be read to require "direct 
acquisition" of the product purchased in  all cases.127 India pointed in particular to its concern 
regarding the consequences of reading Article  III:8(a) in a manner that "would mean that for a 
government to effectively procure solar cells and modules under Article  III:8(a)", it would need to 
purch ase these products and either generate electricity from them itself, or provide them to SPDs 
for power generation.128  
5.34.   In rejecting India's argument regarding "direct acquisition", the Panel did not consider it 
evident that the scenarios proffered  by India " would necessarily meet all of the requirements of 
Article  III:8(a)"129, notably because , "to fall within the scope of Article III:8(a), products must be 
purchased 'for governmental purposes and not with a view to commercial resale or with a view to 
use in th e production of goods for commercial sale'."130 We understand the Panel to have simply 
pointed out that, even if "procurement" were not read to require "direct acquisition of the 
product", the competitive relationship standard is only one among other require ments under 
Article III:8(a), and therefore India's concerns would not necessarily be addressed by a broader 
reading of the scope of that provision.  
5.35.   In further support of its argument, India relied on the Appellate  Body's statement in 
Canada  ‒ Renewable Energy / [Canada – ] Feed-in Tariff Program  that, "if procurement was 
understood to refer simply to any acquisition, it would not add any meaning to Article  III:8(a) in 
addition to what is already expressed by the word 'purchase d'".131 India argued that the term 
"procurement" should therefore not be read to require direct acquisition of the product in all 
cases.132 The Panel rejected India's argument, noting that the conceptual distinction between 
"procurement" and "purchase" made by the Appe llate Body was simply an expression of the 
principle of effective treaty interpretation.133 As noted by the Panel, the Appellate  Body has 
explained that "the concepts of 'procurement' and 'purchase' are not to be equated", and the term 
"procurement" , in Arti cle III:8(a),  "refer[s] to the process pursuant to which a government 
acquires products", while the concept of "purchase" relates to "the type of transaction used to put 
into effect that procurement".134 Therefore, the fact that "procurement" may refer to "t he process 
of obtaining products, rather than … to an acquisition itself" does not mean that, in order to be 
                                                
124 India's appellant's submission, paras.  11-14 and 16.  
125 Panel Report, para.  7.121.  
126 We recall , in this regard , that it was not India's argument before the Panel that electricity and solar 
cells and modules are in a competitive relationship. Furthermore, it was undisputed that the government does 
not take title or cus tody of solar cells and modules.  (Pane l Report, para. 7.114 (referring to India's opening 
statement at the first Panel meeting, para. 28) ; see also para. 7.129 ) 
127 India's appellant's submission, paras. 21 -23. 
128 Panel Report, para. 7.130.  
129 Panel Report, para.  7.132.  
130 Panel Report, para.  7.132 . 
131 India's appellant's submission, para. 22 (quoting Appellate Body Reports, Canada – Renewable 
Energy / Canada – Feed-in Tariff Program , para.  5.59). 
132 See also Panel Report, para. 7.133 (referring to Appellate  Body Reports, Canada – Renewable Energy 
/ Canada – Feed-in Tariff Program , para. 5.59).  
133 Panel Report, para. 7.133.  
134 Panel Report, para. 7.133 (quoting Appellate Body Reports, Canada – Renewable Energy / Canada – 
Feed-in Tariff Program , para. 5.59).  WT/DS456/AB/R  
 
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  covered under Article  III:8(a), government  procurement can be effectuated by means of a 
contractual arrangement other than a "purchase" , as India a ppears to suggest.135 
5.36.   Moreover, as we see it, in arguing that the term "procurement" should not be read to 
require "direct acquisition" of a product136, India reiterates, in essence, its argument that 
Article  III:8(a) should cover situations where the discrimi nation involves  inputs or processes of 
production, regardless of whether the product discriminated against is  in a "competitive 
relationship" with the product purchased. However, we recall that , in order for  Article  III:8(a)  to 
apply , the product purchased  should always be  in a competitive relationship with the product 
discriminated against.137  
5.37.   India also contends that , because of its reliance on  Canada – Renewable Energy / Canada – 
Feed-in Tariff Program , the Panel refused to consider the issue of why a sep arate consideration of 
solar cells and modules from other generation equipment is necessary.138 As we see it, in stating 
that "India's consequentialist arguments do not establish that the measures at issue in this case 
are distinguishable in any relevant res pect from those considered by the Appellate  Body"139, the 
Panel correctly found that India's arguments do not have a bearing on the proper determination of 
the scope of  Article III:8(a) of the GATT 1994 .140 
5.38.   Finally, India argues that the Panel erred in its rea soning that "India did not submit reasons 
for why a different approach " than the one in  Canada – Renewable Energy / Canada – Feed-in 
Tariff Program  "should be considered under the facts before the Panel", and that it could not 
therefore "go beyond the test s applied by the Appellate  Body" in those disputes.141 We note that 
the Panel elaborated on the issue before it, as follows:  
… the arguments on the interpretation of Article III:8(a) advanced by the parties in 
this case appear to be based on their opposing u nderstandings of the Appellate Body's 
findings and reasoning in Canada  ‒ Renewable Energy / [Canada – ] Feed-in Tariff 
Program . We are therefore not presented with the question of whether we should 
deviate from the Appellate  Body's findings and reasoning in that case [*]; rather, we 
are presented with the question of ho w the Appellate Body's findings and reasoning 
under Article  III:8(a) should apply to the DCR measures at issue in this dispute.142 
_______________________________  
[*fn original]295 The present case is therefore distinguishable from other cases in which one o f 
the disputing parties argued that a panel should deviate from a legal interpretation of the 
covered agreements arrived at by the Appellate Body. For example, see Appellate Body Reports, 
US – Stainless Steel (Mexico) , paras. 154 -162; US – Continued Zeroin g, para. 358 -365; and 
Panel Reports, China – Rare Earths , paras. 7.55 -7.61; US – Countervailing and Anti -Dumping 
Measures (China) , paras. 7.311 -7.317.  
 
5.39.   The cases referred to by the Panel in the footnote cited above concern the issue of whether 
a panel shou ld "resolve the same legal question in the same way in a subsequent case" and 
whether it can depart for "cogent reasons" from previous Appellate Body findings  on the same 
issue of legal interpretation.143 As we understand it,  India sought to distinguish from  
Canada  ‒ Renewable Energy / Canada – Feed-in Tariff Program  on the facts of those cases, rather 
than to have the Panel re -assess the merits of the Appellate  Body's legal standard and 
                                                
135 India's appellant's submission, paras. 21 -23. (emphasis omitted) See also European Union's third 
participant's submission, para. 36. We observe that , although the Appellate  Body in Canada – Renewable 
Energy / Canada – Feed-in Tariff Program  did not rule on the precise range of contractual arrangement s that 
are encompassed by the concept of "purchase", in the present case , it is India's position that the government 
does not "purchase" solar cells and modules as it " does not physically acquire or take custody of the solar cells 
and modules, and instead chooses to buy the solar power generat ed from such cells and modules".  (Panel 
Report, para. 7.113 (quoting India's first written submission to the Panel, para.  114))  
136 Panel Report, para. 7.130 (referring to India's first written submission to the Panel, p ara. 120). 
137 See para. 5.24. of this Report.  
138 India's appellant's submission, para. 24.  
139 Panel Report, para. 7.134.  
140 See Panel Report, para. 7.130.  
141 India's appellant's submission, para. 32 and heading IIE, respectively . 
142 Panel Report, para. 7.115.  
143 Appellate Body Report, US – Stainless Steel (Mexico) , para. 160 . (fn omitted)  WT/DS456/AB/R  
 
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  reasoning.144 Contrary to what India suggests , we do not understand the Pa nel to have applied "as 
'binding' a principle evolved by the Appellate  Body", or to have disregarded India's arguments 
because India did not ask "that the Panel set aside in its entirety the principle of competitive 
relationship".145 Rather, as noted above, the Panel was properly guided by the Appellate  Body's 
clarification and application of Article III:8(a) in  Canada – Renewable Energy / Canada – Feed-in 
Tariff Program , having found that India's arguments were insufficient to distinguish the facts at 
issue in the present case from those before the Appellate  Body in  Canada – Renewable Energy / 
Canada – Feed-in Tariff Program .  
5.1.5   Conclusion  
5.40.   We have found above that, under Article III:8(a), the product purchased by way of 
procurement must necessarily be "like", o r "directly competitive" with or "substitutable" for – in 
other words, in a "competitive relationship" with – the foreign product subject to discrimination. 
Although a consideration of inputs and processes of production may inform the question of 
whether t he product purchased is in a competitive relationship with the product being 
discriminated against, it does not displace the competitive relationship standard. The question of 
whether the cover of Article III:8(a) may also extend to discrimination relating  to inputs and 
processes of production used in respect of products purchased arises only after the product 
purchased has been found to be in a competitive relationship with the product subject to 
discrimination. Based on our review of the Panel's analysis and approach, we consider that the 
Panel properly addressed India's arguments and conducted its own objective assessment of the 
matter before it, including the facts of the case and whether the DCR measures are covered by the 
derogation under Article III:8 (a). As we understand it, it was on the basis of its analysis of the 
facts before it, including the characteristics of solar cells and modules, as well as both parties' legal 
arguments, that the Panel reached its ultimate conclusion that India's arguments did "not establish 
that the measures at issue in this case are distinguishable in any relevant respect from those 
considered by the Appellate Body" in Canada – Renewable Energy / Canada – Feed-in Tariff 
Program . We therefore find that the Panel was properl y guided by the Appellate Body report in 
Canada – Renewable Energy / Canada – Feed-in Tariff Program  in finding that the DCR measures 
are not covered by the derogation under Article III:8(a).  
5.41.   In light of the foregoing, we reject India's claim that the Pane l acted inconsistently with 
Article 11 of the DSU in assessing India's arguments regarding the scope of application of 
Article  III:8(a) of the GATT 1994. Consequently, we uphold the Panel's findings, in 
paragraphs  7.135 and 7.187 of its Report, that the DC R measures are not covered by the 
derogation under Article III:8(a) of the GATT 1994.  
5.1.6   The remaining elements under Article  III:8(a) of the GATT 1994  
5.42.   We recall that , apart from the applicability of Article  III:8(a) of the GATT  1994 in respect of 
"products p urchased", several other cumulative requirements must be met under that provision146: 
(i) the measures in question are "laws, regulations or requirements governing … procurement"147; 
(ii) the procurement is "by governmental agencies"148; (iii) the procurement is  of products 
purchased "for governmental purposes"149; and ( iv) the products purchased are not procured "with 
                                                
144 India's responses to questioning at the oral hearing.  
145 India's appellant's submission, para.  34. 
146 See Panel Report, para.  7.105 (referring to Appellate  Body Reports, Canada – Renewable Energy / 
Canada – Feed-in Tariff Program , paras. 5.57, 5.69, and 5.74 ), and para. 7.106 . 
147 With respect to this element, the Appellate  Body in Canada – Renewable Energy / Canada – Feed-in 
Tariff Program  found that Article  III:8(a) requires "an a rticulated connection between the laws, regulation s, or 
requirements and the procurement, in the sense that the act of procurement is undertaken within a binding 
structure of laws, regulation s, or requirements." ( Appellate  Body Reports, Canada – Renewable Energy / 
Canada – Feed-in Tariff Program , para.  5.58) 
148 The Appellate  Body in Canada – Renewable Energy / Canada – Feed-in Tariff Program  concluded that 
"governmental agency" is "an entity acting for or on behalf of government and performing governmental 
functions within t he competences conferred on it".  (Appellate  Body Reports, Canada – Renewable Energy / 
Canada – Feed-in Tariff Program , para.  5.61) 
149 The Appellate  Body in Canada – Renewable Energy / Canada – Feed-in Tariff Program  found that the 
phrase "p roducts purchased for governmental purposes" "refers to what is consumed by government or what is 
provided by government to recipients in the discharge of its public functions" and that there should be "a 
rational relationship between the product and the g overnmental function being discha rged".  (Appellate  Body 
Reports, Canada – Renewable Energy / Canada – Feed-in Tariff Program , para.  5.68)  WT/DS456/AB/R  
 
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  a view to commercial resale or with a view to use in the production of goods for commercial 
sale".150 Although the Panel found that the discrimination  relating to solar cells and modules under 
the DCR measures is not covered by the government procurement derogation under  
Article  III:8(a) because of the absence of a competitive relationship between the product 
purchased and the product discriminated agai nst, it considered it useful to proceed with a limited 
analysis of the remaining legal elements under that provision.151 In particular, the Panel found that 
the DCR measures are "laws, regulations or requirements governing the procurement" of 
electricity152, and that the procurement of electricity is "by governmental agencies".153 The Panel 
also summarized  – but did not make legal findings regarding – the arguments of the parties and 
addressed, in a limited manner, the questions of whether electricity under the D CR measures is 
purchased "for governmental purposes" and "not with a view to commercial resale".154 
5.43.   India requests that we complete the legal analysis of the remaining elements of 
Article  III:8(a) described above, should we find that the DCR  measures are cov ered by the 
derogation under that provision.155 In particular, India asks that we reaffirm the Panel's findings 
that the DCR measures are "laws, regulations or requirements governing … procurement", and 
that the procurement under the DCR measures is "by gove rnmental agencies", and that we 
complete the legal analysis by ruling that the procurement is of products purchased "for 
governmental purposes", and that the procurement of products is "not with a view to commercial 
resale".156  
5.44.   We note that India's request for completion of the legal analysis is premised on the 
condition that we reverse the Panel's finding  that the DCR measures are not covered by the 
government procurement derogation under Article  III:8(a)  of the GATT  1994.157 Having upheld 
this finding by the  Panel, we need not, and do not, address India's further claims and related 
arguments concerning the Panel 's interpretation and application of the remaining elements under 
Article III:8(a)  of the GATT  1994. We express no view on the Panel's reasoning and a nalysis in this 
regard.  
5.2  Article  XX(j) of the GATT  1994 – "general or local short supply"  
5.45.   We have upheld the Panel's finding that the government procurement derogation under 
Article  III:8(a) of the GATT 1994 does not cover the DCR measures at issue in the p resent case, 
and therefore turn to address India's conditional appeal of the Panel's finding that the 
DCR measures are not justified under the general exception in Article  XX(j) of the GATT 1994 for 
measures "essential to the acquisition or distribution of  products in general or local short supply ". 
In this appeal, India claims that the Panel erred in its interpretation and application of Article XX(j) 
and acted inconsistently with its obligations under Article 11 of the DSU.158 Below, we summarize 
the Panel' s findings and the issues appealed. We then address the interpretation of Article XX(j) 
before turning to consider the Panel's analysis as challenged by India on appeal.159 
5.2.1   The Panel's findings  
5.46.   As a general matter, regarding the scope of Article  XX(j) of the  GATT  1994, India claimed 
before the Panel that a situation of short supply can exist where a product that is available 
                                                
150 The Appellate  Body in Canada – Renewable Energy / Canada – Feed-in Tariff Program  understood the 
term "commercial re sale" to mean "a resale of a product at arm's length between a willing seller and a willing 
buyer" , and explained that this "must be assessed having regard to the entire transaction", both from the 
seller's and the buyer's perspective. (Appellate  Body Repo rts, Canada – Renewable Energy / Canada – Feed-in 
Tariff Program , paras.  5.70-5.71)  
151 Panel Report, para.  7.137.  
152 Panel Report, para.  7.145.  
153 Panel Report, para.  7.151.   
154 Panel Report, paras. 7.162 and 7.18 6. 
155 India's appellant's submission, para. 36.  
156 India's appellant's submission, para.  61. 
157 India's appellant's submission, para. 36.  
158 India's appellant's submission, para s. 90 and 99.  
159 Our analysis focuses  on India's arguments as they relate to the Panel's interpretation and application 
of the phr ase "products in general or local short supply" in Article XX(j) of the GATT 1994. We address India's 
arguments regarding whether the DCR measures are "essential" within the meaning of Article  XX(j) in the final 
section of this Report, where we also addres s India's arguments concerning whether those measures are  
"necessary" within the meaning of Article XX(d)  of the GATT 1994 . WT/DS456/AB/R  
 
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  internationally is nevertheless "in short supply in certain local markets"160, and that "general or 
local short supply" could exist in cir cumstances where a "product is not produced or manufactured 
in a particular market".161 Specifically, in the context of the present dispute, India explained that it 
did not seek to argue that Article  XX(j) is "available to address any situation where a count ry's 
indigenous manufacturing capacity for any product is low" .162 Rather , India argued  that a 
"justification for invoking Article  XX(j) would need to rest on whether a measure is essential to  
redress such a situation of general or local short supply"163, whic h, for India, is a question "to be 
examined in the context of the overall objectives of energy security and ecologically sustainable 
growth for which acquisition or distribution of indigenously manufactured solar cells and modules is 
essential."164 India fur ther submitted that  "sole dependence on imported solar cells and modules 
brings risks associated with supply side vulnerabilities and fluctuations"165, and that , "[i]n order to 
achieve energy security, India needs to achieve domestic resilience to such risks ."166 
5.47.   The Panel determined that "[t]he logical starting point of an assessment under Article XX(j) 
is the identification of the products that are alleged to be in 'general or local short supply'"167, 
which the Panel noted that India had identified to be "solar  cells and modules".168 The Panel then 
interpreted the phrase "products in general or local short supply" in Article XX(j). With respect to 
the notion of "short supply", the Panel considered that "the terms 'products in … short supply' … 
refer to products in  respect of which the quantity of available supply does not meet demand."169 
Regarding the terms "general or local" short supply, the Panel indicated that "these words relate to 
the extent of the geographical area or market in which the available quantity of  supply of a 
product does not meet demand", such that these terms "give Article XX(j) a wide ambit, and … 
cover product shortages within a region inside a country, a single country as a whole, an area 
including several countries, or even global shortage of  a product".170 The Panel thus concluded that 
"the ordinary meaning of the terms 'products in general or local short supply' refers to a situation 
in which the quantity of available supply of a product does not meet demand in the relevant 
geographical area o r market."171 
5.48.   The Panel then turned to determine whether a lack of domestic manufacturing capacity 
amounts to solar cells and modules being in "general or local short supply" within the meaning of 
Article XX(j). In response to India's argument that "its 'lac k of manufacturing capacity of solar cells 
and modules amounts to a situation of local and general short supply of solar cells and modules in 
India'"172, the Panel noted that "the words 'products in general or local short supply' do not refer to 
'products of national origin  in general or local short supply'."173 Unlike other provisions of the 
GATT  1994, such as Article III:4174, Articles II:1(b) and II:1(c)175, Article XX(g)176, and 
Article  XX(i)177, the Panel noted that it did not see any language in Article XX(j) tha t speaks to the 
source of the products concerned, or to the question of where those products are produced.178 The 
Panel further noted that "India's interpretation of Article XX(j) would be tantamount to interpreting 
the words 'products in general or local sh ort supply' … as though they meant 'products in general 
or local short production '", which would amount to "a far -reaching principle that all Members are 
entitled to an equitable share in the international production  of products in short supply".179 
                                                
160 Panel Report, Add.1, Annex B-3, para. 41.  
161 Panel Report, Add.1, Annex B-3, para. 42.  
162 Panel Report, Add.1, Annex B-3, para. 42.  
163 Panel Report, Add.1, Annex B-3, para. 43. (emphasis original)  
164 Panel Report, Add.1, Annex B-3, para. 43.  
165 Panel Report, Add.1, Annex B-3, para. 49.  
166 Panel Report, Add.1, Annex B-3, para. 49.  
167 Panel Report, para. 7.199.  
168 Panel Report, paras. 7.199 -7.200. 
169 Panel Report, para. 7.205 . 
170 Panel Report, para. 7.206.  
171 Panel Report, para. 7.207. (fn omitted)  
172 Panel Report, para. 7.220 (quoting India's first written submission to the Panel, para. 213).  
173 Panel Report, para. 7.223. (emphasis original)  
174 Article III:4 refers to "products of the territory of any Member".  
175 Article  II:1(b) designates "products of territories of other Members" and Article  II:1(c) refers to 
"products of territories entitled under Article  I to receive preferential treatment upon im portation".  
176 Article  XX(g) speaks of "domestic production or consumption".  
177 Article  XX(i) refers to "restrictions on exports of domestic materials".  
178 Panel Report, para. 7.223.  
179 Panel Report, para. 7.224. (emphasis original)  WT/DS456/AB/R  
 
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  5.49.   The Pane l also considered that, for the purposes of making a determination under 
Article  XX(j) of the GATT 1994, "there must be some objective point of reference to serve as the 
basis for an objective assessment of whether there is a 'deficiency' or 'amount lackin g' in the 
'quantity' of a product that is 'available'"180. However,  "India's alternative interpretation of 
Article  XX(j) does not present any objective point of reference to serve as the basis for an 
objective assessment of whether a product is in 'short sup ply'", given that "India ha[d] not 
adequately explained what would constitute a 'lack' of domestic manufacturing capacity amounting 
to a 'short supply'".181 The Panel concluded that "the terms 'products in general or local short 
supply' refer to a situation in which the quantity of available supply of a product, from all sources, 
does not meet demand in a relevant geographical area or market."182  
5.50.   In response to what the Panel considered to be an alternative argument raised by India, 
that "the risk of a disrupt ion in imports, and the risk of a resulting shortage of solar cells and 
modules for Indian SPDs, makes these 'products in general or local short supply'"183, the Panel 
determined that "[t]he immediate context of the terms 'products in … short supply' does no t lend 
support to the view that they cover products at risk of being in short supply."184 The Panel further 
determined that "even assuming for the sake of argument that the concept of 'products in general 
or local short supply' in Article XX(j) could be inte rpreted to include products at risk of being in 
short supply ", the Panel considered  that "only imminent risks of such shortage would be 
covered"185, which it noted that India had not established.186 For these reasons, the Panel 
concluded that the DCR measures do not involve the acquisition of "products in general or local 
short supply" in India within the meaning of Article XX(j), and that they are therefore not justified 
under the general exception in that provision.187 Noting, however, that its findings involve d "novel 
issues of law and legal interpretation" under Article XX(j) , and that the Appellate Body might 
reverse those findings on appeal, the Panel proceeded with a limited analysis and review in order 
to provide the Appellate  Body with factual findings re garding whether the DCR measures are 
"essential" within the meaning of Article XX(j)  of the GATT 1994 .188  
5.2.2   India's claims on appeal  
5.51.   India appeals the Panel's analysis and findings under Article  XX(j) of the GATT 1994 , and 
requests us to find that the lack of  manufacturing capacity of solar cells and modules in India 
"amounts to a situation of local and general short supply", and that the DCR measures are 
measures relating to the acquisition of such products for the purposes of Article  XX(j).189 India 
contends t hat the Panel erred in its interpretation of the phrase  "products in general or local short 
supply" because it did not read "'short supply' in Article  XX(j) in the context of the specific terms 
used in that provision, i.e., 'general or local'" , and instead  adopted an "approach that interpreted 
the words 'general or local' in isolation of the words 'short supply'."190 According to India, the use 
of the terms "general or local short supply" in Article  XX(j) "contemplates short supply that is 
distinct from situa tions that can be addressed by 'international supply'."191 India submits that an 
"interpretation that Article  XX(j) cannot be applied when imports are available fundamentally veers 
towards the position that only export restraints will qualify for considerati on under Article  XX(j), 
and not import restraints", and that , if such interpretation had been intended by the drafters, they 
"would have explicitly stated this, as was done in the context of Article  XI:2 of the GATT  1994".192 
Regarding the question of risks associated with dependence on imports, India argues that the 
Panel mischaracterized its argument as an "alternate argument"193, adding that it did not intend 
                                                
180 Panel Report, para. 7.225 . (fn omitted)  
181 Panel Report, para. 7.226.  
182 Panel Report, para. 7.234.  
183 Panel Report, para. 7.237. (emphasis omitted)  
184 Panel Report, para. 7.245.  
185 Panel Report, para. 7.255.  
186 Panel Report, paras. 7.263 -7.264.  
187 Panel Report, para. 7.265. Having found  that solar cells and modules are not "products in general or 
local short supply" in India, the Panel did not consider it necessary to examine whether the DCR measures 
involve the "acquisition or distribution" of those products . (Ibid., fn 629 to para 7.26 5) 
188 See Panel Report, para. 7.335.   
189 India's appellant's submission, para. 106.  
190 India's appellant's submission , para. 73.  
191 India's appellant's submission, para. 86.  
192 India's appellant's submission, para. 87.  (fn omitted)  
193 India's appellant's submiss ion, para. 100  (quoting Panel Report, para. 7.237) . WT/DS456/AB/R  
 
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  "to place the concept of 'risk' as central to [its] defence, as concluded by the Panel".194 Rather, 
India "reiterates its fundamental argument that 'general or local short supply' exists  in the first 
place due to low domestic manufacturing" and its vulnerability "to the risks associated with 
international supply and market fluctuations".195  
5.52.   India further al leges that the Panel acted inconsistently with Article  11 of the DSU in 
rejecting India's arguments regarding the concept of "sufficient manufacturing capacity" and the 
context in which India referred to that concept, namely , to argue that the DCR measures  do not 
seek to "maximize" self -sufficiency or "minimize" dependence on imports , but rather to "reduce" 
the risks linked to such dependence.196 India contends that it presented evidence of what would 
constitute "sufficient manufacturing capacity" that would "enable discontinuation of the DCR 
measures"197, and maintains that " India does not intend for the DCRs to be applied indefinitely".198 
According to India, "[t]he Panel's refusal to take into account India's arguments" amounts to a 
breach of the Panel's duties  under Article  11 of the DSU.199 India concludes by requesting us to 
find that " India's lack of manufacturing capacity of solar cells and modules amounts to a situation 
of local and general short supply of such products in India, and that the DCR measures ar e 
measures relating to the acquisition of such products for the purposes of Article  XX(j)."200 
5.53.   For its part, the United States requests us to uphold the Panel's findings. According to the 
United States, the Panel correctly interpreted the terms "general or l ocal short supply", in their 
context and in light of their object and purpose201, and properly rejected India's argument that a 
lack of domestic production can constitute a situation of "short supply" within the meaning of 
Article XX(j).202 The United States s ubmits that the term "products" in Article  XX(j) "is unqualified 
by origin, indicating that it addresses supply of that product without respect to origin or 'source of 
supply'"203, adding, by way of contrast , that other "provisions of the GATT  1994 that addr ess 
products of a particular origin identify that fact explicitly", such as Article  III:4, Article s II:1(b)  and 
II:1(c), and Article  XX(i).204 The United States also disagrees with India's contention that the Panel 
erred under Article  11 of the DSU in assess ing India's arguments relating to the lack of domestic 
manufacturing capacity for solar cells and modules.205  
5.54.   We turn next to India's appeal as it relates to the Panel's interpretation of Article XX(j) of 
the GATT 1994 , and in particular the phrase  "product s in general or local short supply". We begin 
by examining key aspects of the legal standard to be applied in determining whether a measure 
can be provisionally justified under Article XX  of the GATT 1994 . 
5.2.3   The legal standard under Article XX(j) of the GATT  1994  
5.55.   Article XX(j) provides , in relevant part,  that nothing in the GATT 1994 shall be construed to 
prevent the adoption or enforcement by any Member of measures:  
essential to the acquisition or distribution of products in general or local short supply; 
Provided  that any such measures shall be consistent with the principle that all 
Members are entitled to an equitable share of the international supply of such 
products, and that any such measures, which are inconsistent with the other 
provisions of the Agree ment shall be discontinued as soon as the conditions giving rise 
to them have ceased to exist.206 
5.56.   The Appellate Body has explained that the evaluation of a defence under Article  XX of the 
GATT 1994 involves a two -tiered analysis, in which a measure must firs t be provisionally justified 
                                                
194 India's appellant's submission, para. 102.  
195 India's appellant's submission, para. 104. (emphasis original)  
196 See India's appellant's submission, para s. 91-101. 
197 India's appellant's submission, para. 9 4. 
198 India's appellant's submission, para. 94.  (fn omitted)  
199 India's appellant's submission, para. 99.  
200 India's appellant's submission, para. 106.   
201 See United States' appellee's submission, para. 88.  
202 United States' appellee's submission, paras. 93 -94. 
203 United States' appellee's submission, para. 91.  
204 United States' appellee's submission, para. 91.  
205 United States' appellee's submission, para. 103.  
206 Emphasis original.  WT/DS456/AB/R  
 
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  under one of the paragraphs of Article  XX, and then shown to be consistent with the requirements 
of the chapeau of Article  XX.207 This "sequence of steps" in the analysis of a claim under Article  XX 
reflects "not inadvertence or random choice, but rather the fundamental structure and logic of 
Article  XX of the GATT  1994".208 
5.57.   Regarding the first part of the analysis, it is well established that , for a responding party to 
justify provisionally a measure under an Article XX exception, two elements must be shown: first, 
that the measure addresses the particular interest specified in that paragraph209; and, second, that 
there is a sufficient nexus between the measure and the interest protected, which is specified 
through the use of terms su ch as "necessary to" in Article XX(d), and, in the case of Article  XX(j), 
"essential to".  210  
5.58.   Since this is the first case in which the Appellate Body is called upon to interpret 
Article  XX(j) of the GATT 1994 , we review briefly our jurisprudence under the other paragraphs of 
Article XX , and in particular our recent jurisprudence under Article XX(d), for the purpose of 
assessing its possible relevance to Article XX(j). As to the first element of the analysis 
contemplated under Article XX(d), the Appellate Bo dy has stated that the responding party has the 
burden of demonstrating that: there are "laws or regulations"; such "laws or regulations" are "not 
inconsistent with the provisions of" the GATT 1994; and the measure sought to be justified is 
designed "to se cure compliance" with such "laws or regulations". An examination of a defence 
under Article XX(d) thus includes an initial, threshold examination of the relationship between the 
challenged measure and the "laws or regulations" that are not GATT -inconsisten t so as to 
determine whether the former is designed "to secure compliance" with specific rules, obligations, 
or requirements under the relevant provisions of such "laws or regulations".211 If the assessment 
of the design of a measure, including its content, structure, and expected operation, reveals that 
the measure is "incapable" of securing compliance with specific rules, obligations, or requirements 
under the relevant provisions of such "laws or regulations" that are not GATT -inconsistent, then 
the measure  cannot be justified under Article XX(d) , and this would be the end of the inquiry .212  
5.59.   As to the second element of the analysis contemplated under Article XX(d), the 
Appellate  Body has stated that a determination of whether a measure is "necessary" entails a 
more in -depth and holistic examination of the relationship between the inconsistent measure and 
the relevant laws or regulations. This involves, in each case, a process of "weighing and balancing" 
a series of factors, including : the extent to which the m easure sought to be justified contributes to 
the realization of the end pursued ( i.e. securing compliance with specific rules, obligations, or 
requirements under the relevant provisions of "laws or regulations" that are not 
GATT -inconsistent); the relative  importance of the societal interest or value that the "law or 
regulation" is intended to protect; and the trade -restrictiveness of the challenged measure.213 
                                                
207 See Appellate  Body Report, US – Gasoline , p. 22, DSR 1996:I, p.  20. See also Ap pellate  Body 
Reports, Dominican Republic – Import and Sale of Cigarettes , para. 64; US ‒ Shrimp , paras.  119-120; and 
EC – Seal Products , para. 5.169.  
208 Appellate Body Report, US – Shrimp , para. 119.  
209 This would consist of "secur [ing] compliance with laws or regulations " in the case of Article XX(d), 
and "acquisition or distribution of products in general or local short supply"  in the case of Article XX(j).  
210 Appellate Body Report, Argentina – Financial Services , para. 6.202. See also Appellate Body Report s, 
Colombia – Textiles, para. 5.67; EC – Seal Products , para. 5.169;  US – Gambling , para. 292 ; and Korea – 
Various Measures on Beef , para.  157. 
211 Appellate Body Report, Colombia – Textiles , para. 5.126 (referring to Appellate Body Report, 
Argentina – Financ ial Services , para. 6.203).  See also Appellate Body Report, Colombia – Textiles , 
paras. 5.68-5.69 (referring to Appellate Body Reports, Argentina – Financial Services , para. 6.203; Mexico – 
Taxes on Soft Drinks , para. 72; US – Shrimp , paras. 135 -142; and EC – Seal Products , para. 5.144) . 
212 See Appellate  Body Report, Colombia – Textiles , para.  5.126 . However, as indicated by the 
Appellate  Body, "[a] panel must not … structure its analysis of the ['design' step] in such a way as to lead it to 
truncate its ana lysis prematurely and thereby foreclose consideration of crucial aspects of the respondent's 
defence relating to the 'necessity' analysis."  (Appellate  Body Report, Colombia  – Textiles , para.  5.126 (quoting 
Appellate  Body Report, Argentina – Financial Servi ces, para. 6.203 )) 
213 See Appellate Body Reports, Colombia – Textiles , para s. 5.71-5.73 and 5.77; and Korea – Various 
Measures on Beef , paras. 162 -164. WT/DS456/AB/R  
 
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  In most cases, a comparison between the challenged measure and reasonably available alternative 
measures should then be undertaken.214 
5.60.   The analytical framework for the "design" and "necessity" elements of the analysis 
contemplated under Article XX(d) is relevant mutatis mutandis  also under Article XX(j).  As with 
Article XX(d), the examination of a defence  under Article XX(j) would appear to include an initial, 
threshold examination of the " design " of the measure at issue, including its content, structure, and 
expected operation. In the case of Article XX(j), the responding party must identify the 
relations hip between the measure and "the acquisition or distribution of products in general or 
local short supply", whereas, in the case of Article  XX(d), a panel must examine the relationship 
between the measure and "securing compliance" with relevant provisions of laws or regulations 
that are not GATT -inconsistent.215 If the assessment of the design of a measure, including its 
content, structure, and expected operation, reveals that the measure is "incapable", in the case of 
Article  XX(j), of addressing "the acquis ition or distribution of products in general or local short 
supply ", or, in the case of Article  XX(d), " secur [ing] compliance with [relevant provisions of ] laws 
or regulations that are not inconsistent " with the GATT 1994 , there is no relationship that mee ts 
the requirements of the "design" element. In either situation, further analysis with regard to 
whether the measure is " necessary " or " essential " would not be required.216 This is because there 
can be no justification under Article  XX(j) for a measure that  is not "designed" to address the 
"acquisition or distribution of products in general or local short supply", just as there can be no 
justification under Article  XX(d) for a measure that is not "designed" to secure compliance with 
relevant provisions of la ws or regulations that are not GATT -inconsistent.217  
5.61.   We recall that , while the "design" and "necessity" elements may provide a useful analytical 
framework for assessing whether a measure is provisionally justified under  Article XX(d) , they are 
"conceptually  distinct ".218 Yet, they are related aspects of the overall inquiry to be carried out into 
whether a respondent has established that the measure at issue is "necessary to secure 
compliance with laws or regulations which are not inconsistent" with the GATT 19 94219, and that 
the structure of the analysis under Article XX(d) therefore does not have to follow a "rigid path".220 
Thus, the way a panel organizes its examination of these elements may be influenced not only by 
the measures at issue or the laws or regulati ons identified by the respondent, but also by the 
manner in which the parties present their respective arguments and evidence.221 These 
considerations are equally relevant for the analysis under Article  XX(j) in assessing whether a 
measure is "essential to t he acquisition or distribution of products in general or local short supply".  
5.62.   The participants in the present case disagree as to whether the term "essential" in 
Article  XX(j) introduces a more stringent legal threshold than the necessity analysis under 
Article XX(d).222 The Appellate Body has explained in this regard that , in a continuum ranging from 
"indispensable" to "making a contribution to", a "necessary" measure is "located significantly 
                                                
214 The Appellate Body has explained that, in most cases, a panel must compare the challenged measure 
and p ossible alternative measures that achieve an equivalent level of protection while being less trade 
restrictive . (Appellate Body Report, Colombia – Textiles , para. 5.74)  See also Appellate  Body Reports, EC – 
Seal Products , para.  5.169 (referring to Appellat e Body Report,  US – Gambling , para.  307, in turn referring to 
Appellate Body Report, Korea – Various Measures on Beef , para. 166).  
215 See Appellate  Body Report, Colombia – Textiles , para.  5.126. The Appellate Body has remarked that 
the objectives of, or the  common interests or values protected by, the relevant law or regulation may assist in 
elucidating the content of specific rules, obligations, or requirements in such law or regulation . (Appellate  Body 
Report, Colombia – Textiles , fn 272 to para  5.126 (ref erring to Appellate Body Report, Argentina – Financial 
Services , fn 495 to para.  6.203))  
216 See Appellate  Body Report, Colombia – Textiles , para.  5.126.  
217 See Appellate  Body Report, Colombia – Textiles , para.  5.126 (referring to Appellate  Body Reports, 
Argentina – Financial Services , para. 6.203; and Mexico – Taxes on Soft Drinks , para.  72). 
218 Appellate  Body Report, Colombia – Textiles , para.  5.125. 
219 See Appellate  Body Report s, Colombia – Textiles , para.  5.125 ; and Argentina – Financial Services , 
para. 6.20 5. 
220 Appellate Body Report, Argentina – Financial Services , para. 6.205.  
221 Appellate Body Report, Argentina – Financial Services , para. 6.205.  
222 India argues, based on dictionary definitions, that the term "necessary" is a synonym for "essential" , 
and that  the requirement that a measure be "essential" "is not limited to what is 'absolutely indispensable' but 
also encompasses situations that are 'necessary'" . (India's appellant's submission, para.  120) For its part, the 
United States submits that "essential"  suggests a "higher level of indispensability" than the term "necessary", 
and that a demonstration that a measure is "essential" therefore "requires a higher threshold than proving that 
a measure is merely 'necessary'" . (United  States' appellee's submissio n, para.  122) WT/DS456/AB/R  
 
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  closer to the pole of 'indispensable' than to the opposite pole of simply 'making a contribution 
to'".223 The word "essential" in turn is defined as "[a]bsolutely indispensable or necessary".224 The 
plain meaning of the term thus suggests that this word is located at least as close to the 
"indispensable" end of the continu um as the word "necessary".  
5.63.   Having said this, we recall that a "necessity" analysis under Article XX(d) involves a process 
of "weighing and balancing" a series of factors. We consider that the same process of weighing and 
balancing is relevant in assessing  whether a measure is "essential" within the meaning of 
Article  XX(j). In particular, we consider it relevant to assess the extent to which the measure 
sought to be justified contributes to : "the acquisition or distribution of products in general or local 
short supply"; the relative importance of the societal interests or values that the measure is 
intended to protect; and the trade -restrictiveness of the challenged measure. In most cases, a 
comparison between the challenged measure and reasonably available  alternative measures 
should then be undertaken.225 
5.64.   As noted, Article XX(j) establishes a general exception for measures "essential to the 
acquisition or distribution of products in general or local short supply". The "products" at issue are 
the ones that mu st be "in … short supply" . It must therefore be established that there are 
"products in general or local short supply", and that the challenged measures are "essential to the 
acquisition or distribution of" such products. We also note that Article XX(j) pr ovides that 
measures covered by the general exception under Article  XX(j) are subject to the requirement that 
they "shall be consistent with the principle that all Members are entitled to an equitable share of 
the international  supply  of such products"226, and that Members may take GATT -inconsistent 
measures essential to the acquisition or distribution of products "in general or local short supply", 
subject to the requirement that such measures "shall be discontinued as soon as the conditions 
giving rise to t hem have ceased to exist". In light of this language in Article XX(j), we consider 
that a proper interpretation of that provision, including the phrase "products in general or local 
short supply", requires careful consideration of how the different terms u sed in that provision 
inform one another, and should thus be holistic in nature.  
5.65.   Beginning with the phrase "products in … short supply", we note that this language refers 
generally to products "available only in limited quantity, scarce".227 We understand th e phrase 
"products … in short supply" to refer therefore to products in respect of which there is a 
"shortage", that is, a "[d]eficiency in quantity; an amount lacking".228 This understanding is 
reinforced by the fact that the French and Spanish versions of Article XX(j) refer to " pénurie " and 
"penuria ", respectively, which translate best as "shortage" in English.  
5.66.   We note that "supply" is defined as the "amount of any commodity actually produced and 
available for purchase ", and that, in its ordinary meaning,  the word "supply" is the "correlative" of 
the word "demand".229 An assessment of whether there is a "deficiency" or "amount lacking" in the 
"quantity" of a product that is available  would therefore appear to involve a comparison between 
"supply" and "demand ", such that products can be said to be "in short supply" when the "quantity" 
of a product that is "available" does not meet "demand" for that product.  
5.67.   This brings us to the question as to the extent of the geographical area or market in which 
the quantit y of "available" supply of a product should be compared to demand. Article XX(j) refers , 
in this regard , to products in "general or local" short supply. The dictionary definition s of "local" 
include  "in a particular locality or neighbourhood, esp. a town, county, etc., as opp. to the country 
                                                
223 Appellate Body Report, Korea – Various Measures on Beef , para. 161.  
224 See Shorter Oxford English Dictionary , 6th edn, W.R. Trumble, A. Stevenson (eds.) 
(Oxford  University Press, 2007), Vol. 1, p. 865.  
225 See Appellate  Body Reports, EC – Seal Products , para.  5.169 (referring to Appellate  Body Report,  US 
– Gambling , para.  307, in turn referring to Appellate Body Report, Korea – Various Measures on Beef , 
para. 166).  
226 Emphasis added.  
227 Shorter Oxford English Dictionary , 6th edn, W.R. Trumble, A.  Stevenson (eds .) (Oxford University 
Press, 2007), Vol. 2, p. 3115. See also Appellate Body Report s, China – Raw Materials , para. 325.  
228 Shorter Oxford English Dictionary , 6th edn, W.R. Trumble, A. Stevenson (eds .) (Oxford University 
Press, 2007), Vol. 2, p. 2813. See also Appellate Body Report s, China – Raw Materials , para. 325.  
229 See Shorter Oxford English Dictionary , 5th edn, W.R. Trumble, A. Stevenson (eds.) 
(Oxford  University Press, 2002), Vol. 2, p. 3118.  (emphasis added)  WT/DS456/AB/R  
 
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  as a whole" and "limited or peculiar to a particular place or places".230 The word "general", in turn, 
is relevantly defined as "all or nearly all of the parts of a (specified or implied) whole, as a 
territory, community,  organization, etc.; completely or nearly universal; not partial, particular, 
local, or sectional".231 Their ordinary meaning s thus suggest that the terms  "general or local" refer 
to a range of product shortages, which may cover shortages that occur locally,  within a region, or 
a territory within a country, or continuing beyond the boundaries of a particular country. In the 
context of Article XX(j), however, we understand the phrase "products in general or local short 
supply" to be focused on products for whi ch a situation of short supply exists within the territory of 
the Member invoking Article XX(j). This does not mean that a situation of "general" short supply 
cannot extend beyond the boundaries of that territory , as long as it also occurs within that 
territory. We further read the terms "general" and "local", together with the disjunctive "or", to 
suggest that there is no requirement for a Member to demonstrate that the shortage extends to all 
parts of its territory, but that, depending on the circumstance s, it may be sufficient to demonstrate 
that the existence of such a situation of shortage occurs locally , or is limited to certain parts of its 
territory.  
5.68.   Moving on to consider whether Article XX(j) speaks to the origin of products that may be 
"available"  in a particular geographical area or market, we note that the phrase "products in 
general or local short supply" is immediately preceded by the terms "acquisition or distribution of". 
The word "acquisition" refers generally to "[t]he action of acquiring s omething"232, and 
"distribution" is defined as "[t]he action of spreading or dispersing throughout a region".233 
Article  XX(j) therefore contemplates measures that seek to redress situations of "short supply" by 
providing for the "acquisition or distribution o f" given products. By its terms, Article XX(j) does not 
limit the scope of potential sources of supply to "domestic" products manufactured in a particular 
country that may be "available" for purchase in a given market. Nor does it exclude the possibility 
that products from sources outside a particular geographical area or market may also be 
"available" to satisfy demand. In this sense, the language in A rticle XX(j), which does not speak to 
the origin of products  that may be "acquired" or "distributed", may be contrasted with, f or 
example, Article III:4  of the GATT 1994 , which refers expressly to "products of the territory of any 
Member" and "like products of national origin"; and with Article XX(g)  of the GATT 1994 , which 
refers to  "domestic production or co nsumption".234 
5.69.   In determining whether products are in general or local short supply , it is relevant to 
consider the quantity of products produced  in the particular geographical area or market where the 
alleged shortage exists. There is, however, no reason no t to give due regard to the quantity of 
product s that is produced in other parts of a particular country , as well as in other countries , 
provided that such quantities are "available" for purchase in the relevant geographical area or 
market. Further, while an increase in manufacturing capacity or production in a particular 
geographical area may lead to an increase in the total quantity of a product available for purchase 
in that area, it does not follow from such increase that domestic manufacturers will nec essarily sell 
their production to domestic buyers, as opposed to exporting their production by selling to buyers 
abroad. An assessment of whether there is a situation of "products in general or local short supply" 
should not focus exclusively on availabili ty of supply from "domestic" , as opposed to foreign or 
"international" sources.  
5.70.   Turning to consider whether there is a temporal dimension to the phrase "products in 
general or local short supply", we recall that Article XX(j) stipulates that any measures t aken 
under paragraph (j) "shall be discontinued as soon as the conditions giving rise to them have 
ceased to exist". We read this language in Article XX(j) to contemplate situations of "short supply" 
                                                
230 Panel Report, para. 7.206 ( quoting Shorter Oxford English Dictionary , 5th edn, W.R.  Trumble, 
A. Stevenson (eds.) (Oxford Universit y Press, 2002), Vol. 1, p. 1619 ). 
231 Panel Report, para. 7.206 (quoting Shorter Oxford English Dictionary , 5th edn, W.R.  Trumble, 
A. Stevenson (eds.) (Oxf ord University Press, 2002), Vol. 1, p. 1081).  
232 Shorter Oxford English Dictionary , 6th edn, W.R. Trumble, A.  Stevenson (eds.) (Oxford University 
Press, 200 7), Vol. 1, p.  20. 
233 Shorter Oxford English Dictionary , 6th edn, W.R. Trumble, A.  Stevenson (eds.) ( Oxford University 
Press, 200 7), Vol. 1, p.  720. 
234 We further note that Article  XX(j) requires that measures to be justified under this exception "shall 
be consistent with the principle that all Members are entitled to an equitable share of the internationa l supply  
of such products".  This language further supports the view that an assessment of whether "products are in 
general or local short supply" requires consideration of all sources  of supply that may be "available" in a given 
geographical area or market , and that "international supply" is not to be excluded from consideration . WT/DS456/AB/R  
 
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  that may continue over time , but are nonetheless expecte d not to last indefinitely. An analysis of 
whether a respondent has identified "products in general or local short supply" is therefore not 
satisfied, in our view, by considering only whether there is a mathematical difference at a single 
point in time bet ween demand and the quantity of supply that is "available" for purchase in a 
particular geographical area or market. Instead, Article XX(j) requires a careful scrutiny of the 
relationship between supply and demand based on a holistic consideration of trend s in supply and 
demand as they evolve over time , as well as whether the conditions giving rise to short supply 
have ceased to exist.  
5.71.   In light of the above, we read Article XX(j) of the GATT 1994 as reflecting a balance of 
different considerations to be ta ken into account when assessing whether products are "in general 
or local short supply". In particular, a panel should examine the extent to which a particular 
product is "available" for purchase in a particular geographical area or market, and whether thi s is 
sufficient to meet demand in the relevant area or market. This analysis  may, in appropriate cases, 
take into account not only the level of domestic production of a particular product and the nature 
of the product that is alleged to be "in general or l ocal short supply"235, but also such factors as 
the relevant product and geographic market236, potential price fluctuations in the relevant market, 
the purchasing power of foreign and domestic consumers, and the role that foreign and domestic 
producers play in  a particular market, including the extent to which domestic producers sell their 
production abroad. Due regard should be given to the total quantity of imports that may be 
"available" to meet demand in a particular geographical area or market. It may thus  be relevant to 
consider the extent to which international supply of a product is stable and accessible, including by 
examining factors such as the distance between a particular geographical area or market and 
production sites, as well as the reliability o f local or transnational supply chains. Whether and 
which factors are relevant will necessarily depend on the particularities of each case. Just as there 
may be factors that have a bearing on "availability" of imports in a particular case, it is also 
possible that, despite the existence of manufacturing capacity, domestic products are not 
"available" in all parts of a particular country, or are not "available" in sufficient quantities to meet 
demand. In all cases, t he responding party has the burden of demo nstrating that the quantity of 
"available" supply from both domestic and international sources in the relevant geographical 
market is insufficient to meet demand .  
5.72.   Our interpretation of Article XX(j) of the GATT 1994 is in consonance with the preamble of 
the Marrakesh Agreement Establishing the World Trade Organization  (WTO Agreement ), which 
refers to the "optimal use of the world's resources in accordance with the objective of sustainable 
development, seeking both to protect and preserve the environment an d to enhance the means for 
doing so in a manner consistent with [Members'] respective needs and concerns at different levels 
of economic development" . The different levels of economic development of Members may, 
depending on the circumstances, impact the a vailability of supply of a product in a given market. 
Developing countries may, for example, have less domestic production, and may be more 
vulnerable to disruptions in supply than developed countries. Such factors may be relevant in 
assessing the availabi lity of a product in a particular case, and thus in assessing whether a product 
is in "general or local short supply ".237  
5.2.4   Whether the Panel erred in finding that solar cells and modules are not products 
in short supply in India  
5.73.   We recall that the Panel cons idered that "the terms 'products in … short supply' … refer to 
products in respect of which the quantity of available supply does not meet demand."238 The Panel 
thus concluded that "the ordinary meaning of the terms 'products in general or local short supply ' 
refers to a situation in which the quantity of available supply of a product does not meet demand 
in the relevant geographical area or market."239 Based on its analysis of the text and context of 
                                                
235 It may be relevant, for example, to consider whether the measure concerns perishable goods or 
foodstuffs, or products that may be difficult to transport.  
236 A consideration of f actors such as product homogeneity, supply -side and  demand -side substitutability  
may also be relevant in order to assess properly whether there is shortage of a particular product in a given 
market.  
237 We recall that it must also be established that the chall enged measure is "essential to the acquisition 
or distribution of" such products.  
238 Panel Report, para. 7.205.  
239 Panel Report, para. 7.207. The Panel then confirmed its interpretation of the phrase "products in 
general or local short supply" by having reco urse to the negotiating history of the GATT  1994.  WT/DS456/AB/R  
 
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  Article  XX(j) of the GATT 1994 , together with relevant juris prudence, the Panel found that "the 
terms 'products in general or local short supply' refer to a situation in which the quantity of 
available supply of a product, from all sources , does not meet demand in a relevant geographical 
area or market"240 and that t hey "do not refer to products in respect of which there merely is a 
lack of domestic manufacturing capacity".241 The Panel added that "India ha [d] not argued that the 
quantity of solar cells and modules available from all sources, i.e. both international and  domestic, 
is inadequate to meet the demand of Indian SPDs or other purchasers."242 
5.74.   As we have explained above, an assessment of whether a Member has identified "products 
in general or local short supply" requires a case -by-case analysis of the relationship between 
supply and demand based on a holistic consideration of all relevant factors .243 We agree with India 
to the extent that it suggests that an increase in domestic manufacturing "capacity" may lead to 
an increase in the total quantity of available supply  of a product. However, we disagree that a lack 
of "sufficient" domestic manufacturing "capacity" will necessarily constitute a product "shortage" in 
a particular market, as India appears to suggest. Nor does it follow from an increase in domestic 
producti on capacity that domestic manufacturers will necessarily sell their production to domestic 
buyers, rather than exporting to buyers abroad.  
5.75.   This brings us to India's argument that continued dependence on imports of solar cells and 
modules exposes it to risk s related to continued dependence on imports. Before the Panel, India 
submitted that "[a]ny dependence on imports brings with it risks associated with supply side 
vulnerabilities and fluctuations"244 and that , since "India's solar PV installations predominan tly rely 
on imported cells and modules", this "exposes India to the risks of market fluctuations in 
international supply".245 According to India, government al intervention was thus "required in order 
to minimize dependence on imports " and to "ensure domestic  resilience in addressing any supply 
side disruptions" .246 India reiterated on appeal these arguments relating to the risks associated 
with continued dependence on imports of solar cells and modules.247 
5.76.   We understand India's arguments regarding the alleged ris ks inherent to the continued 
dependence on imported solar cells and modules to relate to the issue of supply  availability , and 
agree that such considerations could, in principle, be relevant in assessing whether a situation of 
"short supply" exists. While a consideration of potential risks of disruption in supply of a given 
product may inform the question of whether a situation of "short supply" exists, we note the 
Panel's finding that India "ha [d] not identified any actual disruptions in imports of solar c ells and 
modules to date", and that SPDs in India ha d not "experienced an actual disruption in the supply 
of affordable foreign solar cells and modules".248  
5.77.   We further disagree with India to the extent that it appears to assume, first, that all 
imports, in and of themselves, entail supply -related risks and , in that sense , are not "available" to 
meet demand249; and, second, that such risks are intolerable , as long as a sufficient level of 
domestic manufacturing capacity of solar cells and modules has not been m et, such that a 
situation of "short supply" exists , as long as domestic manufacturing capacity lies below this 
level.250 In any event, even assuming that there may be risks of disruption in the supply of imports 
to a particular market, it may equally be the case that such risks exist in relation to domestic 
production. Thus, in assessing whether products are "available" in a particular area or market, 
consideration must be given to all relevant factors , such that an analysis of whether a respondent 
has identi fied a situation of "short supply" is carried out on a case -by-case basis for each and 
every  source of supply concerned, both foreign and domestic  supply .  
                                                
240 Panel Report, para. 7.234. (emphasis added)  
241 Panel Report, para. 7.236.  
242 Panel Report, para. 7.236.  
243 See para. 5.71. of this Report . 
244 Panel Report, Add.1, Annex B-3, para. 33.  
245 Panel Report, Add.1, Annex B-3, para. 35.  
246 Panel Report, Add.1, Annex B-3, para. 35.   
247 We note that India "reiterates its fundamental argument that 'general or local short supply' exists  in 
the first place due to low domestic manufacturing" and its vulnerability "to the risks associated with 
international supply and market fluctuations" . (India's appellant's submis sion, para. 104  (emphasis original) ) 
248 Panel Report, para. 7.262.  
249 See India's appellant's submission, para. 101.  
250 See India's appellant's submission, para. 93.  WT/DS456/AB/R  
 
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  5.78.   We further note that, during the present dispute, India has sought to justify its 
DCR measures on th e basis of the policy objectives underlying them. India has argued that the 
DCR measures should be seen in light of the policy objectives of: "(i) Energy Security and 
Sustainable Development; and (ii) Ecologically sustainable growth, while addressing the c hallenges 
of climate change."251 India argue s, for instance , that "[i]t is not India's  case … that Article XX(j) is 
an exception that would allow countries to impose import restrictions for any and all products 
which it cannot produce or manufacture by itsel f", but that a "justification for invoking Article XX(j) 
would need to rest on whether a measure is essential to redress such a situation of general or local 
short supply", which relates to the "relationship between a measure and its objective of acquisiti on 
or distribution of products in general or local short supply".252 India further argue s that the 
DCR measures are consistent with Article XX(j) because they "need to be examined in the context 
of the overall objectives of energy security and ecologically s ustainable growth for which 
acquisition or distribution of indigenously manufactured solar cells and modules is essential ."253 
5.79.   While policy considerations such as those referred to by India may inform the nature and 
extent of supply and demand, they do not r elieve the responding party invoking the exception in 
Article XX(j) from the burden to demonstrate that imported products are not "available" to meet 
demand and that the products at issue are "in general or local short supply".  
5.80.   India further contends that , under the Panel's interpretation of Article  XX(j), import 
restrictions could not be justified under that provision.254 India suggests that , if the drafters had 
intended this result, they "would have explicitly stated this, as was done in the context of 
Article XI:2 of the GATT  1994"255, as well as Article XX(i).256 While the Panel provided illustrations 
of non -export -related measures that could presumably be justified under Article XX(j)257, India 
suggests that the examples provided by the Panel do "not address t he question of how import 
restraints on the product would apply in such situations".258 As we understand it, India suggests 
that, under the Panel's interpretation of the phrase "products in general or local short supply", 
measures taken to redress a situatio n of short supply can only take the form of export restrictions, 
and, hence, that the Panel's interpretation of Article XX(j) cannot be correct.  
5.81.   As India correctly notes, the text of Article XI:2(a) and Article XX(i) of the GATT 1994 
contain express langu age referring to export restrictions. By contrast, Article  XX(j) does not 
contain express language referring to either import or export restraints. The interpretation of the 
phrase "products in general or local short supply" must begin with the text of Art icle XX(j) and in 
light of the substantive requirements within the provision where this phrase is located. Contrary to 
what India appears to suggest, a proper interpretation of the phrase "products in general or local 
short supply" cannot be based merely o n textual differences or similarities between Article XX(j) 
and some other provisions of the GATT 1994.  
5.82.   In any event, we disagree with India that it follows from the Panel's interpretation of the 
phrase "products in general or local short supply" that exp ort restrictions are the only type of 
measure that may be used to redress a situation of "short supply", or that it follows from this 
interpretation that Article XX(j) cannot cover measures taking the form of import restrictions. The 
Panel noted, for examp le, that , "where the quantity of available supply of a product does not meet 
demand for that product in a given Member, it is conceivable that this Member might establish a 
temporary monopoly in respect of the sale of that product as a measure essential to  the 
distribution of such products within its territory" and that such "a monopoly could be enforced and 
given effect through restrictions on both the exportation and the importation by private traders of 
the product concerned."259  
                                                
251 Panel Report, Add.1, Annex B-3, para. 34.  
252 India's appellant's submission, para. 68. (emphasis original ; fn omitted ) 
253 India's appellant's submission, para. 68. (emphasis original ; fn omitted ) 
254 India's appellant's submission, para. 87.  
255 India's appellan t's submission, para. 87.  (fn omitted)  
256 India's appellant's submission, para. 88.  
257 See Panel Report, para. 7.230 and fn 566 thereto.  
258 India's appellant's submission, para. 89.  
259 Panel Report, fn 566 to para. 7.230. The Panel also suggested that, even in  the absence of a 
monopoly, a Member might "take other measures to control both the importation and distribution of the 
product in a manner as part of a plan for the rationing of the product".  (Ibid.)  WT/DS456/AB/R  
 
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  5.83.   Based on the foregoing, w e disagree  with India to the extent that it argues that "short 
supply" can be determined without regard to whether supply from all sources is sufficient to meet 
demand in the relevant market. Rather, as noted, we read Article XX(j) of the GATT 1994 as 
reflecting a balance of different considerations to be taken into account when assessing whether 
products are "in general or local short supply". This analysis may, in appropriate cases, take into 
account not only the level of domestic production of a particul ar product and the nature of the 
products that are alleged to be "in general or local short supply", but also such factors as the 
relevant product and geographic market , potential price fluctuations in the relevant market, the 
purchasing power of foreign a nd domestic consumers, and the role that foreign and domestic 
producers play in a particular market, including the extent to which domestic producers sell their 
production abroad. Due regard should be given to the total quantity of imports that may be 
"available" to meet demand in a particular geographical area or market. Whether and which 
factors are relevant will necessarily depend on the particularities of each case.  
5.2.5   Whether the Panel acted inconsistently with Article 11 of the DSU in addressing 
India's  arguments and evidence  regarding the domestic manufacturing capacity  
5.84.   India also challenges, under Article  11 of the DSU, the manner in which the Panel dealt with 
India's arguments and evidence regarding the notion of "sufficient domestic manufacturing 
capacity".260 India argues that the Panel erred in the assessment of India's  argument and the 
evidence it presented to demonstrate that it currently does not possess a "sufficient manufacturing 
capacity". India states, for example, that it has explained that it  "cannot afford to remain 
dependent on the import of components intrinsic to solar power development … [since] [s]olar 
energy is critical to [its] long -term energy security, and this cannot be achieved if India does not 
have an indigenous manufacturing cap acity of solar cells and modules … [which] is necessary in 
order to reduce the risks arising from complete dependence on imports of critical components."261  
5.85.   India argues that it submitted relevant evidence indicating "what will constitute 'sufficient 
manufa cturing capacity'", at which point there would no longer be a need for the DCR measures , 
since "the conditions giving rise to them [would ] have ceased to exist ".262 India further argue s that 
"the Panel's conclusion that India does not seek to maximize 'self -sufficiency' or 'self -reliance', 
negates India's need for maintaining 'sufficient manufacturing capacity', is not based on an 
objective assessment of facts and legal arguments presented before it … [and] goes against the 
basic mandate of Article 11 of the DSU that a panel must consider all the evidence presented to it, 
assess its credibility, determine its weight, and ensure that its factual findings have a proper basis 
in that evidence."263 The United States responds that "[t]he absence of an evidence -based baseline 
and a reasoned comparison in India's argument prevent any conclusion as to whether a situation 
of short supply existed" and that "[i]t is this legal flaw in India's interpretation that led the Panel to 
reject India's Article  XX(j) defense, and not  a mistaken conclusion that India had neglected to 
provide any estimate of the level of capacity it considered sufficient."264 
5.86.   We recall that the Panel found, with regard to India's arguments pertaining to the "sufficient 
domestic manufacturing capacity" req uirement, that, in order to assess whether a situation of 
"short supply" exists within the meaning of Article XX(j)  of the GATT 1994 , "there must be some 
objective point of reference to serve as the basis for an objective assessment of whether there is a 
'deficiency' or 'amount lacking' in the 'quantity' of a product that is 'available'."265 The Panel 
determined , in this regard , that "India's alternative interpretation of Article XX(j) [did] not present 
any objective point of reference to serve as the basis f or an objective assessment of whether a 
product is in 'short supply' within the meaning of Article XX(j) [since] India ha[d] not adequately 
explained what would constitute a 'lack' of domestic manufacturing capacity amounting to a 'short 
supply' under its interpretation of Article XX(j)."266 The Panel further found that "India ha[d] not 
itself articulated what would constitute 'sufficient' manufacturing capacity for the purposes of 
Article XX(j) under its alternative interpretation of this provision " and that  it was "also not clear 
whether India [was] arguing that it would fall under the discretion of each Member concerned to 
                                                
260 India's appellant's submission, section IVA.5.  
261 India's app ellant's submission, para. 93(a) . (fns omitted)  
262 India's appellant's submission, para. 94.  
263 India's appellant's submission, para. 98  (referring to Appellate Body Report, Brazil – Retreaded 
Tyres , para. 185, in turn referring to Appellate Body Repo rt, EC – Hormones , paras. 132 -133).  
264 United States' appellee's submission, para. 102.  (fn omitted)  
265 Panel Report, para. 7.205.  (fn omitted)  
266 Panel Report, para. 7.226.  WT/DS456/AB/R  
 
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  determine what 'sufficient' manufacturing capacity would be, or whether the point of reference for 
assessing the level of 'sufficient' m anufacturing capacity would vary from case-to-case, depending 
on the policy objective being pursued."267 The Panel thus determined that India's interpretation of 
Article XX(j) is "problematic because it does not reflect an objective point of reference that c an be 
used for the purpose of making an objective assessment of whether a product is in 'short supply' 
within the meaning of Article XX(j)."268  
5.87.   As noted, a panel is required under Article 11 of the DSU to "consider all the evidence 
presented to it, assess i ts credibility, determine its weight, and ensure that its factual findings 
have a proper basis in that evidence" .269 At the same time, panels "are not required to accord to 
factual evidence of the parties the same meaning and weight as do the parties".270 Moreover, "[i]t 
is … unacceptable for a participant effectively to recast its arguments before the panel under the 
guise of an Article  11 claim", and an appellant "must [instead] identify specific errors regarding the 
objectivity of the panel's assessment".271  
5.88.   India's claim under Article 11 of the DSU relies for its validity on India's reading of 
Article  XX(j) of the GATT 1994 , and in particular India's contention that the existence of a situation 
of "short supply" within the meaning of Article XX(j) is to be de termined exclusively by reference 
to whether there is "sufficient" domestic manufacturing of a given product. The fact that India 
does not agree with the conclusion the Panel reached does not mean that the Panel committed an 
error amounting to a violation of Article 11 of the DSU. India is "merely " recasting its arguments 
before the Panel under the guise of an Article 11 claim. We therefore reject  India's claim that the 
Panel acted inconsistently with Article  11 of the DSU.  
5.2.6   Conclusion  
5.89.   We have found above th at Article XX(j) of the GATT 1994 reflects a balance of different 
considerations to be taken into account when assessing whether products are "in general or local 
short supply". In particular, a panel should examine the extent to which a particular product  is 
"available" for purchase in a particular geographical area or market, and whether this is sufficient 
to meet demand in the relevant area or market. This analysis  may, in appropriate cases, take into 
account not only the level of domestic production of a particular product and the nature of the 
products that are alleged to be "in general or local short supply", but also such factors as the 
relevant product and geographic al market , potential price fluctuations in the relevant market, the 
purchasing power of foreign and domestic consumers, and the role that foreign and domestic 
producers play in a particular market, including the extent to which domestic producers sell their 
production abroad. Due regard should be given to the total quantity of imports that  may be 
"available" to meet demand in a particular geographical area or market. It may thus be relevant to 
consider the extent to which international supply of a pr oduct is stable and accessible, by 
examining factors such as the distance between a particul ar geographical area or market and 
production sites, as well as the reliability of local or transnational supply chains. Whether and 
which factors are relevant will necessarily depend on the particularities of each case. Just as there 
may be factors that h ave a bearing on "availability" of imports in a particular case, it is also 
possible that, despite the existence of manufacturing capacity, domestic products are not 
"available" in all parts of a particular country, or are not "available" in sufficient qua ntities to meet 
demand. In all cases, t he responding party has the burden of demonstrating that the quantity of 
"available" supply from both domestic and international sources in the relevant geographical 
market is insufficient to meet demand . For these re asons, we have disagreed with India to the 
extent that it argues that "short supply" can be determined without regard to whether supply from 
both domestic and international sources is sufficient to meet demand in the relevant market. We 
have also rejected India's claim that the Panel acted inconsistently with Article  11 of the DSU.  
5.90.   In light of our interpretation of Article XX(j), as well as the evidence and arguments 
presented to the Panel, we find that India has not establish ed that solar cells and modules  are 
                                                
267 Panel Report, para. 7.226. (fn  omitted)  
268 Panel Report, para. 7.227.  
269 Appellate Bo dy Reports, Philippines – Distilled Spirits , para.  135 (quoting Appellate Body Report, 
Brazil – Retreaded Tyres , para.  185, in turn referring to Appellate Body Report, EC ‒ Hormones , 
paras.  132-133).  
270 Appellate Body Report, Australia – Salmon , para.  267. 
271 Appellate  Body Report, EC – Fasteners (China) , para.  442. WT/DS456/AB/R  
 
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  "products in general or local short supply" in India. Consequently , we uphold  the Panel's finding s in 
paragraph 7.265 of its Report, that solar cells and modules are not "products in general or local 
short supply" in India within the meaning of Articl e XX(j) of the GATT  1994 and that the 
DCR measures are therefore not justified  under Article XX(j) of the GATT 1994.  
5.3  Article XX(d) of the GATT 1994  
5.91.   We have upheld the Panel's finding that the government procurement derogation under 
Article  III:8(a) of the GATT 1994 is not applicable to the DCR measures at issue in the present 
case.272 We have also upheld the Panel's finding that solar cells and modules are not "products in 
general or local short supply" in India within the meaning of Article XX(j) of the GATT  1994 and 
that the DCR  measures are therefore not justified under that provision.273 We turn therefore to 
address India's conditional appeal of, first, the Panel's finding that India has not demonstrated that 
the DCR measures are measures "to secure complian ce with laws or regulations which are not 
inconsistent with the provisions of  [the GATT 1994]" within the meaning of Article XX(d) of the 
GATT 1994 ; and, second, the Panel's ultimate finding that the DCR measures are not justified 
under that provision.274 
5.92.   India claims that the Panel erred in its interpretation and application of Article XX(d) in  
finding that the international instruments identified by India do not have direct effect in India and 
are therefore not "laws or regulations" within the meaning of Ar ticle XX(d).275 India further argues 
that the Panel erred, first, in finding that three of the domestic instruments identified by India, 
namely, the National Electricity Policy276, the National Electricity Plan277, and the National Action 
Plan on Climate Change278, do not constitute "laws or regulations" ; and, second, by consequently 
focusing its analysis on a fourth domestic instrument, namely,  Section 3 of India's Electricity Act  of 
2003279, in isolation of these  three other instruments.280 India requests that we rev erse the Panel's 
findings, complete the legal analysis, and find that the relevant instruments are "laws or 
regulations" within the meaning of Article XX(d); that the DCR measures are "necessary to secure 
compliance" with these "laws or regulations"; and t hat they meet the requirements of the chapeau 
of Article XX.281  
5.93.   India's appeal therefore focuses  on the Panel's assessment of whether the international and 
domestic instruments identified by India are "laws or regulations" within the meaning of 
Article  XX(d). We begin by summarizing the Panel's findings before setting out the legal standard 
applicable under Article XX(d)  of the GATT 1994  and considering the Panel's analysis as challenged 
by India on appeal.  
5.3.1   The Panel's findings  
5.94.   Before the Panel, India argued  that it has the obligation "to ensure ecologically sustainable 
growth while addressing India's energy security challenge, and ensuring compliance with its 
                                                
272 See para. 5.41. of this Report.  
273 See para. 5.90. of this Report.  
274 India's Notice of Appeal, Section III,  para. 1 (referring to Panel Report, paras. 7.284 -7.333 and 
7.337 -7.390 ); appellant's submission, para. 164.  
275 India's app ellant's submission, paras. 166 and 170-173. India identified the following international 
instruments: (i) the preamble of the WTO Agr eement; (ii)  the United  Nations Framework Convention on 
Climate Change , done at New  York, 9 May 1992,  UN Treaty Series, Vol. 1771, p. 107 (Panel Exhibit IND -3); 
(iii) the Rio Declaration on Environment and Development, adopted by the United Nations General  Assembly in 
1992 (Panel Exhibit IND -35); and (iv)  United Nations General Assembly Resolution A/RES/66/288 (adopted 
27 July 2012) (Rio+20 Document: "The Future We Want")  (Panel Exhibit IND -28). (See Panel Report, 
paras.  7.269 -7.274 ) 
276 Government of India,  Ministry of Power , National Electricity Policy , Resolution No.  23/40/2004 -R&R 
(Vol. II) (12 February 2005)  (Panel  Exhibit IND -14). 
277 Government of India,  Ministry of Power , Central Electricity Authority , National Electricity Plan , 
Vol. 1 – Generation (Janu ary 2012)  (Panel  Exhibit IND -16). 
278 Government of India,  National Action Plan on Climate Change (June 2008) (Panel Exhibit IND -2). 
279 Parliament of India, The Electricity Act , 2003 [No. 36 of 2003] ( 26 May 2003)  (Panel Exhibit 
USA-20). 
280 See India's appella nt's submission, paras. 164 -167 and 171. At the oral hearing, India confirmed 
that it is not challenging the Panel's findings under Article 11 of the DSU . 
281 India's appellant's submission, para s. 178 and 180 -181. WT/DS456/AB/R  
 
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  obligations relating to climate change".282 According to India, this obligation is  "reflected in four 
international instruments , and four domestic instruments"283, and both sets of instruments qualify 
as "laws or regulations" within the meaning of Article XX(d) of the GATT 1994. India claimed that 
its DCR measures "secure compliance" with these "laws or regu lations" because they "reduce the 
risk of a disruption in Indian SPDs' access to a continuous and affordable supply of the solar cells 
and modules needed to generate solar power".284 India further argued that its DCR  measures are 
"necessary" because they are  the only means it has to incentivize local manufacturing of solar cells 
and modules, and thereby reduce this risk.285 The United States, for its part, argued that India had 
failed to demonstrate that the DCR measures are necessary to comply with any law or regulation 
for purposes of Article XX(d).286  
5.95.   The Panel began  by examining whether the international instruments identified by India are 
"laws or regulations" within the meaning of Article  XX(d), before turning to consider the domestic 
instruments that India  had identified. The Panel explained that it would proceed in this manner 
because India ha d distinguished between its "international and domestic obligations", and also 
"because different issues are raised in relation to these two different groups of instr uments".287 
5.96.   The Panel recalled that India had argued that its "international law obligations" are 
embodied in the following international instruments: (i) the preamble of the WTO Agreement; 
(ii) the United  Nations Framework Convention on Climate Change; (iii ) the Rio Declaration on 
Environment and Development  (1992) ; and (iv) UN Resolution A/RES/66/288  (2012) ( Rio+20 
Document: "The Future We Want").288  
5.97.   Having reviewed the relevant text of the instruments identified by India, the Panel turned to 
consider whethe r "laws or regulations" within the meaning of Article XX(d) includes international 
instruments, as opposed to domestic instruments. Based on its review of the Appellate  Body's 
reasoning and findings in Mexico – Taxes on Soft Drinks , the Panel recalled  that the terms "laws or 
regulations" in Article XX(d) refers  to "rules that form part of the domestic legal system of a WTO 
Member" .289 The Panel added that "[i]nternational agreements (or other sources of international 
law) may constitute 'laws or regulations' only insofar as they have been incorporated, or have 
'direct effect' , within a Member's domestic legal system."290  
5.98.   Turning to examine whether the international instruments identified by India form a part of 
India's domestic legal system, the Panel recalled India's position that such instruments have 
"direct effect" in India because rules of international law are accommodated into India's domestic 
                                                
282 Panel Report, para. 7.268 (quoting India' s first written submission to the Panel, para. 240; opening 
statement at the first Panel meeting, para. 54; and opening statement at the second Panel meeting, para. 35).  
283 Panel Report, para. 7.268. Noting that "a central issue in this case is whether the materials identified 
by India are 'laws or regulations' within the meaning of Article XX(d)", the Panel expla ined that, in referring to 
these materials as "instruments", its intention was to "adopt a nomenclature that is neutral with respect to that 
issue" . (Ibid., fn 635 to para. 7.268) We see merit in the Panel's approach and continue to use the term 
"instruments" to refer to the materials identified by India.  
284 Panel Report, para. 7.191 (quoting India's first written submission  to the Panel , para. 255 : stating 
that "[t]he DCR Measures have been designed to secure compliance with India 's obligations under its law and 
regulations which require it to ensure ecologically sustainable growth and sustainable development. The DCR 
Measures seek to achieve this by creating a local manufacturing base for solar PV cells and modules, in order 
to ensure the ability of satisfy the requirements for such cells and modules without being susceptible to the 
risks of imports, such as price fluctuations, and geo -political facto rs"). 
285 Panel Report, para. 7.191 (quoting India's first written submission  to the Panel , para. 262 : stating, in 
the context of Article XX(d), that "India does not have any reasonably available alternatives to achieve its 
objectives of building a domestic manufacturing base for solar cells and modules with a view to ensuring 
domestic resilience to the fluctuations and uncertainties associated with imports "). 
286 Panel Report, para. 7.194 (referring to United States' opening statement at the first Panel meetin g, 
paras. 48 -52). 
287 Panel Report, para. 7.284.  
288 See Panel Report, paras. 7.269 -7.274.  More specifically, India referred to: (i) the first recital of the 
preamble of the WTO  Agreement ; (ii) Articles 3, 4(1)(b), and  4(1)(f)  of the United Nations Framework 
Convention on Climate Change  (Panel Exhibit IND -3); (iii) the Rio Declaration on Environment and 
Development, adopted by the UN General Assembly in  1992 (Panel Exhibit IND -35); and (iv) paras. 3, 4, and 
127 of United Nations  General Assembly Resolution A/RE S/66/288 (adopted 27 July 2012 ) (Rio+20 Document: 
"The Future We Want ") (Panel Exhibit IND -28). 
289 Panel Report, para s. 7.290 and  7.293 (quoting Appellate Body Report, Mexico – Taxes on Soft 
Drinks , paras. 69 -70 and  79). (emphasis omitted)  
290 Panel Report, p ara. 7.293 . WT/DS456/AB/R  
 
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  legal system "without express legislative sanction, provided they do not run into conflict with laws 
enacted by t he Parliament".291 The Panel also noted India's explanation that , "[u]nder the 
Constitution of India, acts of the executive are not confined to areas where there is a pre -existing 
law" and that such acts "extend to aspects over which the Parliament has power  to enact laws".292 
The Panel accepted India's explanations regarding how its domestic legal system functions.293 The 
Panel found, however, based on India's explanations, that "international law obligations are not 
'automatically incorporated' into Indian law,  but rather that they may possibly be acted upon and 
implemented by certain domestic authorities", and that India had therefore failed to demonstrate 
that the relevant international instruments have "direct effect" in India.294 The Panel further noted 
India' s argument that principles of international environmental law and the concept of sustainable 
development "are fundamental to the environmental and developmental governance in India" and 
"that the concept of sustainable development is a part of customary in ternational law".295 The 
Panel did not , however , consider that this spoke "to the question of whether international 
obligations are automatically incorporated into domestic law and have 'direct effect' in India".296 
The Panel therefore found that India had fai led to demonstrate that the international instruments it 
had identified can be characterized as "laws or regulations" within the meaning of Article XX(d) in 
the present dispute.297 
5.99.   The Panel then turned to consider whether the domestic instruments that India  had 
identified qualify as "laws or regulations". The Panel recalled India's assertion that its obligation "to 
ensure ecologically sustainable growth" is embodied in Section 3 of India's Electricity Act, 2003, 
"read with" paragraph 5.12.1 of the National E lectricity Policy; subsection 5.2.1 of the National 
Electricity Plan; and the National Action Plan on Climate Change.298  
5.100.   The Panel began by noting that the dictionary definitions of the terms  "law" and 
"regulation" make clear that they refer to "rules"299, and that , throughout its report in 
Mexico  ‒ Taxes on Soft Drinks , the Appellate Body had understood "laws or regulations" to refer to 
"rules".300 The Panel further noted that, b y its terms, Article XX(d) refers to "laws or regulations" 
in respect of which "compliance" can be secured, and considered that, "by necessary implication, 
the 'laws or regulations' referred to in Article XX(d) must therefore be rules in respect of which 
conduct would, or would not, be in 'compliance'."301 Referring to the "context" provided by the 
illustrative list in Article X X(d), the Panel found this to imply that the "laws or regulations" under 
Article XX(d) "must be legally enforceable".302 Based on its analysis, the Panel concluded that  the 
terms  "laws or regulations" in Article XX(d) refer to "legally enforceable rules of c onduct under the 
domestic legal system of the WTO Member concerned, and do not include general objectives".303 
5.101.   In respect of the domestic instruments identified by India, the Panel began by assessing 
whether Section 3 of the Electricity Act , 2003  constitutes  a "law or regulation" within the meaning 
of Article XX(d). The Panel noted that the Electricity Act , 2003  "has formal characteristics that are 
normally associated with a statute" , in the sense that "it contains a date of entry into force, a 
section defini ng the terms used in the instrument" , and that it "is divided into numbered parts, 
sections and subsections that consist of rules cast in binding language ".304 The Panel further 
observed that Section 3 of the Electricity Act , 2003  "appears to constitute a le gally enforceable 
                                                
291 Panel Report, para. 7.285 (quoting India's response to Panel question No. 35 ; and first written 
submission to the Panel, para. 180).  
292 Panel Report, para. 7.295 (quoting India's opening statement at the first Panel meeting, para.  60). 
The sam e language is reproduced in para. 7.296 (quoting India's response to Panel question No.  35). 
293 Panel Report, para. 7.297.  
294 Panel Report, para. 7. 298. 
295 Panel Report, para. 7.298 (referring to India's first written submission  to the Panel , para. 180 , in 
turn referring to  Supreme Court of India, Judgment, Vellore Citizens Welfare forum v. Union of India and 
Others  (1996) 5 SCC 647, paras. 10 -15). 
296 Panel Report, para. 7.298.  
297 Panel Report, paras. 7.301 and 7.333.  
298 Panel Report, paras. 7.275 -7.283.  
299 Panel Report, para. 7.308.  
300 Panel Report, para. 7.308.  
301 Panel Report, para. 7.308 (referring to Appellate Body Report, Mexico – Taxes on Soft Drinks , 
paras.  69-70, 75, 77, and 79 ). 
302 Panel Report, para. 7.309.  
303 Panel Report, para. 7.311.  
304 Panel Report, para.  7.312. (fns omitted)  WT/DS456/AB/R  
 
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  rule of conduct under the domestic legal system of India"305, in the sense that it "establishes the 
legal basis" for the development of the National Electricity Plan and the National Electricity Policy 
and "identifies the entities involved in the periodic preparation, publication, and review of the 
National Electricity Policy and the National Electricity Plan".306 The Panel added, however, that 
Section 3 "does not address the content or substance of either the National Electricity Policy or th e 
National Electricity Plan, other than to state that the Policy to be prepared from time to time will 
be 'based on optimal utilisation of resources such as coal, natural gas, nuclear substances or 
materials, hydro and renewable sources of energy'."307  
5.102.   Drawing a contrast with Section 3 of the Electricity Act, 2003, the Panel observed that the 
National Electricity Policy, the National Electricity Plan, and the National Action Plan on Climate 
Change  are each expressly entitled a "policy" or "plan", and that th e language of the provisions 
and passages in these instruments identified by India "does not suggest the existence of any 
legally enforceable rules", and is instead "hortatory, aspirational, declaratory, and at times solely 
descriptive".308 The Panel further  noted that India had not suggested that the National Electricity 
Policy, the National Electricity Plan, or the National Action Plan on Climate Change are "legally 
binding", or that they are substantively similar to legislative acts or other instruments un der its 
domestic legal system.309 The Panel saw "no  reason to doubt" that these instruments were 
adopted by the Central Government in exercise of its powers under the Constitution of India310, 
but did not consider this to be a decisive criterion in determining  whether these instruments 
qualify as "laws or regulations" within the meaning of Article XX(d).311 Based on its analysis, the 
Panel found that " the Electricity Act, and in particular Section 3 thereof, constitutes a 'law' for the 
purposes of Article XX(d)"312, while the other domestic instruments identified by India do not 
quality as "laws or regulations" within the meaning of that provision.313  
5.103.   With respect to Section 3 of the Electricity Act, 2003, the Panel referred to past GATT/WTO 
jurisprudence, and recall ed that the phrase "to secure compliance with laws or regulations" in 
Article XX(d) refers to measures "to enforce obligations under laws or regulations", and not to 
measures "to ensure the attainment of the objectives of the laws and regulations".314 The Pa nel, 
however,  saw "no link or nexus" between the DCR measures and Section 3 of the Electricity Act , 
2003.315 In particular, the Panel said it failed "to see how the DCR measures could be said to 
secure compliance with the obligations in Section 3 of the Elec tricity Act, which are to periodically 
prepare the National Electricity Policy and the National Electricity Plan."316 The Panel added that 
"India ha [d] not suggested that the DCR measures are aimed at preventing the Central 
Government of India or the Central  Electricity Authority from acting inconsistently with their 
obligations to periodically prepare the National Electricity Policy and the National Electricity 
Plan."317 The Panel therefore found that India had failed to demonstrate that its DCR measures are 
measures "to secure compliance" with the legal obligations in Section 3 of the 
Electricity  Act, 2003.318 For all these reasons, the Panel concluded that India had failed to 
demonstrate that its DCR measures are provisionally justified under Article XX(d) of t he 
GATT  1994.319 
                                                
305 Panel Report, para. 7.312.  
306 Panel Report, para. 7.327.  
307 Panel Report, para. 7.276 (quoting Electricity Act , 2003  (Panel Exhibit  USA-20), Section 3(1 ). 
308 Panel Report, para. 7.313.  
309 Panel Report, para. 7.314.  
310 Panel Report, para.  7.317. 
311 Panel Report, para. 7.317.  
312 Panel Report, para. 7.312.  
313 Panel Report, para. 7.318.  
314 Panel Report, para. 7.330 (referring to GATT Panel Report, EEC – Parts and Components , para. 5.17; 
Panel Reports, Canada – Periodicals , para. 5.9; Canada – Wheat Exports and Grain Imports , para. 6 .248; 
EC ‒ Trademarks and Geographical Indications (US) , para. 7.447; Mexico  ‒ Taxes on Soft Drinks , para. 8.175; 
and Colombia – Ports of Entry , para. 7.538).  
315 Panel Report, para. 7.329.  
316 Panel Report, para. 7.329.  (fn omitted)  
317 Panel Report, para. 7.329.  
318 Panel Report, para. 7.332.  
319 Panel Report, para. 7.333.  WT/DS456/AB/R  
 
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  5.3.2   The legal standard under Article XX(d) of the GATT 1994  
5.104.   Having recalled the Panel's analysis and findings, we turn to consider the legal standard 
that applies under Article XX(d) of the GATT 1994.  Article XX(d) sets out a general exception f or 
measures that are:  
necessary to secure compliance with laws or regulations which are not inconsistent 
with the provisions of this Agreement, including those relating to customs 
enforcement, the enforcement of monopolies operated under paragraph 4 of Ar ticle II 
and Article  XVII, the protection of patents, trade marks and copyrights, and the 
prevention of deceptive practices;  
5.105.   Having already surveyed , in the context of our discussion on Article XX(j) of the 
GATT  1994, the general analytical framework that applies under Article XX(d)320, we turn 
immediately to examine the proper interpretation of the terms "laws or regulations" in the context 
of the phrase "to secure compliance with laws or regulations" in Article XX(d).  
5.106.   Beginning with the ordinary meaning of  the terms "laws" and "regulations", we note that 
the term "law" is generally understood to refer to "a rule of conduct imposed by authority"321, 
while the term "regulation" is defined as "[a] rule or principle governing behaviour or 
practice;  esp. such a di rective established and maintained by an authority".322 In Mexico – Taxes 
on Soft Drinks , the Appellate Body said that the terms "laws or regulations" in Article XX(d) refer 
to "rules that form part of the domestic legal system of a WTO  Member, including rul es deriving 
from international agreements that have been incorporated into the domestic legal system of a 
WTO Member or have direct effect according to that WTO Member's legal system."323 As to the 
illustrative list contained in Article XX(d), the Appellate Body observed that the matters listed as 
examples in Article XX(d)  – namely, customs enforcement, the enforcement of monopolies, the 
protection of patents, trade marks and copyrights, and the prevention of deceptive practices  – 
involve the regulation by a government of activity undertaken by a variety of economic actors 
(e.g. private firms and State enterprises), as well as by government al agencies.324 The illustrative 
list contained in Article XX(d) reinforces the notion that "laws or regulations" refer to r ules of 
conduct and principles governing behaviour or practice that form part of the domestic legal system 
of a Member.325  
5.107.   Furthermore, as noted by the Appellate Body, "laws or regulations" encompass "rules 
adopted by a WTO Member's legislative or executive  branches of government".326 In ascertaining 
whether an alleged rule falls within the scope of "laws or regulations" for purposes of Article XX(d) , 
it may therefore be relevant to assess whether the rule at issue has been adopted or recognized 
by an authorit y that is competent to do so under the domestic legal system of the Member 
concerned.  
5.108.   Turning to the immediate context of  the terms  "laws or regulations", we note that the text 
of Article  XX(d) refers to "laws or regulations" in respect of which "complianc e" can be "secure[d]". 
The "laws or regulations" referred to in Article XX(d) must therefore be ones in respect of which 
conduct would, or would not, be in "compliance ". As to the term "secure", we understand  that, in 
Mexico – Taxes on Soft Drinks , the App ellate Body disagreed with the panel's interpretation that 
"'to secure compliance' is to be read as meaning to enforce  compliance ".327 The Appellate Body 
explained that absolute certainty in the achievement of a measure's stated goal, as well as the use 
of coercion, are not necessary components of a measure designed "to secure compliance" within 
the meaning of Article XX(d).328 Instead, a measure can be said "to secure compliance" with "laws 
                                                
320 See paras. 5.56 -5.61. of this Report.  
321 Oxford English Dictionary online, definition of the word "law"  
<http://www.oed.com/view/Entry/106405 >, accessed 23 August 2016.  
322 Oxford English Dictionary online, definition of the word "regulation"  
<http://www.oed.com/view/Entry/161427 >, accessed 23 August 2016. ( italics  original)  
323 Appellate Body Report, Mexico – Taxes on Soft Drinks , para. 79 . 
324 Appellate Body Rep ort, Mexico – Taxes on Soft Drinks , para. 70 . 
325 See Appellate Body Report, Mexico – Taxes on Soft Drinks , para. 70 . 
326 Appellate Body Report, Mexico – Taxes on Soft Drinks , para. 69.  
327 Appellate Body Report, Mexico – Taxes on Soft Drinks , paras. 73 -74 (quot ing Panel Report, Mexico – 
Taxes on Soft Drinks , para. 8.175). (emphasis added)  
328 Appellate Body Report, Mexico – Taxes on Soft Drinks , para. 74.  WT/DS456/AB/R  
 
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  or regulations " when it seeks to secure observance of specific rules, even if the measure cannot be 
guaranteed to achieve such result with absolute certainty.329  
5.109.   We do not consider that the scope of "laws or regulations" is limited to instruments that 
are legally enforceable (including, e.g. before a court of law), or that ar e accompanied by penalties 
and sanctions to be applied in situations of non -compliance. Instead, as we see it, the concept is 
broader and may, in appropriate cases, include rules in respect of which a Member seeks to 
"secure compliance", even when complian ce is not coerced, for example, through the imposition of 
penalties or sanctions. I n assessing whether a rule falls within the scope of "laws or regulations" 
under Article XX(d), a panel should consider the degree to which an instrument containing the 
alleged rule is normative in nature. It is therefore relevant for a panel to examine whether a rule is 
legally enforceable, as this may demonstrate the extent to which it sets out a rule of conduct or 
course of action that is to be observed within the domestic  legal system of a Member. It also may 
be relevant for a panel to examine whether the instrument provides for penalties or sanctions to 
be applied in situations of non -compliance.  
5.110.   The Appellate Body has stated that a "measure can be said 'to secure compli ance' with 
laws or regulations when its design reveals that it secures compliance with specific rules, 
obligations, or requirements  under such laws or regulations".330 It is important, in this regard, to 
distinguish between the specific rules, obligations , or requirements with respect to which a 
measure seeks to secure compliance, on the one hand, and the objectives of the relevant "laws or 
regulations", which may assist in "elucidating the content of specific rules, obligations, or 
requirements" of the "laws  or regulations", on the other hand.331 The "more precisely" a 
respondent is able to identify specific rules, obligations, or requirements contained in the relevant 
"laws or regulations", the "more likely" it will be able to elucidate how and why the inconsi stent 
measure secures compliance with such "laws or regulations".332 Thus, in assessing whether an 
instrument constitutes a "law or regulation" within the meaning of Article XX(d), a panel should 
also consider the degree of specificity or precision with whic h the relevant instrument lays down a 
particular rule of conduct or course of action within the domestic legal system of a Member, as 
opposed to simply providing a legal basis for action that may be consistent with certain objectives.  
5.111.   In certain cases, a r espondent may be able to identify a specific provision of a single 
domestic instrument that contains a given rule, obligation, or requirement with which it seeks "to 
secure compliance" for purposes of Article XX(d). However, it is also possible to envisage  
situations where a respondent seeks to identify a given rule, obligation, or requirement by 
reference to, or deriving from, several elements or parts of one or more instruments under its 
domestic legal system. In Argentina – Financial Services , the Appell ate Body acknowledged this 
possibility when it said that a respondent "may choose to demonstrate that the measure is 
designed and necessary to secure compliance with an obligation or obligations arising from several 
laws or regulations operating together a s part of a comprehensive framework".333 Indeed, we do 
not see anything in the text of Article XX(d) that would exclude , from the scope of "laws or 
regulations", rules, obligations, or requirements that are not contained in a single domestic 
instrument or a provision thereof. In a given domestic legal system, several elements of one or 
more instruments may function together to set out a rule of conduct or course of action. In such a 
scenario, in order to understand properly the content, substance, and normati vity of a given rule, 
a panel may be required to examine together the different elements of one or more instruments 
identified by a respondent. Of course, insofar as a respondent seeks to rely on a rule deriving from 
several instruments or parts thereof, i t would still bear the burden of establishing that the 
instruments or the parts that it identifies actually set out the alleged rule.  
5.112.   Ultimately, a panel's scrutiny of whether a responding party has identified "laws or 
regulations" within the meaning of A rticle XX(d) should focus on the specific features and 
characteristics of the instruments at issue, including the alleged rules that they may contain. W hile 
the form and title given to an instrument may shed light on its legal status and content, a 
determi nation of whether an alleged rule falls within the scope of "laws or regulations" for 
                                                
329 See Appellate Body Reports, Colombia – Textiles , paras. 5.69, 5.126, and 5.131; and 
Argentina  ‒ Financial Services , para. 6.203.  
330 Appellate Body Report, Argentina – Financial Services , para. 6.203. (emphasis added ; fn omitted ) 
331 Appellate Body Report, Argentina – Financial Services , fn 495 to para. 6.203.  
332 Appellate Body Report, Argenti na – Financial Services , para. 6.203.  
333 Appellate Body Report, Argentina – Financial Services , fn 505 to para. 6.208 . WT/DS456/AB/R  
 
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  purposes of Article XX(d) cannot be made simply by reference to the label given to an instrument 
under the domestic law of a Member.334  
5.113.   To sum up, in determining whether a  responding party has identified a rule that falls within 
the scope of "laws or regulations" under Article XX(d) of the GATT 1994, a panel should evaluate 
and give due consideration to all the characteristics of the relevant instrument(s) and should avoid 
focusing exclusively or unduly on any single characteristic. In particular, it may be relevant for a 
panel to consider, among others: (i) the degree of normativity of the instrument and the extent to 
which the instrument operates to set out a rule of condu ct or course of action that is to be 
observed within the domestic legal system of a Member; (ii) the degree of specificity of the 
relevant rule; (iii) whether the rule is legally enforceable, including, e.g. before a court of law; 
(iv) whether the rule has  been adopted or recognized by a competent authority possessing the 
necessary powers under the domestic legal system of a Member; (v) the form and title given to 
any instrument or instruments containing the rule under the domestic legal system of a Member;  
and (vi) the penalties or sanctions that may accompany the relevant rule.  
5.114.   In some cases, such as those involving a specific, legally enforceable rule under a single 
provision of a domestic legislative act, determining whether a respondent has identified "laws or 
regulations" within the meaning of Article XX(d) may be a relatively straightforward exercise. In 
others, however, the assessment may be more complex. Importantly, this assessment must 
always be carried out on a case -by-case basis, in light of the  specific characteristics and features 
of the instruments at issue, the rule alleged to exist, and the domestic legal system of the Member 
concerned.  
5.115.   Having identified the legal standards under Article XX(d), we turn to address India's claims 
on appeal, be ginning with the arguments directed at the Panel's analysis of whether the domestic 
instruments and the alleged rules thereunder, as identified by India, fall within the scope of "laws 
or regulations" under Article XX(d). We note that the Panel adopted a d ifferent sequence, 
beginning, first, by considering whether the international instruments identified by India are "laws 
or regulations", before turning to the domestic instruments identified by India. We nonetheless 
consider it useful to begin our assessme nt with the Panel's analysis of India's domestic 
instruments , because it is in the course of this analysis that the Panel developed its interpretation 
of "laws or regulations" under Article XX(d).335  
5.3.3   Whether the Panel erred in its assessment of the domestic  instruments identified 
by India  
5.116.   With respect to the Panel's analysis of the alleged rule set out in the domestic instruments 
identified by India, India appeals the Panel's findings that India had failed to demonstrate that its 
DCR measures are designed " to secure compliance with laws or regulations" within the meaning of 
Article XX(d) of the GATT 1994. As we see it, India's appeal is based on three main grounds.  
5.117.   First, India contends that the Panel erred under Article XX(d) in finding that the National 
Electricity Policy, the National Electricity Plan, and the  National Action Plan on Climate Change  do 
not constitute "laws or regulations".336 According to India, these admittedly "non -binding" 
instruments are nonetheless "laws" within the meaning of Article X X(d) under India's domestic 
legal system because the "legal framework in India" comprises both "binding" laws, and policies 
and plans , that provide the "framework for executive action".337  
5.118.   Second, India disagrees with the Panel to the extent that it suggest ed that the phrase "to 
secure compliance" limits the scope of Article XX(d) to measures that "prevent" actions that would 
be "illegal " under the laws or regulations at issue.338 
                                                
334 Appellate Body Report, US – Corrosion -Resistant Steel Sunset Review , fn 87  to para. 87 . See also 
Panel Report, fn 749 to para. 7.314 . 
335 See Panel Report, paras. 7.306 -7.311.  
336 India's appellant's submission, para. 171.  
337 India's appellant's submission, para. 171.  
338 India's appellant's submission, para. 174 (referring to  Panel Report, para. 7.328 and fn 770 thereto; 
and India's second writt en submission  to the Panel , paras.  131-133).  WT/DS456/AB/R  
 
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  5.119.   Third, India submits that the Panel erred in examining Section 3 of India's 
Electricity  Act, 2003,  "in isolation" from the other "non -binding" instruments it had identified , 
given that India had argued that all the domestic instruments it had identified, taken together, set 
out the obligation to ensure "ecologically sustainable growth "339 and that the DCR measures are 
required in order to secure compliance with this obligation.340 India adds , in this regard , that the 
fact that the instruments to which it referred "leave open flexibility for India to design its 
implementation measures  does not mean they constitute objectives that need not be complied 
with, or that compliance with such obligations need not be secured".341  
5.120.   The United States responds that the fact that the domestic instruments that India had 
identified lay out important and even  "critical" objectives does not make them "laws or 
regulations" within the meaning of Article XX(d). The United  States asserts that "to secure 
compliance" under Article XX(d) means to "enforce" obligations under laws and regulations and not 
to "ensure" the  attainment of the objectives of the laws and regulations.342 According to the 
United  States, India does not even attempt to argue that its DCR measures are necessary to 
comply with any Indian laws or regulations "as such", but only with the objectives embod ied in the 
laws identified by India.343 Moreover, the United States recalls that the Panel considered that 
Section 3 of the Electricity Act , 2003  requires the Central Government to prepare the National 
Electricity Policy , and that the DCR measures do nothing  to enforce this legal requirement.344 
Noting India's argument on appeal that it did not mean to cite Section 3 on its own, but as one 
element of its laws or regulations, the United States further submits that India does not directly 
appeal the Panel's findi ngs with respect to Section 3 of the Electricity  Act, 2003.345  
5.121.   We address India's arguments below, beginning with India's contention that the Panel 
erred in its interpretation of the terms "laws or regulations" in Article XX(d) as referring to "legally 
enforceable rules of conduct under the domestic legal system" of a Member.346 As discussed 
above, a determination of whether an instrument qualifies as a "law or regulation" within the 
meaning of Article XX(d) includes an assessment of whether the responding par ty has identified 
specific rules, obligations, or requirements that operate with a sufficient degree of normativity 
under its domestic legal system so as to set out a rule of conduct or course of action. The legal 
enforceability of an instrument under the domestic legal system of a Member may be an 
important, even determinative, factor in demonstrating that such an instrument operates with a 
high degree of normativity within the domestic legal system of that Member. Depending on the 
domestic legal system of  a Member, as well as the characteristics of the instrument at issue, there 
may, however, be other ways to demonstrate that an instrument operates with a sufficient degree 
of normativity. Insofar as Article XX(d) is susceptible of application in respect of  a wide variety of 
"laws or regulations"347, we recall that the degree of normativity of an instrument is one of the 
relevant factors in assessing whether such instrument qualifies as a "law or regulation" under 
Article XX(d). The Panel goes some way in ackn owledging this by stating that the diversity of 
Members' domestic legal systems should be taken into account in determining  whether an 
instrument can be characterized as a "law or regulation" for purposes of Article  XX(d).348 We, 
however, disagree with the P anel to the extent that it may have suggested that the scope of "laws 
or regulations" under Article XX(d) is limited to  "legally enforceable rules of conduct under the 
domestic legal system" of a Member.349 
                                                
339 According to India, "ecologically sustainable growth" means "economic growth in an ecologically 
sustainable manner". In India's view, the "concept of 'sustainable development' … encompasses within it the 
conce pt of 'ecologically sustainable growth'". India also clarifies that "ecologically sustainable growth is 
fundamental to India's strategy to address its energy security objective as well" and "they cannot be seen as 
distinct from each other". (India's appell ant's submission, para. 176 (referring to India's second written 
submission  to the Panel , paras. 138 and 140 , and fn 172  thereto )) 
340 India's appellant's submission, para. 173.  
341 India's appellant's submission, para. 173.  (fn omitted)  
342 United States' appel lee's submission, para. 158 (referring to Panel Report, Canada  ‒ Wheat Exports 
and Grain Imports , para. 6.248).  
343 United States' appellee's submission, para. 15 8. 
344 United States' appellee's submission, para. 159 (referring to Panel Report, para. 7.330).  
345 United States' appellee's submission, para. 159.  
346 Panel Report, para. 7.311.  See also India's appellant's submission, para s. 171-172. 
347 Appellate Body Report, Korea – Various Measures on Beef, para. 162.  
348 See Panel Report, fn 749 to para. 7.314.  
349 Panel Report, para. 7.311.  WT/DS456/AB/R  
 
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  5.122.   We next consider the Panel's interpretation of the phrase "to secure compliance" in 
Article  XX(d). Having summarized the position of prior panels350, the present Panel "consider[ed] it 
unnecessary to resolve the question of precisely what type of link or nexus would be required to 
establish that the DCR meas ures 'secure compliance' with [Section 3 of the Electricity Act , 2003 ]", 
given that the Panel saw "no link or nexus between the DCR measures and Section 3 of the 
Electricity Act".351 Contrary to what India argues on appeal, we therefore do not see the Panel to 
have found that "to secure compliance" in Article XX(d) restricts the scope of that provision only to 
measures that "prevent" actions that would be illegal under the "laws or regulations " at issue.  
5.123.   We turn now to consider India's argument that the Pane l erred in its application of 
Article  XX(d) by examining Section 3 of India's Electricity Act , 2003  "in isolation" , although India 
had argued that the domestic instruments that it had identified, when considered together, 
"mandate achieving ecologically su stainable growth" and that the DCR measures are required for 
securing compliance with this rule.352 
5.124.   We recall that the Panel began its analysis by summarizing India's position as follows:  
India also submits that its "domestic … obligations to ensure ecologic ally sustainable 
growth while addressing India's energy security challenge, and ensuring compliance 
with its obligations relating to climate change" are embodied in: (a) the Electricity Act 
"read with "; (b) the National Electricity Policy; (c) the National  Electricity Plan; and 
(d) the National Action Plan on Climate Change.353 
5.125.   The Panel noted that India's defence under Article XX(d) was based on the "domestic 
obligations" of India as reflected in the Electricity Act, 2003, "read with" the National  Electricit y 
Policy, the National Electricity Plan, and the National Action Plan on Climate Change. Subsequently, 
the Panel structured its analysis in a manner whereby it assessed the relevant passages and 
provisions of each of these instruments individually, in orde r to determine whether any of them f all 
within the scope of "laws or regulations" under Article  XX(d). The Panel found the relevant 
passages and provisions of the National Electricity Policy, the National Electricity Plan, and the 
National Action Plan on C limate Change to be outside the scope of "laws or regulations". By 
contrast, the Panel found Section 3 of the Electricity Act , 2003  to be a "law" within the meaning of 
Article  XX(d), and therefore proceeded to analyse whether the DCR measures are designed "to 
secure compliance" with Section 3 of the Electricity Act, 2003, finding, ultimately, that this is not 
the case.  
5.126.   The rule that India sought to identify, with respect to which the DCR measures seek to 
secure compliance, is that of "ensur[ing] ecological ly sustainable growth while addressing India's 
energy security challenge, and ensuring compliance with its obligations relating to climate 
change".354 This rule, India alleged, is set out in the passages and provisions of the domestic 
instruments that were i dentified by it, and falls within the scope of "laws or regulations" under 
Article XX(d) with which compliance is sought to be secured.  
5.127.   As discussed above , a respondent may be able to identify a specific provision of a single 
domestic instrument that conta ins a given rule, obligation, or requirement with which it seeks "to 
secure compliance" for purposes of Article XX(d). However, a respondent may also identify a given  
rule, obligation, or requirement by reference to, or deriving from, several elements or p arts of one 
or more instruments under its domestic legal system. In the latter scenario, the respondent would 
bear the burden of demonstrating that the instruments , or parts thereof , that it identifies actually 
set out the rule alleged by it. Additionally,  a respondent would also have to demonstrate that such 
rule falls within the scope of "law s or regulation s" under Article XX(d) by reference to all the 
factors that may be relevant for such an assessment. As explained  above , such factors may 
include, among  others: (i) the degree of normativity of the instrument and the extent to which the 
                                                
350 Panel Report, para. 7.328 (quoti ng GATT Panel Report, EEC – Parts and Components , para. 5.15 ; 
and Panel Reports, China – Auto Parts , para. 7.315 and fn 572 thereto, in turn citing Panel Report, Korea – 
Various Measures on Beef , paras. 655 and 658).  
351 Panel Report, fn 773  to para. 7.329 . 
352 India's appellant's submission, para. 173 (referring to India's response to Panel question No. 34(a) ; 
and second written submission  to the Panel , paras. 136 -137).  
353 Panel Report, para. 7.275 (referring to India's first written submission  to the Panel , para. 240).  
(emphasis added)  
354 Panel Report, para. 7.275 (referring to India's first written submission  to the Panel , para. 240).  WT/DS456/AB/R  
 
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  instrument operates to set out a rule of conduct or course of action that is to be observed within 
the domestic legal system of a Member; (ii) the degree of specificity of  the relevant rule; 
(iii) whether the rule is legally enforceable, including, e.g. before a court of law; (iv) whether the 
rule has been adopted or recognized by a competent authority possessing the necessary powers 
under the domestic legal system of a Mem ber; (v) the form and title given to any instrument or 
instruments containing the rule under the domestic legal system of a Member; and (vi) the 
penalties or sanctions that may accompany the relevant rule.  
5.128.   We recall that the Panel analysed each of the dom estic instruments that India had 
identified to assess whether they qualif y as "law s or regulation s" within the meaning of 
Article  XX(d). The Panel found that , whereas the passages and provisions of the National Electricity 
Policy, the National Electricity Plan, and the National Action Plan on Climate Change  are not "laws 
or regulations" within the meaning of Article XX(d), Section 3 of the Electricity Act , 2003 is a "law" 
for purposes of that provision. In our view, given how India presented its case allegi ng the 
existence of the obligation of ensuring ecologically sustainable growth deriving from several 
instruments, it may have been appropriate for the Panel to have begun by assessing whether the 
passages and provisions of the domestic instruments that Ind ia had identified, when considered 
together , set out the rule alleged by India. Were the Panel satisfied that India had established the 
existence of such a rule, it could then have considered whether this rule embodied in the domestic 
instruments identifie d by India qualified as a "law or regulation" under Article XX(d).  
5.129.   Although we acknowledge that the Panel could have carried out its analysis differently, we 
do not consider that the approach outlined by us above,  i.e. considering the different instrument s 
together,  would ultimately have led the Panel  to a different conclusion as to whether the 
DCR measures are measures "to secure compliance with laws or regulations" within the meaning 
of Article XX(d) for the reasons set out below.355 
5.130.   We recall that, with r espect to the National Electricity Policy, India identified 
paragraph  5.12.1 of the Policy as containing the "specific obligation" with which the DCR measures 
are designed to secure compliance.356 Paragraph 5.12.1 of the National Electricity Policy reads as 
follows:  
Non-conventional sources of energy being the most environment friendly there is an 
urgent need to promote generation of electricity based on such sources of energy. For 
this purpose, efforts need to be made to reduce the capital cost of projects b ased on 
non-conventional and renewable sources of energy. Cost of energy can also be 
reduced by promoting competition within such projects. At the same time, adequate 
promotional measures would also have to be taken for development of technologies 
and a su stained growth of these sources.357 
5.131.   As to the National Electricity Plan, India referred to subsection  5.2.1 of the Plan as 
containing the obligation with which the DCR measures are designed to secure compliance.358 
Subsection 5.2.1 reads:  
5.2.1 Sustainable Dev elopment  
Sustainable Development of our country is our ultimate goal which encompasses 
economic development, maintaining environmental quality and social equity. This 
would also ensure that development takes place to fulfil our present needs without 
compro mising the needs of our future generations. The importance and relevance of 
power development within the confines of Clean and Green Power is the most 
essential element. Such a growth depends upon the choice of an appropriate fuel / 
technology for power ge neration. Accordingly, the Plan takes into account the 
development of projects based on renewable energy sources as well as other 
measures and technologies promoting sustainable development of the country.  
                                                
355 Panel Report, para. 7.333.  
356 Panel Report, para. 7.279.  
357 National Electricity Policy  (Panel Exhibit IND -14), para. 5.12.1 . 
358 Panel Report, para. 7.281 (referring to India's response to Panel question No. 34(a)) . WT/DS456/AB/R  
 
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  The foremost Low Carbon Strategy Initiative is the  choice of resources for power 
generation. Projects in the Plan based on Conventional Sources i.e. Hydro, Nuclear & 
thermal are selected as a result of Studies carried out using Capacity Expansion 
Software programmes to meet the demand as stipulated by the  draft 18th EPS Report. 
Power from Renewable Energy Sources has also been considered while carrying out 
these studies.  
The demand adopted for planning purpose is the draft 18th EPS demand projections. 
This demand is based on use of energy efficient technol ogies being used and energy 
conservation measures being adopted. Therefore, the planning strategy adopted is in 
accordance with low carbon strategy growth.359 
5.132.   Finally, with respect to the National Action Plan on Climate Change, based on the summary 
provided by India, the Panel identified three excerpts from the Plan to which  it understood India 
was referring.360 On appeal, India does not take issue with the Panel's identification of these 
excerpts. These excerpts read as follows:  
Recognizing that climate change  is a global challenge, India will engage actively in 
multilateral negotiations in the UN Framework Convention on Climate Change, in a 
positive, constructive and forward -looking manner. Our objective will be to establish 
an effective, cooperative and equit able global approach based on the principle of 
common but differentiated responsibilities and respective capabilities, enshrined in the 
[UN Framework Convention on Climate Change ]. … Finally, our approach must also be 
compatible with our role as a responsi ble and enlightened member of the international 
community, ready to make our contribution to the solution of a global challenge, 
which impacts on humanity as a whole.  
- - - 
The National Solar Mission would promote the use of solar energy for power 
generati on and other applications. …  
Solar based power technologies are an extremely clean form of generation with 
practically no form of emissions at the point of generation. They would lead to energy 
security through displacement of coal and petroleum.  
- - - 
Rural solar thermal applications would also be pursued under public -private 
partnerships where feasible. Commensurate local manufacturing capacity to meet this 
level of deployment, with necessary technology tie -ups, where desirable, would be 
established. Fur ther, the Mission would aim for local Photovoltaic (PV) production from 
integrated facilities at a level of 1000 [megawatts ]/annum within this time frame. It 
would also aim to establish at least 1000 [megawatts ] of Concentrating Solar Power 
(CSP) generatio n capacity, again, with such technical tie -ups as essential within the 
stated time frame.361 
5.133.   Looking at the passages and provisions of the National Electricity Policy, the National 
Electricity Plan, and the National Action Plan on Climate Change identified b y India, we fail to see 
how these instruments, taken together, could be read to set out a "rule" to ensure ecologically 
sustainable growth that India alleges.362 The National Electricity Policy states that it "aims at laying 
guidelines" for the attainment of  certain objectives.363 The National Electricity Plan is described as 
a "reference document".364 The National Action Plan on Climate Change "updates India's national 
                                                
359 National Electricity Plan (Panel Exhibit  IND-16), subsection 5.2.1, pp. 90 -91. 
360 Panel Report, para. 7.283.  
361 National Action Plan on Climate Change  (Panel Exhibit  IND-2), pp. 1, 20, and  22, respectively.  
362 India acknowledges that the National Electricity Policy, the National Electricity Plan, and the National 
Action Plan on Climate Change are, in and of themselves, "non -binding legal instruments". (India's appellant's 
submission, para. 172 ; see also Panel Report, para. 7.314 ) 
363 National Electricity Policy  (Panel Exhibit  IND-14), para. 1.8.  
364 National Electricity Policy  (Panel Exhibit  IND-14), para. 3.1.  WT/DS456/AB/R  
 
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  programmes relevant to addressing climate change"; it "identifies measures that promote [India 's] 
development objectives, while also yielding co -benefits for addressing climate change effectively"; 
and it "lists specific opportunities to simultaneously advance India's development and climate 
related objectives of both adaptation as well as greenhou se gas (GHG) mitigation ."365 We note that 
there are differences in the substantive content of the passages and provisions of these three 
instruments, on the one hand, and the substance of the rule that India alleges they contain, on the 
other hand. In additi on, the relevant texts of these instruments, whether seen in isolation or read 
together, do not set out, with a sufficient degree of normativity and specificity, a "rule" to ensure 
ecologically sustainable growth, as alleged by India. Instead, we note, as did the Panel, that the 
text of these passages and provisions "is hortatory, aspirational, declaratory, and at times solely 
descriptive".366 
5.134.   We now turn to Section 3 of the Electricity Act, 2003,  which reads as follows:  
3. (1) The Central Government shall, from time to time, prepare the national 
electricity policy and tariff policy, in consultation with the State Governments and the 
[Central Electricity Authority] for development of the power system based on optimal 
utilisation of resources such as coal, nat ural gas, nuclear substances or materials, 
hydro and renewable sources of energy.  
(2) The Central Government shall publish National Electricity Policy and tariff policy 
from time to time.  
(3) The Central Government may, from time to time, in consultation w ith the State 
Governments and the [Central Electricity Authority], review or revise, the National 
Electricity Policy and tariff policy referred to in sub -section (1).  
(4) The [Central Electricity Authority] shall prepare a National Electricity Plan in 
accordance with the National Electricity Policy and notify such plan once in five years:  
Provided that the [Central Electricity Authority] in preparing the National Electricity 
Plan shall publish the draft National Electricity Plan and invite suggestions and 
objections thereon from licensees, generating companies and the public within such 
time as may be prescribed:  
Provided further that the [Central Electricity Authority] shall - 
(a) notify the plan after obtaining the approval of the Central Government;  
(b) revise the plan incorporating therein the directions, if any, given by the Central 
Government while granting approval under clause (a).  
(5) The [Central Electricity Authority] may review or revise the National Electricity 
Plan in accordance with the Nationa l Electricity Policy.367 
5.135.   Section 3(1) of the Electricity  Act, 2003  thus stipulates that the Central Government "shall" 
prepare the National Electricity Policy. Section 3(2) requires the Central  Government to publish 
this policy from time to time. Section 3(3 ) allows the Central Government to review and revise this 
policy. Section 3(4) requires that the Central Electricity Authority "shall" prepare a National 
Electricity Plan in accordance with the National Electricity Policy and notify such plan once in five 
years. Section 3 therefore sets out the obligation, and empowers the relevant entities to 
periodically prepare, publish, and review the National Electricity Policy, and the National Electricity 
Plan.368 This obligation is different in content from the rule t hat India seeks to derive from Section 
3 of the Electricity Act, 2003, i.e.  to ensure ecologically sustainable growth while addressing 
                                                
365 National Action Plan on Climate Change  (Panel Exhibit  IND-2), p. 13. 
366 Panel Report, para. 7.313.   
367 Electricity Act, 2003  (Panel Exhibit  USA-20), Section 3 . 
368 See Panel Report, paras. 7.312 and 7.327.  WT/DS456/AB/R  
 
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  India's energy security challenge, and ensuring compliance with its obligations relating to climate 
change.369  
5.136.   While Secti on 3 sets out the legal basis and authority for the development of the National 
Electricity Policy and the National Electricity Plan, it does not speak to the degree of normativity of 
these instruments. Thus, for example, Section 3 does not speak to the ex tent to which these 
instruments are to be observed or complied with under the domestic legal system of India . 
Whereas the National Electricity Policy and the National Electricity Plan may well have been 
enacted by the authorities competent to do so under I ndia's domestic legal system, it is not clear 
to us how Section 3 of the Electricity Act , 2003  would have the effect of adding to the degree of 
normativity of these otherwise "non -binding" domestic instruments.  
5.137.   For all these reasons, we disagree  with India 's contention that the passages and provisions 
of the domestic instruments identified by India, when read together, set out the rule "to ensure 
ecologically sustainable growth while addressing India's energy security challenge, and ensuring 
compliance with  its obligations relating to climate change", as alleged by India.  
5.3.4   Whether the Panel erred in its assessment of the international instruments 
identified by India  
5.138.   India appeals the Panel's finding that India ha d failed to demonstrate that the international  
instruments it had identified have "direct effect" in India, and are  therefore  "laws or regulations" 
within the meaning of Article XX(d)  of the GATT 1994 .370 First, India submits that the Panel's 
analysis was based on a "complete misunderstanding" of India' s argument s regarding the 
"implementation" of legal obligations.371 India asserts that the international instruments it had 
identified have "direct effect" in India , because the executive branch of the Central G overnment 
can take actions to "implement" or "e xecute" these international instruments without the need for 
the legislature to enact a domestic law incorporating the international instruments.372 For India, it 
is because the se international instruments have "direct effect" in India that the executive is 
required to take implementing action.373 Second, India submits that the "direct effect" of the 
identified international instruments under its domestic legal system is established by the fact that 
"the principles of sustainable development under international  environmental law have been 
recognized by the Supreme Court of India to be part of the environmental and developmental 
governance in India."374 India therefore requests that we reverse the Panel's finding that the 
international instruments India had identif ied do not fall within the scope of "laws or regulations" 
under Article XX(d). India also requests that we find that , "because these instruments of 
international law have a direct effect in India, … the executive needs to secure compliance with 
such laws."375 
5.139.   The United States responds that, in Mexico – Taxes on Soft Drinks , the Appellate Body 
found that an international agreement is not a "law or regulation" under Article XX(d) if a 
Member's legal system calls for "domestic legislative or regulatory acts" to  implement the 
                                                
369 Insofar as Section 3 of the Electricity Act , 2003  requires that the "Central Government shall, from 
time to time, pr epare the national electricity policy and tariff policy … based on optimal utilisation of resources 
such as coal, natural gas, nuclear substances or materials, hydro and renewable sources of energy " (emphasis 
added) , India agreed, at the oral hearing, with  the Panel's  view that the "optimal utilisation of resources such 
as coal, natural gas, nuclear substances or materials, hydro and renewable sources of energy" are objectives 
referenced in Section 3 of the Electricity Act , 2003 . (See Panel Report, paras. 7 .330-7.332 ) We also note the 
Panel's finding, not challenged on appeal, that India did not put forth the argument that the DCR measures are 
designed to secure compliance with the obligations under Section 3 of the Electricity Act,  2003 to periodically 
prepare the National Electricity Policy and the National Electricity Plan. The Panel also stated that it "faile[d] to 
see how the DCR measures could be said to secure compliance with the obligations in Section 3 of the 
Electricity Act, which are to periodicall y prepare the National Electricity Policy and the National Electricity Plan". 
(Ibid., para. 7.329)  
370 India's appellant's submission, para. 170.  
371 India's appellant's submission, para. 167.  
372 India's appellant's submission, para s. 167-168. According to Indi a, legislative action to incorporate 
the international instrument is required only when there is a "conflicting" domestic legislation, which is not the 
case with respect to the international instruments that India has identifie d in this case.  
373 India's app ellant's submission, para. 167.  
374 India's appellant's submission, para. 168 (referring to India's first written submission  to the Panel , 
para. 180 and fn 172 thereto).  
375 India's appellant's submission, para. 170.  WT/DS456/AB/R  
 
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  agreement.376 According to the United States, "where a 'regulatory act' intervenes, an 
international agreement is not in and of itself part of a Member's laws and regulations."377 
Highlighting India's acknowledgment that the international instru ments it had identified require 
executive "implementation", the United States asserts that these international instruments do not 
have "direct effect" in India and are therefore outside the scope of Article XX(d), because that 
provision does not distinguis h between executive or legislative action in matters of implementing 
international law.378 Moreover, the United States submits that India has failed to discharge its 
burden of proof under Article XX(d), as its arguments consist of "broad generalizations abou t 
Indian law, with no supporting evidence".379 With respect to the Decisions of the Supreme Court of 
India that India relies upon, the United States points out that one of them merely recounts the 
"history of international agreements regarding sustainable de velopment" and "provides no 
guidance whatsoever on the role the referenced agreements play in Indian law".380 The 
United  States also submits that  India did not provide  a copy of the Supreme Court Decision cited 
in its first written submission  to the Panel , thereby preventing an evaluation of the extent to which 
it supports India's position.381 
5.140.   As set out above, a respondent seeking to justify an otherwise GATT -inconsistent measure 
under Article XX(d) is required to establish the existence of rules that form par t of its domestic 
legal system and that such rules fall within the scope of "laws or regulations" under that 
provision.382 In Mexico – Taxes on Soft Drinks , the Appellate Body stated that "the terms 'laws or 
regulations' cover rules that form part of the dom estic legal system of a WTO Member, including  
rules deriving from international agreements that have been incorporated into the domestic legal 
system of a WTO Member or have direct effect according to that WTO Member's legal system".383 
Rules deriving from i nternational agreements may thus become part of the domestic legal system 
of a Member in at least two ways. For example, Members may incorporate  such rules, including 
through domestic legislative or executive acts intended to implement an international 
agreement384; and, certain international rules may have direct effect  within the domestic legal 
systems of some Members without specific domestic action to implement such rules.385 Subject to 
the domestic legal system of a Member, there may well be other ways in which international 
instruments or rules can become part of that domestic legal system. An assessment of whether a 
given international instrument or rule forms part of the domestic legal system of a Member must 
be carried out on a case -by-case basis, in li ght of the nature of the instrument or rule and the 
subject matter of the law at issue, and taking into account the functioning of the domestic legal 
system of the Member in question.  
5.141.   We emphasize that , even if a particular international instrument can be  said to form part 
of the domestic legal system of a Member, this does not, in and of itself, establish the existence of 
a rule, obligation, or requirement  within the domestic legal system of the Member that falls within 
the scope of a "law or regulation" under Article XX(d). Rather, as set out above, an assessment of 
whether an instrument operates with a sufficient degree of normativity and specificity under the 
domestic legal system of a Member386 so as to set out a rule of conduct or course of action, and 
thereby qualify as a "law or regulation", must be carried out on case -by-case basis, taking into 
                                                
376 United States' appellee's submission, par a. 155.  
377 United States' appellee's submission, para. 155 (referring to Appellate Body Report, Mexico – Taxes 
on Soft Drinks , para. 69).  
378 United States' appellee's submission, para. 155.  
379 United States' appellee's submission, para. 156.  
380 United States' appellee's submission, para. 156.  (fn omitted)  
381 United States' appellee's submission, para. 156.  
382 See supra  paras.  5.106 -5.114.  
383 Appellate Body Report, Mexico – Taxes on Soft Drinks , para. 79. (emphasis added)  
384 Appellate Body Report, Mexico – Taxes on Soft Drinks , para 69.  
385 Appellate Body Report, Mexico – Taxes on Soft Drinks , fn 148 to para. 69.  
386 In the context of India's argument that the "DCR measures  … have been designed to secure 
compliance with India’s obligations under international law " (India 's appellant's submission, para. 169),  we 
note that the degree of normativity of an international instrument or rule under the domestic legal system of a 
Member may be different from the degree of normativity of such an instrument or rule under public 
international law. Thus, for example, while the principle of pacta sunt servanda under public international law, 
as codified in Article 26 of the Vienna Convention on the Law of Treaties  (done at Vienna, 23 May 1969, 
UN Treaty Series, Vol. 1155, p.  331), requi res that "[e] very treaty in force is binding upon the parties to it and 
must be performed by them in good faith", this does not mean that, in and of itself, there is a rule, 
requirement, or obligation within the domestic legal system of a Member that falls  within the scope of "laws or 
regulations".  WT/DS456/AB/R  
 
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  account all the other relevant factors relating to the instrument and the domestic legal system of 
the Member.  
5.142.   We now turn to India's contention that the inte rnational instruments it had identified have 
"direct effect" in India, and fall within the scope of "laws or regulations" under Article XX(d), 
because the Indian legislature "is not required to legislate on a domestic law incorporating the 
international la w into domestic law" before the executive branch  can take action to "implement" or 
"execute" the international instruments.387 According to India, legislative action to incorporate an 
international instrument is required only when there is "conflicting" dome stic legislation, which is 
not the case with respect to the international instruments that India has identifie d in this case.388 
India asserts that the very fact that the executive branch can take action to "execute" the 
international instruments at issue, e .g. by enacting the DCR measures, shows that these 
international instruments and rules are already a part of its domestic legal system and therefore 
may be acted upon by the executive branch.389 According to India's reading of Article XX(d), 
international in struments that can be "implemented" or "executed" in the domestic legal system of 
a particular Member exclusively through executive action, without any prior domestic legislative 
basis, have "direct effect" within the legal system of the Member in question , form a part of that 
legal system, and therefore fall within the scope of "laws or regulations" under Article XX(d).  
5.143.   We recall that the Panel accepted India's explanation of how its domestic legal system 
functions and the allocation of powers under the C onstitution of India:  
We have taken careful note of India's explanation of how its domestic legal system 
functions. We accept India's explanation of the allocation of powers under the 
Constitution of India, and we accept its explanation that the executive branch may 
take implementing actions to secure compliance with India's international law 
obligations under the afore -mentioned instruments. We also accept India's 
explanation that the executive branch may take implementing actions without express 
sanction by the legislative branch, provided those implementing actions do not run 
into conflict with laws enacted by the Parliament.390  
5.144.   In the Panel's view, however, India's explanation suggest s that, under its domestic legal 
system, either the executive or the leg islative branch, or both, as appropriate, must take 
"implementing actions" to incorporate and implement India's international obligations into its 
domestic legal system.391 Given that India's explanation established that India's international law 
obligations  may possibly be acted upon and implemented by certain domestic authorities in India, 
the Panel considered this to suggest that th ese obligations do not have "direct effect" in India.392 
The Panel also saw no basis, either in the text of Article XX(d) or in the Appellate Body's report in 
Mexico – Taxes on Soft Drinks , for drawing a distinction between implementing actions taken by 
the legislative branch versus implementing actions taken by the executive branch, such that the 
question of whether an internation al agreement would be found to have "direct effect" for 
purposes of Article XX(d) would depend on "whether the executive branch, as opposed to the 
legislative branch, takes implementing measures to incorporate them into the domestic legal 
system".393 
5.145.   Like th e Panel, we see no reason to question India's explanation of the allocation of powers 
between the executive and legislative branches under the Constitution of India. We also take note 
of India's submission that the very fact that the executive branch can t ake action to "execute" the 
international instruments or rules at issue, e.g. by enacting the DCR measures, because they are 
not in conflict with domestic legislation shows that these international instruments may already 
form part of its domestic legal sy stem and therefore may be acted upon by the executive 
                                                
387 India's appellant's submission, para. 167.  
388 India's app ellant's submission, paras. 167 -168. India explained before the Panel that, "[u]nder 
Indian law, rules of international law are accommodated into domestic  law without express legislative sanction, 
provided they do not run into conflict with laws enacted by the Parliament". ( Panel Report, para. 7.294 
(quoting India's first written submission to the Panel, para. 180))  
389 India's response to questioning at the oral hearing.  
390 Panel Report, para. 7.297.  
391 Panel Report, para. 7.298.  
392 Panel Report, para. 7.298.  
393 Panel Report, para. 7.299 (quoting Appellate Body Report, Mexico – Taxes on Soft Drinks , para. 79).  WT/DS456/AB/R  
 
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  branch.394 However, the issue of which branch of the Central G overnment has the power to 
implement, execute, or otherwise give effect to an international instrument within the domestic 
legal system is not , in and of itself, determinative of whether such an instrument falls within the 
scope of "laws or regulations" under Article XX(d). Rather, as explained  above, whether a rule set 
out in an international instrument  forms part of the domestic legal system o f a Member and falls 
within the scope of "law s or regulation s" under Article XX(d) has to be determined in light of all the 
relevant factors in a given case, including the characteristics of the instrument at issue and the 
features of the domestic legal sy stem of the Member concerned.  
5.146.   We now turn to consider India's contention that the "direct effect" of the identified 
international instruments under its domestic legal system is established by the fact that 
"the principles of sustainable development under international environmental law have been 
recognized by the Supreme Court of India to be part of the environmental and developmental 
governance in India."395  
5.147.   The Panel noted India's submission that the Supreme Court of India "has held that 
principles of int ernational environmental law, and the concept of sustainable development, 'are 
fundamental to the environmental and developmental governance in India', and 'has also noted 
that the concept of sustainable development is a part of customary international law'".396 In the 
Panel's view, however, India's arguments and evidence do not speak "to the question of whether 
international obligations are automatically incorporated into domestic law and have 'direct effect' 
in India".397 The Panel also recalled India's openi ng statement at the first meeting of the Panel, 
where India, referring to a Decision of the Supreme Court of India, explained:  
The Supreme Court of India, in the context of exercise of the Central Government's 
executive power of establishing a power plant,  recently ruled that the decision -making 
power by the executive in that case was based on the touchstone of sustainable 
development and its impact on ecology following national and international 
environmental principles. The principles on sustainable devel opment in that case were 
inferred from the provisions of several instruments of international environmental law, 
including the [United Nations  Framework Convention on Climate Change] , the principles 
arrived at the other conventions concluded at the United N ations Conference on 
Environment and Development in 1992, including Agenda 21 and the Convention on 
Biological Diversity, as well as the Rio+5 Summit of 1997, which adopted the 
Programme for Further Implementation of Agenda 21. The court did not go into 
whether or not the provisions or principles were legally binding or non -binding in 
nature. It simply noted the relevance of international environmental law, as enshrined 
in several legal instruments that states, in the exercise of their sovereign power, have  
adhered to. It is in exercise of these powers that the policies referred to in India's 
submission were formulated by the Government, including the National [Action Plan 
on Climate Change], the National Electricity Policy.398 
5.148.   While these Decisions and observ ations by the Supreme Court may serve to highlight the 
relevance of the international instruments and rules identified by India for purposes of interpreting 
provisions of India's domestic law, as well as for guiding the exercise of the decision -making powe r 
of the executive branch of the Central G overnment , we do not consider that this is sufficient to 
demonstrate that the international instruments India identified are rules that form part of its 
                                                
394 India's response to questioning at the oral hearing . See also India's appellant's submission, 
para. 167: stating that "[t]he fact that the executive takes 'implementing' actions, does not mean that the 
international law instrument has no direct effect. On the contrary, it is because the international law h as direct 
effect, that the executive wing of the government is required to take implementation action in the first place".  
395 India's appellant's submission, para. 168 (referring to India's first written submission  to the Panel , 
para. 180 and fn 172 thereto ). At the oral hearing, India appeared to suggest that the international 
instruments it had identified can form an independent and exclusive basis for a cause of action before the 
domestic courts of India. This position, however, is not supported by the Pa nel's findings or the Panel record.  
396 Panel Report, para. 7.298 (quoting India's first written submission to the Panel, para. 180, in turn 
referring to Supreme Court of India, Judgment, Vellore Citizens Welfare Forum v. Union of India and Others 
(1996) 5 S CC 647, paras. 10 -15). 
397 Panel Report, para. 7.298.  
398 Panel Report, fn 715 to para. 7.295 (quoting India's opening statement at the first Panel meeting, 
para. 61, in turn referring to Supreme Court of India, Decision , G. Sundarrajan v. Union of India and O thers 
(2013) (6) SCC 620 (Panel Exhibit IND -36 (excerpts)), paras.  161-174).  WT/DS456/AB/R  
 
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  domestic legal system and fall within the scope of "laws or r egulations" under Article  XX(d). To the 
extent that India relies on these Decisions by the Supreme Court to reinforce its point that the 
executive branch, by enacting the DCR measures, was "executing", or giving effect to, the 
international instruments ide ntified by India, we recall that the mere fact that the executive branch 
takes actions in pursuance of the international instruments at issue is not sufficient, in and of 
itself, to demonstrate that such international instruments fall within the scope of " laws or 
regulations" under Article XX(d).  
5.149.   For the above reasons, we uphold  the Panel's finding, in paragraph 7.301 of its Report, 
that India failed to demonstrate that the international instruments identified by it – namely, the 
preamble of the WTO Agreeme nt, the United Nations Framework Convention on Climate Change, 
the Rio Declaration on Environment and Development  (1992) , and UN Resolution A/RES/66/288 
(2012)  (Rio+20 Document: "The Future We Want ") – qualify as " laws or regulations " under  
Article  XX(d) of the GATT 1994 in the present dispute.  
5.3.5   Conclusion  
5.150.   We have found above that , in determining whether a responding party has identified a rule 
that falls within the scope of "laws or regulations" under Article XX(d) of the GATT 1994, a panel 
should evaluate and give due consideration to all the characteristics of the relevant instrument(s) 
and should avoid focusing exclusively or unduly on any single characteristic. In particular, it may 
be relevant for a panel to consider, among others: (i) the degree of nor mativity of the instrument 
and the extent to which the instrument operates to set out a rule of conduct or course of action 
that is to be observed within the domestic legal system of a Member; (ii) the degree of specificity 
of the relevant rule; (iii) whet her the rule is legally enforceable, including, e.g. before a court of 
law; (iv) whether the rule has been adopted or recognized by a competent authority possessing 
the necessary powers under the domestic legal system of a Member; (v) the form and title gi ven 
to any instrument or instruments containing the rule under the domestic legal system of a 
Member; and (vi) the penalties or sanctions that may accompany the relevant rule. In some cases, 
such as those involving a specific, legally enforceable rule unde r a single provision of a domestic 
legislative act, determining whether a respondent has identified "laws or regulations" within the 
meaning of Article XX(d) may be a relatively straightforward exercise. In other cases, however, 
the assessment may be more complex. Importantly, this assessment must always be carried out 
on a case -by-case basis, in light of the specific characteristics and features of the instruments at 
issue, the rule alleged to exist, and the domestic legal system of the Member concerned.  
5.151.   We recall that India has not demonstrated that the passages and provisions of the 
domestic instruments it identified, when read together, set out the obligation "to ensure 
ecologically sustainable growth while addressing India's energy security challenge, a nd ensuring 
compliance with its obligations relating to climate change" , as alleged by India.399 We have also 
concluded that the Panel did not err in finding that India did not demonstrate that the international 
instruments it had identified  fall within the scope of "laws or regulations" under Article  XX(d) in the 
present dispute.400 Consequently , we uphold  the Panel's finding, in paragraph 7.333 of its Report, 
that India has not demonstrated that the DCR measures are measures "to secure compliance with 
laws or  regulations which are not inconsistent with the provisions of [the GATT 1994]", and the 
Panel's ultimate finding, in paragraph 8.2.b of its Report, that the DCR measures are not justified 
under Article XX(d) of the GATT 1994.  
5.4  "Essentiality" and " necessity " under Articles XX( j) and XX( d), and the chapeau of 
Article XX  of the GATT 1994  
5.152.   We recall the Panel's finding that the DCR measures do not involve the acquisition of 
"products in general or local short supply" within the meaning of Article  XX(j) of the GA TT 1994401, 
and that India did not demonstrate that its DCR  measures are measures "to secure compliance 
with laws or regulations" that are not GATT -inconsistent within the meaning of Article  XX(d) of the 
                                                
399 See para. 5.137.  of this Report. We clarify that , while such an obligation may exist under the 
domestic legal system of India, our conclusion is limited to India's failure to de monstrate that the passages and 
provisions of the domestic instruments identified by it set out the obligation alleged by it.  
400 See para. 5.149.  of this Report.  
401 Panel Report, para.  7.265.  WT/DS456/AB/R  
 
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  GATT  1994.402 The Panel therefore considered it unnecess ary to make any additional findings as to 
whether the same measures would be "essential" to the acquisition of solar cells and modules 
within the meaning of Article  XX(j), or "necessary" to secure compliance within the meaning of 
Article  XX(d).403 The Panel explained that , were it to find that the measures at issue "are not 
'essential' or 'necessary'" within the meaning of those provisions, this would merely establish a 
"separate and additional basis for the overall conclusion", which the Panel had already re ached, 
i.e. "that the DCR  measures are not justified under Articles XX(j) or XX(d)".404 The Panel decided, 
however, to continue its review and to make additional findings that may assist the Appellate Body 
should it later be called upon to complete the legal  analysis under either Article  XX(j) or 
Article  XX(d).405 As the Panel pointed out, its approach is consistent with the approach that has 
been taken in the past by other panels.406  
5.153.   With regard to the requirements of the chapeau of Article  XX, the Panel furthe r recalled 
that "India ha[d] failed to demonstrate that the DCR  measures fall within the scope of 
Articles  XX(j) or XX(d)" and that "the arguments that India advance[d] in connection with the 
requirements of the chapeau of Article  XX [were] essentially a r epetition of the arguments that it 
present[ed] in relation to the issue of whether solar cells and modules are 'essential to the 
acquisition or distribution of products in general or local short supply' under Article  XX(j), and 
'necessary to secure complia nce with laws or regulations' under Article  XX(d)."407 Consequently, 
the Panel saw "no compelling reason to proceed with any further examination of the 
DCR measures under the chapeau of Article  XX of the GATT  1994", and therefore refrained from 
doing so.408  
5.154.   We have addressed India's appeal of the Panel 's findings regarding threshold legal 
elements under Articles XX(j) and XX(d) of the GATT  1994 above, and have upheld the Panel's 
finding, in paragraph 7.265 of its Report, that solar cells and modules are not "p roducts in local or 
general short supply" in India, within the meaning of Article XX(j), as well as the Panel's finding, in 
paragraph 7.333 of its Report, that India did not demonstrate that the DCR measures are 
measures "to secure compliance with laws or regulations which are not inconsistent with the 
provisions of [the GATT 1994]" . We have also upheld the Panel's conclusion, in paragraph 8.2.b of 
its Report, that the DCR measures are not justified under either Article XX(j) or Article XX(d) of the 
GATT 19 94.  
5.155.   Given these findings, we do not consider it necessary further  to examine  India's claims on 
appeal pertaining to the Panel's "limited review and analysis" of whether the DCR measures are 
"essential" to the acquisition of solar cells and modules for the  purpose of Article XX(j), or whether 
they are "necessary" within the meaning of Article  XX(d). Nor do we consider it necessary to 
examine  India's arguments as they relate to the requirements of the chapeau of Article XX  of the 
GATT 1994 .  
5.5  Separate opinion  of one Appellate  Body Member  
5.156.   Having upheld the Panel's findings under Article  III:8(a), Article  XX(j) and Article  XX(d) of 
the GATT 1994, the Division hearing this appeal has determined that it is not necessary further to 
address India's claims regarding the remaining legal elements under those provisions. While fully 
agreeing with my colleagues in this regard, I wish to offer some remarks regarding why I consider 
                                                
402 Panel Report, para.  7.333.  
403 Panel Report, para.  7.334.  
404 Panel Report, para.  7.334.  
405 See Panel Report, para.  7.335.  
406 As noted by the Panel, the Appellate Body has confirmed that , "[j]ust as a panel has the discretion to 
address only those claims which must be addressed in  order to dispose of the matter at issue in a dispute, so 
too does a panel have the discretion to address only those arguments it deems necessary to resolve a 
particular claim" . (Appellate Body Report, EC – Poultry , para.  135 (emphasis original) ) The Panel  noted that 
the "logical corollary of this proposition is that a panel has the discretion based on the circumstances of each 
case to address certain claims and arguments even where it is not strictly necessary to do so to resolve the 
matter at issue", and that "the Appellate Body has confirmed that panels have the discretion to make 
alternative findings, including alternative factual findings ." (Panel Report, fn 214 to para. 7.76 (referring to 
Appellate Body Reports, US – Softwood Lumber IV , para.  118; Canada – Wheat Exports and Grain Imports , 
para. 126; China – Auto Parts , para.  208; and US – Carbon Steel (India) , para.  4.274)  (emphasis original))  
407 Panel Report, para.  7.389. (fn omitted)  
408 Panel Report, para.  7.390.  WT/DS456/AB/R  
 
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  that it was appropriate to end our analysis, without further disposing of the other issues ra ised by 
India on appeal. My remarks relate mainly to the adjudicatory function of the Appellate  Body in 
general, and I begin therefore by reflecting on the Appellate  Body's function as contemplated 
under the DSU.  
5.157.   Article  17.1 of the DSU describes the Appel late Body's function in broad terms: to "hear 
appeals from panel cases". In particular, Article  17.12 of the DSU provides that the Appellate  Body 
"shall address" each of the issues raised by the parties to a dispute during an appellate 
proceeding, and Arti cle 17.6 delineates the scope of appeals as "issues of law covered in the panel 
report and legal interpretations developed by the panel". Thus, the Appellate  Body is called upon 
to review any aspect of a panel's analysis, including a panel's legal reasonin g, provided that it has 
been properly raised by the parties on appeal in accordance with Article  17.6. This language in the 
DSU limits the scope of appellate review to the issues raised  by the parties in the context of a 
given dispute. Once raised by the p arties on appeal, however, it is the legal "duty" of the 
Appellate  Body to "address" each of those issues.  
5.158.   In deciding how to "address" each of the issues raised by the parties,  the Appellate  Body is 
guided by certain overarching principles. First, the App ellate  Body, as a part of the WTO dispute 
settlement mechanism, contributes to  the objectives of the "prompt settlement" of a dispute or 
"positive solution to a dispute", which are enunciated in the DSU.409 Thus, the Appellate  Body may, 
for example, decline to make specific findings regarding an issue raised on appeal, and "address" 
the issue only to the extent necessary to ascertain that, in light of the other rulings under a 
different, but related, claim on appeal that resolve the dispute, there was no need  to rule on that 
particular additional issue in question.410 Whether making such an additional finding would serve 
the goal of facilitating the prompt settlement and effective resolution of a dispute is a matter for 
the Appellate  Body to decide in light of t he particular circumstances of each case, including the 
nature of, and relationship between, the relevant claims on appeal, as well as their implications for 
implementation.  
5.159.   In addition, a  necessary incident of the adjudicative function conferred upon the  
Appellate  Body is that it must ensure that the parties have the opportunity fully to present their 
arguments and evidence, and that they enjoy "due process" throughout the appellate 
proceeding.411 Thus, the need to safeguard the due process rights of the pa rties in cases where, 
for example, a particular issue has not been sufficiently explored before the panel is an important 
constraint on the Appellate  Body's ability to rule on particular issues raised on appeal.412 
5.160.   That said, the Appellate  Body's decision on  how to "address" each of the issues on appeal 
should be understood as an extension of its duty to properly exercise its adjudicative function. 
Given the express language contained in Article  17.12 of the DSU, i.e. "shall address", the 
Appellate  Body is no t required to provide reasons as to why it adjudicates a particular issue 
properly raised by the parties on appeal in accordance with Article  17.6 of the DSU. However, 
when the Appellate  Body considers, for example, that further findings on issues appealed  are not 
                                                
409 Article  3.3 of the DSU provides , in this regard , that the aim of the WTO 's dispute settlement system 
is the "prompt settlement of situations in which a Member considers that any benefits accruing to it directly or 
indirectly under the covered agreements are being impaired by measures taken by another Member ". 
Article  3.4 stipulates that DSB recommendations or rulings "shall be aimed at achieving a satisfactory 
settlement of the matter under consideration."  Article  3.7 of the DSU further states that "[t]he aim of the 
dispute settlement mechanism  is to secure a positive solution to a dispute ". 
410 In US – Upland Cotton , the Appellate  Body stated as follows: "although we recognize that there may 
be cases in which it would be useful for us to review an issue, despite the fact that our ruling would not  result 
in rulings and recommendations by the DSB, we find no compelling reason for doing so in this case. " The 
Appellate  Body added that an interpretation of a particular phrase in the SCM Agreement  was "unnecessary for 
purposes of resolving" that dispute . (Appellate  Body Report, US – Upland Cotton , para s. 510-511) In relation 
to another claim in that case, the Appellate  Body stated that it failed to see how an examination of that "claim 
would contribute to the 'prompt' or 'satisfactory settlement' of this  matter or would contribute to 'secure a 
positive solution' to this dispute."  (Appellate  Body Report, US – Upland Cotton , para. 747) 
411 Third parties are conferred relatively more limited rights under Article  10 of the DSU.  
412 See e.g. Appellate  Body Report,  EC – Export Subsidies on Sugar , para.  339, where the 
Appellate  Body observed that "the question of the applicability of the SCM Agreement  to the export subsidies in 
this dispute raises a number of complex issues" and that "in the absence of a full explora tion of these issues, 
completing the analysis might affect the due process rights of the participants".  See also Appellate  Body 
Reports, EC ‒ Seal Products , para . 5.69.  WT/DS456/AB/R  
 
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  necessary in order to facilitate  the prompt settlement and effective resolution of the dispute, it will 
explain this in its report.413  
5.161.   This brings me to Article  3.2 of the DSU, which provides that the "dispute settlement 
system of the WTO … serves … to clarify the existing provisions of [the covered] agreements in 
accordance with customary rules of interpretation of public international law" . As the 
Appellate  Body has noted, there is nothing in Article  3.2 that would encourage "the Appellate  Body 
to 'make law' by clarifying existing provisions of the WTO Agreement outside the context of 
resolving a particular dispute."414 The Appellate  Body cannot be expected to offer interpretative 
guidance regarding provisions of the covered agreements in an abstract  manner beyond the scope 
of what is required in a particular dispute. To do so would go beyond the Appellate  Body's 
adjudicatory function as contemplated under the DSU.  
5.162.   At the same time, WTO Members including the third parties to a dispute have a systemic 
interest in receiving an Appellate  Body report that properly clarifies the existing provisions of the 
covered agreements.415 Moreover , an Appellate  Body report that appropriately disposes of the 
matter at issue, which ultimately serves to clarify the relevan t provisions of the covered 
agreement, is not only required under the DSU, it is also important in that it allows the DSB to 
make sufficiently precise recommendations and rulings "in order to ensure effective resolution of 
disputes to the benefit of all Me mbers".416 
5.163.   Through this separate opinion, I hope to be able to shed light on how I view the 
Appellate  Body's function, as well as its limits, both in the context of the present appeal, as well as 
others on which I have been working with my distinguished coll eagues at the Appellate  Body.  
6  FINDINGS AND CONCLUS IONS  
6.1.  For the reasons set out in this Report, the Appellate Body makes the following findings and 
conclusions.  
6.1  Article III:8(a) of the GATT 1994  
6.2.  With respect to the Panel's finding under Article III:8(a) of  the GATT 1994, we consider that , 
under Article  III:8(a) the product purchased by way of procurement must necessarily be  "like", or 
"directly competitive " with or "substitutable" for – in other words, in a "competitive relationship" 
with – the foreign prod uct subject to discrimination. Although a consideration of inputs and 
processes of production may inform  the question of whether the product purchased is in a 
competitive relationship with the product being discriminated against, it does not displace  the 
competitive relationship standard. The question of whether the cover of Article III:8(a) may also 
extend to discrimination relating to inputs and processes of production used in respect of products 
purchased arises only after the product purchased has been found to be in a competitive 
relationship with the product subject to discrimination. Based on our review of the Panel's analysis 
and approach:  
a. We find that the Panel was properly guided by the Appellate Body report in Canada – 
Renewable Energy / Canada – Feed-in Tariff Program  in finding that the DCR measures 
are not covered by the derogation under Article  III:8(a).  
b. We reject  India's claim that  the Panel acted inconsistently with Article 11 of the DSU in 
assessing India's arguments regarding the scope of a pplication of Article III:8(a) of the 
GATT 1994 .  
                                                
413 See e.g. Appellate  Body Reports, Australia – Salmon , paras. 117 -118; US – Wheat Gluten , 
paras.  80-92; and Canada – Aircraft ( Article  21.5 – Brazil) , paras. 43 -52. In addition, if the Appellate  Body 
considers that it is not i n a position to complete the legal analysis as requested by a party on appeal, for 
instance, due to a lack of sufficient factual findings by a panel, it will state this reason in its Report.  
414 Appellate  Body Report, US – Wool Shirts and Blouses , p. 19, DSR  1997:I, p. 323 at 340 . 
415 The Appellate  Body has explained,  "[w]hile the application of a provision may be regarded as 
confined to the context in which it takes place, the relevance of clarification contained in adopted 
Appellate  Body reports is not limite d to the application of a particular provision in a specific case."  
Appellate  Body report, US ‒ Stainless Steel (Mexico) , para. 160.  
416 Article  21.1 of the DSU.  WT/DS456/AB/R  
 
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  c. Consequently, we  uphold  the Panel's findings, in paragraphs  7.135 and 7.187 of the 
Panel Report that the DCR measures are not covered by the derogation under 
Article  III:8(a) of the GATT  1994 and that, ther efore, the DCR measures are inconsistent 
with Article 2.1 of the TRIM s Agreement and Article III:4 of the GATT 1994 . 
6.3.  India's request for completion of the legal analysis is premised on the condition that we 
reverse the Panel's finding  that the DCR measures  are not covered by the derogation under 
Article  III:8(a)  of the GATT  1994. Having upheld this finding by the Panel, we need not, and do 
not, address India's further claims and related arguments regarding the remaining elements under 
Article III:8(a). We t herefore express no view  on the Panel's reasoning and analysis in this regard.  
6.2  Article XX(j) of the GATT 1994  
6.4.  With respect to the Panel's findings under Article XX(j) of the GATT 1994, we consider that, in 
assessing whether products are "in general or loca l short supply" within the meaning of 
Article  XX(j), a panel should examine the extent to which a particular product is "available" for 
purchase in a particular geographical area or market, and whether this is sufficient to meet 
demand in the relevant area  or market. This analysis  may, in appropriate cases, take into account 
not only the level of domestic production of a particular product and the nature of the products 
that are alleged to be "in general or local short supply", but also such factors as the relevant 
product and geographic market , potential price fluctuations in the relevant market, the purchasing 
power of foreign and domestic consumers, and the role that foreign and domestic producers play 
in a particular market, including the extent to which  domestic producers sell their production 
abroad. Due regard should be given to the total quantity of imports that may be "available" to 
meet demand in a particular geographical area or market. It may thus be relevant to consider the 
extent to which intern ational supply of a product is stable and accessible, including by examining 
factors such as the distance between a particular geographical area or market and production 
sites, as well as the reliability of local or transnational supply chains. Whether and  which factors 
are relevant will necessarily depend on the particularities of each case. Just as there may be 
factors that have a bearing on "availability" of imports in a particular case, it is also possible that, 
despite the existence of manufacturing ca pacity, domestic products are not "available" in all parts 
of a particular country, or are not "available" in sufficient quantities to meet demand. In all cases, 
the responding party has the burden of demonstrating that the quantity of "available" supply f rom 
both domestic and international sources in the relevant geographical market is insufficient to meet 
demand .  
a. We therefore disagree  with India to the extent that it argues that "short supply" can be 
determined without regard to whether supply from all s ources is sufficient to meet 
demand in the relevant market.  
b. We reject  India's claim that the Panel acted inconsistently with Article  11 of the DSU. As 
we see it, India's claim under Article 11 of the DSU relies for its validity on India's 
reading of Articl e XX(j), and in particular India's contention that the existence of a 
situation of "short supply" within the meaning of Article XX(j) is to be determined 
exclusively by reference to whether there is "sufficient" domestic manufacturing of a 
given product. T he fact that India does not agree with the conclusion the Panel reached 
does not mean that the Panel committed an error amounting to a violation of Article 11 
of the DSU.  
c. Consequently, we uphold  the Panel's finding, in paragraph 7.265 of the Panel Report, 
that solar cells and modules are not "products in general or local short supply" in India 
within the meaning of Article XX(j) of the GATT  1994, and the Panel's ultimate finding, in 
paragraph 8.2.b of its Report, that the DCR measures are not justified unde r 
Article  XX(j) of the GATT 1994 . 
6.5.  Having upheld the Panel's finding, in paragraph 7.265 of the Panel Report, that solar cells 
and modules are not "products in local or general short supply" in India, within the meaning of 
Article XX(j), we do not consider it necessary further to examine  India's claims on appeal 
pertaining to the Panel's "limited review and analysis" of whether India's DCR measures are 
"essential" to the acquisition of solar cells and modules for the purpose of Article XX(j). Nor do we WT/DS456/AB/R  
 
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  consider it necessary to examine  India's arguments as they relate to the requirements of the 
chapeau of Article XX of the GATT 1994.  
6.3  Article XX(d) of the GATT 1994  
6.6.  With respect to the Panel's findings under Article XX(d) of the GATT 1994, we consider that , 
in determining whether a responding party has identified a rule that falls within the scope of "laws 
or regulations" under Article XX(d) of the GATT 1994, a panel should evaluate and give due 
consideration to all the characteristics of the relevant instrument( s) and should avoid focusing 
exclusively or unduly on any single characteristic. In particular, it may be relevant for a panel to 
consider, among others: (i) the degree of normativity of the instrument and the extent to which 
the instrument operates to set  out a rule of conduct or course of action that is to be observed 
within the domestic legal system of a Member; (ii) the degree of specificity of the relevant rule; 
(iii) whether the rule is legally enforceable, including, e.g. before a court of law; (iv) whether the 
rule has been adopted or recognized by a competent authority possessing the necessary powers 
under the domestic legal system of a Member; (v) the form and title given to any instrument or 
instruments containing the rule under th e domestic legal  system of a  Member; and (vi) the 
penalties or sanctions that may accompany the relevant rule. Importantly, this assessment must 
always be carried out on a case -by-case basis, in light of the specific characteristics and features 
of the instruments at issu e, the rule alleged to exist, as well as the domestic legal system of the  
Member concerned.  
a. We therefore find that India has not demonstrated that the passages and provisions of 
the domestic instruments identified by India, when read together, set out the rule "to 
ensure ecologically sustainable growth while addressing India's energy security 
challenge, and ensuring compliance with its obligations relating to climate change", as 
alleged by India.  
b. We find that that the Panel did not err in finding that India  failed to demonstrate that the 
international instruments it identified  fall within the scope of "laws or regulations" under 
Article  XX(d) in the present dispute.  
c. Consequently, we uphold  the Panel's finding, in paragraph 7.333 of the Panel  Report, 
that Ind ia has not demonstrated that the DCR measures are measures "to secure 
compliance with laws or regulations which are not inconsistent with the provisions of 
[the GATT 1994]", and the Panel's ultimate finding, in paragraph 8.2.b of the Panel  
Report, that the  DCR measures are not justified under Article XX(d) of the GATT 1994.  
6.7.  Having upheld the Panel's finding, in paragraph 7.333 of the Panel  Report, that India did not 
demonstrate that the DCR measures are measures "to secure compliance with laws or regulation s 
which are not inconsistent with the provisions of [the GATT 1994]", we do not consider it 
necessary further to examine  India's claims on appeal pertaining to the Panel's "limited review and 
analysis" of whether the DCR measures are "necessary" within the  meaning of Article  XX(d). Nor 
do we consider it necessary to examine  India's arguments as they relate to the requirements of 
the chapeau of Article XX of the GATT 1994.  
6.8.  The Appellate Body recommends  that the DSB request India to bring its measures, found in 
this Report, and in the Panel Report as modified by this Report, to be inconsistent with the TRIMs 
Agreement and the GATT 1994, into conformity with its obligations under those Agreements.