RESTRICTED  
  
WT/DSB/M/392  
 
5 April 2017 
(17-1852) Page: 1/17 
Dispute Settlement Body  
20 February 2017    
 
 MINUTES OF MEETING  
HELD IN THE CENTRE W ILLIAM RAPPARD  
ON 20 FEBRUARY 2017  
Chairman: Mr. Xavier  Carim  (South Africa ) 
Prior to the adoption of Agenda , the item concerning the adoption of the Panel Report in the 
dispute on "Russia - Anti-Dumping Duties on Lig ht Commercial Vehicles from Germany and Italy"  
(DS479) was removed from the proposed Agenda following the Russian  Federation's decision to 
appeal the Report.  
 
Table of Contents  
1   SURVEILLANCE OF I MPLEMENTATION OF REC OMMENDATIONS ADOPTED  BY 
THE DSB ................................ ................................ ................................ ...........................  2 
A.  United  States – Anti-dumping measures on certain hot -rolled steel products from 
Japan: Status report by the United  States  ................................ ................................ ..............  2 
B.  United  States – Section 110(5) of the US Copyright Act: Status report by 
the United  States  ................................ ................................ ................................ ................  3 
C.  European  Communities – Measures affec ting the approval and marketing of biotech 
products: Status report by the European  Union ................................ ................................ ....... 3 
2   CANADA – ANTI -DUMPING MEASURES ON IMPORTS OF CERTAIN C ARBON 
STEEL WELDED PIPE FR OM THE SEPARATE C USTOMS TERRITORY OF TAIWAN, 
PENGHU, KINMEN AND M ATSU  ................................ ................................ .........................  4 
A.  Implementation of the recommendations of the DSB  ................................ ..........................  4 
3   UNITED  STATES – CONTINUED DUMPING AN D SUBSIDY OFFSET ACT  
OF 2000: IMPLEMENTATION  OF THE RECOMMENDATIO NS ADOPTED BY THE  DSB ...........  4 
A.  Statement by the European  Union  ................................ ................................ ....................  4 
4   CHINA – CERTAIN MEASURES AFF ECTING ELECTRONIC PA YMENT SERVICES  .............  5 
A.  Statement by the United  States  ................................ ................................ .......................  5 
5   MOROCCO – ANTI -DUMPING MEASURES ON CERTAIN HOT -ROLLED STEEL 
FROM TURKEY  ................................ ................................ ................................ ..................  6 
A.  Request for the establishment of a panel by Turkey  ................................ ............................  6 
6   UNITED  STATES – CERTAIN MEASURES REL ATING TO THE RENEWAB LE 
ENERGY SECTOR  ................................ ................................ ................................ ..............  6 
A.  Request for the establishment of a panel by India  ................................ ..............................  6 
7   RUSSIA – MEASURES CONCERNING TRAFFIC IN TRANSIT  ................................ ..........  7 
A.  Request for the establishment of a panel by Ukraine  ................................ ..........................  7 
8   COLOMBIA – MEASURES RELATING TO  THE IMPORTATION OF T EXTILES, 
APPAREL AND FOOTWEAR  ................................ ................................ ................................  8 
A.  Recourse to Article 22.2 of the DSU by Panama  ................................ ................................ . 8 WT/DSB/M/392  
 
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 9   COLOMBIA – MEASURES RELATING TO  THE IMPORTATION OF T EXTILES, 
APPAREL AND FOOTWEAR  ................................ ................................ ..............................  13 
A.  Recourse to Article  21.5 of the DSU by Colombia: Request for the establishment 
of a panel  ................................ ................................ ................................ ......................... 13 
10   PROPOSED NOMINATIONS  FOR THE INDICATIVE L IST OF GOVERNMENTAL 
AND NON -GOVERNMENTAL PANELIS TS ................................ ................................ ..........  16 
11   APPELLATE BODY APPOI NTMENTS  ................................ ................................ ..........  16 
A. Statement by the Chairman  ................................ ................................ ............................. 16 
12   DISPUTE SETTLEMENT W ORKLOAD  ................................ ................................ .........  17 
A.  Statement by the Chairman  ................................ ................................ ............................ 17 
 
 
1  SURVEILLANCE OF IMPL EMENTATION OF RECOMM ENDATIONS ADOPTED BY  THE DSB 
A.  United  States – Anti-dumping measures on certain hot -rolled steel products from Japan: Status 
report by the United  States (WT/DS184/15/Add.169)  
 
B.  United  States – Section 110(5) of the US Copyright Act: Status report by the United  States 
(WT/DS160/24/Add.144)  
 
C.  European  Communities – Measures affecting the approval and marketing of biotech products: 
Status report by the European  Union (WT/DS291/37/Add.107)  
 
 
1.1.  The Chairman  noted that there were three sub -items under the Agenda item concerning 
status reports submitted by delegations pursuant to Article  21.6 of the DSU. He recalled that 
Article  21.6 requi red that: "Unless the DSB decides otherwise, the issue of implementation of the 
recommendations or rulings shall be placed on the Agenda of the DSB meeting after six  months 
following the date of establishment of the reasonable period of time and shall rema in on the DSB's 
Agenda until the issue is resolved". Under this Agenda item, the Chairman invited delegations to 
provide up -to-date information about compliance efforts and to focus on new developments, 
suggestions and ideas on progress towards the resolut ion of disputes. He also reminded 
delegations that, as provided for in Rule  27 of the Rules of Procedure for DSB meetings: 
"Representatives should make every effort to avoid the repetition of a full debate at each meeting 
on any issue that has already been  fully debated in the past and on which there appears to have 
been no change in Members' positions already on record". He then turned to the first status report 
under this Agenda item.  
A.  United  States – Anti-dumping measures on certain hot -rolled steel p roducts from 
Japan: Status report by the United  States (WT/DS184/15/Add.169)  
1.2.  The Chairman  drew attention to document WT/DS184/15/Add.169, which contained the 
status report by the United  States on progress in the implementation of the DSB's 
recommendations in the case concerning US  anti-dumping measures on certain hot -rolled steel 
products from Japan.  
1.3.  The representative of the United  States  said that the United  States  had provided a status 
report in this dispute  on 9 February  2017, in accordance with Article  21.6 of the DSU. The 
United  States had addressed the DSB's recommendations and rulings with respect to the 
calculation of anti -dumping margins in the hot -rolled steel anti -dumping duty investigation at 
issue. With respect to the recommendations and ruling s of the DSB that had yet to be addressed, 
the US Administration would work with the US  Congress with respect to appropriate statutory 
measures that would resolve this matter.  WT/DSB/M/392  
 
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 1.4.  The representative of Japan  said that his country thanked the United  States for its statement 
and its status report. Japan called on the United  States to fully implement the DSB's 
recommendations and rulings in order to resolve this matter.  
1.5.  The DSB took note  of the statements and agreed  to revert to this matter at its next regular 
meeting. 
B.  United  States – Section 110(5) of the US Copyright Act: Status report by 
the United  States (WT/DS160/24/Add.144)  
1.6.  The Chairman  drew your attention to document WT/DS160/24/Add.144, which contained the 
status report by the United  States on progress in the implementation of the DSB's 
recommendations in the case concerning Section  110(5) of the US Copyright Act.  
1.7.  The representative of the United  States  said that the United  States  had provided a status 
report in this dispute on 9  February  2017, in accord ance with Article  21.6 of the DSU. The 
US Administration would continue to confer with the EU, and to work closely with the US  Congress, 
in order to reach a mutually satisfactory resolution of this matter.  
1.8.  The representative of the European  Union  said that  his delegation thanked the United  States 
for its status report and its statement made at the present meeting. The EU referred to its 
previous statements and said that it would like to resolve this dispute as soon as possible.  
1.9.  The DSB took note  of the stat ements and agreed  to revert to this matter at its next regular 
meeting.  
C.  European  Communities – Measures affecting the approval and marketing of biotech 
products: Status report by the European  Union (WT/DS291/37/Add.107)  
1.10.   The Chairman  drew attention to d ocument WT/DS291/37/Add.107, which contained the 
status report by the European  Union on progress in the implementation of the DSB's 
recommendations in the case concerning measures affecting the approval and marketing of 
biotech products.  
1.11.   The representative  of the European  Union  said that the draft authorisation decision for one 
type of genetically modified maize1 (for food and feed uses) had been submitted for a vote at the 
member States committee on 27  January  2017. The draft proposals for the authorisatio n of three 
types of maize2 (for cultivation) had also been submitted for a vote at the member States 
committee on 27  January  2017. The EU said that it continued to be committed to acting in line 
with its WTO obligations. More generally, and as it had state d previously on many occasions, the 
EU recalled that the EU approval system was not covered by the DSB's recommendations and 
rulings.  
1.12.   The representative of the United  States  said that the United  States  thanked the EU for its 
status report and its statement  made at the present meeting. The EU measures affecting the 
approval and marketing of biotech products continued to be characterized by lengthy, 
unpredictable, and unexplained delays in approvals. For example, the EU's scientific review 
process had slowed in recent years. Many corn and soybean products had now been under 
consideration by the EU's scientific authority for several years. Furthermore, the EU had recently 
proposed regulations that created more, rather than less, uncertainty with regard to the 
information required for scientific evaluation of biotech products. The United  States encouraged 
the EU to ensure that only the scientific information  relevant to  environmental risk  assessments 
was required  to be provided to  the EU's scientific authority, a nd only by those applicants who 
sought authorization to conduct field trials or participate in cultivation of biotech products. The 
delays  and uncertainty in   approvals  caused  adverse effects on  trade, particularly with respect  to 
                                                
1 Maize Bt11 × 59122 × MIR604 × 1507 × GA21.  
2 Bt11, 1507 and MON810 (renewal) . WT/DSB/M/392  
 
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 soybeans and corn. Th e United  States encouraged the EU to ensure that products in the biotech 
approval pipeline moved forward in a timely manner, as required by EU regulations and WTO rules.  
1.13.   The DSB took note  of the statements and agreed  to revert to this matter at its next re gular 
meeting.  
2  CANADA – ANTI -DUMPING MEASURES ON IMPORTS OF CERTAIN C ARBON STEEL 
WELDED PIPE FROM THE  SEPARATE CUSTOMS TER RITORY OF TAIWAN, PE NGHU, 
KINMEN AND MATSU  
A.  Implementation of the recommendations of the DSB  
2.1.  The Chairman  recalled that, in accorda nce with the DSU provisions, the DSB was required to 
keep under surveillance the implementation of recommendations and rulings of the DSB in order to 
ensure effective resolution of disputes to the benefit of all Members. In this respect, Article  21.3 of 
the DSU provided that the Member concerned had to inform the DSB, within 30  days after the date 
of adoption of the panel or Appellate Body report, of its intentions in respect of implementation of 
the recommendations and rulings of the DSB. The Chairman reca lled that, at its meeting on 
25 January  2017, the DSB had adopted the Panel Report in the dispute on: "Canada – 
Anti-Dumping Measures on Imports of Certain Carbon Steel Welded Pipe from the Separate 
Customs Territory of Taiwan, Penghu, Kinmen and Matsu". H e then invited the representative of 
Canada to inform the DSB of its intentions in respect of implementation of the DSB's 
recommendations.  
2.2.  The representative of Canada  recalled that the DSB had adopted the Panel Report in the 
"Canada – Welded Pipe" dispute  (DS482) at the 25  January  2017 DSB meeting. Pursuant to 
Article  21.3 of the DSU, Canada wished to inform the DSB that it intended to implement the 
recommendations and rulings of the DSB in DS482 within a reasonable period of time. Canada also 
wished to in form the DSB that Canada and Chinese  Taipei had reached an agreement, pursuant to 
Article  21.3(b) of the DSU, that the reasonable period of time in this dispute would be 14  months. 
Therefore, it would expire on 25  March  2018. That agreement had been circul ated to Members in 
document WT/DS482/6. Canada thanked Chinese  Taipei for the constructive dialogue that had 
taken place during the negotiations for determining the length of the reasonable period of time to 
comply.  
2.3.  The representative of Chinese  Taipei  said that his delegation confirmed the statement made 
by Canada regarding the agreement reached by the parties on a reasonable period of time of 
14 months, and said that it stood ready to work closely with Canada towards a prompt settlement 
of this dispute.  
2.4.  The DSB took note  of the statements, and of the information provided by Canada regarding 
its intentions in respect of implementation of the DSB's recommendations.  
3  UNITED  STATES – CONTINUED DUMPING AN D SUBSIDY OFFSET ACT  OF 2000: 
IMPLEMENTATION OF TH E RECOMM ENDATIONS ADOPTED BY  THE DSB 
A.  Statement by the European  Union  
3.1.  The Chairman  said that this item was on the Agenda of the present meeting at the request of 
the European  Union and invited the representative of the European  Union to speak.  
3.2.  The representativ e of the European  Union  said that  his delegation, once again, requested the 
United  States to stop transferring anti -dumping and countervailing duties to the US industry. Every 
disbursement that still took place was clearly an act of non -compliance with the  DSB's 
recommendations and rulings. The EU renewed its call on the United  States to abide by its clear 
obligation under Article  21.6 of the DSU to submit status reports on implementation in this 
dispute. The EU would continue to place this matter on the DS B Agenda for as long as the 
United  States had not implemented the WTO rulings.  WT/DSB/M/392  
 
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 3.3.  The representative of Brazil  said that his country thanked the EU for keeping this item on the 
Agenda of the DSB. As a party to the Byrd Amendment disputes, Brazil referred to i ts previous 
statements on this matter. In particular, Brazil wish ed to refer to its statements regarding the 
continuation of illegal disbursements, which should cease immediately. Brazil renewed its calls on 
the United  States to fully comply with the DSB's  recommendations and rulings in th ese disputes. 
Until then, the United  States was under an obligation to submit status reports, pursuant to 
Article  21.6 of the DSU.  
3.4.  The representative of Canada  said that his country thanked the EU for putting this item on 
the Agenda of the DSB. Canada shared their view that the Byrd Amendment should be kept under 
the surveillance of the DSB until the United  States stopped applying it.  
3.5.  The representative of China  said that her country thanked the EU for placing this item on the 
Agenda of the present meeting. China urged the United  States to fully implement the DSB's 
recommendations and rulings on this matter as soon as possible.  
3.6.  The representative of the United  States  said that, as the United  States  had noted at previous 
DSB meetings, the Deficit Reduction Act – which included a provision repealing the Continued 
Dumping and Subsidy Offset Act of 2000 – had been enacted into law in February  2006. 
Accordingly, the United  States had taken all actions necessary to implement the DS B's 
recommendations and rulings in these disputes. The United  States recalled, furthermore, that the 
EU had acknowledged that the Deficit Reduction Act did not permit the distribution of duties 
collected on goods entered after 1  October  2007, over nine yea rs ago. With respect to the EU's 
request for status reports in this matter, as the United  States had already explained at previous 
DSB meetings, there was no obligation under the DSU to provide further status reports once a 
Member announced that it had imp lemented the DSB recommendations and rulings, regardless of 
whether the complaining party disagreed about compliance. Indeed, the EU had demonstrated 
repeatedly that it shared this understanding, at least when it was the responding party in a 
dispute, such  as in the "EC – Large Civil Aircraft" (DS316) dispute. The United  States said that if 
the EU disagreed, it could demonstrate this different understanding by submitting a status report 
in DS316 for the DSB meeting on 21  March  2017.  
3.7.  The DSB took note  of the  statements.  
4  CHINA – CERTAIN MEASURES AFF ECTING ELECTRONIC PA YMENT SERVICES  
A.  Statement by the United  States  
4.1.  The Chairman  said that this item was on the Agenda of the present meeting at the request of 
the United  States and invited the representative of t he United  States to speak.  
4.2.  The representative of the United  States  said that the DSB had adopted its recommendations 
in this dispute in August  2012, and that the reasonable period of time had long since expired. 
China had issued a regulation several months  before that purported to set out a licensing 
application process for foreign EPS suppliers. However, the only entity authorized to provide 
electronic payment services (EPS) in China remained a business set up by the People's Bank of 
China and other Chines e Government -related entities. The United  States urged China to ensure 
that foreign EPS suppliers could apply for and receive permission to operate in China, in 
accordance with China's WTO obligations.  
4.3.  The representative of China  said that her country regr etted that the United  States had, once 
again, brought this matter before the DSB. China referred to its statements made at previous 
meetings and emphasized that it had taken all necessary actions and had fully implemented the 
DSB's recommendations and ruli ngs in this dispute.  
4.4.  The DSB took note  of the statements.  WT/DSB/M/392  
 
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 5  MOROCCO – ANTI -DUMPING MEASURES ON CERTAIN HOT -ROLLED STEEL FROM 
TURKEY  
A.  Request for the establishment of a panel by Turkey (WT/DS513/2)  
5.1.  The Chairman  recalled that the DSB had considered this mat ter at its meeting on 
25 January  2017 and had agreed to revert to it. He drew attention to the communication from 
Turkey contained in document WT/DS513/2, and invited the representative of Turkey to speak.  
5.2.  The representative of Turkey  recalled that at the 25 January  2017 DSB meeting, Turkey had 
requested, for the first time, the establishment of a panel to examine the anti -dumping duties 
imposed by Morocco on imports of certain hot -rolled steel from Turkey. At the present meeting, 
Turkey was requesting the establishment of a panel for a second time. Turkey reiterated that 
Morocco's anti -dumping duties on imports of certain hot -rolled steel from Turkey were not in 
compliance with Morocco's WTO obligations, as had been explained in detail in Turkey's panel 
request. Furthermore, these duties had already had significant effects on Turkish exports of these 
products. Turkey said that it had hoped that this matter could have been resolved without the 
need to go to the panel stage. Unfortunately, this had not been th e case and Turkey had to ensure 
that its rights under the Anti -Dumping Agreement were properly secured. Turkey was, therefore, 
requesting the DSB to establish a panel, with standard terms of reference, to address the matters 
set out in its panel request.  
5.3.  The representative of Morocco  said that his country regretted that Turkey was requesting, for 
the second time, the establishment of a panel in this dispute. Morocco stressed that it had done 
what it could to resolve this dispute through consultations, and r emained ready to pursue those 
consultations in order to reach a mutually acceptable solution. Indeed, Morocco had contacted 
Turkey after the 25  January  2017 DSB meeting in order to resume consultations in a constructive 
spirit and to seek a solution in the  interest o f both parties. However, Morocco had received no 
response to its request. Over the past few years, Morocco's steel plate industry had been seriously 
undermined by imports at abnormally low prices, leading the Moroccan authorities to conduct an 
objective and unbiased anti -dumping investigation, in accordance with the relevant regulations. 
Following that investigation, an anti -dumping duty had been adopted in conformity with Morocco's 
obligations under the Anti -Dumping Agreement. Notwithstanding th ese considerations, if, after the 
present meeting, a panel was established under Article  6.1 of the DSU, Morocco would provide the 
necessary explanations and to defend the conformity of its measure before that panel. Morocco 
believed that it had violated n either the provisions of the Anti -Dumping Agreement, nor those of 
the Agreement on Import Licensing Procedures.  
5.4.  The DSB took note  of the statements and agreed  to establish a panel in accordance with the 
provisions of Article  6 of the DSU with standard term s of reference.  
5.5.  The representatives of China , Egypt , the European  Union , India, Japan , Kazakhstan , Korea , 
the Russian  Federation , Singapore  and the United  States  reserved their third -party rights to 
participate in the Panel's proceedings.  
6  UNITED  STATES – CERTAIN MEASURES RELA TING TO THE RENEWABL E ENERGY 
SECTOR  
A.  Request for the establishment of a panel by India (WT/DS510/2)  
6.1.  The Chairman  drew attention to the communication from India contained in document 
WT/DS510/2, and invited the representative of India  to speak.  
6.2.  The representative of India said that the United  States maintained certain renewable energy 
programmes which promoted domestic content requirements (DCR) through incentives. India had, 
in the past, made sincere efforts to understand the nature o f some of these programmes through 
clarificatory questions before the TRIMs and SCM Committees. These efforts had not yielded 
satisfactory responses. Subsequently, on 9  September  2016, India had requested consultations 
with the United  States. These consult ations had been held on 16 -17 November  2016 and had, 
unfortunately, failed to resolve these issues. As a result, India was now requesting the 
establishment of a panel, in accordance with the provisions of the DSU, to resolve this dispute. WT/DSB/M/392  
 
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 India said that i t was mindful that climate change was a real threat and the global community had 
to take all necessary steps to protect the planet for future generations. In this regard, constructive 
efforts made thus far by the global community had been commendable. Past  experience showed 
that, for the purpose of long -run energy security, there was need for in -house capacity 
development for manufacturing of equipment for generation of renewable energy. This was 
required, at least to some extent, to avoid an international crisis. Hence, India said that it believed 
that every country needed to have policy space to build such manufacturing capacity within its 
own territory. However, Members would also have to be mindful of their WTO obligations. India 
said that it believed th at certain renewable energy programmes maintained by the United  States, 
which were the subject matter of India's panel request, fell short of the same and were not 
consistent with WTO disciplines on non -discrimination and subsidies.  
6.3.  India had identified el even Renewable Energy Programmes in its panel request. This formed 
the basis of the present dispute. A brief description of these programmes and the legal basis for 
India's claims formed part of the panel request. Each of these programmes offered certain 
subsidies to targeted recipients which appeared to be conditioned upon use of local content in the 
production process of the concerned goods. Members were aware that subsidies which were 
contingent on local content requirements had trade distortionary effec ts and were not only 
prohibited under the SCM  Agreement, but were also inconsistent with Article  III of the GATT  1994 
as well as Article  2.1 of the TRIMs Agreement. Therefore, India said that it was concerned with the 
identified programmes which negated be nefits to WTO Members. Since the consultations had not 
resolved this dispute, India was requesting that the DSB establish a panel, in accordance with 
Article  6 of the DSU, to examine the matter set out in India's panel request and make appropriate 
findings  for the early resolution of the dispute.  
6.4.  The representative of the United  States  said that the United  States  was disappointed that 
India had sought the establishment of a panel in this matter. It appeared that India had launched 
this dispute for purely po litical reasons. Indeed, Indian government officials had been quoted as 
characterizing this dispute as motivated by the DSB's findings in the DS456 dispute that the 
domestic content requirements under India's National Solar Mission were contrary to WTO rul es, a 
complaint brought by the United  States. Article  3.10 of the DSU made clear that the "use of the 
dispute settlement" mechanism should be made "in good faith" and that "complaints and counter -
complaints […] [in distinct matters] should not be linked". India did not export significant amounts 
of renewable energy equipment to the United  States, and the state -level programs identified in 
India's request appeared to have virtually no effect on commerce. At a time when WTO dispute 
settlement resources were s tretched thin, the United  States said that it regretted that India would 
seek to use WTO resources on such a matter. For all these reasons, the United  States did not 
agree to the establishment of a panel at the present meeting.  
6.5.  The DSB took note  of the sta tements and agreed  to revert to this matter.  
7  RUSSIA – MEASURES CONCERNING TRAFFIC IN TRANSIT  
A.  Request for the establishment of a panel by Ukraine (WT/DS512/3)  
7.1.  The Chairman  drew attention to the communication from Ukraine contained in document 
WT/DS512/3 , and invited the representative of Ukraine to speak.  
7.2.  The representative of Ukraine  said that his country was requesting the establishment of a 
panel, pursuant to Article  6 of the DSU, to examine the measures imposed by the 
Russian  Federation on traffic in  transit from Ukraine, through Russia, to third countries. Since 
1 January  2016, Russia had imposed measures which required traffic in transit from Ukraine to 
Kazakhstan, through Russia, to be carried out exclusively from Belarus. Since 1  July 2016 the 
same applied to traffic in transit from Ukraine to the Kyrgyz Republic. In addition, traffic in transit 
from Ukraine had to comply with the application of identification means (seals) and the use of 
registration cards for drivers. Furthermore, as of 1  July 2016, Russia had imposed a ban on the 
transit of a substantial number of goods through its territory via the above -mentioned transit 
routes. Russia had also imposed other measures concerning traffic in transit, from Ukraine to third 
countries, through its te rritory. All these measures on traffic in transit had not only had 
detrimental economic consequences on Ukraine, they were also inconsistent with several 
provisions of the GATT  1994 and the WTO Protocol on the Accession of the Russian  Federation. WT/DSB/M/392  
 
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 Ukraine h ad requested consultations with Russia on 14  September  2016. These consultations had 
been held on 10  November  2016, but, unfortunately, had failed to settle the dispute. Since the 
measures remained in force and continued to violate several WTO obligations,  Ukraine was 
requesting the establishment of a panel, with standard terms of reference.  
7.3.  The representative of the Russian  Federation  said her country wished to express its strong 
disappointment with Ukraine's decision to request the establishment of a pane l in this dispute. 
Ukraine had filed its request for consultations on 14  September  2016, and these consultations had 
been held on 10  November  2016. In the course of the consultations Russia had responded to the 
relevant questions and provided necessary cla rifications. Notably, Russia had affirmed its 
continuing respect for WTO rules and its accession commitments. As provided for in the DSU, 
before bringing a case, a Member had to exercise its judgment as to whether an action under 
these procedures would be fruitful. In Russia's view, actions by Ukraine did not meet these criteria. 
For this reason, Russia was not in a position to accept the establishment of a panel at the present 
meeting.  
7.4.  The representative of the European  Union  said that his delegation noted  that the request for 
panel establishment related, inter alia, to traffic in transit from the territory of Ukraine through the 
territory of the Russian  Federation to certain third countries. Due to its geographical location, the 
EU was a major user of tran sit routes addressed in the panel request. In particular, the EU was a 
major exporter to Kazakhstan and to the Kyrgyz  Republic. Furthermore, the measures at issue, as 
characterized by Ukraine in its request, affected not only goods of Ukrainian origin, but  also goods 
originating in third countries, including in the EU. The EU had already expressed its strong 
concerns about these measures in other WTO fora, such as the Council for Trade in Goods. The EU 
said that it regretted that the consultations between R ussia and Ukraine had failed to settle this 
dispute and that the measures at issue still remained in place. The EU would continue to follow this 
dispute very closely and would reserve its third - party rights in the Panel's proceedings.  
7.5.  The DSB took note  of the statements and agreed  to revert to this matter.  
8  COLOMBIA – MEASURES RELATING TO  THE IMPORTATION OF T EXTILES, APPAREL 
AND FOOTWEAR  
A.  Recourse to Article 22.2 of the DSU by Panama (WT/DS461/16)  
8.1.  The Chairman  drew attention to the communication from Pan ama contained in document 
WT/DS461/16, and invited the representative of Panama to speak.  
8.2.  The representative of Panama  recalled that on 25  September  2013 the DSB had established a 
panel, at the request of Panama, to examine the compound tariff imposed by C olombia on imports 
of textile, apparel and footwear products. In examining this matter, both the Panel and the 
Appellate Body had found that the measure violated the GATT  1994. On 22  June 2016, the DSB 
had adopted the Panel Report, as modified by the Appel late Body Report, recommending that 
Colombia bring the measure at issue into conformity with the GATT  1994. The arbitrator had 
subsequently determined that the "reasonable period of time" for Colombia to implement the DSB 
recommendations and rulings would expire on 22  January  2017. On 2  November  2016, Colombia 
had adopted two decrees that affected the tariff and customs regime for the importation of 
textiles, apparel and footwear. In Panama's view, however, these legislative acts, far from bringing 
the meas ure into conformity with Colombia's WTO obligations, perpetuated the nullification and 
impairment of benefits accruing to Panama directly or indirectly under the GATT  1994. Article  22 of 
the DSU provided that, in the event that the recommendations were not  implemented within the 
"reasonable period of time", the parties to a dispute could attempt to negotiate mutually 
acceptable compensation, or the prevailing party could be authorized by the DSB to suspend 
concessions and obligations. Panama had requested a  meeting to that end, which had taken place, 
but the parties had not reached an agreement on satisfactory compensation. Article  22.2 of the 
DSU provided that if no satisfactory compensation had been agreed within 20  days after the date 
of expiry of the "re asonable period of time", a prevailing party could request authorization from 
the DSB to suspend the application of concessions and obligations to the party that had failed to 
implement the DSB's recommendations and rulings.  WT/DSB/M/392  
 
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 8.3.  Article  22.6 of the DSU require d the DSB to grant such authorization within 30  days of the 
expiry of that period, unless there was consensus to reject the request. Colombia's failure to bring 
its measure into conformity with its WTO obligations by complying with the DSB recommendations 
and rulings in this matter had resulted in a loss for Panama of US$210 million worth of exports of 
textile, apparel and footwear products. In accordance with Article  22.2 of the DSU, Panama was 
requesting authorization from the DSB to suspend the applicati on to Colombia of concessions or 
other obligations covering trade in the amount of US$210 million. In considering what concessions 
or other obligations to suspend, Panama had applied the principles and procedures set forth in 
Article  22.3 of the DSU, and h ad submitted its request pursuant to Article  22.3(c) of the DSU. The 
request was based on the fact that, for Panama, the suspension of concessions or other obligations 
with respect to the goods sector only would be problematic. In Panama's view, a measure of this 
kind would affect sensitive sectors of the Panamanian economy that needed Colombian imports, 
including the energy, agriculture, health and construction sectors, which accounted for a 
considerable share of Panama's gross domestic product. Considerin g that the circumstances were 
sufficiently serious, and that it was not practicable or effective to suspend concessions or other 
obligations with respect to the goods sector only, Panama was requesting authorization from the 
DSB to suspend concessions or o ther obligations under the Trade in Goods, Services and TRIPS. As 
required by Article  22.4 of the DSU, the level of suspension proposed was equivalent on an annual 
basis to the nullification or impairment of benefits accruing to Panama, resulting from Colo mbia's 
failure to comply with the DSB's recommendations and rulings.  
8.4.  The representative of Colombia  said that his country regretted Panama's request for the 
DSB's authorization to suspend the application, to Colombia, of concessions or other obligations 
under the GATT  1994, the GATS, and the TRIPS Agreement. Colombia said that it considered that, 
from a systemic point of view, it was an extremely serious matter that Panama had requested this 
authorization, in spite of the fact that Colombia had already noti fied its compliance with the DSB's 
recommendations and rulings in document WT/DS461/15. Colombia had complied promptly and 
effectively within the reasonable period of time. Colombia had replaced the compound tariff with 
an ad valorem tariff that did not ex ceed Colombia's WTO bound tariff rates. Colombia had thus 
brought the measure subject to the DSB's recommendations and rulings into compliance with its 
WTO obligations. Any disagreement between Colombia and Panama as to the existence or 
consistency with a covered agreement of measures taken to comply with the DSB 
recommendations and rulings had to be resolved through Article  21.5 of the DSU, which provided 
that: "Where there is a disagreement as to the existence or consistency with a covered agreement 
of me asures taken to comply with the recommendations and rulings such dispute shall be decided 
through recourse to these dispute settlement procedures, including whenever possible resort to 
the original Panel ". 
8.5.  As stated by the Appellate Body3: "On the one hand , the authorization to suspend 
concessions can be said to be the result of a previous act of seeking redress that involved initiating 
a dispute. On the other hand, the continued application of the suspension of concessions can be 
said to reflect a continuo us act of seeking redress for a violation found by the DSB that has not yet 
been rectified. In any event, the suspension of concessions that has been duly authorized by the 
DSB will not constitute a violation of Article  23.1, as long as it is consistent wi th other rules of the 
DSU, including paragraphs  2 through  8 of Article  22, even if the continued application of the 
suspension of concessions is regarded as an action or part of a process of 'seeking the redress'. 
This is because, before obtaining the DSB' s authorization to suspend concessions, a Member must 
initiate a dispute settlement process in which it challenges the consistency with the covered 
agreements of a measure taken by another Member. The Member initiating the process will only 
be authorized t o suspend concessions when the measure is found by the panel (and the Appellate 
Body, if appealed) to be inconsistent with the covered agreements and the Member taking the 
measure fails to implement the panel's (or Appellate Body's) findings within a reaso nable period of 
time or, if it takes a measure to comply, that measure is found by the panel (and the Appellate 
Body) in compliance proceedings not to have brought the Member concerned into compliance. In 
other words, the Member will only be able to suspen d concessions pursuant to the DSB's 
authorization after having had extensive recourse to, and abided by, the rules and procedures of 
the DSU, consistent with the requirements of Article  23.1". 
8.6.  Panama's decision to have recourse to Article  22.2 of the DSU a nd to request the DSB's 
authorization to suspend concessions or other obligations, rather than requesting the 
                                                
3 Appellate Body Report in "US – Continued Suspension " (DS320), para. 374.  WT/DSB/M/392  
 
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 establishment of a panel under Article  21.5, in spite of the fact that Colombia had already notified 
its compliance with the recommendations and r ulings of the DSB, was contrary to the principles 
governing dispute settlement procedures, which maintained the balance and ensured the proper 
functioning of the system. It was clear to Colombia that since it had fully complied with the DSB's 
recommendatio ns and rulings there could not be any nullification or impairment, and Panama's 
request for authorization to suspend concessions was therefore unjustified. Consequently, 
pursuant to Article  22.3 and  22.6 of the DSU, Colombia challenged the level of suspens ion of 
concessions or other obligations proposed by Panama and contended that Panama's request did 
not follow the principles and procedures set forth in Article  22.3 of the DSU. Colombia was 
therefore requesting that the matter be referred to arbitration.  
8.7.  The representative of the European  Union  noted that Colombia had notified full compliance 
with the DSB's recommendations and rulings. The EU also noted that Panama did not agree that 
Colombia had brought its measures into compliance with the covered agreem ents. Therefore, it 
appeared that "there is a disagreement as to the existence or consistency with a covered 
agreement of measures taken to comply with the recommendations and rulings" of the DSB within 
the meaning of Article  21.5 of the DSU. The EU recall ed that, pursuant to that provision, "such 
dispute shall be decided through recourse to these dispute settlement procedures, including 
wherever possible recourse to the original panel". In cases of disagreement on compliance, 
concessions could be only susp ended once there was a multilateral determination of compliance by 
the DSB. The EU hoped that Panama and Colombia would ensure that the DSU procedures 
regarding compliance and suspension of concessions would be conducted efficiently in this dispute 
and tha t the correct and logical sequence would be respected.  
8.8.  The representative of Canada  said that Panama's decision to seek authorization from the DSB 
to suspend concessions vis -à-vis Colombia, despite Colombia's claim of compliance, and in the 
absence of a DS B ruling on compliance, raised the sequencing issue for the DSB's consideration. 
First, for the benefit of Members that had questions about the sequencing issue, Canada recalled 
that it had circulated an annotated Sequencing Agreement under the Mechanism f or Developing, 
Documenting, and Sharing Practices and Procedures in the Conduct of WTO Disputes, which had 
been established in July  2016. That document explained the sequencing issue (JOB/DSB/1/Add.6). 
The DSU did not clearly set out the sequence of compli ance proceedings under Article  21.5 and 
requests for authorization from the DSB to suspend concessions under Article  22.2 of the DSU. For 
the most part, this uncertainty had been resolved through the well -established practice of 
disputing parties entering into "sequencing agreements". These agreements set out, for the 
purposes of a specific dispute, that the parties agree that compliance proceedings would, if 
invoked, precede the grant of authorization to suspend concessions and that the request for such 
authorization can be made after the 30 -day time period set out in Article  22.6 of the DSU. 
Sequencing agreements thus overcame the uncertainty that the text of the DSU created and 
contributed to the effectiveness and predictability of the WTO dispute settlem ent system. Canada 
considered that Panama's request under Article  22.2 of the DSU departed from this practice. In 
Canada's view, given that Colombia asserted that it had taken a measure to comply with the 
recommendations and rulings of the DSB and because this was the first time that a disagreement 
regarding a compliance measure had arisen in this dispute, it would be appropriate for the parties 
to first go through compliance proceedings under Article  21.5 of the DSU. It was not too late for 
Panama and Colo mbia to enter into a sequencing agreement. Given that Colombia had objected to 
the level of suspension proposed by Panama, the matter would be referred to arbitration. The 
parties could agree to suspend that arbitration until the completion of the Article  21.5 proceedings.  
8.9.  Beyond the specifics of this dispute, Canada believed that Article  21.5 of the DSU should not 
be subject to abuse. Such abuse would arise where a responding party serially implemented 
multiple measures that it asserted achieved compliance , which would delay indefinitely the 
complaining party from having recourse to Article  22.2 of the DSU. In Canada's view, it would be 
appropriate for the complaining party to be able to exercise its rights under Article  22.2 of the DSU 
in all circumstances  where the DSB had ruled that a measure taken to comply in fact did not 
comply. As a final point, Canada said that Colombia's recourse to Article  21.5 of the DSU clearly 
illustrated the relevance and appropriateness of the right of a responding party to in itiate 
compliance proceedings under the DSU.  
8.10.   The representative of India said that his country would like to touch upon the issue of 
sequencing and the procedure followed by Panama at the present meeting. India said that it was 
not commenting on the merits  of the dispute or on the issue of compliance. India had faced a WT/DSB/M/392  
 
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 similar situation in an earlier dispute and its views were a reiteration of its views previously 
expressed. India said that it was concerned about the systematic implications of such an actio n by 
Panama. In India's view, as had also been mentioned by the EU, if there was a disagreement 
between the parties with respect to "the consistency with a covered agreement of measures taken 
to comply with the recommendations and rulings" the proper cours e of action was first to have 
recourse to Article  21.5 of the DSU. India said that considerable discussions that had been held on 
the 19  July 2016 DSB meeting, in the context of another dispute, were noteworthy. In that 
meeting, Japan had rightly brought o ut the issues involved. Japan had said that "Under the 
practice, 'where there is disagreement as to the existence or consistency with a covered 
agreement, of measures taken to comply  with the recommendations and rulings', the parties 
committed themselves t o have recourse to the compliance proceedings under Article  21.5 of the 
DSU prior to the arbitration under Article  22.6 of the DSU. These procedural arrangements would 
certainly have implications for the time -frame of dispute settlement proceedings, but it  had been 
and would continue to provide a practical way forward by securing legal certainty at this very 
critical stage in a dispute, nonetheless. And this practical arrangement actually made sense for the 
following reasons: (i) reviewing fully, complex is sues of compliance through adjudicative process 
and multilateral decision by the DSB; (ii) securing the parties' rights to appeal; and (iii) providing 
a basis for the work of the arbitrator under Article  22.6". India agreed with the above assessment.  
8.11.   If there was a disagreement between the parties on this matter, the proper course of action 
was first to have recourse to Article  21.5 of the DSU. This had been a consistent practice. 
Members had signed sequencing agreements to ensure that this proper order was  respected. Not 
doing so disrupted the legal certainty of the DSU. India noted that there was no sequencing 
agreement in this dispute. Colombia claimed it had complied with the DSB's recommendations and 
rulings; Panama disagreed. The right course of action , in India's view, was the establishment of a 
compliance panel. Pursuance of Article  22.6 proceedings, in India's view, was premature and 
seriously undermined the balance that Members had found in the dispute settlement mechanism. 
India agreed with Canada that it was not too late for Colombia and Panama to resolve the issue of 
process in the larger interests of the dispute settlement mechanism.  
8.12.   The representative of Japan  said that his country understood that Colombia had objected to 
the level of suspension s proposed and claimed that the principles and procedures set out in 
paragraph  22.3 of the DSU had not been followed. With this objection and claim, the matter had 
been automatically referred to arbitration. Japan noted that under item  9 of the Agenda, the  
establishment of a compliance panel would be considered. Japan said that it did not know if the 
panel was going to be established at the present meeting, but that eventually a panel would have 
to be established. This would mean that there would be two par allel proceedings: an arbitration 
proceeding under Article  22.6 of the DSU and a compliance proceeding under Article  21.5 of the 
DSU. As Canada had stated, Members had a well -established practice to resolve this kind of 
procedural issue, namely that the pa rties would agree on a sequencing arrangement.  Japan 
encouraged the parties to work together and agree on a workable arrangement to promote the 
smooth functioning of the dispute settlement system. Otherwise, the parallel proceedings would 
create a series o f difficult legal issues, including the issue of what would happen if the two 
proceedings resulted in different outcomes.  
8.13.   The representative of Argentina  said that his delegation wished to make a statement due to 
its systemic interest in the issues under d iscussion. Argentina did not wish to comment on the 
substantive issues involved in dispute DS461. Argentina had a systemic interest in the sequencing 
issue under Articles  21.5 and 22.2 of the DSU. In the past, Argentina, together with the 
G7 countries, had  tabled a proposal on the sequencing issue in the context of the DSU 
negotiations. With regard to DS461, Argentina noted that, in document WT/DS461/15, Colombia 
had informed the DSB that it had adopted a measure and had "complied with the DSB's 
recommendat ions and rulings". Argentina noted that in document WT/DS461/16 Panama had 
sought recourse to Article  22.2 of the DSU, requesting authorization from the DSB to suspend the 
application of concessions or other obligations to Colombia. In that document, Panam a had stated 
that Colombia had "adopted two decrees that affect the tariff and customs regime for the 
importation of textiles and footwear". In th at regard, Panama appeared to be aware of the 
existence of a measure adopted by Colombia. However, Panama stat ed that, in its view, "these 
legislative acts [had not brought] the measure into conformity with Colombia's WTO obligations". 
Argentina noted that at the present meeting, Panama had sought the DSB's authorization to 
suspend concessions or other obligations  to Colombia without recourse to compliance proceedings 
under Article  21.5 of the  DSU. In WT/DS461/17, Colombia had sought recourse to Article  21.5 of WT/DSB/M/392  
 
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 the DSU "to resolve the disagreement as to compliance". In the light of these facts, and given that 
the sequencing issue was a matter of systemic interest that could have consequences beyond this 
dispute and affect the use of the DSU for the entire Membership, Argentina urged both parties to 
reflect on the steps taken and to try to reach  a sequencing agreemen t. 
8.14.   The representative of Brazil  said that his country wished to echo the concerns expressed by 
some of the previous speakers. In Brazil's view, the discussion at the present meeting 
demonstrated that one unresolved issue was being brought back to the DSB. After the "Bananas" 
disputes, the sequencing issue had been brought to the Ministerial Conference in Seattle. With the 
failure of the Conference, the issue was later managed by sequencing agreements, which, 
although providing only a frail balance, had serv ed as a modus  vivendi  for a long time. However, 
recently the DSB was witnessing that delegations had had recourse to Article  22.2 of the DSU 
directly. Brazil called on Members to reflect on systemic consequences of such actions. Members 
should also reflect  on the question of unilateral determination of compliance, based on unilateral 
criteria as opposed to the multilateral determination of compliance based on the use of Article  21.5 
of the DSU. Th at Article referred to two elements: measures taken to comply  by the defendant and 
a disagreement about those measures between the two parties. In the present situation, Panama 
recognized that Colombia had taken measures to comply, but disagreed with those measures. In 
Brazil's view to follow the logical sequence of  first having recourse to Article  21.5 of the DSU and 
then to Article  22.2 of the DSU made sense and was in line with the principle of good faith. Some 
could argue that in some cases merely "cosmetic" measures were taken, and that it would be a 
burden to h ave to go through an Article  21.5 procedure. In Brazil's view, if the time -frames 
provided in Article  21.5 the DSU were respected, this would not be a problem, and it would imply a 
three -month panel process, plus three -month appeal process. Brazil believed  that Members should 
reflect on the serious consequences resulting from a situation where a Member was honestly 
seeking to comply and was being faced with retaliation before any determination of 
non-compliance had been made under Article  21.5 of the DSU.  
8.15.   The representative of Mexico  said that his country had an interest in the procedural issue 
related to this dispute although it had not participated as a third party in the proceedings of this 
dispute. He said that i t was the practice of Members to first fol low the compliance procedures 
before requesting the suspension of concessions in line with a sequencing agreement. In that 
regard, Mexico urged the parties to seek a sequencing agreement in this dispute.  
8.16.   The representative of Colombia  said that his country  was prepared to reach a sequencing 
agreement with Panama. On 9  February  2017, a high -level meeting had been held between the 
two governments and Colombia had submitted a proposal on a sequencing agreement in this 
dispute. However, that proposal had not be en accepted by Panama. Therefore, Colombia invited 
Panama, once again, to reach a sequencing agreement in order to resolve this dispute.  
8.17.   The representative of Panama  said that, as had been stated by Canada, the DSU did not 
provide for the sequencing of pro cedures under Articles  21 and  22 of the DSU. However, it did 
clearly specify time -frames to be observed for requesting authorization to suspend  concessions. 
Panama was aware of the "Bananas " dispute and of the reasons that prompted the sequencing 
agreement  process as well as of its value. As demonstrated in the DSU negotiations, which had not 
yielded any agreement on this issue over many years, it was unclear whether all Members agreed 
on a single sequencing rule. The parties were unsuccessful in reaching a  sequencing agreement in 
this dispute. Therefore, Panama had to ensure all its rights under the DSU. Panama said it was still 
open to a sequencing agreement and reserved its rights in this respect. Like others, Panama 
underlined that the matter would be re ferred to arbitration, as provided for in the DSU.  
8.18.   The representative of the United  States  said that the United  States  supported Panama's 
right to have recourse to Article  22.2 of the DSU. As an initial point, the United  States noted that a 
few delegates h ad commented that the parties should have entered into a sequencing agreement. 
There was nothing in the DSU that required Members to enter into such an agreement. While some 
Members had found it appropriate to do so in certain circumstances, others may not  consider it 
appropriate in their circumstances, such as where a responding party had not taken steps to 
address DSB recommendations at the time the complainant had to take procedural action to 
preserve its rights under Article  22. Further, the United  States agreed with Japan's statement and 
considered that, upon Colombia's objection to that request, the matter had been automatically 
referred to arbitration under Article  22.6 of the DSU, as was provided for in the text of that 
provision. Article  22.2 of the  DSU stated that if a Member fail s to bring a challenged measure WT/DSB/M/392  
 
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 found to be inconsistent with a covered agreement into compliance within the reasonable period of 
time determined under Article  21.3 of the DSU, then such Member shall, if requested, enter in to 
negotiations with the complaining Member "with a view to developing mutually acceptable 
compensation". Panama indicated in its statement that such negotiations had been undertaken, 
but no agreement on compensation had been reached. If no such agreement was reached, DSU 
Article  22.2 stated that "any party having invoked the dispute settlement procedures may request 
authorization from the DSB to suspend the application to the Member concerned of concessions or 
other obligations under the covered agreements ". Further, Article  23.2 of the DSU set out the 
actions to obtain redress for a breach of WTO rules and confirmed that a Member shall "follow the 
procedures set forth in Article  22 to determine the level of suspension of concessions or other 
obligations an d obtain DSB authorization in accordance with those procedures before suspending 
concessions or other obligations under the covered agreements in response to the failure of the 
Member concerned to implement the recommendations and rulings within that reaso nable period 
of time".4 There was thus no support in the text of Article  22.2, or Article  23.2, for the suggestion 
that a Member would be required to first bring a separate compliance proceeding under 
Article  21.5 of the DSU.  
8.19.   The United  States noted, howev er, that any level of suspension of concessions determined 
in the arbitration had to be equivalent to the current level of nullification and impairment. This was 
clear from the text of Article  22.4 of the DSU, which stated that the "level of the suspension  of 
concessions or other obligations authorized by the DSB shall be equivalent to the level of the 
nullification or impairment", thus referring to the present level at the time suspension was 
authorized by the DSB. Therefore, if Colombia had, in fact, brou ght its measure into compliance 
with WTO rules, as it had stated, then the current level of nullification and impairment was zero. 
Consequently, the issue of compliance had to be addressed as part of any award determining a 
level of suspension of concessio ns or other obligations. The United  States noted that the next 
Agenda item concerned Article  21.5 of the DSU. The United  States considered that the issue of 
whether Colombia's actions removed the WTO -inconsistency found by the DSB could be addressed 
in the  context of the Article  22.6 proceeding or in a proceeding under Article  21.5 of the DSU.  
8.20.   The DSB took note  of the statements and that the matter raised by Colombia in document 
WT/DS461/18 has been referred to arbitration, as required by Article  22.6 of th e DSU.  
9  COLOMBIA – MEASURES RELATING TO  THE IMPORTATION OF T EXTILES, APPAREL 
AND FOOTWEAR  
A.  Recourse to Article  21.5 of the DSU by Colombia: Request for the establishment of a 
panel (WT/DS461/17)  
9.1.  The Chairman  drew attention to the communication from Colom bia contained in document 
WT/DS461/17, and invited the representative of Colombia to speak.  
9.2.  The representative of Colombia  recalled that on 22  June 2016, the DSB had adopted the 
Panel Report, as modified by the Appellate Body, in the dispute "Colombia – Measures Relating to 
the Importation of Textiles, Apparel and Footwear". In that Report, the DSB had found that, for 
imports of products classified in Chapters  61, 62, 63 and 64 (except for heading 64.06 but 
including tariff line 6406.10.00.00) of Colombia's  Customs Tariff, that in the instances identified in 
the Panel Report, the compound tariff had exceeded the bound tariff rate in Colombia's Schedule 
of Concessions, and was therefore inconsistent with Article  II:1(a) and (b) of the GATT  1994. The 
DSB had a lso found that although the measure at issue was "designed" to protect public morals in 
Colombia, within the meaning of Article  XX(a) of the GATT  1994, Colombia had failed to 
demonstrate that the compound tariff was a measure "necessary to protect public m orals" within 
the meaning of Article  XX(a) of the GATT  1994. Similarly, the DSB had found that although the 
measure at issue was "designed" to secure compliance with laws or regulations which were not 
inconsistent with the GATT  1994, namely, Article  323 of  Colombia's Criminal Code, within the 
meaning of Article  XX(d) of the GATT  1994, Colombia had not demonstrated that the compound 
tariff was a measure "necessary to secure compliance with laws or regulations which are not 
inconsistent" with the GATT  1994, w ithin the meaning of Article  XX(d) of the GATT  1994. At the 
DSB meeting of 21 July 2016, Colombia had announced its intention to implement the 
recommendations and rulings of the DSB and had stated that it would require a reasonable period 
                                                
4 DSU Article  23.2(c).  WT/DSB/M/392  
 
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 of time to do so.  That reasonable period of time had been determined by arbitration, and had 
expired on 22  January  2017.5 On 2  November  2016, the Colombian Government had issued 
Decree  1744 of 2016 modifying the tariffs applicable to imports of products classified in 
Chapt ers 61, 62 and 63 of the Customs Tariff, and certain items in Chapter  64. By that decree, 
Colombia had replaced the inconsistent compound tariff with an  ad valorem  tariff that did not 
exceed its WTO bound tariff rate. In other words, Colombia had brought t he measure subject to 
the DSB's recommendations and rulings into compliance with its WTO obligations. By doing so, 
Colombia had complied fully and timely with the DSB's recommendations and rulings, as had been 
notified to the WTO in document WT/DS461/15 of  15 December  2016.  
9.3.  Colombia noted that Panama had requested authorization to suspend concessions or other 
obligations, which implied that Panama considered that there was disagreement as to the 
existence or consistency with a covered agreement of measures taken to comply with the DSB's 
recommendations and rulings. Colombia and Panama had held extensive consultations on this 
matter and on Decree  1744 in particular, without having been able to reach any mutual agreement 
on the implementation of the DSB's reco mmendations and rulings in this dispute. Since Panama 
had not requested the establishment of an Article  21.5 compliance panel, but rather, had directly 
requested the suspension of the application of concessions to Colombia, it was necessary for 
Colombia to  resort to Article  21.5 of the DSU to request a compliance panel, including wherever 
possible to resort to the original panel, to determine whether Decree  1744 of 2016 had brought 
the measure found to be inconsistent into conformity with the DSB's recommen dations and 
rulings. Colombia hoped that if a panel was established under Article  21.5 of the DSU and 
arbitrators were appointed under Article  22.6 of the DSU – and were composed of the same 
individuals – they would find a "reasonable way" to expedite the proceedings and settle all 
outstanding issues in this dispute in order to guarantee the proper functioning of the DSU 
provisions. In either case, prompt findings would assist the parties in securing a positive solution 
to this dispute, in accordance with A rticle 3.7 of the DSU.  
9.4.  The representative of Panama  said that his delegation could not agree to the establishment of 
a panel at the present meeting and urged Colombia to withdraw its request, which was premature 
and improper. Article  21.5 of the DSU requir ed that the request be made in conformity with the 
DSU provisions pertaining to the establishment of panels. Consultations prior to a panel request 
were a fundamental requirement of the DSU. To the extent that the preference expressed in the 
DSU of promoti ng and arriving at a mutually agreed arrangement among the parties was a core 
principle of the DSU, this requirement could not be disregarded. Colombia had not requested such 
consultations. Although Colombia's request referred to consultations, the meeting  to which 
Panama understood that Colombia may be referring did not constitute consultations as required by 
Article  21.5 of the DSU. The meeting to which Colombia had referred was not requested by 
Colombia. Panama, which had requested the meeting, had done so strictly for the purposes of 
negotiating the compensation provided for under Article  22 of the DSU. If the meeting had been in 
relation to or understood as Article  21.5 consultations, the dynamics would have been very 
different. It would, for example, h ave also covered Decree  1745, which contained measures of the 
kind that Colombia announced during the arbitration that determined the reasonable period of time 
it had to observe in order to comply with the recommendations. Panama remained open to 
reaching an agreed solution, at any time, in order to end this dispute, which had already lasted for 
far too long. Therefore, Panama was still prepared to enter into consultations with Colombia. As 
things stood, preference had been given to dispute proceedings rath er than to the primary 
principle of promoting a mutually agreed solution. Panama believed that Colombia should not insist 
on the establishment of a panel at the present meeting, but rather enter into consultations 
required under the DSU. The Chairman could  hold an informal meeting with the parties to clarify 
                                                
5 Minutes of the DSB meeting  held on 21  July 2016: " The representative of Colombia said that, in 
accordance with Article  21.3 of the DSU, his delegation wished to inform the DSB that Colombia intended to 
implement the DSB's recommendations and rulings resulting from the Appellate Body and Panel Reports in the 
dispute: " Colombia – Measures Relating to the Importation of Textiles, Apparel and Footwear" (DS461). 
Colombia would need a reasonable period of time in order to do so since a rigorous analysis and administrative 
coordination by the Colombian Government were necessary to bring the disputed measure int o conformity with 
the covered agreements. It was important to bear in mind that, as had been demonstrated during the dispute 
settlement proceedings, the measure that had to be brought into conformity was essential for Colombia to 
achieve its objective of c ombating money laundering, on the grounds of Colombia's vital social interests. 
Currently, Colombia was engaging in discussions with Panama in order to reach an agreement on a reasonable 
period of time for the implementation of the DSB's recommendatio ns an d rulings in this dispute " 
(WT/DSB/M/383, para.2.2).  WT/DSB/M/392  
 
- 15 - 
 
 and facilitate this process. In the event that Colombia should insist at the present meeting on 
requesting the establishment of a panel, Panama could not agree and would object to a panel 
being establis hed at the present meeting. Panama reiterated that Colombia's Article  21.5 request 
was premature and improper.  
9.5.  The representative of Colombia  noted that Article  21.5 of the DSU did not refer to 
consultations. It simply stated that progress should be made w ith the issue under discussion 
concerning compliance, and that the dispute should be decided through recourse to the dispute 
settlement provisions and specifically, by resorting to the original Panel. In other words, 
consultations were included as part of a sequencing agreement which, as Colombia had explained, 
unfortunately, did not exist in this dispute. Consequently, Colombia had not had recourse to such 
consultations.  
9.6.  The representative of the European  Union  recalled that his delegation had participated  as a 
third party in the panel and appeal proceedings in this dispute. Therefore, pursuant to Articles  10.1 
to 10.3 of the  DSU, the EU reserved its right to participate as a third party in proceedings with 
respect to any disagreement as to the existence or  consistency with a covered agreement of 
measures taken to comply with the DSB recommendations and rulings.  
9.7.  The representative of Brazil  noted that Members were witnessing a historical moment, 
namely, the unravelling of the long -standing sequencing agreeme nts. The procedure was acquiring 
new features, where the complainant could unilaterally – through a direct recourse to Article  22.2 
of the DSU – determine whether there had been compliance. This situation inverted the logic of 
the right of defence and the principle of good faith. Therefore, Members should ask themselves if 
this was good for the system. Furthermore, given that the Article  22.6 procedure was shorter than 
the Article  21.5 procedure, which allowed for an appeal, this would create a procedural p roblem. In 
Brazil's view, it seemed that there was a textual discrepancy between both Articles – a sequencing 
problem – and the alleged automatic solution, namely direct recourse to Article  22.2 of the DSU. 
The solution to the matter at hand would be to co dify the practice  of sequencing and to amend  the 
DSU. 
9.8.  The representative of Mexico  said that in his country's view consultations on compliance were 
covered by Article  21.5 of the DSU since it provided that disagreements on compliance had to be 
decided thro ugh recourse to dispute settlement procedures. While Article  21.5 of the DSU did not 
expressly provide for consultations or appeals, compliance proceedings were subject to appeals 
and therefore they were also subject to consultations.  
9.9.  The representative of  Japan  said that his country had at least two concerns under this 
Agenda item. One concern was that the request for the establishment of a compliance panel had 
been made by the respondent, Colombia, not by the complainant, Panama. It was true that 
Article  21.5 of the DSU did not expressly prescribe which party should  have recourse to this 
provision. But the DSB had a long -standing customary practice, with some exception, that it was 
the complainant who would initiate the compliance proceedings. This made se nse because, as a 
jurisdictional matter, the complainant was in a better position to define and delimit the scope of 
disagreement between the parties under Article  21.5 of the DSU. The outcome of the panel 
requested by the respondent may not be satisfactor y for the purpose of the resolution of the 
dispute. The second concern was that Panama had rejected the establishment of a compliance 
panel on procedural grounds at the present meeting. This would create a time lag between the 
Article  22.6 arbitration, whi ch had just been initiated and was going forward, and the parallel 
compliance proceedings, which was yet to be established. This could lead to procedural 
complications. Once again, Japan encouraged the parties to the dispute to work together to 
manage the situation for the purpose of, and in the interest of, the smooth functioning of the 
dispute settlement system.  
9.10.   The representative of the United  States  said that, with regard to proceedings under 
Article  22.6 of the DSU, the United  States  referred to its st atement made under Agenda item  8. 
The United  States said that it would like to comment on Panama's statement that consultations 
had to be held prior to the establishment of a compliance panel under Article  21.5 of the DSU. This 
issue had come up before, an d the United  States did not agree with Panama's assertion. There was 
no requirement in the DSU to request consultations under Article  4 as a condition for requesting 
the establishment of a compliance panel pursuant to Article  21.5. And as it had noted befo re, the 
United  States could not see how Article  4 of the DSU could apply to an instance in which it was the WT/DSB/M/392  
 
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 Member concerned who was requesting a compliance panel to confirm that Member's compliance. 
The United  States recognized that Panama had a right to object to the establishment of a panel at 
the present meeting. However, the United  States considered that the panel should be established 
as soon as possible so that the individuals comprising the arbitrator and the compliance panel 
could consider how to o rganize their work as efficiently as possible.  
9.11.   The DSB took note  of the statements and agreed  to revert to this matter.  
10  PROPOSED NOMINATIONS  FOR THE INDICATIVE L IST OF GOVERNMENTAL AND 
NON-GOVERNMENTAL PANELIS TS (WT/DSB/W/589)  
10.1.   The Chairman  drew attention t o document WT/DSB/W/589, which contained additional 
names proposed by Egypt and the European  Union for inclusion on the Indicative List of 
Governmental and Non -Governmental Panelists, in accordance with Article  8.4 of the DSU, and 
proposed that the DSB app rove the names contained in document WT/DSB/W/589.  
10.2.   The DSB so agreed . 
11  APPELLATE BODY APPOI NTMENTS  
A. Statement by the Chairman  
11.1.   The Chairman  recalled that at the 25  January  2017 DSB meeting he had reminded 
delegations that the second four -year term of Mr. Ricardo Ramírez Hernández would expire on 
30 June 2017, and the second four -year term of Mr. Peter Van den Bossche would expire on 
11 December  2017. Pursuant to Article  17.2 of the DSU they were not eligible for reappointment 
and the DSB would have to init iate work to appoint two new Appellate Body members. At the 
25 January  2017 DSB meeting, the Chairman had also outlined two possible approaches to fill the 
upcoming vacancies. Following the 25  January  2017 DSB meeting, the Chairman had consulted 
with Membe rs on the alternative approaches he had mentioned. Several delegations had supported 
one single selection process to fill both positions at the same time, and to complete the process by 
the end of June. In their view one selection process was more efficien t and would take into 
account the fact that delegations would be deep in preparations for MC11 in the second half 
of 2017. However, two delegations had expressed a preference for undertaking two independent 
processes. One delegation had suggested that, at this point, the DSB could initiate a first selection 
process to fill the vacancy that would expire in June  2017 and that more time should be given to 
decide on when to launch a second process to fill the second vacancy. It was however the 
Chairman's unders tanding that those delegations supporting one single selection process would 
only agree to two independent processes if the work on both could be completed before the 
summer break. Since there was no agreement on this matter at this stage, it was the Chair man's 
intention to continue to consult with delegations. He said that he would aim to be in a position to 
submit a proposal that was agreeable to all Members on the procedural steps and timing for the 
Appellate Body appointments at the next regular DSB mee ting in March.  
11.2.   The representative of Peru said that his country thanked the Chairman and the Secretariat 
for their consultations on the process of selecting two new Appellate Body  members. As mentioned 
by Peru during the consultations, the best way of proc eeding would be that the same Selection 
Committee carry out the selection process for both positions. This would save resources and would 
provide an overall balance for the composition of the Appellate Body. Nevertheless, if some 
Members wished to carry ou t a different process, Peru would be flexible. Otherwise, if there were 
to be two separate processes for each of the vacant positions, the selection process to replace 
Mr. Ricardo Ramírez Hernández should start as early as possible, given that his mandate would 
expire in June  2017. Peru wished to underline that it would be appropriate for the process of 
appointing two new Appellate Body  members to end before the 30  June 2017 prior to the 
preparations for MC11 in Buenos Aires, which would take place in the s econd half of the year.  
11.3.   The representative of the European  Union  said that his delegation had expected that the 
DSB would be able to launch the selection process for Appellate Body appointments in 2017 at the 
present meeting. Based on past practice, the EU  expected this to be one single process for both 
vacancies, as had been the case in 2009. In the EU's view, this was indeed the most efficient way 
of managing the selection processes for vacancies that were only a few months apart. The EU WT/DSB/M/392  
 
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 encouraged the Ch airman to continue engaging with Members so that the selection process could 
be launched without delay.  
11.4.   The representative of Brazil  said that his country was flexible regarding the format of the 
procedures, but considered that the deadlines for the upcomi ng vacancies should be respected.  
11.5.   The representative of Argentina  said that his country hoped the selection process would 
start without any delay.  
11.6.   The DSB took note  of the statements.  
12  DISPUTE SETTLEMENT W ORKLOAD  
A.  Statement by the Chairman  
12.1.   The Chairman , speaking under "Other Business", said that he wished to provide the DSB 
with information about the Appellate Body's workload, the number of disputes before panels, and 
at the panel composition stage, and the ability of the Secretariat to meet expected dema nd over 
the coming period. With regard to panels, there were currently 17 active panels (including five 
panels under Article  21.5 of the DSU) that had not yet issued a final report to the parties. Multiple 
disputes that were being considered simultaneously  by the same panel were being counted as one. 
As of the present meeting, all composed panels had been assigned staff to assist them and were 
either active or in the process of commencing proceedings. There were six panels at the 
composition stage, not coun ting panels for which there had been no composition activity in the last 
twelve months. In addition, four final panel reports that had been issued to the parties were 
currently being translated. Regarding appeals, the Appellate Body was currently dealing w ith seven 
appeals, including the extremely complex compliance proceedings in "EC and Certain Member 
States – Large Civil Aircraft" (Airbus). Three of these appeals could not be staffed at this point. 
Two additional appeals could be filed within the next tw o months. Regarding arbitrations, three 
matters had been referred to arbitration under Article  22.6 of the DSU and one had been referred 
to arbitration under Article  21.3(c) of the DSU.  
12.2.   The DSB took note  of the statement.  
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