WT/AB/ 27 
 
16 May 2017 
(17-2572) Page: 1/162 
   
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
APPELLATE  BODY  
 
 
ANNUAL REPORT FOR 20 16 
 
 
 
 
 
MARCH  2017 WT/AB/27  
 
- 2 - 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The Appellate  Body  welcomes comments and inquiries  
regarding this Annual R eport at the  
following address:  
 
Appellate  Body Secretariat  
World Trade Orga nization  
rue de Lausanne 154  
1211 Geneva, Switzerland  
e-mail: appellatebody.registry@wto.org  
<https://www.wto.org/english/tratop_e/dispu_e/appellate_body_e.htm > WT/AB/27  
 
- 3 - 
 
 CONTENTS  
FOREWORD  ................................ ................................ ................................ ......................  6 
1  INTRODUCTION  ................................ ................................ ................................ ...........  8 
2  COMPOSITION OF THE APPELLATE  BODY  ................................ ................................ ... 11 
3  APPEALS  ................................ ................................ ................................ ....................  15 
4  APPELLATE  BODY  REPORTS  ................................ ................................ ........................  16 
4.1 Appellate  Body Report, European Communities – Definitive Anti -Dumping Measures 
on Certain Iron or Steel Fasteners from China – Recourse to Article  21.5 of the DSU 
by China , WT/DS397/AB/RW  ................................ ................................ .............................  17 
4.2 Appellate  Body Report, Argentina – Measure s Relating to Trade in Goods and 
Services , WT/DS453/AB/R  ................................ ................................ ................................  33 
4.3 Appellate  Body Report, Colombia – Measures Relating to the Importation of Textiles, 
Apparel and Footwear , WT/DS461/AB/R  ................................ ................................ ..............  42 
4.4 Appellate  Body Report, India – Certain Measures Relating to Solar Cells and 
Solar Modules , WT/DS456/AB/R  ................................ ................................ .........................  51 
4.5 Appellate  Body Report, United  States – Anti-Dumping and Countervailing Measures 
on Large Residential Washers from Korea , WT/DS464/AB/R  ................................ ...................  61 
4.6 Appellate  Body Report, European Union – Anti-Dumping Measures on Bi odiesel from 
Argentina , WT/DS473/AB/R  ................................ ................................ ...............................  79 
5  PARTICIPANTS AND THI RD PARTICIPANTS IN A PPEALS  ................................ ...........  90 
6  PROCEDURAL ISSUES AR ISING IN APPEALS  ................................ ..............................  91 
7  ARBITRATIONS UNDER ARTICLE  21.3(C) OF THE DSU  ................................ ...............  94 
8  OTHER ACTIVITIES  ................................ ................................ ................................ .... 97 
 
ANNEXES  
Annex 1 Executive Summaries of Written Submissions in Appellate Proceedings  .....................  99 
Annex 2 Limits on the Length of Written Submissions  ................................ .......................  100 
Annex 3 Communications from Appellate Body members a nd former Appellate Body 
members concerning opposition to the reappointment of an Appellate Body 
member  ................................ ................................ ................................ ........  102 
Annex 4 Farewell speeches of two Appellate Body member s ................................ ..............  105 
Annex 5 Speech by Thomas Graham on 22 No vember 2016  ................................ ..............  112 
Annex 6 Members of the Appellate  Body 2016 – Biographical notes  ................................ .... 118 
Annex 7 Former Appellate Body member s and Chairpersons  ................................ ..............  123 
Annex 8 Appeals filed: 1995 -2016 ................................ ................................ .................  125 
Annex 9 Percentage of panel reports appealed by year of adoption: 199 6-2016 ...................  127 
Annex 10 WTO agreements addressed in Appellate  Body reports circulated : 1996-2016 ..........  128 
Annex 11 Participants  and third participants in appeals: 199 6-2016 ................................ ..... 130 WT/AB/27  
 
- 4 - 
 
 WTO Abbreviations used in this Annual Report  
Abbreviation  Description  
Anti-Dumping Agreement  Agreement on Implementation of Article  VI of the General 
Agreement on Tariffs and Trad e 1994  
Basic Regulation  Council Regulation (EC) No. 1225/2009 of 30 November 2009 on 
protection against dumped imports from countries not members of 
the European Community (codified version), Official Journal of the 
European Union, L Series, No. 343 (22 December 2009), pp. 51 -73, 
and corrigendum thereto, L Series, No. 7 (12 January 2010), 
pp. 22-23 (Panel Exhibit ARG -1) 
DCR Measures  Domestic Content Requirements  
DDSR  WTO Digital Dispute Settlement Registry  
Definitive Regulation  Council Implementing Reg ulation (EU) No. 1194/2013 of 
19 November 2013 imposing a definitive anti -dumping duty and 
collecting definitively the provisional duty imposed on imports of 
biodiesel originating in Argentina and Indonesia, Official Journal of 
the European Union, L Series , No. 315 (26 November 2013), 
pp. 2-26 (Panel Exhibit ARG -22) 
DET Differential Export Tax  
DPM Differential Pricing Methodology  
DSB Dispute Settlement Body  
DSU Understanding on Rules and Proc edures Governing the 
Settlement  of Disputes  
EBB European Bi odiesel Board  
EC European Communities  
EU European Union  
ELSA European Law Students' Association  
f.o.b. price  Free on Board Price  
GATS  General Agreement on Trade in Services  
GATT 1994  General Agreement on Tariffs and Trade 1994  
LRWs  Large residenti al washers  
NME Non-market economy  
PCN Product control number  
Provisional Regulation  Commission Regulation (EU) No. 490/2013 of 27 May 2013 
imposing a provisional anti -dumping duty on imports of biodiesel 
originating in Argentina and Indonesia, Official journal of the 
European Union, L Series, No. 141  (28 May 2013), pp. 6 -25 
(Panel  Exhibit ARG -30) 
R&D Research and development  
RSTA  Korea's Restriction of Special Taxation Act  
Rules of Conduct  Rules of Conduct for the Understanding on Rules and Procedures  
Governing the Settlement of Disputes, adopted by the DSB 
on 3 December 1996, WT/DSB/RC/1  
SCM Agreement  Agreement on Subsidies and Countervailing Measures  
SPDs Solar power developers  
TRIMs Agreement  Agreement on Trade -Related Investment Measures  WT/AB/27  
 
- 5 - 
 
 Abbreviation  Description  
T-T comparison 
methodology  Transaction -to-transaction comparison methodology  
USDOC  United States Department of Commerce  
Working Procedures  Working Procedures for Appellate Review, WT/AB/WP/6, 
16 August  2010 
W-T comparison 
methodology  Weighted average -to-transaction comparison m ethodology  
WTO World Trade Organization  
WTO Agreement  Marrakesh Agreement Establishing the World Trade Organization  
W-W comparison 
methodology  Weighted average -to-weighted average comparison methodology  WT/AB/27  
 
- 6 - 
 
 FOREWORD  
2016 was a challeng ing year for the Appellate Body in several ways. I would like to focus mainly 
on the greatly increasing workload and its implications for the timely completion of our work.  
The Appellate Body was engaged in appellate proceedings throughout the 12 months of  2016. 
The Appellate  Body circulated six reports in 2016: EC ‒ Fasteners (Article  21.5 – China) ; 
Argentina  – Financial Services ; Colombia – Textiles ; India ‒ Solar Cells ; EU – Biodiesel ; and 
US ‒ Washing Machines . These reports addressed matters including the WTO Agreement, the 
Anti-Dumping  Agreement, the TRIMs Agreement, GATS, the GATT  1994, and the DSU. These 
disputes concerned a number of contemporary issues such as climate change, renewable energy, 
tax evasion, money laundering, and fair trade.  
Late in 2016 four more appeals were filed, in the following disputes: the very large EC and certain 
member States – Large Civil Aircraft (Article 21 .5); Russia – Pigs; US – Anti-Dumping 
Methodologies (China) ; and US – Tax Incentives . Moreover, the WTO Secretariat that assists 
panels has estimated that more than 12 panel reports could be iss ued to parties in the course 
of 2017. These include the massive US – Large Civil Aircraft (Boeing) (Article  21.5) ; 
Brazil  ‒ Taxation Measures ; and the Australia – Tobacco Plain P ackaging disputes. The size, 
complexity, and number of these appeals will occupy a significant part of Appellate Body 
Secretariat staff resources for exceptionally long time periods. The average appeal rate is 68%. 
Thus, the large increase in the Appellate  Body's workload that had been predicted is now upon us, 
and will be with  us for the foreseeable future.  
The constraints on the Appellate Body's resources were further exacerbated by the changes in its 
composition. The DSB established a Selection Committee  on 25  January  2016 to carry out a 
selection process for the appointment of a new Appellate Body member to replace our colleague 
Yuejiao Zhang, whose second term was due to expire on 31  May 2016. At the same meeting, the 
Chairman of the DSB announced his i ntention to initiate consultations on the possible 
reappointment of our colleague Seung Wha Chang, whose first four -year term of office was due to 
expire on 31  May 2016. Mr  Chang was eligible for reappointment by the DSB to a second four -year 
term and had expressed his willingness to serve a second term. On 11  May 2016, the Chairman of 
the DSB was informed that a delegation did not support Mr  Chang's reappointment. Shortly 
thereafter, this delegation publicized its reasons for its opposition to Mr  Chang's r eappointment. 
Subsequently, Appellate Body member s other than Mr  Chang, in a letter signed by the 
Appellate  Body Chair, expressed concerns about the public statement of reasons given for 
opposition to Mr  Chang's reappointment. As a result of the expiration  of the term of Mrs  Zhang, 
and the non -reappointment of Mr  Chang, there were only five members of the Appellate Body from 
1 June 2016 until near the end of 2016, when the process of  appointment of new members 
was completed.  
At its meeting of 23  November  2016, the DSB agreed to a ppoint Ms  Hong Zhao and 
Mr Hyun Chong Kim as the new Appellate Body members for a four -year term. Their respective 
terms started on 1  December  2016.  
During 2016, the Appellate Body continued efforts to improve efficiency and to make our reports 
more concise and readable by WTO delegations and others. We conti nued the practice, initiated 
in 2015, of annexing to Appellate  Body reports the executive summaries of the arguments 
submitted by the participants and third  participants, instead of summarizing the arguments of the 
participants in the body of our reports. We also introduced more complete descriptions of our 
"findings and conclusions", so as to make our central reasoning, as well as our bottom -line 
conclusions, more quickly accessib le to those who turn first to the "findings and conclusions". We 
have also tried to make our reports more concise. These changes are aimed at making the public 
face of our work more "user friendly" and at using eff iciently our limited resources.  
It should be recognized, however, that t he massive volume of appeals in 2017 will strain our 
resources, and that there will be inevitable delays. Faced with our caseload and our limits, the 
Appellate Body will do what it can, with the staff and resources that it has , on a sustainable basis. 
In striking the balance between quality, speed, sustainability, and capacity, we will give priority to WT/AB/27  
 
- 7 - 
 
 quality within our capacity. This means that almost certainly there will be delays and queues. We 
will work with the Members an d case participants to handle these problems as best we can. I take 
this opportunity to reiterate the request that I made to WTO  Members in my speech of 
November  2016, which is annexed to this annual report: Let us work together to maintain, 
nurture, and p reserve the trust and credibility that has been built up over the years in this dispute 
settlement system, which is uniquely effective, but fragile, and which cannot be taken for granted. 
In particular, we hope to find a better way for WTO Members and the Appellate Body to discuss 
long-standing structural problems of the dispute settlement system, and in particular of the 
Appellate Body.  
In this regard, I am pleased to report that there has been some progress. As my predecessor did 
in 2015, I engaged in a s eries of informal consultations with WTO  Members , particularly those who 
are active users of the dispute settlement system, on possible further improvements to internal 
procedures and practices. These consultations included discussions of concerns relating  to the 
independence and impartiality of the Appellate Body, and practical concerns regarding the 
resources necessary to meeting the growing demands of the dispute settlement system in general, 
and the Appellate Body in particular. The constructive nature of these consultations persuades me 
that we should engage with one another more broadly, and more frequently, rather than merely 
meeting across the podium in the hearing room.  
Finally, 2016 will sadly also be remembered as the year that we lost one of the great proponents 
of the multilateral trading system and the Appellate Body. Ambassador Julio Lacarte -Muró passed 
away on 4  March  2016 at the age of 97. Few have had as sustained and as profound an influence 
on the multilateral trading system as Ambassador Lacarte. He took part in the first session in 1946 
of the Preparatory Committee, tasked with drawing up a charter for the proposed International 
Trade Organization (ITO), and participated in the 1947 Havana Conference. Ambassador Lacarte 
later helped launc h the Uruguay Round, which eventually led to the establishment of the 
WTO in 1995. He served as Chairman of the Uruguay Round negotiating group on dispute 
settlement, and the text of the Dispute Settlement Understanding was negotiated and agreed 
under his leadership. Having served as a key architect of the WTO dispute settlement system, 
Ambassador Lacarte was appointed as one of the original seven Appellate Body members, and 
then elected the first Chairman of that body. Ambassador Lacarte's chairmanship of the 
Appellate  Body in its formative years was instrumental in shaping this institution. To honour 
Ambassador Lacarte 's legacy, I am pleased to announce that the Appellate Body has launched an 
initiative to create an annual "Julio Lacarte Lecture", on issue s of relevance to the multilateral 
trading system, with the inaugural lecture to be held in 2017.  
Thomas R. Graham  
Chair, Appellate Body  WT/AB/27  
 
- 8 - 
 
 WORLD TRADE ORGANIZA TION  
APPELLATE  BODY  
ANNUAL REPORT FOR 20 16 
1  INTRODUCTION  
This Annual Report  summarizes the activiti es of the Appellate  Body and its Secretariat for the 
year 2016. 
Dispute settlement in the World Trade Organization (WTO) is regulated by the 
Understanding  on Rules and Procedures Governing the Settlement of Disputes (DSU), which is 
contained in Annex  2 of the Marrakesh Agreement Establishing the World Trade Organization 
(WTO  Agreement). Article  3.2 of the DSU identifie s the purpose  and role  of the dispute settlement 
system as follows : "The dispute settlement system of the WTO is a central element  in providi ng 
security and predictability to the multilateral trading system." Further, Article  3.2 provides that the 
dispute settlement system "serves to preserve the rights and obligations of Members under the 
covered agreements, and to clarify the existing provisi ons of those agreements in accordance with 
customary rules of interpretation of public international law." The dispute settlement system is 
administered by the Dispute Settlement Body (DSB), which is composed of all WTO Members.  
A WTO Member may have recou rse to the rules and procedures established in the DSU if it 
"considers that any benefits accruing to it directly or indirectly under the covered agreements are 
being impaired by measures taken by another Member ."1 The DSU procedures apply to disputes 
arising under any of the covered agreements listed in Appendix 1 to the DSU, which include the 
WTO Agreement and all the multilateral agreements annexed to it relating to trade in goods2, 
trade in services3, and the protection of intellectual property rights4, as well as the DSU itself. 
Pursuant to Article  1.2 of the DSU, the special or additional rules and procedures listed in 
Appendix  2 of the DSU prevail over those contained in the DSU to the extent that there 
is an inconsistency. The application of the DSU to disputes under the plurilateral trade agreements 
annexed to the WTO Agreement5 is subject to the adoption of a decision by the parties to each 
of these agreements setting out the terms for its application to the individual agreement.6 
Proceedings under the DSU take place in stages. In the first stage, Members are required to hold 
consultations with a view to reaching a mutually agreed solution to the matter in dispute.7 If these 
consultations fail to produce a mutually agreed solution, the dispute may ad vance to the 
adjudicative stage in which the complaining Member requests the DSB to establish a panel to 
examine the matter.8 Panelists are chosen by agreement of the parties, based on nominations 
proposed by the Secretariat.9 However, if the parties canno t agree, either party may request the 
WTO Director -General to determine the composition of the panel.10 Panels shall be composed of 
well-qualified governmental and/or non -governmental individuals  with expertise in international 
trade law or policy.11 In disc harging its adjudicative function, a panel is required to " make an 
objective assessment of the matter before it, including an objective assessment of the facts of the 
case and the applicability of and conformity with the relevant covered agreements, and ma ke such 
other findings as will assist the DSB in making the recommendations or in giving the rulings 
provided for in the covered agreements."12 The panel process includes written submissions by the 
                                               
1 Article  3.3 of the DSU.  
2 Annex 1A to  the WTO Agreement . 
3 Annex 1B to the WTO Agreement . 
4 Annex 1C to the WTO Agreement.  
5 Annex 4 to the WTO Agreement.  
6 Appendix 1 to the DSU.  
7 Article  4 of the DSU.  
8 Article  6 of the DSU.  
9 Article  8.6 of the DSU.  
10 Article  8.7 of the DSU.  
11 Article  8.1 of the DSU.  
12 Article  11 of the DSU.  WT/AB/27  
 
- 9 - 
 
 main parties and also by third parties that have notified t heir interest in the dispute to the DSB. 
Panels usually hold two meetings with the parties, one of which als o includes a session with 
third parties. Panels set out their factual and legal findings in an interim report that is subject to 
comments by the par ties. The final report is first issued to the parties, and is subsequently 
circulated to all WTO Members  in the three official languages of the WTO (English, French, 
and Spanish), at which time it is also posted on the WTO website . 
Article  17 of the DSU es tablishes a standing Appellate  Body. The Appellate  Body is composed 
of seven members who are each appointed to a four -year term, with a possibility to be 
reappointed once. The expiration dates of terms are staggered in order to ensure that not all 
members begin and complete their terms at the same time. Members of the Appellate  Body must 
be persons of  recognized authority, with demonstrated expertise in law, international trade, and 
the subject matter of the covered agreements generally. They shall be unaff iliated with any 
government. Moreover, the Appellate  Body membership shall be broadly representative of the 
membership of the WTO. Appellate Body member s elect a Chairperson to serve a one -year term, 
which can be extended for an additional one -year period . The Chairperson is responsible for the 
overall direction of Appellate  Body business. Each appeal is heard by a Division of three 
Appellate  Body member s. The process for the selection of Divisions is designed to ensure 
randomness, unpredictab ility, and  opportunity for all m embers to serve, regardless of their 
national origin. To ensure consistency and coherence in decision -making, Divisions exch ange views 
with the other four m embers of the Appellate  Body before finalizing Appellate  Body reports. The 
Appella te Body receives legal and  administrative support from its  Secretariat. The conduct of 
members of the Appellate  Body and its staff is regulated by the Rules of Conduct for the 
Understanding on Rules and Procedures Governing the Settlement of Disputes13 (Rules of 
Conduct). These Rules emphasize that Appellate Body member s shall be independent  and 
impartial, avoid any direct or indirect conflict of  interest , and maintain the confidentiality of 
appellate proceedings .14 
Any party to a dispute, other than WTO Memb ers that were third parties  at the panel stage , 
may appeal a panel report to the Appellate  Body. These third parties may however participate 
and make written and oral submissions in the appellate proceedings. The appeal is limited 
to issues of law covered in the panel report and legal interpretations developed by the panel. 
Appellate proceedings are conducted in accordance with the procedures established in the DSU 
and the Working Procedures for Appellate Review15 (Working Procedures), drawn up by the  
Appell ate Body in consultation with the Chairperson of the DSB and the Director -General 
of the WTO, and communicated to WTO Members. Proceedings involve the filing of written 
submissions by the participants and third participants, as well as an oral hearing. The 
Appellate  Body report is to be circulated within 90 days of the date when the appeal was initiated, 
and is posted on the WTO website immediately upon circulation to Members. In its report, 
the Appellate  Body may uphold, modify, or reverse the legal findin gs and conclusions of a panel.  
Panel and Appellate  Body reports must be adopted by WTO Members acting collectively through 
the DSB. Under the reverse consensus rule, a report is adopted unless  the DSB decides by 
consensus not to adopt the report .16 Upon ado ption, Appellate  Body reports and panel reports 
(as modified by the Appellate  Body) become binding upon the parties.  
Following the adoption by the DSB of a panel or Appellate  Body report that includes a finding 
of inconsistency of a measure of the respondi ng Member with its WTO obligations, Article  21.3 
of the DSU provides that the responding Member should, in principle, comply immediately. 
However,  where immediate compliance is " impracticable", the responding Member shall have 
a "reasonable period of time"  to implement the DSB's recommendations and rulings. 
The "reasonable period of time" may be determined by the DSB, by agreement between the 
parties, or through binding arbitration pursuant to Article  21.3(c) of the DSU. In such arbitration, 
                                               
13 The Rules of Conduct, as adopted by the DSB on 3  December 1996 (WT/DSB/RC/1), are incorporated 
into the Working Procedures for Appellate Review (WT/AB/WP/6), as Annex I I thereto. (See  WT/DSB/RC/2, 
WT/AB/WP/W/2)  
14 Former Appellate Body member s, Secretariat staff and interns are subject to Post Employment 
Guidelines, which facilitate compliance with relevant obligations of conduct following a term of service  
(WT/AB/22 ). 
15 Working Procedures for Appellate Review, WT/AB/W P/6, 16 August 2010.  
16 Articles  16.4 and 17.14 of the DSU.  WT/AB/27  
 
- 10 - 
 
 a guideline for  the arbitrator is that the reasonable period of time to implement panel or 
Appellate  Body recommendations should not exceed 15 months from the date of adoption of the 
panel or Appellate  Body report. However, that time may be shorter or longer, depending u pon the 
particular circumstances. Arbitrators have indicated that the reasonable period of time shall be the 
shortest time possible in the implementing Member's legal system.  
Where the parties disagree "as to the existence or consistency with a covered ag reement 
of measures taken to comply", the matter may be referred to the original panel in compliance 
proceedings under Article  21.5 of the DSU. In these Article  21.5 compliance proceedings, a panel 
report is issued and may be appealed to the Appellate  Body. Upon their adoption by the DSB, 
panel and Appellate  Body reports in Article  21.5 compliance proceedings become binding on 
the parties.  
If the responding Member does not bring its WTO -inconsistent measure into compliance with its 
obligations under the cov ered agreements within the reasonable period of time, the complaining 
Member may request negotiations with the responding Member with a view to reaching an 
agreement on  compensation as a temporary and voluntary alternative to full compliance. 
Compensation is subject to acceptance by the complaining Member , and must be consistent with 
the WTO agreements. If no satisfactory compensation is agreed upon, the complaining Member 
may request authorization from the DSB, pursuant to Article  22 of the DSU, to suspend  the 
application of concessions or other obligations under the WTO agreements to the responding 
Member. The level of the suspension of concessions or other obligations authorized by the DSB 
shall be equivalent to the level of the nullification or impairmen t resulting from non -compliance 
with the DSB recommendations and rulings . The responding Member may request arbitration 
under Article  22.6 of the DSU if it objects to the level of suspension proposed or considers that the 
principles and procedures concerni ng the suspension of concessions or other obligations have not 
been followed. In principle, the suspension of concessions or other obligations must relate to the 
same trade sector or agreement as the measure found to be inconsistent. However, if this is 
impracticable or ineffective for the complaining Member, and if circumstances are serious, the 
complaining Member may seek authorization to suspend concessions with respect to other sectors 
or agreements. The a rbitration under Article  22.6 shall be carried o ut by the original panel, if its 
members are available. Compensation and the suspension of concessions or  other obligations are 
temporary measures; neither is to be preferred to full implementation of a  recommendation to 
bring a measure into conformity wit h the covered agreements.17  
A party to a dispute may request good offices, conciliation, or mediation as alternative methods of 
dispute resolution at any stage of dispute settlement proceedings.18 In addition, under Article  25 
of the DSU, WTO Members may ha ve recourse to arbitration as an alternative to the regular 
procedures set out in the DSU.19 Recourse to arbitration, including the procedures to be followed in 
such arbitration proceedings, is subject to mutual agreement of the parties.20 
                                               
17 Article  22.1 of the DSU.  
18 Article  5 of the DSU.  
19 There has been only one recourse to Article  25 of the DSU and it was not in lieu of panel or 
Appellate  Body proceedings. Rather, the purpose of that arbitration was to set an amount of compensation 
pending full compliance by the responding Member. (See Award of the Arbitrators, US – Section  110(5) 
Copyright Act ( Article  25)) 
20 Articles  21 and 22 of the DSU apply mutatis mutandis  to decisions by ar bitrators.  WT/AB/27  
 
- 11 - 
 
 2  COMPOSITION OF TH E APPELLATE  BODY  
The Appellate  Body is a standing body com posed of seven m embers, each appointed by the DSB 
for a term of four years with the possibility of being reappointed once for another four -year term.  
The second term of office of Mrs  Yuejiao Zhang expired on 31  May 2016.21 The first four -year term 
of Mr Seung Wha Chang expired on 31  May 2016. Mr  Chang expressed his interest and willingness 
to be appointed for a second four -year term. At a meeting held on 25  January  2016, the DSB 
agreed to the followi ng: (i)  to launch a selection process for one position in the Appellate  Body to 
replace M rs Zhang; (ii)  to establish a Selection Committee, consistent with the procedures set out 
in document WT/DSB/1 and with previous selection processes, composed of the D irector -General 
and the 2016 Chairpersons of the General Council, the Goods Council, the Services Council, the 
TRIPS Council and the DSB, to be chaired by the DSB Chair; (iii)  to set a deadline of 
15 March  2016 for Members to submit nominations of candidat es; (iv)  to request the Selection 
Committee to carry out its work in April/May 2016 in order to make a recommendation to the DSB 
by no later than 12  May 2016, so that the DSB could take a decision to appoint a new 
Appellate  Body member at its regular meeti ng scheduled for 23  May 2016; and (v)  to request the 
DSB Chairman to carry out consultations on the possible reappointment of Mr  Chang.22 
At the DSB meeting of 23  March 2016, the DSB Chairman reported on the developments regarding 
the selection process for the new Appellate  Body member. The DSB  Chairman informed the 
WTO Members that by the agreed deadline of 15  March  2016, the names of seven candidates had 
been submitted by the following Members: Japan, Nepal, China, Australia, Malaysia and Turkey. 
China had  submitted names of two candidates. The DSB Chairman also noted that the 2016 Chair 
of the Council for Trade in Goods, Mr  Hamish McCormick of Australia, had recused himself from the 
process in light of the fact that Australia had submitted a nominatio n for consideration in the 
2016 selection process.23 At the DSB meeting of 23  May 2016, the DSB Chairman stated  that the 
Selection Committee had conducted thorough interviews wit h the seven nominated candidates 
on 7 and 8  April 2016 with a view to identifying th ose individuals who possessed the qualifications 
and expertise as required by the DSU for Appellate  Body members. As part of the selection 
process, the Committee had met individually with 50  delegations to hear their views on the 
candidates. The Committee had also received in writing the views of 23  delegations. Throughout 
the process, the Committee had based its work on the guidelines, the rules and procedures 
contained in the DSU, and documents WT/DSB/1 and WT/DSB/70 governing the selection and 
appointmen t of Appellate  Body members. The Selection Committee regretted that despite its best 
efforts,  at that time  it was not in a po sition to recommend a candidate  who would enjoy the 
consensus of the entire Membership. The Selection Committee therefore  requested  more time to 
consult further on this matter.24 
At the DSB meeting of 23  May 2016, the DSB Chairman also recalled  that, in the DSB's decision 
of 25 January  2016, contained in document WT/DSB/70, the DSB Chairman was requested to 
carry out consultations on t he possible reappointment of Mr  Seung Wha  Chang for a second 
four-year term. Since then, both the DSB Chairman's predecessor and he had carried out informal 
consultations with interested delegations on this matter. As a result of those consultations, the 
DSB Chairman had hosted an informal meeting on 10  May 2016 to enable delegations to pose 
questions to Mr  Chang.  
The DSB Chairman reported that a  total of 26  delegations  had participated in the meeting  of 
10 May 2016. At the outset of the meeting, the DSB Ch airman  had read out the ground rules for 
the process, based on the process conducted in 2015 by the previous DSB Chairman. In this 
regard, the Chair man had emphasized that the meeting was not intended to replicate or repeat the 
extensive interviews conduct ed by delegations in connection with original appointments. The 
Chair man had also informed the delegations that questions to Mr Chang  could be posed by 
Ambassadors or Deputies only, and that each delegation was allowed to ask only two questions. 
Moreover, the delegations could not ask questions that touched upon: (i)  any legal issues raised in 
disputes currently under consultations, before panels or before the Appellate  Body; (ii) any legal 
                                               
21 Mrs Zhang delivered her farewell speech on 26 October 2016.  See Annex 4 of this Report.  
22 See WT/DSB/M/373.  
23 See WT/DSB/M/376.  
24 See WT/DSB/M/379.  WT/AB/27  
 
- 12 - 
 
 issues on which the Appellate  Body had ruled during the term of the  Appellate  Body member 
seeking reappointment; or (iii) any legal issues which ha d not yet been addressed by the 
Appellate  Body. The Chair man had further  recalled that the Appellate  Body members are bound by 
the Rules of Conduct for the DSU as annexed to th e Working Procedures for Appellate Rev iew, and 
that pursuant to Rules  II.1 and  III.2 they shall be independent and impartial, shall avoid direct and 
indirect conflicts of interest, and shall maintain confidentiality. In this regard, the Chair man had 
emphas ized that Mr Chang  could at any time decline to answer any of the questions posed during 
the meeting.  
The DSB Chairman explained that, f ollowing these  introductory remarks  at the 10 May informal 
meeting , two delegations had made statements regarding the na ture of the meeting and had 
expressed their views on the issue of reappointment, as set out in Article  17.2 of the DSU. 
Subsequently, several delegations had posed questions to which Mr  Chang had given his replies, 
and the meeting was then concluded. The f ollowing day, on 11  May 2016, the DSB Chairman had 
been informed by one delegation that it would be unable to support Mr Chang's reappointment. 
That delegation's position and reasons had also been  made public. The Chairman recalled that 
delegations had also received a communication by fax from the Chairman of the Appellate  Body, 
dated 19  May 2016, which included a letter that the Appellate  Body members had sent the 
DSB Chairman with their views on these recent developments.25 This letter is reproduced in 
Annex 3 of this report.  The Chairman concluded by observing that, if the situation remained 
unchanged, Mr Chang's term as an Appellate Body member would expire on 31 May 2016.  
Given the absence of  agreement amongst Members on the matter of reappointment, Mr  Chang's 
term as an Appellate  Body member expired on 31  May 2016.26 On the same day, all living former 
Appellate  Body members addressed a letter to the DSB Chairman expressing their views on the 
non-reappointment of Mr  Chang.27 
At the DSB meeting of 21  July 2016, the DSB Chairman reported that he had consult ed with WTO 
Members on Appellate  Body matters. Based on these consultations, it appeared to him that 
Members were ready to proceed  as follows. First, beginning in September  2016, the DSB Chairman 
would conve ne Dedicated Sessions for a focused discussion by Members on any issue that had 
been raised in respect of Appellate  Body reappointments, including whether WTO Members wish to 
modify the rules governing reappointments. The DSB Chairman clarified that the pu rpose of these 
Dedicated Sessions would be  to discuss issues relating to reappointment only, with particular 
attention paid to assuring the independence and impartiality of the Appellate  Body, and not to 
discuss any other issues including those raised in t he DSU negotiations. The DSB Chairman 
encouraged all Members to fully and actively engage in these Dedicated Sessions with a sense of 
urgency so as to reach an agreement on this matter at the earliest moment with a view to mak ing 
recommendations to the DSB . 
Second, the DSB adopted a decision: (i) to launch a selection process to fill the vacancy left by the 
non-reappointment of one Appellate  Body member; (ii) to invite Members to nominate candidates 
to fill that vacancy and to set a deadline of 14  September  2016 for Members'  nominations; 
(iii) to agree that, should any of the candidates nominated for the 2016  process initiated by the 
DSB at its meeting on 25  January  2016 wish to participate in this selection process, the Member 
who nominated the candidate wo uld inform the Selection Committee of the candidate's intention to 
participate by the deadline stated in paragraph  (ii), and that such candidate would  not need to be 
interviewed by the Selection Committee for a second time; (iv) t o agree that the 2016  Selection 
Committee would also carry out this new selection process; and (v) to request the Selection 
Committee to carry out its work, including conducting interviews of any new candidates and 
hearing the views of delegations on all candidates during the month  of October in order to make 
recommendations to the DSB as soon as possible so that the DSB could take a decision to appoint 
the new Appellate  Body member at the latest by its regular meeting in November  2016.28 
At the DSB meeting of 23  October  2016, the DS B Chairman informed WTO Members that,  by the 
deadline of 14  September 2016, seven candidates had been proposed. Pursuant to the 
                                               
25 See WT/DSB/M/379.  
26 Mr Chang delivered his farewell speech on 26 September 2016.  See Annex 4 of this Report.  
27 This letter is reproduced in Annex 3 of this report.  
28 See WT/DSB/M/383.  WT/AB/27  
 
- 13 - 
 
 21 July 2016 DSB decision, Australia, China, Japan and Nepal had re -submitted their candidates 
for the new vacancy and two new n ominations had been submitted by Chinese  Taipei and Korea. 
The interviews by the Selection Committee of the two new candidates that had been submitted by 
Chinese  Taipei and Korea took place on 17  October  2016.29 
At the DSB meeting of 23  November  2016, the D SB Chairman reported that on 3  November  2016, 
the Selection Committee had made a recommend ation on the vacancy left by M rs Zhang's 
departure. With regard to the second selection process, the DSB Chairman indicated that  the 
Selection Committee had met indiv idually with 57  delegations to hear the views on the seven 
candidates. The Committee had also received, in writing, the views of 30 delegations. Throughout 
the process, the Committee had again based its work on the guidelines, rules and procedures 
containe d in the DSU and WT/DSB/1 governing the selection and appointment of Appellate  Body 
members. On  3 November  2016, the Selection Committee made a recommendation on the 
vacancy left  by the non -reappointment of Mr  Chang.30 At the DSB meeting of 23  Novem ber 2016, 
the DSB a greed that Ms  Zhao Hong and Mr  Hyun Chong Kim be appointed as new members of the 
Appellate  Body, each for a four -year term beginn ing on 1  December  2016.31 
The composition of the Appellate  Body in 201 6 and the res pective terms of office of its m embers 
are set out in Table 1.  
Table 1: Composition of the Appellate  Body  in 201 6 
Name  Nationality  Term(s) of office  
Ujal Singh Bhatia  India 2011–2015 
2015–2019 
Seung Wha Chang*  Korea  2012–2016 
Thomas R. Graham  United States  2011–2015 
2015–2019 
Ricardo Ramírez -Hernández  Mexico  2009–2013 
2013–2017 
Hyun Chong Kim**  Korea  2016-2020 
Shree Baboo Chekitan Servansing  Mauritius  2014-2018 
Peter Van den Bossche  Belgium  2009–2013 
2013–2017 
Yuejiao Zhang*  China  2008–2012 
2012–2016 
Hong Zh ao** China  2016-2020 
* Seung Wha Chang and Yuejiao Zhang's terms as Appellate  Body members ended on  31 May 2016.  
** Hyun Chong Kim and Hong Zhao's terms as Appellate  Body members began on 1  December  2016. 
Pursuant to Rule  5.1 of the Working Procedures, th e members of the Appellate  Body elected 
Mr Thomas R . Graham  to serve as Chairman of the Appellate  Body from 1  January to 
31 December  2016.32 In November  2016, Mr  Ujal Singh Bhatia  was elected to serve as Chair man 
as of 1  January 201 7 until 31  December  2017.33 
Biographical in formation about the m embers of the Appellate  Body is provided in Annex  6. A list of 
former Appellate  Body members and Chairpersons is provided in Annex  7. 
The Appellate  Body receives legal and administrative support from the Appellate  Body Secretar iat, 
in accordance with Article  17.7 of the DSU. As at 31  December  2016, the Secretariat comprised a 
                                               
29 WT/DSB/M/387.  
30 WT/DSB/M/389.  
31 WT/DSB/M/389.  
32 See WT/DSB/69.  
33 WT/DSB/72.  WT/AB/27  
 
- 14 - 
 
 Director, fifteen  lawyers, one administrative assistant, and five support staff. Werner  Zdouc has 
been Director of the Appellate  Body Secretariat since 2006.  WT/AB/27  
 
- 15 - 
 
 3  APPEALS  
Pursuant to Rule 20(1) of the Working Procedures and Article  16(4) of the DSU, an appeal is 
commenced by a party to the dispute giving written notice to the DSB and filing a Notice of Appeal 
with the Appellate  Body Secretariat. Rule 23 (1) of the Working Procedures allows a party to the 
dispute other than the initial appellant to join the appeal, or appeal on the basis of other alleged 
errors, by filing a Notice of Other Appeal within five days of the filing of the Notice of Appeal.  
Eight panel reports concerning eight matters were appealed in 201 6. One dispute related to 
compliance proceedings, while all remaining disputes related to original proceedings. 
"Other  appeals" were filed pursuant to Rule 23(1) of the Working Procedures in five out of the 
eight disputes. Table 2 sets out further information regarding appeals filed in 201 6. Further 
information on the number of appeals filed each year since 199 6 is provided in Annex 8. 
The overall average of panel reports that have been appealed f rom 199 6 to 2016 i s 68%. 
A breakdown of the percentage of panel reports appealed each year is provided in Annex 9. 
Table 2: Panel reports appealed in 2016  
Panel report appealed  Date of appeal  Appellanta Document  
symbol  Other  
appella ntb Document  
symbol  
Colombia – Measures 
Relating to the Importation 
of Textiles, Apparel and 
Footwear  22 January 2016  Colombia  WT/DS461/6  No other 
appeal  --- 
United States – 
Anti-Dumping and 
Countervailing Measures on 
Large Residential Washers 
from Korea  19 April 2016  United States  WT/DS464/7  Korea  WT/DS464/8  
India – Certain Measures 
Relating to Solar Cells and 
Solar Modules  20 April 2016  India WT/DS456/9  No other 
appeal  --- 
European Union – 
Anti-Dumping Measures on 
Biodiesel from Argentina  20 May 2016  European 
Union  WT/DS473/10  Argentina  WT/DS473/11  
Russian Federation – 
Measures on the 
Importation of Live Pigs, 
Pork and Other Pig Products 
from the European Union  23 September 2016  Russian 
Federation  WT/DS475/8  European 
Union  WT/DS475/9  
European Communi ties and 
Certain Member States – 
Measures Affecting Trade in 
Large Civil Aircraft – 
Recourse to Article  21.5 of 
the DSU by the 
United  States  13 October 2016  European 
Union  WT/DS316/29  United States  WT/DS316/30  
United States – Certain 
Methodologies and The ir 
Application to Anti -Dumping 
Proceedings Involving China  18 November 2016  China  WT/DS471/8  No other 
appeal  --- 
United States – Conditional 
Tax Incentives for Large 
Civil Aircraft  16 December 2016  United States  WT/DS487/6  European 
Union  WT/DS487/7  
a Pursuant to Rule 20(1) of the Working Procedures . 
b Pursuant  to Rule 23(1) of the Working Procedures . WT/AB/27  
 
- 16 - 
 
 4  APPELLATE  BODY  REPORTS  
Six Appellate  Body reports concerning s ix matters were circulated in 201 6, the details of which are 
summarized in Table  6 3. As of th e end of 201 6, the Appellate  Body had circulated a total 
of 144 reports.  
Table 3: Appellate  Body  reports circulated in 201 6 
Case  Document symbol  Date circulated  Date adopted  
by the DSB  
European Communities – 
Definitive Anti -Dumpin g 
Measures on Certain Iron or Steel 
Fasteners from China – Recourse 
to Article  21.5 of the DSU by 
China  WT/DS397/AB/RW  18 January 2016  12 February 2016  
Argentina – Measures Relating to 
Trade in Goods and Services  WT/DS 453/AB/R  14 April 2016  9 May 2016  
Colombia – Measures Relating to 
the Importation of Textiles, 
Apparel and Footwear  WT/DS461/AB/R  7 June 2016  22 June 2016  
United States – Anti-Dumping 
and Countervailing Measures on 
Large Residential Washers from 
Korea  WT/DS464/AB/R  7 September 2016  26 Septe mber 2016  
India – Certain Measures Relating 
to Solar Cells and Solar Modules  WT/DS456/AB/R  16 September 2016  14 October 2016  
European Union – Anti-Dumping 
Measures on Biodiesel from 
Argentina  WT/DS473/AB/R  6 October 2016  26 October 2016  
Table 4 below  shows which WTO agreements were addressed in the Appellate  Body reports 
circulated in 201 6. 
Table 4: WTO Agreements addressed in Appellate  Body  reports circulated in 201 6 
Case  Document symbol  WTO agreements addressed  
European Communi ties – Definitive 
Anti-Dumping Measures on Certain 
Iron or Steel Fasteners from China 
– Recourse to Article  21.5 of the 
DSU by China  WT/DS397/AB/RW  Anti-Dumping Agreement  
DSU  
GATT  1994 
Argentina – Measures Relating to 
Trade in Goods and Services  WT/DS 453/AB/R  DSU 
GATT  1994 
GATS  
Colombia – Measures Relating to 
the Importation of Textiles, 
Apparel and Footwear  WT/DS461/AB/R  DSU 
GATT  1994 
United States – Anti-Dumping and 
Countervailing Measures on  Large 
Residential Washers from  Korea  WT/DS464/AB/R  Anti-Dumping Agreement  
DSU  
GATT  1994 
SCM Agreement  
India – Certain Measures Re lating 
to Solar Cells and Solar  Modules  WT/DS456/AB/R  DSU 
GATT  1994 
TRIMs  Agreement  
European Union – Anti-Dumping 
Measures on Biodiesel 
from Argentina  WT/DS473/AB/R  Anti-Dumping  Agree ment 
DSU 
GATT  1994 
WTO Agreement  
The findings and conclusions contained in the Appellate  Body reports circulated in 201 6 are 
summarized below.  WT/AB/27  
 
- 17 - 
 
 4.1  Appellate  Body  Report, European Communities – Definitive Anti -Dumping Measures 
on Certain Iron or Steel Fastener s from China – Recourse to Article  21.5 of the DSU 
by China , WT/DS397/AB/RW  
This dispute concerned  certain measures taken by the European  Union to comply with the 
recommendations and rulings of the DSB in EC – Fasteners (China)  relating  to the imposition b y 
the European Union of anti -dumping duties on fasteners from China.  The original dispute arose  
from a complaint brought by China against the European Union concerning Council Regulation (EC) 
No. 91/2009 (the Definitive Regulation) imposing definitive anti -dumping duties on fasteners from 
China, and aspects of the underlying anti -dumping investigation leading to their imposition. In the 
original proceedings, the panel and the Appellate Body found that the Definitive Regulation was 
inconsistent with several provisions of the Anti -Dumping Agreement (Article  2.4, Articles 3.1 
and 4.1, as well as Articles 6.2 and 6.4).  
Subsequent to the DSB's adoption of the panel and Appellate Body reports in the original 
proceedings, the European Union took certain measures t o implement the DSB's  recommendations 
and rulings, including, conducting a review investigation. In both the original and the review 
investigations, the Commission considered that the Chinese producers under investigation did not 
operate according to the p rinciples of a market economy and resorted to the so -called "analogue 
country methodology" for determining the normal values for the Chinese producers' products. The 
Commission determined the normal values used to calculate the dumping margins on the basis  of 
data provided by the analogue country producer, Pooja Forge, rather than the Chinese producers 
under investigation because the producers  had non -market economy  (NME) status. Before the 
Article 21.5  Panel, China claimed that certain aspects of the revie w investigation leading to the 
continued application of definitive duties on fasteners from China were inconsistent with 
Articles  2.4, 2.4.2, 3.1,  4.1, 6.1.2, 6.2, 6.4, 6.5, and  6.5.1 of the Anti -Dumping Agreement and 
Article VI:1 of the GATT 1994.  
The Art icle 21.5 Panel found that the European Union acted inconsistently with Article 6.5 of the 
Anti-Dumping Agreement  by treating  the information on the list and characteristics of the products 
of Pooja Forge  as confidential . Consequentially, the Article 21.5 Panel found that it was not 
necessary for it to make a finding under that provision since it had already found a violation of 
Article 6.5. The Article 21.5 Panel further found that the European Union acted inconsistently 
under Article 6.4 of the Anti -Dumpi ng Agreement  by failing  to provide the Chinese producers with 
timely opportunities to see the information on the  list and characteristics of Pooja Forge's 
products, which was not confidential  within the meaning of Article 6.5. Furthermore, the 
Article  21.5 Panel found that, having denied t he Chinese producers access to information relevant 
within the meaning of Article 6.4, the European Union acted inconsistently with  Article 6.2  of the 
Anti-Dumping Agreement.  With respect to China's claim under Article 6.1 .2 of the Anti -Dumping 
Agreement, the Article 21.5 Panel found that Pooja Forge was not an interested party in the review 
investigation, and  that China had failed to establish that the European Union acted inconsistently 
with the  obligations under Article 6.1.2 by failing to ensure that the information provided by  
Pooja  Forge concerning the list and characteristics of its products was made available  promptly to 
the Chinese producers . In addition, the Article 21.5 Panel found that the European Union acted 
inconsistently with Article 2.4 of the Anti -Dumping Agreement by failing to provide the Chinese 
producers with the information regarding the characteristics of  Pooja Forge's products that were 
used in the determination of the normal values . With respect to t he remainder of China's claims 
under Article 2.4, the Article 21.5 Panel found that China had failed to establish the alleged 
inconsistencies.  The Article 21.5 Panel further concluded that the European Union acted 
inconsistently with Article 2.4.2 of the A nti-Dumping Agreement by not  taking into consideration, 
in its dumping margin determinations, models exported by the  Chinese producers that did not 
match any of the models sold by Pooja Forge . Finally, t he Article 21.5 Panel found that the 
European Union a cted inconsistent ly with Article 4.1 in defining the domestic indus try in the review 
investigation and with Article 3.1 since the Commission's injury determination was based on the 
data obtained  from a wrongly defined domestic industry.  
4.1.1   Terms of reference issues  
The European Union claimed on appeal that the Panel erred in finding that China's claims under 
Articles 6.5, 6.5.1, 6.4, 6.2, 6.1.2, 2.4, 4.1, and 3.1 of the Anti -Dumping Agreement fell within its 
terms of reference under Article 21.5 of the DSU.  WT/AB/27  
 
- 18 - 
 
 The European Union argued that China's claims under Articles 6.5 and 6.5.1 of the Anti -Dumping 
Agreement did not fall within the Panel's terms of reference because these were the same claims 
that had been raised and decided in the original proceedings. The A ppellate Body recalled its ruling 
in EC – Bed Linen (Article  21.5 – India)  that a complainant should not be allowed to raise claims in 
compliance proceedings that were already raised and dismissed in the original proceedings in 
respect of a component of th e implementation measure that is the same as in the original 
measure. However, the Appellate Body also recalled that in subsequent disputes, it had clarified  
that the same claim with respect to an unchanged element of the measure can be re -litigated in 
the Article 21.5 proceedings, if in the original proceedings the matter was not resolved because, 
for instance, the Appellate Body was not able to complete the analysis.  
The Appellate Body considered  that the objects of China' s claims under Articles 6.5 and  6.5.1 of 
the Anti -Dumping Agreement in the original and in the compliance proceedings were not the same. 
China's claims under Articles 6.5 and 6.5.1 in the original proceedings concerned the confidential 
treatment of the information provided in Pooja Forge' s questionnaire on the "product types", which 
the Commission used to make the dumping calculation. China's claims under Articles 6.5 and 6.5.1 
in the compliance proceedings concerned the confidential treatment of the list and characteristics 
of Pooja Forge 's products, which the Chinese producers asked to see after the Commission had 
disclosed to them in the review investigation the "product types" and certain characteristics used 
in the price comparison, in order to bring itself into compliance with the DSB  recommendations 
and rulings in the original proceedi ngs under Articles 6.4 and 6.2.  
Moreover, the Appellate Body considered that the treatment as confidential b y the Commission of 
the list and characteristics  of Pooja Forge's products constituted an integ ral part of the measure 
taken to comply with the DSB recommendations and rulings in the original proceedings. 
Accordingly, the Appellate Body  upheld  the Panel's finding that China's  claims under Articles 6.5 
and 6.5.1 were within the Panel's terms of refer ence.  
The European Union argued that China's claims under A rticles 6.4 and 6.2 of the 
Anti-Dumping  Agreement that the Commission failed to provide timely opportunities to the 
Chinese  producers to see the information concerning the list and characteristics of Pooja Forge's 
products and to defend their interests, did not fall within the Panel's terms of reference because 
these were claims that China could have raised, but did not raise, in the original proc eedings. 
Moreover, the European  Union contended that China's claims raised in these Article 21.5 
proceedings concerned an unchanged aspect of the original measure that was separable from the 
measure taken to comply.  
The Appellate Body recalled that in US – Upland Cotton (Article  21.5 – Brazil)  it had found t hat a 
complaining Member ordinarily would not be allowed to raise claims in an Article  21.5 proceeding 
that it did not, but could have, pursued in the original proceedings. The Appellate Body further 
referred to its finding in US – Zeroing (EC) (Article  21.5 – EC) that this was not the case for new 
claims against a measure taken to comply, i.e. in principle, a new and different measure even if 
such measure incorporates components of the original measure that are unchanged, but are not 
separable from other a spects of the measure taken to comply.  
The Appellate Body observed that violations of the procedural obl igations under Articles  6.4 
and 6.2 of the Anti -Dumping Agreement could occur multiple  times  during an investigation, 
depending on the piece of informa tion that an interested party requests to see or the presentation 
that such a party wishes to make for the defence of its interests. The Appellate Body considered 
that the aspect of the measure China challenge d in these compliance proceedings had changed 
from the original proceedings, considering that China was challenging a different episode of 
non-disclosure by the Commission, which concerned different aspects of Pooja  Forge's product 
information. According to the Appellate Body, the key question in addre ssing this issue on appeal 
was whether the Chinese producers were aware in the original investigation of the existence of the 
information regarding the list and the characteristics of Pooja Forge's products and of its 
relevance. Only if it could be demonst rated that the Chinese producers were aware of the 
existence and of the relevance of this information, could it then be concluded that China could 
have claimed in the original proceedings that the non -disclosure of such information by the 
Commission amount ed to a violation of Articles 6.4 and 6.2.  
The Appellate Body recalled that the Chinese producers' requests to see information concerning 
the information at issue were prompted by the C ommission's disclosures of the product types  used WT/AB/27  
 
- 19 - 
 
 in the dumping calcul ation and that the exchanges between  the Commission and the 
Chinese  producers in the review investigation suggested that the Chinese producers became aware 
of the existence of the information at issue only during the review investigation, following partial  
disclosures made by the Commission. Accordingly, the Appellate Body agreed with the Panel that 
China's claims were not claims that it could have made in the original proceedings.  
Finally, the Appellate Body considered that the Commission's non -disclosure of the information at 
issue could be characterized as an omission in the disclosures made by the Commission to comply 
with the DSB  recommendations and rulings under Articl es 6.4, 6.2 , and 2.4 of the 
Anti-Dumping  Agreement . The Appellate Body considered tha t it constituted an integral part of, 
and was not separable from, the measure taken to comply with the DSB recommendations and 
ruling in the original proceedings.  
Accordingly, the Appellate Body concluded the claims that China raised in these compliance 
proceedings under Articles 6.4 and 6.2 of the Anti -Dumping Agreement were not claims that China 
could have raised in the original proceedings and, therefore,  upheld  the Panel's finding that 
China's  claims under Articles 6.4 and 6.2 were within the Panel's te rms of reference.  
The European Union made the same arguments mutatis mutandis  in respect of China's claim under 
Article 6.1.2 of the Anti -Dumping Agreement. The Appellate Body rejected the European Union's 
claim  that the Panel erred in finding that China's  claims under Article 6.1.2 fell within its terms of 
reference, and rejected it. The European Union further contended that in finding that China's claim 
under Article 6.1.2 fell within its terms of reference the Panel had ac ted inconsistently with 
Article  11 of the DSU, because it had concluded that Pooja Forge had provided certain information 
on coating of fasteners, for the first time, in the review investigation, rather than simply 
confirming information that it had already provided in the original inves tigation. The Appellate 
Body rejected this claim under Article 11 of the DSU because it considered that whether the 
information was provided for the first time in the review investigation or not  was im material to the 
Panel's finding that China's claims und er Article 6.1.2  of the Anti -Dumping Agreement  fell within its 
terms of reference. Accordingly, the Appellate Body concluded that the claim that China raised in 
these compliance proceedings under Article 6.1.2 of the Anti -Dumping Agreement was not a claim 
that China could have raised in the original proceedings and, therefore, upheld t he Panel's finding 
that China's  claim under Article 6.1.2 was within the Panel's terms of reference.  
The European Union argued that China's claims under Article 2.4 of the Ant i-Dumping Agreement 
in respect of adjustments for differences in physical characteristics did not fall within the 
Panel's  terms of reference because these were claims that China could have raised, but did not 
raise, in the original proceedings. Moreover, t he European Union contended that China's claims in 
these Article  21.5 proceedings concerned an unchanged aspect of the original measure that was 
separable from the measure taken to comply.  
The Appellate Body observed that the exchanges between the Chinese producers and the 
Commission in the review investigation demonstrated that the Chinese producers became aware of 
the information underlying China's claim under Article 2.4 of the Anti -Dumping Agreement  only 
during the review investigation. This was because  the Commission never fully disclosed all the 
information regarding the characteristics of Pooja Forge's products that were relevant to the 
dumping determination. The Appellate Body, thus, agreed with the Panel that the absence from 
the record of the origi nal investigation of any discussion on the impact on price  comparability of 
physical characteristics , not included in the original product control numbers (P CNs), showed that 
this issue was unique to the review investigation and, therefore, could not have been raised in the 
original proceedings.  
Moreover, the Appellate Body considered that the claim by China in these compliance proceedings 
under Article 2.4 of the Anti -Dumping Agreement could not have been raised in the original 
proceedings, and challenged aspects that were intrinsically connected with, and form ed part of the 
measure taken to comply, namely, the disclosures made by the Commission in the review 
investigation to comply with the DSB  recommendations and rulings under Article 2.4 in the 
original proceedings.  
Accordingly, the Appellate Body considered that the claim that China raised in these compliance 
proceedings under Article 2.4, in respect of adjustments relating to differences in physical WT/AB/27  
 
- 20 - 
 
 characteristics not reflected in the original  PCNs, wa s not a claim that China could have raised in 
the original proceedings. The Appellate Body , therefore, upheld the Panel's finding that China's 
claim under Article 2.4 in respect of adjustments relating to differences in physical characteristics 
not reflect ed in the original PCNs, fell within its terms of reference.  
The European Union also  argued that China's claims under Articles 4.1 and 3.1 of the 
Anti-Dumping Agreement did not fall within the Panel's terms of reference because these were 
claims that China  could have raised, but did not raise, in the original proceedings. Moreover, the 
European Union contended that China's claims in these Article 21.5 proceedings concerned an 
unchanged aspect of the original measure that was separable fr om the measure taken  to comply.  
The Appellate Body observed that China's claims under Articles 4.1 and 3.1 of the 
Anti-Dumping  Agreement  related to a disagreement among the parties over t he meaning and 
scope of the DSB  recommendations and rulings in the original proceedings. The European Union 
considered that all it had to do to comply was to re -define the domestic industry, based on the 
original Notice of Initiation, and include all producers that had come forward within the deadline 
set forth in that notice. In contrast, Chi na considered that the Commission had to issue a new 
notice of initiation. The Appellate Body stated that such a disagreement on the scope of the DSB 
recommendations and rulings in the original proceedings clearly could not have been addressed in 
the origi nal proceedings, and that this was exactly the type of disagreement which a 
compliance  panel under Article 21.5 of the DSU was called upon to resolve. Accordingly, the 
Appellate Body  upheld  the Panel's finding that China's  claims under Articles 4.1 and 3.1  of the 
Anti-Dumping Agreement, with respect to the definition of domestic industry, fell within its terms 
of reference.  
Finally, the Appellate Body made some remarks in relation to claims regarding the Panel's terms of 
reference under Article 21.5 of the DSU brought by the European Union. In this respect, the 
Appellate Body recalled that before the Panel the European Union raised objections regarding the 
Panel's terms of reference under Article 21.5 of the DSU in respect of 7 out of 10  claims brought 
by Ch ina. On appeal, the European Union challenged 6 of the 7 findings by the Panel's findings 
regarding its terms of references.  
The Appellate Body observed that a decision to raise a claim regarding a panel's terms of reference 
must be t aken judiciously, in p articular  given the serious consequences that flow from a finding 
that a matter is beyond the scope of a panel's jurisdiction under Article 21.5; namely, that the 
complainant would be able to obtain a ruling on that matter only by initiating dispute settle ment 
proceedings afresh. The Appellate Body emphasized that complainants should exercise their 
judgment as to whether it is fruitful to raise such claims, as well as whether, on appeal, it is 
fruitful to claim that a panel erred in finding jurisdiction in circumstances where the panel itself has 
rejected the same challenge to its jurisdiction on a reasoned basis. Finally, the Appellate Body 
recalled that, even when the parties to a dispute remain silent on issues that touch on the proper 
scope of proceeding s, panels and the Appellate Body cannot ignore such issues, but must deal with 
such issues in order to satisfy themselves that they have authority to proceed.  
4.1.2   Articles 6.5 and 6.5.1 of the Anti -Dumping Agreement  
The European Union raised a series of claims  in relation to the Panel's findings under Article 6.5 of 
the Anti -Dumping Agreement. In particular, the European Union raised claims of error regarding 
the Panel's treatment of Pooja Forge's request for the confidential treatment of the information, 
regar ding the list and characteristics of its products in its analysis of China's claim under 
Article  6.5. For its part, China put forward a conditional appeal under Article 6.5.1 of the 
Anti-Dumping Agreement regarding the Commission's alleged failure to ensur e that Pooja  Forge 
submit ted a non -confidential summary of the information at issue. In this regard, China requested 
that the Appellate Body find that the European Union acted inconsistently with this provision, in 
the event that the Appellate Body found t hat the European Union had not acted inconsistently with 
Article  6.5. WT/AB/27  
 
- 21 - 
 
 4.1.2.1   Whether the Panel erred in its treatment of Pooja Forge's request for the 
confidential treatment of the information regarding the products list and characteristics 
of the analogue countr y producer  
The Appellate Body first addressed the European Union's claim that the Panel erred in its 
treatment of Pooja Forge's request for the confidential treatment of the information regarding the 
list and characteristics of its products. The Appellate Body noted that the request for confidential 
treatment by Pooja Forge was reflected in an e -mail to the Commission in which Pooja Forge 
stated that the list of the products sold by it could not be provided because, if disclosed, this 
information would conf er an advantage on its competitors. The Appellate Body then turned to 
address the European Union's argument that the Panel acted inconsistently with Article  17.5(ii) of 
the Anti -Dumping Agreement by disregarding Pooja Forge's request in its consideration o f China's 
claim under Article 6.5 of that Agreement. The Appellate Body found that the Panel had clearly 
engaged with the content of Pooja Forge's r equest when it found that the e -mail contained  
no more than a bald assertion , which, in the Panel's view, wa s insufficient to support the 
conclusion that good cause had been shown for the confidential treatment of the information at 
issue. Accordingly, the Appellate Body rejected the European Union's argument that the Panel 
disregarded Pooja Forge's request for confidential treatment in its analysis of China's claim under 
Article 6.5 of the Anti -Dumping Agreement, and thereby acted inconsistently with Article 17.5(ii) of 
that Agreement.  
The Appellate Body next turned to examine the European Union's argument that the Panel failed to 
conduct an objective assessment of the facts, as required by Article 11 of the DSU, when it found 
that, because Pooja Forge's e -mail to the Commission requesting confidential treatment of the 
information at issue was placed on the confi dential file of the investigation, the Chinese producers 
had been deprived of the opportunity to respond to Pooja Forge's request. The Appellate Body 
examined the record evidence on which the European Union relied, in support of its argument, and 
found tha t this evidence did not call into question the objecti vity of the Panel's finding. 
In particular, the Appellate Body highlighted that a panel does not act inconsistently with Article 11 
of the DSU merely because it does not refer to a certain piece of evid ence or attribute to that 
evidence the same weight as the party relying on it.  
In relation to the Panel's treatment of Pooja Forge's request for the confidential treatment of the 
information at issue, the Appellate Body considered the European Union's furt her claim that the 
Panel erred in finding that Pooja Forge's e -mail to the Commission contained no more than a bald 
assertion  on the part of Pooja Forge, which did not seem to support the argument that Pooja  Forge 
had provided good cause to justify the con fidential treatment o f its information. 
The European  Union contended in this regard that the Panel was required to examine whether, in 
light of the nature of the information at issue and the particu lar good cause alleged by 
Pooja  Forge, the statement conta ined in the e -mail was sufficient to establish that the Commission 
objectively assessed "good cause" for the purposes of Article 6.5 of the Anti -Dumping Agreement. 
The Appellate Body considered that, in light of the particular circumstances of this case, w here 
substantiation of the particular good cause alleged by Pooja Forge was lacking in Pooja Forge's 
request for confidential treatment and in the Commission's published reports and related 
supporting documents, it was not for the Panel to examine, ab init io, Pooja  Forge's request for 
confidential treatment in light of the nature of the information at issue and the particular good 
cause alleged by Pooja Forge. The Appellate Body recalled that a panel does not comply with the 
applicable standard of review un der Article 6.5 if, in the absence of an objective assessment by the 
investigating authority of the good cause alleged, it engages in a de novo review of evidence on 
the record of the investigation and determines for itself, or on the basis of subjective c oncerns of 
the submitting party, whether the request for confidential treatment is sufficiently substantiated 
and that good cause for such treatment objectively exists. Accordingly, the  Appellate Body found 
that, in the circumstances of this case, the Pane l did not err in finding that Pooja Forge's e -mail to 
the Commission contained "no more than a bald assertion".  
4.1.2.2   Whether the Panel erred in finding that the Commission "never" conducted an 
objective assessment of the "good cause" alleged by Pooja Forge  
The Appellate Body then turned to consider the European Union's claim that the Panel acted 
inconsistently with Article 11 of the DSU in finding that the Commission never conducted an 
objective assessment of whether the information at issue was confidential by nature or whether 
"good cause" had been shown to justify its confidential treatment, as required by Article 6.5. The WT/AB/27  
 
- 22 - 
 
 European Union relied on a letter from the case -handler who had conducted the verification visit at 
Pooja Forge's premises in the course of  the original investigation. In this letter, the case -handler 
averred that, at the time of the Commission's verification visit, Pooja  Forge had requested that its 
company details be treated confidentially, and that Pooja  Forge was very much concerned about  
the treatment of its information in the investigation because of strong competition with the 
Chinese producers in the after -sales market in India. The European  Union further relied on an 
exchange of e -mails between Pooja Forge and the  Commission in which Pooja Forge confirmed 
that it did not wish to disclose its company details to interested parties, as it had mentioned during 
the verification visit that took place in 2008.  
The Appellate Body noted that the letter from the case -handler on which the Europea n Union relied 
was not part of the record of the investigation but, instead, a document that had been prepared 
specifically for these WTO dispute settlement proceedings. The Appellate Body considered that the 
letter from the case -handler constituted ex pos t rationalization, which the Panel could not have 
properly relied on in examining China's claim under Article 6.5. The Appellate Body further pointed 
out that, in any event, this letter, as well as the exchange of e -mails between Pooja Forge and the 
Commis sion on which the European Union relied merely confirmed that Pooja Forge had requested 
confidential treatment of its information on the basis that its disclosure could confer an advantage 
on its competitors. This evidence did not, however, indicate whethe r and how the Commission 
engaged with the particular good cause alleged by Pooja Forge in according confidential treatment 
to the information at issue. On this basis, the Appellate Body concluded that the evidence relied on 
by the European Union did not ca ll into question the objectivity of the Panel's finding that the 
Commission never conducted an objective assessment of whether Pooja Forge had shown good 
cause for the confidential treatment of the information at issue. Accordingly, the Appellate Body 
found that , in reaching this finding , the Panel did not fail to make an objective assessment of the 
facts, as required by Article 11 of the DSU.  
4.1.2.3   Whether the Panel erred in finding that there was an inconsistency in the 
arguments put forward by the European Uni on 
The Appellate Body then turned to the European Union's claim that the Panel's finding under 
Article 6.5 was in error, insofar as it rested on the Panel's statement that there was an 
inconsistency in the arguments presented by the European Union. The App ellate  Body found that 
the Panel's conclusion that the European Union acted inconsistently with Article  6.5 followed from 
its finding that the Commission had failed to conduct an object ive assessment of whether 
Pooja  Forge had shown good cause for the conf idential treatment of the information at issue, as 
required by Article 6.5. The Appellate Body, therefore, considered that the Panel's  statement that 
there was a logical inconsistency in the European  Union's arguments constituted obiter dictum , 
which did n ot provide a basis for reversing the Panel's ultimate conclusion that the European Union 
acted inconsistently with Article 6.5.  
4.1.2.4   Whether the Panel erred by not conducting its own analysis of the nature of the 
information at issue  
The Appellate Body proceede d to address the European Union's claim that the Panel erred in 
concluding that the European Union acted inconsistently with Article 6.5 because the Panel found, 
without a proper analysis, that the information at issue was not confidential. At the outset o f its 
analysis, the Appellate Body disagreed with the European Union to the extent that it suggested 
that the Panel found that the information at issue was, in fact, not confidential by nature. In this 
regard, the Appellate Body highlighted that the Panel expressly stated that it was not making such 
a finding because the applicable standard of review would not have allowed it to conduct a de novo  
review. Instead, the Panel found that the European Union acted inconsistently with Article  6.5 on 
the basis that  the Commission failed to conduct an objective assessment of whether Pooja Forge 
had shown good cause for the confidential treatme nt of the information at issue.  
Turning to the European Union's argument that this was an insufficient basis for the Panel's f inding 
that the European Union acted inconsistently with Article 6.5, the Appellate Body considered that 
this argument did not comport with the Appellate Body's guidance under Article 6.5 regarding : the 
role of a party requesting confidential treatment for  information that it submits to an authority; the 
role of that authority in examining that request; and the role of a WTO panel in the event of a 
claim that the authority acted inconsistently with Article 6.5 by according confidential treatment to 
the info rmation in the absence of "good cause" being shown by the party submitting the WT/AB/27  
 
- 23 - 
 
 information. The Appellate Body recalled in this regard that it is for the party requesting 
confidential treatment for information that it considers to be confidential by nature , or that it 
submits on a confidential basis, to furnish reasons justifying such treatment. The role of the 
authority is to assess such reasons and determine, objectively, whether the submitting party has 
shown good cause for the confidential treatment of its information. In the event of a claim of 
violation of Article 6.5, a panel, tasked with reviewing whether an authority has objectively 
assessed the good cause alleged by the party submitting information to it, must examine this issue 
on the basis of the  investigating authority's published report and its related supporting documents, 
in light of the nature of the information at issue, and the reasons given by the submitting party for 
its request for confidential treatment.  
Noting that the Panel found that  the Commission had never conducted the objective assessment 
required of it under Article 6.5, the Appellate Body considered that, h aving made that finding, it 
was not for the Panel to conduct a de novo review of whether the information at issue was 
confid ential by nature or whether good cause had been shown by Pooja  Forge . Thus , the 
Appellate  Body found that the Panel did not err by not conducting its own analysis of the nature of 
the information at issue for the purposes of its assessment of C hina's claim  under Article 6.5.  
In light of the foregoing considerations, the Appellate Body upheld the  Panel's finding that the 
European Union acted inconsistently with Article 6.5 in the review investigation at issue. The 
Appellate Body further noted that China's co nditional appeal under Article 6.5.1 of the 
Anti-Dumping Agreement would have been triggered only in the event of the reversal of the 
Panel's finding of a violation under Article 6.5. Having upheld the Panel's finding under Article 6.5, 
the condition for a ddressing China's claim under Article 6.5.1 was not met and, accordingly, the 
Appellate Body made no findings under Article 6.5.1.  
4.1.3   Articles 6.4 and 6.2 of the Anti -Dumping Agreement  
On appeal, the European Union claimed that the Panel erred in finding tha t the information at issue 
was: (i) relevant  to the presentation of the Chin ese producers' cases; (ii)  not confidential  within 
the mea ning of Article 6.5; and (iii) used  by the Commission in its calculation of dumping margins. 
The European Union argued tha t, for the purposes of its analysis under Article 6.4, the Panel 
should not have relied on its finding that the Commission had accorded confidential treatment to 
this information in a manner that did not conform to the requirements of Article 6.5. Instead,  the 
European Union argued  that the Panel was required to carefully and separately undertake an 
analysis of the information at issue in order to determine whether such information was 
confidential by nature within the meaning of Article 6.5.  
In addressing the European Union's argument, the Appellate Body framed the issue as one 
concerning the meaning of the reference in Article 6.4 to information "that is not confidential as 
defined in paragraph 5". Recalling its earlier finding that Article 6. 5 prescribes a showing of 
"good  cause" by the party requesting confidential treatment of its information as a condition 
precedent for an investigating authority to accord such treatment, the Appellate Body noted that 
the treatment of information as confidential was, th erefore, the legal consequence that flowed 
from the establishment of good cause, as determined pursuant to an objective assessment by the 
authority reviewing a party's request for confidential treatment. In light of this interpretation of 
Article 6.5, the Appellate Body considered that the reference  in Article 6.4 to information that was  
not confide ntial as defined in paragraph 5  was properly to be understood as excluding from the 
scope of Article 6.4 information that has been accorded confidential treatmen t in accordance with  
Article 6.5. Conversely, the Appellate Body stated that if information has been accorded 
confidential treatment under Article 6.5 in a manner that did not conform to the requirements of 
that provision, there was no legal basis for acco rding confidential treatment and such information 
would, for the purposes of Article 6.4 , be considered as information that was  not confide ntial as 
defined in paragraph 5 . The Appellate Body therefore rejected the European Union's argument 
that, for the pu rposes of conducting an analysis under Article 6.4, a panel must carefully and 
separately undertake an examination of the information at issue in order to determine whether 
such information is confidential within the meaning of Article 6.5. Accordingly, th e Appellate Body 
found that the Panel did not err in treating the information at issue as not requiring confidential 
treatment for the purposes of its analysis under Article 6.4.  
The Appellate Body next turned to consider the European Union's claim that th e Panel erred in 
finding that the information at issue was "relevant", within the meaning of Article 6.4, for the WT/AB/27  
 
- 24 - 
 
 presentation of the Chinese producers' cases. The European Union argued that, in reaching this 
finding, the Panel erred by relying on the fact  that the Chinese producers had requested the 
information at issue from the Commission. Recalling its finding in the original proceedings, the 
Appellate Body highlighted that whether information is "relevant" to the presentation of an 
interested party's ca se, within the meaning of Article 6.4, is to be determined from the perspective 
of that interested party, rather than the perspective of the investigating authority. Thus, the 
Appellate Body found that the Panel did not err in finding that the information at issue was 
"relevant" to the presentation of the Chinese producers' cases on the basis that the 
Chinese  producers had repeatedly requested this i nformation from the Commission.  
The Appellate Body then turned to examine the European Union's claim that the  Panel erred in 
finding that the information at issue was "used" by the Commission, within the meaning of 
Article  6.4. The Appellate Body recalled its finding in the original proceedings that whether 
information was "used" by the authority is dependent on whether the information relates to a 
required step in an anti -dumping investigation, rather than on whether such information was 
actually relied on by the authority in its determination. Thus, under Article 6.4, information is 
"used" by an authority when s uch information relates to issues which the authority is required to 
consider under the Anti -Dumping Agreement, or which it, in fact, considers, in the exercise of its 
discretion, during the course of an anti -dumping investigation. Turning to the facts of this case, 
the Appellate Body found that, although all of the specific data provided by Pooja  Forge concerning 
its products and their characteristics may not have been specifically relied on by the Commission 
in its determinations, the Commission extracted  as much as possible from all of Pooja  Forge's data 
in order to group the products at issue in accordance with the revised PCNs, and calculated 
dumping margins for the Chinese producers on this basis. The Appellate Body, thus, found that all 
of the informa tion concerning the products sold by Pooja Forge and their characteristics was 
"used" by the Commission, within the meaning of Article 6.4, because it related to a required step 
in the investigation, namely, the calculation of the dumping margins.  
The Appe llate Body, thereafter, addressed the European Union's claim that the Panel erred in 
finding that the provision of information to the Chinese producers,  at the time when the 
company -specific disclosures were issued, was too late to comply wi th the obligati on under 
Article  6.4. The Appellate Body recalled that the Panel had found th at information concerning 
Pooja  Forge's products was not disclosed to the Chinese producers on the grounds of 
confidentiality. Thus, because the Commission did not provide  an oppo rtunity for the 
Chinese  producers to see all information that was relevant to the presentation of their cases , 
within the meaning of Article  6.4, the Appellate Body found that the question of whether timely 
opportunities had been provided was a moot point that did not arise for consideration. The 
Appellate Body, however, clari fied that the issue of whether timely opportunities , within the 
meaning of Article 6.4, have been provided to interested parties to see information that falls within 
the scope of that provision must be determined on a case -by-case basis, taking into account the 
specific information at issue, the step of the investigation to which such information relates, the 
practicability of disclosure at certain points of the investigation vis -à-vis other points, and the 
stage of the investigation at which interested parties have made a request to see the information 
at issue.  
In light of these considerations, the Appellate Body upheld t he Panel's finding that the European 
Union acted inconsistently w ith Article 6.4 of the Anti -Dumping Agreement because the 
Commission failed to provide the Chinese producers with information concerning the list and 
characteristics of Pooja  Forge's products, which was not confidential within the meaning of 
Article  6.5 of  the Anti -Dumping Agreement, was relevant to the presentation of the 
Chinese  producers' cases, and was used by the Commission.  
The Appellate Body next considered the European Union's claim that the Panel erred in finding that 
the European Union acted incon sistently with A rticle 6.2 mutatis mutandis  as those argued by the 
European Union in the context of its claim u nder Article  6.4. The Appellate  Body recalled its finding 
that the Panel did not err in concluding that the European Union acted inconsistently w ith 
Article  6.4 in the review investigation. Consequently, the Appellate Body found that the Panel did 
not err in finding that, by failing to disclose the information at issue to the Chinese producers in 
accordance with Article 6.4, the European Union deni ed these producers a full opportunity for the 
defence of their interests, in contravention of Article 6.2.  WT/AB/27  
 
- 25 - 
 
 4.1.4   Article 6.1.2 of the Anti -Dumping Agreement  
In respect of China's claim that the Panel erred in rejecting its claim that the European Union acted 
inconsistently with Article 6.1.2 of the Anti -Dumping Agreement, the Appellate Body first 
addressed China's contention that the Panel erred in finding that Pooja Forge was not an 
"interested party" in the review investigation within the meaning of Article 6. 11 of the 
Anti-Dumping Agreement and that, therefore, the obligation under Article 6.1.2 did not apply to 
inform ation submitted by Pooja Forge.  
Turning to the Panel's interpretation of  the term "interested parties" , the Appellate Body noted the 
Panel's fin ding that the residual clause of that provision made clear that, in respect of entities not 
listed in the first part of Article 6.11, a decision by the investigating authority was necessary to 
include such entities as "interested parties" in an anti -dumpin g investigation. The Appellate Body 
then noted that the Panel had found that Pooja Forge was not an "interested party" in the review 
investigation, on the basis that there was no evidence on the record of the investigation that the 
Commission had formally decided to include Pooja Forge as an interested party. However, in 
reviewing the record of the investigation, the Appellate Body found that: (i) Pooja Forge had 
participated in the investigation at the request of the Commission; (ii) the Commission selecte d 
Pooja Forge as the analogue country producer for the purposes of the investigation and used its 
data to determine normal values and calculate dumping margins for the Chinese producers; and 
(iii) the Commission treated Pooja Forge like an investigating au thority is required to treat an 
"interested party" in an anti -dumping investigation by, for example, requesting Pooja Forge to 
provide a non -confidential summary of information submitted in confidence, and verifying the 
information submitted by Pooja  Forge . The Appellate Body thus fo und that, although there was 
no evidence on the record of a formal declaration in which the Commission deemed Pooja Forge an 
"interested party" in the investigation at issue, the record of the investigation demonstrated that, 
by its actions in this particular case, the Commission treated Pooja  Forge as an "interested party" 
in the review investigation and, consequently, allowed Pooja Forge to be included as an "interested 
party", within the meaning of the residual clause of Artic le 6.11. Accordingly, the Appellate Body 
reversed  the Panel's findings that Pooja Forge was not an "interested party" in the review 
investigation and that, therefore, the obligation under Article 6.1.2 of the Anti -Dumping 
Agreement did not apply to evidenc e provided by Pooja Forge.  
Having reversed this finding of the Panel, the Appellate Body recalled that, subject to the 
requirement to protect confidential information, Article 6.1.2 requires that evidence presented in 
writing by one interested party be mad e available promptly to other interested parties. Noting that 
it had upheld the Panel's conclusion that the European Union acted inconsistently with Article 6.5 
because the Commission had accorded confidential treatment to the information at issue, the 
Appellate Body found that the information concerning the list and characteristics of Pooja Forge's 
products was, therefore, not excluded from the scope of the obligation under Article 6.1.2. 
Accordingly, the Appellate Body reversed the Panel's finding that Ch ina had not established that 
the European Union acted inconsistently with Article 6.1.2 of the Anti -Dumping Agreement in the 
review investigation at issue, and found, instead, that the European Union acted inconsistently 
with that provision because the Com mission  failed to make available to the Chinese producers 
information concerning the list and characteristics of Pooja Forge's products.  
4.1.5   Article 2.4 of the Anti -Dumping Agreement  
The European Union appealed the Panel's interpretation and application of the  last sentence of 
Article  2.4 of the Anti -Dumping Agreement. For its part, China claimed that the Panel erred in its 
interpretation and application of Article  2.4 as regards the fair comparison requirement.  
4.1.5.1   The procedural requirement under Article 2.4  
The European Union challenged the Panel's interpretation and application of the last  sentence of 
Article  2.4 of the Anti -Dumping Agreement, which provides that "[t]he authorities shall indicate to 
the parties in question what information is necessary to ensure  a fair comparison and shall not 
impose an unreasonable burden of proof on those parties." The European Union submitted that the 
Panel erred in suggesting that this obligation differs based on the methodology used to establish 
normal values, and in finding  that it requires the disclosure of raw data . In addition, the 
European  Union claimed that the Panel erred in finding that the Commission deprived the WT/AB/27  
 
- 26 - 
 
 Chinese  producers of the opportunity to make informed decisions on whether to re quest 
adjustments under A rticle 2.4. Finally,  the European Union claimed that the Panel erred when it 
found that the confidential nature of the information should not have prevented the Commission 
from disclosing a summary of the product inform ation submitted by Pooja Forge.  
The A ppellate Body recalled that Article 2.4 requires investigating authorities to ensure a fair 
comparison between the export price and the normal value and, to this end, to make due 
allowance, or adjustments, for differences affecting price comparability. As the Appellate Body 
further recalled, while the obligation to ensure a fair comparison lies on the investigating 
authorities, exporters bear the burden of substantiating, as constructively as possible, their 
requests for adjustments reflecting the due allow ance within the meaning of Article 2.4. The last 
sentence of Article 2.4 further adds a procedural requirement to the general obligation to ensure a 
fair comparison, which takes the form of dialogue between the investigating authority and 
interested partie s. In the original proceedings, the Appellate Body had found that , as a starting 
point for the dialogue between the investigating authority and the interested parties to ensure a 
fair comparison, the authority must, at a minimum, inform the parties of the product groups with 
regard to which it will conduct the price comparisons. Addressing the issue of investigations  where 
the normal value is established on the basis of the domestic sales in an analogue country, the 
Appellate Body had further found that, un less the foreign producers under investigation are 
informed of the specific products with regard to which the normal value is determined, they will 
not be in a position to request adjustments they deem necessary.  
The Appellate Body then turned to each of t he European Union's  claims of error. First, the 
Appellate  Body found that the fact that normal value was determined based on a methodology 
involving data of an analogue country producer did not affect the legal obligation imposed on 
investigating authoriti es under the last sentence of Article  2.4. In all anti -dumping investigations,  
the authorities shall indicate to the parties in question what information is necessary to ensure a 
fair comparison and shall not impose an unreasonable b urden of proof on those  parties  as 
prescribed by Article 2.4. However, as the Appellate Body further found, d epending on the factual 
circumstances at hand, this provision may require the investigating authority to provide certain 
information to parties requesting adjustments, in  particular w here the exporter under investigation 
is missing information pertaining to the normal value established by the investigating authority, 
because it is based on the domestic sales of an analogue country producer, rather than the 
exporter's own d omestic sales. The Appellate Body concluded that the Panel correctly underlined 
that its findings were made in the context of a very particular factual situation and that the Panel 
did not find that a different legal obligation applied under the last  sente nce of Article  2.4 where 
normal value is determined based on the data  of analogue country producers.  
Second, looking at the relationship between Article 6 and Article  2.4, the Appellate Body found 
that, in light of the limited scope of the procedural oblig ation under Article 2.4, which is restricted 
to ensuring that interested parties be in a position to make requests for adjustments , this 
provision did not render any of the disclosure obligations under Article  6 redundant, as the 
European Union suggested. The Appellate Body further dismissed the European Union's submission 
that the Panel erred in finding th at the last sentence of Article  2.4 required th e disclosure of raw 
data. T he Appellate Body found  that a determination as to whether or not a given piece  of 
information should be shared with interested parties under that provision has to be made in light 
of the specific circumstances of each investigation, not in the abstract. This is how the Panel 
proceeded when finding that, in the review investigation, information on the characteristics of 
Pooja Forge's products needed to be shared with the Chinese producers for them to be in a 
position to me aningfully request adjustments.  
Third, the Appellate Body found that the Panel correctly applied the last sentence  of Article 2.4 to 
the factual circumstances at hand. The Appellate Body noted that the Commission indicate d to the 
Chinese producers the product groups  that served as the basis for comparing the transactions by 
disclosing the revised PCNs. However, the Co mmission did not disclose all the information 
regarding the characteristics of Pooja Forge's products used for the purposes of price comparison. 
As the Appellate Body further held, the Commi ssion did not indicate the specific products  of 
Pooja  Forge that i t used in determining normal values, which would have enabled the 
Chinese  producers to request the adjustments they deemed necessary. The Appellate Body, 
therefore, agreed with the Panel's finding that b y failing to provide the Chinese producers with the 
information regarding the characteristics of Pooja  Forge's products which were used in determining 
the normal value and which were then compared with the export prices, the Commission deprived WT/AB/27  
 
- 27 - 
 
 the Chinese producers of the opportunity to make informed decisi ons on whether to request 
adjustments under Article  2.4. The Appellate Body added that, having found that the disclosures at 
issue did not contain sufficient information to meet the requirements of the last sentence of 
Article  2.4, the Panel was not requir ed to address the question of whether such disclosures were 
made in a timely manner for the purposes of Article 2.4. However, the Appellate Body considered, 
in most cases, a disclosure under Article 6.9 of the Anti -Dumping Agreement, like the one at hand, 
would not fulfil the requirements of Article 2.4. Whether information shared at the end of an 
on-going dialogue under Article  2.4 is timely enough to ensure fair comparison between normal 
value and export price must be examined on a case -by-case basis, by assessing whether 
interested parties had a meaningful opportunity to request adjustments in light of the information 
shared by the investigating authority towards the end of that dialogue. Therefore, the Appellate 
Body found that it could not be excluded t hat, in some instances, a disclosure under Article 6.9 of 
the Anti -Dumping Agreement could fulfil the requirements of Article  2.4. 
Finally, the Appellate Body found that the Panel did not err in rejecting the European Union's 
argument that the information at issue was protected from disclosure under Article 6.5 and, 
therefore, could not be disclosed under Article  2.4. The Appellate Body added that even if the 
information had required confidential treatment pursuant to Article  6.5, the Commission would, 
under Article 2.4, have needed to make its best effort to disclose the information that was 
necessary for the Chinese producers to request adjustments. While such information could have 
been disclosed, with the permission of Pooja Forge under Article  6.5 or vi a a non -confidential 
summary prepared by Pooja  Forge pursuant to Article  6.5.1, it could also have been disclosed by 
other means for the purposes of Article 2.4, such as via a non -confidential summary prepared by 
the investigating authority.  
On the basis o f the foregoing, the Appellate Body found that the European Union had not 
established that the Panel erred in its interpretation or application of the last sentence of 
Article  2.4 of the Anti -Dumping Agreement and  upheld the Panel's finding of inconsistenc y under  
Article 2.4 . 
4.1.5.2   The fair comparison requirement under Article 2.4  
China claimed that the Panel erred in the interpretation and application of Article  2.4 of the 
Anti-Dumping Agreement in finding that the European Union did not act inconsistently with the fair 
comparison requirement under this provision by rejecting the Chinese  producers' requests for 
adjustments based on differences in: (i)  taxation; (ii) cert ain costs; and (iii) physical 
characteristics.  
China did not challenge the methodology used by  the Commission, which was to base the normal 
values on the domestic prices of an analogue country producer, nor did it challenge the use of 
India as the analogue country or Pooja Forge as the analogue country producer. China, however, 
claimed that there w as no legal basis in the Anti -Dumping Agreement, or in China's  Accession 
Protocol, for a finding that Article  2.4 imposes a different and less  stringent fair comparison 
obligation in investigations involving NME producers. The Appellate Body found that the  fair 
comparison requirement of Article  2.4 applies in all anti -dumping investigations, irrespective of the 
methodology used to establish normal value. However, it further found, that Article 2.4 has to be 
read in the context of the second Ad Note to Artic le VI:1 of the GATT 1994 and Section 15(a) of 
China's  Accession Protocol, which provide the legal basis for resorting to the analogue country 
methodology to determine the normal value in certain investigations. It follows that the 
investigating authority c annot be required to adjust for differences in costs between the 
NME producers under investigation and the analogue country producer, if making the requested 
adjustment would lead the investigating authority to adjust back to costs that were found to be 
distorted. Accordingly, an investigating authority has to take steps to achieve clarity as to the 
adjustment claimed, and determine whether, on its merits, the adjustment is warranted because it 
reflects a difference affecting price comparability or whether it would lead to adjusting back to 
costs or prices that were found to be distorted in the exporting country.  
4.1.5.2.1   Differences in taxation  
Prior to addressing China's claims of error, the Appellate Body recalled that the Chinese producers' 
requests for an adjust ment were based on the fact that Pooja Forge's domestic prices included WT/AB/27  
 
- 28 - 
 
 import duties and other indirect taxes on the raw materials that we re not included in the 
Chinese  export prices. The Commission had rejected the Chinese producers' requests on the basi s 
that: (i)  the Chinese  producers did not show that they would benefit from a non -collection or 
refund of the import duties paid on the raw materials; and (ii) the prices of the raw materials were 
found to be distorted in China and therefore could not serv e as a basis for an adjustment. For its 
part, the Panel rejected China's claim on the grounds that such an adjustment would undermine 
the Commission's right to have recourse to the analogue country methodology; and the 
Chinese  producers did not substantiat e their requests for an adjustment. On appeal, China claimed 
that both of these findings by the Panel were in error.  
The Appellate Body agreed with the Panel that the fact that the analogue country methodology 
was used did not relieve the Commission from t he obligation to conduct a fair comparison, as 
required under Article  2.4. However, it disagreed with the Panel's approach, which was to find, in 
general terms and without more, that adjusting for differences in taxation would have undermined 
the Commissio n's right to have recourse to the analogue countr y methodology. As the 
Appellate  Body further found, the Panel did not review whether the Commission had established 
that the differences in taxation on raw materials were related to the issue of the price of  the 
domestic raw materials that was found to be distorted, or whether an adjustment was merited 
because price comparability was affected under Article 2.4. Moreover,  the Appellate Body 
considered that  the Commission's determination d id not reflect that th e Commission assessed 
whether the requested adjustment was warranted or whether it would have had the effect of 
reintroducing distorted costs or prices in the normal value component of the comparison. The 
Commission, hence, failed to take steps to achieve clarity as to the adjustment claimed and then 
determine, whether and to what extent that adjustment was merited as required by Article 2.4. 
The Appellate Body, therefore, fo und that: (i)  the Panel erred in concluding that the Commission 
was not required to  consider making an adjustment due to differences in taxation solely because 
the analogue country methodology was used in the review investigation; and (ii) the Commission 
failed to assess properly whether the requested adjustment, based on the differences  in taxation 
was warranted, or, whether it would have had the effect of reintroducing distorted costs or prices 
in the normal value component of the comparison.  
Second, China submitted that the Panel erred in its application of Article  2.4 when finding tha t the 
facts on the record did not show that the Chinese producers demonstrated to the Commission that 
the difference in taxation affected price comparability within the meaning of Article  2.4. 
China  submitted that the Chinese producers had made such a show ing, given that Pooja Forge's 
domestic prices included an amount for import duties and other indirect taxes on the raw material 
used to produce fasteners (i.e. wire rod) and that would not have been included in its export 
prices , whereas Chinese export pri ces did not include any import duties or indirect taxes given that 
the Chinese producers sourc ed their wire rod domestically.  
Turning to the issue of whether the Chinese producers submitted a substantiated request for an 
adjustment, the Appellate Body reca lled that the producers under investigation bear the burden of 
substantiating their requests as constructively as possible. Furthermore, the Appellate Body 
observed that the Commission's determination that the Chinese producers failed to substantiate 
their requests for an adjustment seemed to have been based on the erroneous premise that this 
adjustment could not be made because certain prices were distorted in China and that, 
accordingly, it was not possible to substantiate the corresponding requests any f urthe r. On this 
basis, the Appellate Body found that the Panel erred in the application of Article 2.4 and reversed  
the Panel's intermediate finding that the Chinese producers did not come forward with a 
substantiated request for an adjustment for the alleged difference in taxation.  
In light of the above, the Appellate Body reversed the Panel's finding that the European Union did 
not act inconsistently with the fair comparison requirement under Article 2.4 by rejecting the 
Chinese  producers' requests for ad justment based on differences in taxation . Instead, the 
Appellate Body found that , because the Commission's determination did not reflect an adequate 
assessment of the Chinese  producers' requests for an adjustment for differences in taxation, the 
European Union acted inconsistently with Article 2.4 of the Anti -Dumping Agreement.  
4.1.5.2.2   Differences in certain costs  
As a preliminary matter, the Appellate Body recalled that the differences at issue related to: access 
to raw materials; use of self -generated electricit y; efficiency in raw -material consumption; WT/AB/27  
 
- 29 - 
 
 efficiency in electricity consumption; and productivity per employee. It further recalled that the 
Commission rejected these requests for adjustments on the basis that: (i) no evidence had been 
adduced that these differences in costs would translate into differences in prices; and (ii) where an 
analogue  country is used, prices and costs in the NME that are not the result of market forces ar e 
not to be taken into account.  
The Appellate Body further recalled that  the Panel had found that the Chinese producers failed to 
demonstrate that the alleged differences in costs affected price comparability; and that the 
investigating authority was not obligated to make adjustments to reflect such differences in costs 
in an inve stigation where the analogue country methodology is used. China claimed that both 
findings were in error. In addition, China submitted that the Panel ac ted inconsistently with 
Article  11 of the DSU by focusing exclusively on differences in terms of efficie ncy in electricity 
consumption when addressing China's claim that the Commission should have made adjustments 
for all these differences and, further, by considering pieces of evidence  in isolation from 
each other.  
The Appellate Body disagreed with the Pane l's approach, which was to find, in general terms and 
without more, that in an investigation involving  an NME where the analogue country methodology 
is used, claiming adjustments for alleged differences in costs would undermine the investigating 
authority' s recourse to that methodology , and that it is not obligated to make adjustments to 
reflect differences in costs in an investigation where the analogue country methodology is used. 
The Appellate Body further found that the Panel did not review whether the Commission had 
established that the differences in costs were related to prices found to be distorted or, whether 
adjustments were merited because price comparability was affected under Article 2.4 of the 
Anti-Dumping Agreement. Moreover, the Appellate Bod y considered that the Commission's 
determination did not reflect that the Commission assessed whether the requested adjustments 
were warranted or whether they would have had the effect of reintroducing distorted costs or 
prices in the normal value componen t of the comparison. The Commission, hence, failed to take 
steps to achieve clarity as to the adjustment claimed and then determine whether and to what 
extent that adjustment is merited, as required Article 2.4  of the Anti -Dumping Agreement.  
The Appellate Body added that it did not agree with the distinction  between the cost differences at 
issue and the differences in quality control, for which the Commission made an adjustment in the 
original investigation. The European Union claimed that these differences  could not be compared 
because the quality control differences related to an additional step in the production process of 
Pooja Forge, whereas the cost factors at issue were incurred by both Pooja Forge and the 
Chinese  producers. Under Article 2.4 of the A nti-Dumping Agreement, due allowance shall be 
made for differences affecting price comparability. The Appellate Body, therefore, concluded that 
adjustments are to be made  for differences affecting price comparability,  irrespective of whether  
the difference  pertains to an additional step  in the production process or to a step found to be 
carried out both by the analogue country producer and the NME -country producer. Finally, it noted 
that irrespective of wh ether there was an established past practice  to adju st for differences in 
costs as alleged by China, the Commission had, in the past, made adjustments for certain 
differences in costs in the context of investigations involving NMEs.  
On the basis of the foregoing, the Appellate Body found that  the Panel erre d in concluding that the 
Commission was not required to look at the cost factors relied upon by the Chinese producers 
solely because the analogue country methodology was used in revi ew investigation. 
The Appellate  Body further found that  the Commission fai led to assess properly whether the 
requested adjustments based on the differences at issue were warranted, or whether they would 
have had the effect of reintroducing distorted costs or prices in th e normal value component of 
the comparison.  
Second, China c laimed that the Panel erred in finding that the Chinese producers did not put 
forward substantiated requests for adjustments . In particular, China argued that, using all the 
evidence reasonably available to them, the Chinese producers demonstrated that the  differences in 
costs of production affected price comparability. The Appellate Body recalled that , under 
Article  2.4, the Chinese producers had to substantiate their requests for adjustments as 
constructively as possible. It noted that the Commission's de termination in the review 
investigation seemed to associate the absence of evidence that the differences in costs affected 
price comparability with the fact that certain costs were distorted in China. In addition, as per the 
European Union's own submission , the Chinese producers could not have substantiated their WT/AB/27  
 
- 30 - 
 
 requests for adjustments because such adjustments could not be made given that certain prices 
were distorted in China. Consequently, the Appellate Body reversed the Panel's intermediate 
finding tha t the Chinese  producers failed to show that the alleged differences in costs affected 
price comparability  and, thus, failed to come forward with  substantiated requests for adjustments.  
In light of the above, the Appellate Body reversed  the Panel's finding that the European Union did 
not act inconsistently with the fair comparison requirement under Article 2.4 by rejecting the 
Chinese  producers' requests for adjustments based on the alleged cost differences at issue . 
Instead, the Appellate Body  found that be cause the Commission's determination did not reflect an 
adequate assessment of whether the Chinese producers' requests for adjustments for these 
differences were warranted, the European Union acted inconsistent ly with Article 2.4 of the 
Anti-Dumping Agreem ent. Having upheld the Panel's finding that the European Union acted 
inconsistently with the last sentence of Article  2.4, the Appellate Body did not address China's 
conditional claim concerning  requests for adjustments due to differences in physical 
chara cteristics . 
4.1.6   Article 2.4.2 of the Anti -Dumping Agreement  
The European Union claimed that the Panel erred in its interpretation of the phrase "all comparable 
export transactions" in Article 2.4.2 of the Anti -Dumping Agreement. It also requested reversal of 
the Panel's finding that the European Union acted inconsistently with Article 2.4.2 because the 
Commission excluded, from its dumping determinations, the models exported by the Chinese 
producers that did not match with any of the models sold by Pooja Forge . According to the 
European Union, the use of the term "comparable" in Article 2.4.2 demonstrates the intention of 
the draft ers of the agreement that only comparable  export transactions should be taken into 
consideration in calculating dumping margins. The  European Union also relied on Article 6.10 of 
the Anti -Dumping Agreement as evidence that not all transactions must be taken into 
consideration by the investigating authority in the de termination of dumping margins.  
The Appellate Body noted that the Commi ssion used the weighted average -to-weighted 
average  (W-W) methodology when comparing normal values with export prices in calculating 
dumping margins for the Chinese producers. The Appellate Body then recalled its earlier findings in 
EC – Bed Linen  that Art icle 2.4.2 explains how investigating authorities must proceed in 
establishing the existence of dumping. With regard to the meaning of the phrase "all comparable 
export transactions" contained in Article 2.4.2, the Appellate Body found that, once an 
invest igating authority has define d the product at issue and the like product  on the domestic 
market it cannot, at a subsequent stage of the proceedings, take the position that some models 
within the like product  are so different from each other that they cannot  be "comparable" within 
the meaning of Article 2.4.2. According to the Appellate Body, the Anti -Dumping Agreement 
concerns the dumping of a product, and the margins of dumping to which Article 2.4.2 refers are 
the margins for the product as a whole, meanin g that all models  falling within the scope of a like 
product  must necessarily be "comparable" withi n the meaning of Article 2.4.2.  
The Appellate Body determined that the Commission's approach of determining first that the 
fasteners produced by Pooja Forge and the fasteners exporte d by the Chinese producers are like 
products , but then proceeding to exclude from the calculation cer tain models sold by the 
Chinese  producers on the basis that these models did not match with any of those sold by 
Pooja  Forge, was not compatible with the requirement in Article 2.4.2 to establish margins of 
dumping by comparing the normal value with the price of "all comparable export transactions". 
The Appellate Body further noted that , pursuant to Article 2.4, the Commission could have made 
adjustments in order to account for the differences that affected price comparability rather than 
simply excluding the models sold by the Chinese producers that it considered not to match those 
by Pooja Forge. The Appellate Body also indicated th at the Commission could have determined the 
normal values based on alternative methodologies, such as those referre d to in Article 2.2 of the 
Anti-Dumping Agreement, that is, a comparable price of the like product when exported to an 
appropriate third c ountry, or a constructed value.  
With respect to the European Union's argument that Article 6.10 demonstrates that not all 
transactions must be taken into consideration by the investigating authority in the determination 
of dumping margins, the Appellate Body noted that the European Union had not suggested that 
the Commission had engaged in the sampling exercise contemplated in this provision. Rather, the 
European Union relied on Article 6.10 as evidence of the fact that not all export transactions must WT/AB/27  
 
- 31 - 
 
 be incl uded in the W -W comparisons. The Appellate Body, however, considered that Article  6.10 
could not be construed as informing the dumping margin calculation methodology under 
Article  2.4.2. The Appellate Body noted that Articles 6.10 and 2.4.2 serve different  purposes and 
found nothing in Article 6.1 0 that would allow derogating from the obligation in Article 2.4.2  to 
compare "all c omparable export transactions".  
Finally, with respect to the European Union's argument that the dumping margin calculations were 
consistent with Article 2.4.2 because the models included in the dumping calculations represented 
a qualitatively and quantitatively important proportion of the entire exports by the 
Chinese  producers, the Appellate Body reiterated that in order to comply w ith the fair comparison 
requirement of Article 2.4, w hich provides context for the W -W methodology under Article  2.4.2, 
the investigating authority must compare the export transactions relating to the product under 
consideration as a whole. However substan tial the proportion of models considered may have 
been, the Commission failed to take into consideration all export transactio ns involving all models 
of the like product  (i.e. fasteners) exp orted by the Chinese producers.  
The Appellate Body, therefore,  upheld the Panel's finding that the European Union acted 
inconsistently with Article 2.4.2 because the Commission excluded, in its dumping determinations, 
the models exported by the Chinese  producers that did not match with any of the models sold by 
Pooja  Forge. 
4.1.7   Articles 4.1 and 3.1 of the Anti -Dumping Agreement  
The European Union appealed the Panel's finding that, because the Commission defined the 
domestic industry on the basis of the domestic producers that had come forward in response to 
the original Notic e of Initiation, which stated that only those producers willing to be included in the 
injury sample would be considered as cooperating, the European Union acted inconsistently with 
Article  4.1 of the Anti -Dumping Agreement. The European Union argued that i ncluding, in the 
review investigation , the domestic producers that were excluded in the original investigation, 
brought the European Union  into conformity with the DSB's  recommendations and rulings.  
The Appellate Body recalled its finding in the original p roceedings that Article 4.1 defines the 
domestic industry as  either:  (i) the domestic producers a s a whole of the like products; or 
(ii) those producers whose collective output of the products constitutes a major proportion of the 
total domestic production  of those products. The Appellate Body noted that, where an investigating 
authority adopts the second method for the definition of the domestic industry, Article 4.1 does 
not stipulate a specific proportion for evaluating whether a certain percentage const itutes a major 
proportion . The Appellate Body, however, indicated that the absence of a specific proportion does 
not mean that any percentage, no matte r how low, could qualify as a major proportion . Rather, 
this phrase should be understood as referring to a relatively high proportion of  the total domestic 
production.  
Recalling further its findings in the original proceedings, the Appellate Body indicated that the 
requirements for defining the domestic industry, within the meaning of Article 4.1, must be rea d in 
conjunction with the obligations of Article 3.1 of the same agreement that the determination of 
injury be based on positive evidence and involve an objective examination of, inter alia , the impact 
of the dumped imports on domestic producers. The Appel late Body determined that in order to 
ensure the accuracy of an injury determination, an investigating authority must not act so as to 
give rise to a material risk of distortion in defining the domestic industry, for example, by 
excluding a whole category of producers of the like product. Therefore, where a d omestic industry 
is defined as a major proportion  of total domestic production, the higher the proportion relied upon 
by the investigating authority, the less likely the injury d etermination will be dis torted.  
According to the Appellate Body, when the domestic industry is defined as the domestic producers 
whose collective output constitutes a major proportion of total domestic production, a very 
high proportion that substantially reflect s the total domes tic production  will very likely satisfy both 
the quantitative and the qualitative aspect of the requirements of Articles 4.1 and 3.1. However, if 
the proportion of the domestic producers' collective output included in the domestic industry 
definition is no t sufficiently high that it can be considered as substantially reflecting the totality of 
the domestic production, then the qualitative element becomes crucial in establishing whether the 
definition of the domestic industry is consistent with Articles 4.1 and 3.1. While, in the special case WT/AB/27  
 
- 32 - 
 
 of a fragmented industry with numerous producers the practical constraints on an authority's 
ability to obtain information may mean that what constitutes a  major proportion  may be lower 
than what is ordinarily permissibl e, in such cases the investigating authority bears the same 
obligation to ensure that the process of defining the domestic industry does not give rise to a 
material risk of distortion. An investigating authority would need to make a greater effort to 
ensur e that the selected domestic producers are representative of the total domestic production by 
ascertaining that the process of the domestic industry definition, and ultimately the injury 
determination, does not give rise to a material risk of distortion.  
With respect to its ruling in the original proceedings, the Appellate Body recalled that it had found 
that the proportion relied upon by the Commission in the original determination to define the 
domestic industry, representing 27% of total d omestic product ion, was at the lower end of the 
spectrum  and hardly a substantial reflection of the total. The fragmented nature of the fasteners 
industry might have permitted a lower proportion due to the impracticality of obtaining more 
information. However, the Appell ate Body had found in the original proceedings that the process 
utilized by the Commission in order to define the domestic industry, which limited the definition to 
those domestic producers willing to be part of the injury sample, introduced a material ris k of 
distortion of the injury determination and was, therefore, inconsistent with Articles 4.1 and 3.1. 
The Appellate Body had also considered a minimum benchmark of 25% of total domestic 
production, referred to in Article  5.4, irrelevant to the industry d efinition pursuant to Article 4.1.  
The Appellate Body noted that, in the review investigation, the Commission included in the 
domestic industry definition the originally excluded domestic producers which were deemed not to 
cooperate for lack of willingness  to be included in the injury sample. As a result, the proportion 
relied upon by the Commission increased from 27% to 36% of total domestic production. The 
Appellate  Body however determined that the proportion relied upon by the Commission in the 
review de termination remained low, even in the context of the fragmented fasteners industry. The 
Appellate Body further noted that, in the review investigation, the  Commission did not issue a 
new notice of initiation, but, instead, relied on the Notice of Initiatio n of the original investigation, 
which stated that only those producers that agreed to be part of the injury sample would be 
considered as cooperating. The  Commission, therefore, conditioned the producers' eligibility to be 
included in the domestic industr y on their willingness to be included in the injury sample and, thus, 
continued to introduce a material risk of distortion in the process  of the domestic 
industry  definition.  
With respect to the European Union's contention that it was the exclusion of cert ain domestic 
producers that had been  considered by the Appellate Body to be inconsistent with Article 4.1 in the 
original proceedings, the Appellate Body determined that its ruling in the original proceedings 
made clear that the material risk of distortion  did not arise from the exclusion per se , but from 
conditioning the inclusion of domestic producers in the domestic industry definition on their 
willingness to be included in the injury sample. The Appellate Body indicated that the Notice of 
Initiation, st ating that only those producers willing to be included in the injury sample would be 
considered as cooperating, in effect created a distortion in the sense that domestic producers may 
not have come forward unless they considered themselves to be injured by  the alleged dumping of 
the product under consideration. Therefore, this Notice of Initiation provided for a self -selection 
process that may have skewed the composition of the domestic industry in favour of injured 
producers. The Appellate Body further fou nd that defining the domestic industry in this manner 
could not be justified by the difficulty of obtaining information from a greater number  of producers.  
The Appellate Body, therefore, upheld the Panel's finding that the European Union acted 
inconsistent ly with Article  4.1 because the Commission defined the domestic industry on the basis 
of the domestic producers that had come forward, in response to the original Notice of Initiation, 
which stated that only those producers willing to be included in the in jury sample would be 
considered as cooperating. The Appellate Body further found that a domestic industry definition 
based on a self -selection that introduces a material risk of distortion to the investigating 
authority's injury analysis would necessarily render the resulting injury determination inconsistent 
with the obligation to make an objective injury analysis based on positive evidence as laid down in 
Article 3.1. The Appellate Body, therefore, also upheld the Panel's finding that the Commission's 
injury determination was inconsistent with this provision.  WT/AB/27  
 
- 33 - 
 
 4.2  Appellate  Body  Report, Argentina – Measures Relating to Trade in Goods and 
Services , WT/DS453/AB/R  
This dispute concerned eight financial, taxation, foreign exchange, and registration measures 
imposed  by Argentina on services and service suppliers of countries that Argentina classifies as 
"countries not cooperating for tax transparency purposes" (non -cooperative countries). These 
measures provide for differential treatment depending on whether a countr y is classified as 
cooperative or non -cooperative for tax transparency purposes. To be granted cooperative status, 
the country must either sign with Argentina an agreement on exchange of tax information or a 
convention on avoidance of international double taxation or initiate with Argentina the negotiations 
necessary for concluding such an agreement and/or convention. For many years, Panama was 
classified as a non -cooperative country. Following the establishment of the Panel, Panama was 
included in the list  of cooperative countries even though it did not have in place a double taxation 
convention or an information exchange agreement with Argentina, and was not negotiating such a 
convention or agreement with Argentina. At the time that the Panel Report was is sued to the 
parties, Panama remained on the list of cooperative countries.  
Before the Panel, Panama claimed that the eight measures at issue are inconsistent with several 
provisions of the GATS and the GATT  1994. In particular, Panama challenged the  follow ing 
measures imposed by Argentina: (i) measure 1: withholding tax on payments of interest or 
remuneration; (ii) measure 2: presumption of unjustified increase in wealth; (iii) measure 3: 
transaction valuation based on transfer pricing; (iv) measure 4: rule  on the allocation of 
expenditure; (v) measure 5: requirements relating to reinsurance services; (vi) measure 6: 
requirements f or access to the Argentine capital market; (vii) measure 7: requirements for the 
registration of branches; and (viii) measure 8: foreign exchange authorization requirement.  
Having found that the GATS is applicable to all eight measures, the Panel concluded that: (i) all 
eight measures are inconsistent with Article  II:1 of the GATS because they do not accord, 
immediately and uncondit ionally, to services and service suppliers of non -cooperative countries 
treatment no less favourable than that which they accord to like services and service suppliers of 
cooperative countries; (ii) measures 2, 3, and 4 are not inconsistent with Article  XVII of the GATS 
because they accord to services and service suppliers of non -cooperative countries treatment no 
less favourable than that which they accord to like Argentine services and service suppliers, in the 
relevant services and modes of supply in whi ch Argentina has undertaken specific commitments; 
(iii) measures 1, 2, 3, 4, 7, and 8 are not justified pursuant to the exception of Article  XIV(c) of 
the GATS because their application constitutes arbitrary and unjustifiable discrimination within the 
mean ing of the chapeau of Article  XIV of the GATS; and (iv) measures 5 and 6 are not covered by 
paragraph  2(a) of the Annex on Financial Services because they were not taken for prudential 
reasons within the meaning of that provision.  
With respect to measure 5 , the Panel rejected Panama's claims under Article  XVI:2(a) and 
Article  XVI:1 of the GATS finding, respectively, that this measure is not covered by 
Article  XVI:2(a) and that Panama had failed to establish a prima facie case of  inconsistency in 
this respec t. 
With respect to measures 2, 3, and 4, as the Panel had found that these measures are not 
inconsistent with Article  XVII of the GATS, the Panel refrained from ruling on whether these 
measures are covered under the exception provided for in Article  XIV(d)  of the GATS.  
Regarding Panama's claims under the GATT  1994 with respect to measures 2 and 3, the Panel 
rejected Panama's claims under Article  I:1 because Panama had failed to demonstrate that 
measure 2 constitutes a rule or formality in connection with ex portation or a charge imposed on 
the international transfer of payments for exports, within the meaning of Article  I:1 of the 
GATT  1994 and that measure 3 constitutes a matter referred to in Article  III:4 or a rule or 
formality in connection with exportati on or importation, within the meaning of Article  I:1 of the 
GATT  1994. 
In addition, with respect to measure 3, the Panel rejected Panama's claims under Article  III:4 and 
Article  XI:1 of the GATT  1994 because Panama had failed to demonstrate that the measur e is a 
matter referred to in Article  III:4 of the GATT  1994, and the measure, being fiscal in nature, is not 
covered by Article  XI:1 of the GATT  1994. WT/AB/27  
 
- 34 - 
 
 Finally, having rejected Panama's claims under Articles I:1, III:4, and XI:1 of the GATT  1994, the 
Panel refrained from ruling on whether measures 2 and 3 are justified pursuant to Article  XX(d) of 
the GATT  1994. 
4.2.1   Articles II:1 and XVII of the GATS – "Likeness"  
Argentina appealed the Panel's findings that the services and service suppliers at issue are "like" 
under both Article  II:1 and Article  XVII of the GATS. With respect to the Panel's finding of 
"likeness" under Article  II:1 of the GATS, Argentina alleged that the Panel erred in its 
interpretation of Article  II:1 in finding that services and service suppli ers may be considered "like" 
when a measure  provides for differential treatment exclusively on the basis of origin. With regard 
to the Panel's finding of "likeness" under Article  XVII of the GATS, Argentina alleged that the Panel 
erred in relying upon its "likeness" findings under Article  II:1 in finding that the services and 
service suppliers at issue are "like" by  reason of origin for purposes of Article  XVII of the GATS.  
The Appellate  Body noted that the concept of "likeness" must be interpreted in light  of its context 
and the object and purpose of the agreement in which it appears. The Appellate  Body recalled that 
the word "like" refers to something sharing a number of identical or similar characteristics or 
qualities, and that it implies some kind of co mparison. Furthermore, the Appellate  Body considered 
that both Article  II:1 and Article  XVII:1 are concerned with the competitive relationship of services 
and service suppliers. This is so because if the services being compared are not in a competitive 
relationship, the conditions of competition cannot be affected.  
The Appellate  Body recalled that, in the context of trade in goods, the Appellate  Body had held 
that there is a spectrum of degrees of competitiveness or substitutability of products in the 
marke tplace and that the assessment of such a competitive relationship requires a market -based 
analysis. The Appellate  Body considered the same to be true with respect to "like services and 
service suppliers" in the ambit of the GATS, and, further held that the  likeness of services and 
service suppliers can only be determined on a case -by-case basis, taking into account the specific 
circums tances of the particular case.  
Moreover, the Appellate  Body found that the reference to "services and service suppliers" ind icates 
that considerations relating to both the service and the service supplier are relevant for 
determining "likeness" under Articles II:1 and XVII:1 of the GATS. The Appellate  Body saw the 
phrase "like services and service suppliers" as one integrated e lement for the likeness analysis 
under Articles  II:1 and XVII:1, respectively. The Appellate  Body noted that the particular features 
of the competitive relationship, in the circumstances of any specific case, will determine the 
relative weight to be accord ed in the analysis of "likeness" to considerations relating to the service 
and the service supplier, respectively.  
The Appellate  Body further clarified that to the extent that the criteria for assessing "likeness" 
traditionally employed as analytical tools  in the context of trade in goods are relevant for assessing 
the competitive relationship of services and service suppliers, these criteria may be employed also 
in assessing "likeness" in the context of trade in services, provided that they are adapted as 
appropriate to account for the specific characteristics of trade in services. In that respect, the 
Appellate  Body noted, in particular, that Articles  II:1 and XVII:1 of the GATS refer to likeness of 
"services and service suppliers", and stated that, accord ingly, these criteria may be applied both in 
regard to the service and the service supplier in a holistic analysis. As in the context of trade in 
goods, the Appellate  Body considered that the criteria for analysing "likeness" of services and 
service suppli ers are analytical tools to assist in the task of examining the relevant evidence, and 
that they are neither a treaty -mandated nor a closed list of criteria that will determine the legal 
characterization of services and service suppliers as "like". The Appellate  Body also recalled that 
different modes of supply exist in trade in services under the GATS and that the analysis of 
"likeness" of services and service suppliers may require additional considerations of whether or 
how this analysis is affected by th e modes of supply. The Appellate  Body further emphasized that 
adapting the criteria for analysing "likeness" to the particular context of Articles  II:1 and XVII:1 of 
the GATS must not change the fundamental purpose of the comparison to be undertaken in ord er 
to determine "likeness" in the context of trade in services, namely, to assess whether and to what 
extent the services and service suppliers at issue are  in a competitive relationship.  WT/AB/27  
 
- 35 - 
 
 Next, the Appellate  Body turned to the question of whether, in order  to establish "likeness", a 
complainant must always have recourse to the relevant criteria, or whether a complainant may 
establish "likeness" by demonstrating that the measure at issue makes a distinction between 
services and service suppliers based exclus ively on origin (the presumption approach). The 
Appellate  Body noted that in the context of trade in goods, several panels have found that when a 
measure makes a distinction between products based exclusively on the origin of the product, the 
likeness of  such products can be presumed.  
The Appellate  Body considered that, because the determination of "likeness" under Articles  II:1 
and XVII:1 involves consideration of both the service and the service supplier, the analysis of 
whether or not a distinction is ba sed exclusively on origin may be a more complex task, in 
particular, due to the role that domestic regulation may play in shaping, for example, the 
characteristics of services and service suppliers and consumers' preferences. The Appellate  Body 
held that w hile this did not, as a matter of principle, render the presumption approach inapplicable 
in the context of trade in services, the scope of the presumption approach is more limited in trade 
in services than in trade in goods. Whether and to what extent suc h complexities have an impact 
on the determination of whether a distinction is based exclusively on origin in a particular case will 
depend on the nature, configuration, and operation of the measure at issue and the particular 
claims raised.  
With respect t o the burden of proof in establishing "likeness" relying on the presumption approach, 
the Appellate  Body held that, in keeping with the general rule that the burden of proof rests upon 
the party that asserts the affirmative of a particular claim, the compl ainant bears the burden of 
making a prima facie  case that a measure draws a distinction between services and service 
suppliers based exclusively on origin. If a panel finds that the complainant has failed to make a 
prima  facie case that a measure provides for differential treatment based exclusively on origin, 
then the panel must engage in an analysis of "likeness" on the basis of the relevant criteri a 
adapted to trade in services.  
In contrast, if a complainant succeeds in making a prima facie  case that a m easure draws a 
distinction between services and service suppliers based exclusively on origin, and this is not 
rebutted by the respondent, the services and service suppliers at issue may be presum ed to 
be "like" . 
4.2.1.1   Argentina's claim under Article  II:1 
The Appellate  Body then turned to Argentina's requests that it reverse the Panel's finding that 
services and service suppliers located in non -cooperative countries are "like" services and service 
suppliers located in cooperative countries and that, consequently,  it reverse the Panel's conclusion 
that measures  1-8 are inconsistent with Article  II:1 of the GATS. The Appellate  Body was not 
persuaded by Argentina's contention that the presumption approach cannot be applied in trade in 
services. The Appellate  Body found that, while the analysis of whether or not a distinction is based 
exclusively on origin is more complex in the context of trade in services, this does not render the 
presumption approach ina pplicable in trade in services.  
Next, the Appellate  Body addres sed Argentina's contention that the Panel erred in the application 
of Article  II:1 of the GATS in finding that the services and service suppliers at issue are "like" in 
the absence of a finding that the measures  at issue provide for differential treatment exclusively 
on the basis of origin. Having reviewed the Panel's analysis, the Appellate  Body found that the 
Panel had not made a finding that the distinction between cooperative and non -cooperative 
countries in the measures at issue is based exclusively on  origin. The Appellate  Body considered 
that, in the absence of the finding that a measure provides for a distinction based exclusively on 
origin, the Panel was required to undertake an analysis of "likeness", considering various criteria 
relevant for an as sessment of the competitive relationship of the services and service suppliers of 
cooperative and non -cooperative countries as set out above. Accordingly, the Appellate  Body 
concluded that in the absence of a finding that the measures at issue provide for a distinction 
based exclusively on origin, and by failing to conduct an analysis of "likeness" on the basis of the 
arguments and evidence presented by the parties with respect to the "likeness" criteria, the Panel 
erred in finding "likeness" by reason of o rigin. Because the Panel's conclusion that measures  1-8 
are inconsistent with Article  II:1 of the GATS was based on the Panel's finding of likeness, the 
Appellate  Body reversed the Panel's conclusion with respect to Article  II:1 of the GATS.  WT/AB/27  
 
- 36 - 
 
 In addition, t he Appellate  Body held that assuming arguendo  that, as Panama suggest ed, Panama 
indeed made a prima facie  case that the distinction between cooperative and non -cooperative 
countries in the measures at issue is based exclusively on origin, the Panel would h ave been 
required to assess whether Argentina had successfully rebutted such prima facie  case based on the 
presumption approach. The Appellate  Body noted that Argentina had presented to the Panel 
arguments and evidence in this respect.  
The Appellate  Body considered it unnecessary to address separately Argentina's claims that the 
Panel erred in the allocation of the burden of proof and that the Panel erred by making a 
prima  facie case of "likeness" for Panama under Article  II:1 of the GATS.  
4.2.1.2   Argentina's claim  under Article  XVII  
With respect to Article  XVII:1 of the GATS, Argentina requested the Appellate  Body to find that the 
Panel erred by relying upon its "likeness" findings under Article  II:1 of the GATS in its analysis of 
"likeness" under Article  XVII:1, a nd to sustain, on the basis of modified reasoning, the Panel's 
conclusion that measures  2, 3, and 4 are not inconsistent with Article  XVII:1 of the GATS.  
The Appellate  Body noted that the Panel's conclusion under Article  XVII:1 – that Argentine services 
and service suppliers are like the services and service suppliers of non -cooperative countries – was 
based on the Panel's earlier finding of "likeness" under Article  II:1. The Appellate  Body recalled 
that it had found that the Panel erred in the finding of " likeness" under Article  II:1, and found that 
this also removed the basis of the Panel's finding that Argentine services and service suppliers are 
like the services and service suppliers of non -cooperative countries for purposes of Article  XVII. 
Accordingly , the Appellate  Body reversed the Panel's finding that Argentine services and service 
suppliers are like the services and service suppliers of non -cooperative countries for the purposes 
of its analysis under Article  XVII of the GATS. Because the Panel's co nclusion that measures  2, 3, 
and 4 are not inconsistent with Article  XVII of the GATS was based  on this finding, the 
Appellate  Body also reversed this  conclusion of the Panel.  
4.2.2   Articles  II:1 and XVII of the GATS – "Treatment no less favourable"  
Panama claim ed that the Panel erred in its interpretation of the term "treatment no less 
favourable" under Articles  II:1 and XVII of the GATS in finding that the assessment of whether the 
measures in this dispute are inconsistent with these provisions has to take into  account regulatory 
aspects relating to services and service suppliers that may affect the conditions of competition, 
that is, whether Argentina is able to have access to tax information on foreign suppliers. Panama 
additionally alleged that the Panel erre d in its application of the term "treatment no less 
favourable" under Article  XVII of the GATS. Panama requested the Appellate  Body to sustain the 
Panel's finding that the measures at issue are inconsistent with Article  II:1 of the GATS on the 
basis of the  Panel's preliminary findings under that provision. Furthermore, Panama requested the 
Appellate  Body to reverse the Panel's finding that measures  2, 3, and 4 are not inconsistent with 
Article  XVII of the GATS and find, instead, that these measures are inco nsistent with that 
provision. Argentina contended that Panama's appeal, as well as Argentina's other appeal, should 
be resolved on the grounds of "likeness".  In Argentina's view, regulatory difference that affect 
competitive relationships among services an d service suppliers should properl be examined in the 
first instance, as part of the evaluation of whether services and service suppliers may be 
considered "like".  
The Appellate  Body noted that, pursuant to Article  XVII:3 of the GATS, a measure accords les s 
favourable treatment if it modifies the conditions of competition in favour of services or service 
suppliers of a Member as compared to like services or service suppliers of any other Member. The 
Appellate  Body also examined footnote 10 to Article  XVII:1 , which, in the Appellate  Body's view, 
confirms that the standard of "treatment no less favourable" must be based on the impact on the 
conditions of competition that results from the contested measure. The Appellate  Body further 
considered that, on substan ce, the concept of "treatment no less favourable" under both 
Article  II:1 and Article  XVII of the GATS is focused on a measure's modification of the conditions of 
competition. The Appellate  Body noted that, in prior disputes, the fact that a measure modifi ed the 
conditions of competition to the detriment of services or service suppliers of any other Member 
was, in itself, sufficient for a finding of less favourable treatment under Articles II:1 and XVII of 
the GATS.  WT/AB/27  
 
- 37 - 
 
 In the Appellate  Body's view, the Panel c orrectly stated that the concept of "treatment no less 
favourable" in Article  II:1 of the GATS also hinges on the conditions of competition. Nonetheless, 
the Panel considered two specific aspects  in the text of Article  II:1 to be relevant to its 
interpreta tion of the term "treatment no less favourable", namely, the broad scope of the 
obligation under Article  II:1 and the reference to "services and servi ce suppliers". In the 
Appellate  Body's view, although Article  III:4 of the GATT  1994 also has a broad scop e of 
application, the broad scope has not been perceived as a reason for requiring an analysis as to the 
regulatory aspect relating to the products for purposes of determining "less favourable treatment". 
Furthermore, the Appellate  Body did not consider th at the mere reference to "service suppliers" in 
the GATS would alter the legal standard of "treatment no less favourable" under the GATS, that is, 
whether the measure modifies the conditions of competition to the detriment of like services or 
service  suppl iers of any other Member.  
The Appellate  Body considered that its interpretation of the legal standard of "treatment no less 
favourable", on the basis of the text of Articles II:1 and XVII of the GATS, is also supported by the 
structure of the GATS. Under t his structure, Members can utilize certain flexibilities when 
undertaking their GATS commitments, such as those pursuant to Article  XX of the GATS. In the 
Appellate  Body's view, through these flexibilities and exceptions, the GATS seeks to strike a 
balance  between a Member's obligations assumed under the  Agreement and its right to pursue 
national policy objectives referred to in the preamble of the GATS. In view of this balance, the 
Appellate  Body considered that, where a measure is inconsistent with the no n-discrimination 
provisions, regulatory aspects or concerns that could potentially justify such a measure are more 
appropriately addressed in the cont ext of the relevant exceptions.  
The Appellate  Body recalled the concern expressed by the Panel that equati ng national policy 
objectives with the situations covered by the few general exceptions would mean that any 
regulation adopted in order to meet national policy objectives would necessarily be in violation of 
the basic principle of non -discrimination, and w ould require justification under Articles XIV 
and XIV bis. The Appellate  Body agreed with the Panel that the national policy objectives referred 
to in the preamble to the GATS cover a broader range of objectives than those reflected in the 
exceptions. Howe ver, the Appellate  Body also noted that, as long as Members comply with their 
GATS obligations and commitments, they are free to pursue national policy objectives that they 
consider appropriate without the need to invoke exceptions. Therefore, the Appellat e Body found 
that an interpretation of the term "treatment no less favourable" that is based on a measure's 
detrimental impact on the conditions of competition does not prevent a Member from pursuing a 
wide range of national policy objectives beyond those identified in the exceptions. On this basis, 
the Appellate  Body disagreed with the Panel's view that Members' right to regulate in accordance 
with their national policy objectives confirms the relevance of the regulatory aspects concerning 
service supplier s in the interpretation of "treatment no less favourable".  
The Appellate  Body recalled that, under both Article  II:1 and Article  XVII of the GATS, the Panel 
came to the "preliminary" conclusions that all of the relevant measures modify the conditions of 
competition to the detriment of like service suppliers of non -cooperative countries and that, 
consequently, they fail to accord "treatment no less favourable" to such service suppliers. 
Nonetheless, the Panel went on to conduct an additional analytical step  regarding the regulatory 
aspects in this dispute, that is, the possibility for Argentina to have access to tax information on 
foreign suppliers providing services in Argentina. The Appellate  Body found that the Panel's 
consideration of relevant regulatory aspects in its analysis under Article  II:1 did  not actually speak 
to the question of whether the measures at issue modify the conditions of competition to the 
detriment of services and service suppliers of non -cooperative countries. Rather, statements made  
by the Panel indicate that it effectively examined whether detrimental impact on like services and 
service suppliers stems exclusively from a legitimate regulatory distinction. Having examined the 
Panel's analysis of the relevant regulatory aspects under Article  XVII, the Appellate  Body 
concluded that the Panel adopted an erroneous legal interpretation of "treatment no less 
favourable" under Article  XVII of the GATS.  
The Appellate  Body further noted the Panel's finding that, given the objective of measures  2, 3, 
and 4, which was to neutralize an unintended competitive advantage enjoyed by non -cooperative 
jurisdictions owing to the lack of exchange of tax information with Argentina, these measures do 
not modify the conditions of competition in favour of dome stic service suppliers and are therefore 
not inconsistent with Article  XVII. In the Appellate  Body's view, ensuring equal competitive 
conditions, which is required by the legal standard of "treatment no less favourable", is not the WT/AB/27  
 
- 38 - 
 
 same as guaranteeing tha t one group of services or products does not have any competitive 
advantage over another group. Yet, in reaching the above finding, the Panel erroneously equated 
these two concepts. Having found that the Panel adopted an erroneous legal interpretation of 
"treatment no less favourable" under Article  XVII, the Appellate  Body did not consider it necessary 
to address Panama's additional allegations that the Panel had erred in its application of that 
interpretatio n to the facts of this dispute.  
In conclusion, th e Appellate  Body found that the Panel erred in finding that an assessment of 
"treatment no less favourable" under Articles II:1 and XVII of the GATS in this dispute has to take 
into account regulatory aspects relating to services and service suppliers that  may affect the 
conditions of competition, in particular, whether Argentina is able to have access to tax 
information on foreign suppliers. The Appellate  Body considered that, had "likeness" between 
services and service suppliers of cooperative and non -cooperative countries been established in 
this dispute, the preliminary findings under Articles  II:1 and XVII would, in themselves, have been 
sufficient to lead to the conclusions that the relevant measures are inconsistent with these 
provisions. However, rec alling its reversal of the Panel's findings on "likeness", the Appellate  Body 
found that the Panel's findings on "treatment no less favourable" lack a proper basis and could not 
stand. Therefore, it reversed the Panel's conclusion that the eight measures a t issue are 
inconsistent with Article  II:1 of the GATS, as well as its conclusion that measures 2, 3, and  4 are 
not inconsistent with Article  XVII of the GATS.  
4.2.3   Article  XIV(c) of the GATS  
Neither participant appealed the Panel's analysis of the conformity o f Argentina's measures with 
the chapeau of Article  XIV of the GATS, or the Panel's ultimate finding that Argentina had not 
made out its defence. Panama, however, alleged that the Panel er red in finding that 
measures  1, 2, 3, 4, 7, and 8 are provisionally j ustified under Article  XIV(c). In particular, Panama 
argued that the Panel failed properly to apply the relevant legal standard for an Article  XIV(c) 
defence to the measures before it.  
Panama first claimed that the Panel erred by failing to focus its analy sis under Article  XIV(c) on the 
aspects of the measures that gave rise to the findings of inconsistency under Article  II:1 of 
the GATS.  
The Appellate  Body recalled that it had clarified in EC – Seal Products  that the aspects of a 
measure to be justified un der the paragraphs of Article  XX are those that give rise to the finding of 
inconsistency under the GATT  1994. The Appellate  Body explained that relevant aspects of the 
measure are typically those that specify the treatment that such measure gives to impor ted goods 
or services in specific circumstances, and that it is these aspects of the measure providing for 
differences in treatment that form the starting point of the analysis under, and ultimately lead to 
findings of inconsistency with, the GATT  1994 or the GATS. When analysing provisional 
justification under a general exception the focus of the analysis should be on the relevant aspects 
of the measure itself, rather than on how, for example, the measure affects the conditions of 
competition in the releva nt market.  
The Appellate  Body further observed that the mere fact that a panel does not repeat, in 
its Article  XIV analysis, the entirety of its discussion of the measure from its inconsistency 
analysis, or includes more than the particular aspects that it  discussed in reaching its finding of 
inconsistency, does not, in itself, mean that the panel erred and based its assessment of the 
measure's justification under Article  XIV on di fferent aspects of the measure.  
Turning to the dispute at hand, the Appellate  Body found that, for each measure, the Panel 
focused on the same aspects in its Article  XIV(c) analysis as it did in its Article  II:1 analysis. The 
Appellate  Body therefore concluded that, although the Panel's identification of the aspects of 
measures  1, 2, 3, 4, 7, and 8 that were relevant to its assessment under Article  XIV(c) of the 
GATS was at times rather brief or imprecise, the Panel did not fail to focus on the same aspects of 
measures  1, 2, 3, 4, 7, and 8 in both its analyses under Article  II:1 and  Article  XIV(c).  
Panama raised two other allegations in connection with the Panel's findings that measures  1, 2, 3, 
4, 7, and 8 are provisionally justified under Article  XIV(c) of the GATS, namely: (i) that the Panel 
erred in finding that measures 1, 2, 3,  4, and 8 are designed "to secure compliance with" the WT/AB/27  
 
- 39 - 
 
 relevant Argentine laws or regulations, and (ii) that the Panel erred in finding that measures 1, 2, 
3, 4, 7, and 8 are "necessary" to secure compliance  with such laws or regulations.  
The Appellate  Body recalled its explanation in Korea – Various Measures on Beef  that, for a 
respondent to justify provisionally a measure under Article  XX(d) of the GATT  1994, two elements 
must be shown. First, the measure must be one designed to secure compliance with law s or 
regulations that are not themselves inconsistent with some provision of the GATT  1994. Second, 
the measure must be necessary to secure such compliance. The Appellate  Body explained that, 
with respect to the first element, the phrase "to secure complia nce" calls for an initial examination 
of the relationship between the inconsistent measure and the relevant laws or regulations. A 
measure can be said "to secure compliance" with GATS -consistent laws or regulations when its 
design reveals that it secures c ompliance with specific rules, obligations, or requirements under 
such laws or regulations, and the more precisely a respondent is able to identify such specific rules 
or requirements, the more likely it will be able to elucidate how and why the inconsiste nt measure 
secures compliance with the laws or regulations. Where the assessment of the design of the 
measure, including its content and expected operation, reveals that the measure is incapable of 
securing compliance with specific rules or requirements un der the relevant law or regulation, 
further analysis with regard to whether this measure is necessary to secure such compliance may 
not be required. At the same time, a panel must not structure its analysis of the first element in 
such a way as to lead it to truncate its analysis prematurely and thereby foreclose consideration of 
crucial aspects of the respondent's defence relating to the "necessity" analysis. This second 
element entails a more in -depth, holistic analysis of the relationship between the inc onsistent 
measure and the relevant laws or regulations, and, in particular, of whether, in light of all relevant 
factors in the "necessity" analysis, this relationship is sufficiently proximate, such that the measure 
can be deemed to be necessary to secure  compliance with such laws or regulations. The 
Appellate  Body considered that the analyses of the two elements of the Article  XIV(c) defence may 
overlap, and that the way in which a panel organizes its examination of these elements in 
scrutinizing a defenc e in any given dispute will be influenced by the measures and laws or 
regulations at issue, as well as by the way in which the parties present their respective arguments.  
With respect to the first element in the Article  XIV(c) analysis, Panama argued that the Panel 
improperly focused its analysis on the issue of whether measures  1, 2, 3, and 4 secure compliance 
with the objectives of the relevant laws or regulations, rather than on whether those measures 
secure compliance with specific provisions of such la ws or regulations. The Appellate  Body noted 
that, while the Panel observed that measures  1, 2, 3, and 4 are designed to secure compliance 
with the overall objective of the Gains Tax Law, it went on to explain that measures  1, 2, 3, and 4 
are also designed to secure compliance with certain key provisions of the Gains Tax Law. The 
Appellate  Body observed that, in its analysis, the Panel examined the content of Articles  1 and 5 of 
the Gains Tax Law, and addressed whether measures  1, 2, 3, and 4 are designed to  secure 
compliance with these provisions. Thus, the Appellate  Body considered that, contrary to Panama's 
contention, the Panel had examined whether the measures secure compliance with the specific 
obligation set forth in Articles  1 and 5 of the Gains Tax L aw, namely, to establish properly the tax 
base for purposes of the gains tax.  
Panama also contended that a demonstration that a specific measure secures compliance with laws 
or regulations requires identification of an underlying risk of non -compliance wit h such laws or 
regulations that the measure is intended to address. Thus, in Panama's view, although the Panel 
found that measures  1, 2, 3, and 4 are meant to discourage simulated transactions between 
related parties, the Panel failed to assess whether suc h related -party transactions are inconsistent 
– or pose a threat of non -compliance – with the relevant provisions of the Argentine laws and 
regulations. The Appellate  Body understood Panama's argument to be based on the assumption 
that the Panel found Arge ntina's concern in connection with those measures  to be limited to 
simulated transactions between related parties. Yet, in the Appellate  Body's view, such assumption 
was not supported by the Panel record, because the Panel framed the practices that were th e 
subject of Argentina's concern more broadly, as "transactions which cover up harmful tax 
practices". Moreover, the Appellate  Body understood Panama's argument to refer to the fact that 
measures  1, 2, 3, and 4 apply both to transactions with fraudulent pu rposes (i.e. simulated 
transactions between related parties to evade taxes), as well as transactions with legitimate 
purposes (i.e.  transactions between unrelated parties or transactions between related parties at 
arm's length), and that, therefore, these measures  go beyond what is necessary to secure 
compliance with the relevant laws or regulations. The Appellate  Body however agreed with the WT/AB/27  
 
- 40 - 
 
 Panel's reasoning that these measures must be designed to cover all transactions because they 
apply ex ante, and the ir purpose is to detect fraudulent transactions.  
With respect to Panama's argument that the Panel did not take proper account of the broad scope 
of measure  2, the Appellate  Body considered that Panama had not explained why the fact that 
measure  2 may have a broader scope would, in itself, preclude a finding that measure  2 is 
designed to secure compliance with Article s 1 and 5 of the Gains Tax Law.  
With respect to the second element of Article  XIV(c) , Panama challenged the following aspects of 
the Panel's " necessity" analysis: (i)  the Panel's assessment of th e contribution made by 
measures  1, 2, 3, 4, 7, and 8 to the end pursued; (ii)  the Panel's assessment of the 
trade-restrictiveness of these measures; and (iii)  the Panel's weighing and balancing of the 
relevant necessity factors. The Appellate  Body observed that, although there is no single correct 
way to structure a multi -faceted analysis of multiple measures, it had some concerns regarding the 
way in which the Panel had structured its "necessity" analysi s with respect to the relevant six 
measures. The Panel first considered the importance of the objectives pursued. The Panel then 
considered the contribution made by the six measures to the end pursued. Next, the Panel looked 
at the trade -restrictiveness of  the six measures. The Panel subsequently addressed whether any 
reasonably available alternative measures had been identified by Panama. Finally, the Panel 
conducted a single weighing and balancing exercise of these factors for all six measures, 
collective ly. To the Appellate  Body, the initial parts of the Panel's reasoning were somewhat 
disaggregated and compartmentalized in that, for any given measure, the Panel's consideration of 
each of the relevant "necessity" factors was found in separate parts of its  reasoning. This 
separation of the different parts of the Panel's analysis, combined with its collective weighing and 
balancing exercise, in turn rendered it somewhat difficult to ascertain whether, for each measure, 
the Panel conducted the holistic analys is of all of the relevant elements that is called for, and 
properly weighed and balanced the relevant elements and compared them against any proposed 
alternative measures.  
Turning to Panama's specific allegations of error, the Appellate  Body first noted th at many of its 
arguments on appeal appeared to challenge the Panel's assessment of the facts and evidence on 
the record and did not fall within the scope of appellate review in the absence of any claim by 
Panama that the Panel failed to comply with its dut ies under Article  11 of the DSU to make an 
objective assessment of the facts.  
Panama also argued that the Panel improperly based its assessment of the contribution of 
measures  1, 2, 3, 4, and 7 on whether these measures contribute to attaining the objectiv es of the 
relevant laws or regulations, rather than on whether they contribute to securing compliance with 
specific provisions of such laws or regulations. The Appellate  Body observed that, in 
Korea  ‒ Various Measures on Beef , it had explained that one fac tor to be considered under the 
"necessity" analysis is the extent to which the measure contributes to the realization of the end 
pursued, the securing of compliance with the law or regulation at issue. The Appellate  Body 
concluded that, similarly to the an alysis of the design of a measure, a panel's assessment of the 
contribution of such measure to securing compliance with the law or regulation at issue should 
focus on specific rules, obligations, or requirements set out in such law or regulation. At the sa me 
time, the objective of, or the common interest or value protected by, the "laws or regulations" at 
issue is not irrelevant to the analysis of a measure's contribution, as, in many instances, the 
specific obligations and individual provisions of a law or  regulation will reflect and be closely tied to 
the objective(s) of the instrument w ithin which they are contained.  
Turning to the Panel's application of Article  XIV(c) of the GATS to measures 1, 2, 3, and 4, the 
Appellate  Body found that, by addressing th e measures' contribution to safeguarding the tax base 
of Argentine taxpayers, the Panel had conducted an examination of the contribution of these 
measures to securing compliance with the obligation to establish properly the tax base subject to 
the gains ta x, as provided for in Articles  1 and 5 of the Gains Tax Law. Similarly, for measure 7, 
the Appellate  Body understood the Panel to have focused on the requirements in Article  118.3 of 
the Commercial Companies Law and Article  188 of the Resolution on Compani es Incorporated 
Abroad when referring to the need to verify that branches of foreign companies have a legitimate 
commercial purpose, have genuine activities, and have not been set up solely for the purpose of 
simulating transactions with Argentine taxpayer s. Thus, despite its reservations with the Panel's 
analytical framework for the contribution analysis, the Appellate  Body considered that the Panel 
undertook an appropriate analysis of the contribution made by measures  1, 2, 3, 4, and 7 to WT/AB/27  
 
- 41 - 
 
 securing complia nce with specific rules, obligations, or requirements under the  relevant laws and 
regulations.  
The Appellate  Body further called attention to the Panel's finding, for each measure, that it 
contributes to the objective pursued. The Appellate  Body pointed ou t that in a "necessity" analysis, 
a panel's duty is to assess, in a qualitative or quantitative manner, the extent of the measure's 
contribution to the end pursued, rather than merely ascertaining whether or not the measure 
makes any contribution. The Appellate Body noted that, similarly, a panel must seek to assess the 
degree of a measure's trade -restrictiveness, rather than merely ascertaining whether or not the 
measure involves some restriction on trade. The Appellate  Body emphasized that, without having  
undertaken such analyses, a panel would be unable to undertake a proper weighing and balancing 
of all of the relevant factors.  
In addition, Panama argued that the Panel erred in finding, and failed to explain why it considered , 
that the absence of a ban a utomatically implies that measures 1, 2, and 3 do not have a 
trade-restrictive effect. In the view of the Appellate  Body, however, the Panel did not, in its 
analysis of measures 1, 2, and 3, simply accept that the absence of a ban automatically implies 
that a measure has no trade -restrictive effect. Rather, the Panel took a more nuanced position and 
examined the structure, operation and effect of each measure and reached separate conclusions 
as to the m easures' trade restrictiveness.  
In light of the above, the Appellate  Body found that Panama had not demonstrated that the Panel 
erred in the application of Article  XIV(c) of the GATS to measures  1, 2, 3, 4, 7, and 8 by failing to 
focus its analysis on the relevant aspects of the measures that gave rise to the findings of 
inconsistency with Article  II:1 of the GATS, or that the Panel erred in finding that these measures 
are designed and "necessary" to secure compliance with  the relevant Argentine laws 
or regulations.  
4.2.4   Paragraph  2(a) of the Annex on Financial Serv ices 
Panama requested the Appellate  Body to reverse the Panel's finding that paragraph  2(a) of the 
GATS Annex on Financial Services covers all types of measures affecting the supply of financial 
services within the meaning of paragraph  1(a) of this Annex. Panama alleged that the Panel failed 
to give meaning to the term "domestic regulation" in the title of the prudential exception. For 
Panama, the reference to "domestic regulation" in the title delimits the scope of the provision and 
defines the type of mea sures that may be covered by the provision. In response, Argentina 
contended that there are no limitations on the types of measures covered by the exception other 
than the prudential rationale that  leads to their adoption.  
The Appellate  Body recalled that,  having found measures 5 (requirements relating to reinsurance 
services) and 6 (requirements for access to the Argentine capital market) to be inconsistent with 
Article  II:1 of the GATS, the Panel proceeded to examine Arge ntina's defence under 
paragraph  2(a) of the Annex on Financial Services and ultimately found that measures 5 and 6 
were not justified by this provision because they were not taken for prudential reasons. The 
Appellate  Body further recalled that, as the Panel had noted, paragraph  2(a) conta ins 
three  requirements that must be fulfilled for a measure to be justified under this provision. First, 
there is the threshold question of what types of measures may potentially fall within the scope of 
paragraph  2(a). Second, a measure must have been tak en for prudential reasons. Finally, the 
measure shall not be used as a means of avoiding the Member's commitments or obligations under 
the Agreement. The Appellate  Body noted that Panama's appeal was limited to the Panel's anal ysis 
of the threshold questio n. 
The Appellate  Body noted that paragraph  2(a) of the Annex on Financial Services does not identify 
a particular type of measures falling within its scope. In addition, the use of the phrase "measures 
affecting the supply of financial services" in paragra ph 1(a) of the Annex, which establishes the 
scope of the Annex, supports the view that paragraph  2(a) does not impose specific restrictions on 
the types of measures falling within its scope. The Appellate  Body further noted that, pursuant to 
the introducto ry clause "[n]otwithstanding any other provisions of the Agreement" in the first 
sentence of paragraph  2(a), paragraph  2(a) could be invoked to justify inconsistencies with all of a 
Member's obligations under the GATS. For the Appellate  Body, this indicate d that, for example, 
measures imposing market access restrictions for prudential reasons, of the types listed in WT/AB/27  
 
- 42 - 
 
 Article  XVI:2, could potentially fall within the scope of paragraph  2(a). The Appellate  Body recalled 
Panama's argument that measures justifiab le for prudential reasons must take the form of 
domestic regulations, as opposed, for example, to market access restrictions. In the 
Appellate  Body's view, however, by excluding market access restrictions from the scope of 
paragraph  2(a), Panama's interpre tation effec tively meant  that paragraph  2(a) could not be 
invoked to justify inconsistencies with Article  XVI, contrary to the introductory clause of 
paragraph  2(a). 
The Appellate  Body considered that the meaning and function to be attributed to the title of 
paragraph  2(a) should be consistent with a proper interpretation of paragraph  2(a) itself. In this 
regard, the Appellate  Body examined the context provided by Article  VI of the GATS, which is also 
entitled "domestic regulation". The Appellate  Body noted  that the provisions of Article  VI refer to a 
variety of measures, and the broad scope of measures potentially covered by Article  VI indicates 
that its title, "Domestic Regulation", should not serve the function of restricting the types of 
measures falling  under that provision. Similarly, the Appellate  Body found that the title of 
paragraph  2(a) does not serve such a function. The Appellate  Body went on to examine the 
context provided by Article  XXVIII(a) of the GATS, which defines the term "measure" as "an y 
measure by a Member, whether in the form of a law, regulation, rule, procedure, decision, 
administrative action, or any other form". The Appellate  Body considered that the text of 
paragraph  2(a) of the Annex on Financial Services, read in light of the sc ope and definition of the 
word "measure" in both paragraph  1(a) of the Annex and Article  XXVIII(a) of the GATS, indicates 
no restrictions on the type or form of a measure falling under paragraph  2(a) of the Annex. Finally, 
noting the references to national  policy objectives in the third and fourth recitals of the preamble 
of the GATS, the Appellate  Body considered that an interpretation limiting the types of measures 
that could potentially fall under paragraph  2(a) would not be in consonance with the balanc e of 
rights and obligations expressly recognized in the preamble.  
On the basis of these considerations, the Appellate  Body disagreed with Panama's argument that 
the title of paragraph  2(a) delimits the scope of this provision or defines the type of measure s that 
may be covered by the prudential exception. In conclusion, the Appellate  Body found that the 
Panel did not err in finding that paragraph  2(a) of the Annex on Financial Services covers all types 
of measures affecting the supply of financial services within the meaning of paragraph  1(a) of 
the Annex.  
4.3  Appellate  Body  Report, Colombia – Measures Relating to the Importation of Textiles, 
Apparel and Footwear , WT/DS461/AB/R  
This dispute concerned  Panama 's challenge to tariffs imposed by Colombia  on the impor tation of 
certain textiles, apparel , and footwear. Colombia's measure, referred to as a " compound tariff ", is 
composed of an ad valorem  levy, expressed as a percentage of the customs value of goods, and a 
specific levy, expressed in units of currency per u nit of measurement. While the ad valorem  
component of the compound tariff is 10% for all products regardless of their value, the specific 
component varies depending on the product and the declared free  on board  (f.o.b.) pric e in 
respect of two thresholds. With respect to certain imports of good s, the compound tariff does 
not apply . 
Before the Panel , Panama claimed that the compound tariff imposed by Colombia is inconsistent 
with Article  II:1(a) and (b) of the GATT  1994 and Colombia's Schedule of Concessions . 
Furthermore, in response  to the defences invoked by Colombia, Panama requested the Panel to 
reject the argument that the compound tariff is justified under the general exceptions set out in 
Article  XX(a)  and Article  XX(d)  of the GATT  1994. 
The Panel foun d that the measure at issue is structured and designed to be applied to all imports 
of the products concerned, without distinguishing between "licit" and "illicit" trade, and that no 
provision in Colombia's legal system bans the importation of goods whose declared prices are 
below the thresholds established in the measure. In light of these findings, the Panel did not 
consider it necessary to rule on Colombia's claim that the obligations contained in Article  II:1(a) 
and (b) of the GATT  1994 are not applicab le to illicit trade.  The Panel found that the compound 
tariff constitutes an ordinary customs duty that exceeds the levels bound in Colombia's Schedule 
of Concessions, and is therefore inconsistent with the first sentence of Article  II:1(b) of the 
GATT  1994, and accords treatment less favourable than that envisaged in Colombia's Schedule of 
Concessions, in a manner inconsistent with Article  II:1(a) of the GATT  1994, in certain instances. WT/AB/27  
 
- 43 - 
 
 With respect to Colombia's recourse to the general exceptions under Article XX of the  GATT  1994, 
the Panel found that Colombia had failed to demonstrate that the compound tariff is a measure 
necessary to protect public morals within the meaning of Article  XX(a), or necessary to secure 
compliance with Article  323 of Colombia' s Criminal Code within the meaning of Article  XX(d). The 
Panel further found that, even assuming that Colombia had succeeded in demonstrating that its 
measure is provisionally justified under Article  XX(a) or Article  XX(d), the compound tariff is not 
applied in a manner that meets the requirements of the chapeau of Article  XX. 
4.3.1   Article  11 of the DSU  
On appeal, Colombia contended that  the Panel , in stating that it was not necessary for the Panel to 
make a finding on whether or not the obligations of Article  II:1 of the GATT  1994 extend to illicit 
trade, failed to make an objective assessment of the matter before it, as required under Article  11 
of the DSU, including an objective assessment of the applicability of the relevant covered 
agreements.  For Colombia, the only conceiv able way the Panel could have escaped  the 
interpretative  question was if it had found that none of the imports subject to the measure 
involved illicit trade. Colombia pointed out that the P anel never made such a finding.  
The Appellate  Body first recalled 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 . With respect to "the applic ability of … 
the relevant covered agreements", a panel is required to conduct an objective assessment of 
whether the obligations in the covered agreements, with which an inconsistency is claimed, are 
relevant and applicable to the case at hand. The Appella te Body also pointed out  that, in its 
assessment of facts, a panel is expected to provide reasoned and adequate expl anations and 
coherent reasoning . By the same token, a panel  would be expected to provide reasoned and 
adequate explanations and coherent rea soning when assessing the applicabi lity of the covered 
agreements.  
The Appellate  Body recalled that the Panel considered that it would be required to address the 
interpretative issue under Article  II:1(a) and (b) of the GATT  1994 only if it were to find th at the 
trade affected by the measure was illicit trade. The Appellate  Body further noted that,  while panels 
have a degree of discretion to structure the order of their analysis as they see fit , a panel must not 
structure its analysis in a manner that preve nts it from acting in accordance with its duty to 
conduct an objective assessment of the matter, as required under Article  11 of the DSU,  including 
an objective assessment of the applicability of the relevant covered agreements.  
The Appellate  Body disagree d with the Panel's conclusion that it was not necessary for the Panel  to 
interpret Article  II:1(a) and (b) of the GATT  1994 because the compound tariff is not s tructured or 
designed to apply solely to operations  which have been classified as illicit trade.  Rather, the 
Appellate  Body considered that the Panel's statement that the measure does not apply "solely" to 
illicit trade operations implies that the measure applies, or could apply, to some transactions 
classified by Colombia as illicit trade. The fact that there is no legal rule establishing that every 
transaction priced at or below the thresholds is deemed an illegal or illicit transaction does not 
preclude the possibility that some such transactions nevertheless involve what Colombia considers 
to be i llicit trade. For the Appellate  Body, the Panel's finding that the compound tariff does not 
distinguish between licit and illicit trade further indicates that the measure does or could cover 
what Colombia considers to be illicit trade.  
Thus, the Appellate  Body did not consider that the Panel could properly have refrained from ruling 
on the interpretative issue before it simply because the challenged measure did not "solely" cover 
the type of transactions that Colombia maintained was outside the scope of the  applicable 
provision. Rather, given that the Panel's statement implies that the measure at issue applies, or 
could apply, to some transactions considered by Colombia to be illicit trade, in the Appellate  Body's 
view, the Panel was required to address the interpretative issue before it. The Appellate  Body 
concluded  that the Panel did not provide coherent reasoning, and that the basis upon which it 
refrained from interpreting Article  II:1(a) and (b) of the GATT  1994 was flawed.  
On this basis, the Appellate  Body found that the Panel acted inconsistently with Article  11 of the 
DSU in finding that it was unnecessary for the Panel to interpret the scope of Article  II:1(a) 
and (b) of the GATT  1994. Consequently, the Appellate  Body reversed  the Panel's finding that it WT/AB/27  
 
- 44 - 
 
 was unnecessary for the Panel to issue  a finding as to whether or not Article  II:1(a) and (b) of the 
GATT  1994 applies to illicit trade.  
4.3.2   Whether Colombia acted inconsistently with Article  II:1(a) and (b) of the 
GATT  1994  
Colombia requested the Appellat e Body to complete the legal analysis and find that Article  II:1(a) 
and (b)  does not apply to illicit trade and that, because imports priced at or below the thresholds 
are imported at artificially low prices that do not reflect market conditions, the compo und tariff 
does not violate Article  II:1(a) and (b) of the GATT  1994. Colombia argued that the term 
"commerce" in Article  II:1(a) and the term "importation" in Article  II:1(b) do not cover what 
Colombia considers to b e illicit trade. Colombia submitted  that other provisions of the covered 
agreements, in particular, Article  VII:2(a) and (b) of the GATT  1994 and Article  1.1 of the Customs 
Valuation Agreement, provide contextual support for its interpretation of Article  II:1 of the 
GATT  1994. 
Having examined t he ordinary meaning of the term "commerce" in Article  II:1(a)  and 
"importation" in Article  II:1(b) , the Appellate  Body did not see that the scope of the se terms is 
qualified in re spect of the nature or type of commerce or imports , or the reason or function  of the 
transaction, in a manner that excludes what Colombia co nsiders to be illicit trade. The 
Appellate  Body further noted that Article  II:2 of the GATT  1994, which  sets out a closed list of 
instances in which bound tariff rates may be exceeded , provides  further support for a reading of 
Article  II:1 that does not exclude what Colombia considers to be illicit trade.  With regard to 
Article  VII:2 of the GATT  1994 and the Customs Valuation Agreement, the Appellate  Body 
observed that these provisions have a di fferent focus than Article  II:1 of the GATT  1994 in that 
they set out conditions in which customs authorities may adjust or reject the declared value of 
goods and instead rely upon alternative methods for determining the value of those goods for 
customs pu rposes. Thus, where a declared value of a transaction is rejected because it is unduly 
low, the result under the Customs Valuation Agreement would be that the value for customs 
purposes would be adjusted or determined in an alternative manner. For the Appellate Body, the 
existence of such alternative methods for determining the customs value under these provisions 
confirms that the underlying transaction remains subject to the bound tariff rates pursuant to 
Article  II:1 of the GATT  1994 and the relevant par t of a Member's Schedule. The Appellate  Body 
concluded that this further supported its understanding that the scope of Article  II:1(a) and (b) of 
the GATT  1994 does not exclude what Colombia considers to  be illicit trade.  
The Appellate  Body further recalle d that the GATT  1994 strikes a balance between Members' 
obligations , including the obligation not to exceed scheduled tariff bindings , on the one hand, and 
their rights to adopt measures seeking to achieve legitimate policy objectives, on the other hand. 
To effectuate such a balance, Article  XX of the GATT  1994 contains a number of exceptions that 
reflect important societal objectives other than trade liberalization, which may be relied upon in 
seeking to justify an otherwise GATT -inconsistent measure. The Appellate  Body thus observed that 
the GATT  1994 preserves the right of Members to pursue legitimate policy objectives, including 
addressing concerns relating to, in casu , money laundering, through the general exceptions set out 
in Article  XX. 
Moreover, the  Appellate  Body noted that Colombia's interpretation would allow a Member to 
exclude from the scope of Article  II:1(a) and (b) of the GATT  1994 trade activities that it has 
unilaterally determined to be illicit . Such an interpretation would mean that, in r espect of 
concessions inscribed in a Member's Schedule, the scope of a Member's obligation could vary 
depending on what is defined as illicit or asserted to be illicit under that Member's domestic law . 
For the Appellate  Body, such an approach to the interp retation of Article  II:1(a) and (b) would 
create uncertainty as to the scope of coverage of tariff concessions undertaken by Members.  
The Appellate  Body then addressed  Colombia's argument that Article  II:1(a) and (b) does not 
impose an obligation on Member s to ensure that their bound rates are not exceeded when goods 
are imported at artificially low prices. On the basis of its interpret ation of Article  II:1(a) and  (b) of 
the GATT  1994, the Appellate  Body did not find support for Colombia's argument that a l egislative 
ceiling need not apply to imports priced at or below the thresholds incorporated in the measure at 
issue. The Appellate  Body did not see that Article  II:1(a) and (b) excludes from its scope 
transactions that Colombia considers to be illicit beca use they are at artificially low or below 
market prices for money laundering pur poses. Therefore, the Appellate  Body did not consider that WT/AB/27  
 
- 45 - 
 
 a measure that fails to ensure that such transactions do not exceed Colombia's bound tariff rates 
can operate as a le gislative ceiling. The Appellate  Body also noted that Colombia did not contest 
the Panel's finding that imports classified under heading  6305.32 of the Customs Tariff, entering at 
prices above US$10/kg but below US$12/kg, exceed the rate bound in Colombia' s Schedule of 
Concessions.  The Appellate  Body further recalled that, in Argentina – Textiles and Apparel , the 
Appellate  Body explained that it is possible, under certain circumstances, for a Member to design a 
legislative ceiling or cap  on the level of dut y applied which would ensure that, even if the type of 
duty applied differs from the type provided for in that Member's Schedule, the ad valorem 
equivalents of the duties actually applied would not exceed the ad valorem duties provide d for in 
the Member's Schedule.  The Appellate  Body considered that, contrary to the notion of a legislative 
ceiling articulated by the Appellate  Body, the price thresholds set out in Colombia's measure do 
not ensure that duties imposed on certain imports do not exceed  Colombia' s bound tariff rates.  
The Appellate  Body found that, in the instances identified in the Panel Report, the compound tariff 
exceeds the bound tariff rates in Colombia's Schedule of Concessions, and is therefore inconsistent 
with Article  II:1(a) and  (b) of th e GATT  1994. Consequently, the Appellate  Body upheld  the 
relevant Panel  findings . 
4.3.3   Article  XX(a) of the GATT  1994  
4.3.3.1   Whether Colombia demonstrate d that the compound tariff is a measure 
"designed"  to protect public morals  
Colombia argue d that the Panel erred un der Article  XX(a) of the GATT  1994 by requiri ng Colombia 
to demonstrate the effectiveness  of the challenged measure as part of es tablishing that the 
measure is designed  to protect public mora ls. According to Colombia, the effectiveness  of the 
challenged me asure goes to the contribution of the measure to the objective pursued, which is a 
matter that is relevant to the necessity  analysis , rather than to the considera tion of whether the 
measure is designed  to protect public morals.  Colombia also submitted that , even if it was 
appropriate for the Panel to examine the contribution of the measure i n the context of assessing 
its design , the Panel erred by imposing an overly demanding  standard of the term "to protect" 
public morals that is inconsistent with Article  XX(a).  
The Appellate  Body began by indicating that, i n order to establish whether a measure is justified 
under Article  XX(a), the analysis proceeds in two steps . First, the measure must be designed to 
protect public moral s. Second, the measure must be nece ssary  to protect such public morals . With 
respect to the analysis of the design  of the measure,  the phrase "to protect public morals" calls for 
an initial , threshold  examination of the measure's content, structure, and expected operation  in 
order to determ ine whether there is a r elationship between an otherwise GATT -inconsistent 
measure and the protection of public morals. If this initial examination of the design of the 
measure, including its content, structure, and expected operation,  reveals that the mea sure is 
incapable of protecting public morals , further examination  with regard to whether th e measure is 
necessary  to protect such public morals would not be required. This is because  there can be  no 
justification under Article  XX(a) for a measure that is not des igned to protect public morals.  
The Appellate  Body indicated that it did not see t he examination of the design of the measure  as a 
particularly demanding step of the Article  XX(a) analysis. By contrast, the assessment of the 
necessity  of a measure e ntails a more in -depth, holistic analysis of the relationship between the 
measure and the protecti on of public morals. The Appellate  Body also observed that the design 
and necessity  steps of the analysis under Article  XX(a) are conceptually distinct, yet r elated, 
aspects of the overall inquiry to be undertaken into whether a respondent has establishe d that the 
measure at issue is necessary to protect public morals . As the assessment of these two steps is 
not entirely disconnected, there may, in fact, be som e overlap in the sense that certain evidence 
and considerations may be relevant to both aspects of the defence under Article  XX(a). Thus, in 
the context of the design  step of the analysis, a panel is not precluded from taking into account 
evidence and cons iderations that may also  be relevant to the examination of the contribution of 
the measure in the context of the necessity  analysis.  
The Appellate  Body emphasized that a panel must not  structure its analysis of the design  step in 
such a way as to lead it t o truncate its analysis prematurely and thereby foreclose consideration of 
crucial aspects of the respondent's defence relating to the necessity analysis. In particular, once an WT/AB/27  
 
- 46 - 
 
 analysis of the design  of a measure reveals that the measure is not incapable of protecting public 
morals, such that there is a relationship between the measure and the protection of public morals, 
a panel may n ot refrain from conducting the necessity  step of the analysis. Whether a particular 
degree of contribution is sufficient for a measure to be considered necessary  cannot be answered 
in isolation from an assessment of the degree of the measure's trade -restrictiveness and of the 
relative importance of the interest or value at stake. For example, a measure making a limited 
contrib ution to protecting public morals  may be justified under Article  XX(a) in circumstances 
where the measure has only a very low trade -restrictive impact, taking into account the 
importance of the specific interest or value at stake; s imilarly, it may be that  a measure making a 
significant contribution is not justified under Article  XX(a) if that measure is highly trade 
restrictive.  Thus, if a panel finds some degree of contribution, but ceases to analyse the other 
factors (the degree of trade -restrictiveness and the relative importance of the interest or value at 
stake ), a weighing and balancing exercise cannot be conducted , and thus a proper consideration of 
a respondent's defence that the measure is necessary is foreclosed.  
Turning to Colombia's challenge to  the Panel's finding that Colombia failed to d emonstrate that the 
measure is designed  to protect public morals, the Appellate  Body disagreed with Colombia's view 
that the Pane l erred in its analysis of the design  of the measure for the mere reason that it 
examined evidence and considerations related to an analysis of the contribution of the measure. 
However, the Appellate  Body emphasized that the thrust of Colombia's claim of erro r is that the 
Panel applied an overly demanding  legal standard in assessing w hether the compound tariff is 
measure designed  to protect public morals. With this in mind, the Appellate  Body turned to review 
the relevant findings by the Panel.  
The Panel noted that the text of the measure does not contain  any statement of reasons indica ting 
that the objective of the compound tariff is to combat money laundering. Then, the Panel reached 
the following conclusions regarding a series of interconnected assumptions  that, in the Panel's 
view, were the basis of Colombia's argument: (i)  Colombia had not shown that the thresholds 
could be decisive in establishing that the importation of goods at prices below those thresholds is 
necessarily  taking place at artificially low  prices that do not reflect real prices or market conditions ; 
(ii) there was no indication that products imported at prices belo w the thresholds are necessarily  
being undervalued ; and (iii) even assuming that products imported at prices below the thresholds 
established in the measure ar e being undervalued, there was no evidence that  this necessarily 
means that the undervaluation in question i s for money laundering purposes . On the basis of these 
conclusions and certain additional considerat ions, the Panel concluded that a connection between 
the compound tariff and the alleged objecti ve of combating money laundering ha d not been 
demonstrated . Accordingly, the Panel concluded that Colombia had failed to demonstrate that the 
compound tariff is designed to combat money launder ing. 
The Appellate  Body noted a tension between some of the Pan el's intermediate findings and the 
conclusions it reached concerning the design of the measure. The Appellate  Body considered that,  
although the Panel concluded that Colombia had failed to establish a relationship between the 
compound tariff and the object ive of combating money laundering, this was belied by findings  
indicating that the compound tariff is not incapable of combating money laundering. Therefore, the 
Appellate  Body considered that there is a  relationship between th at measure and the protection  of 
public morals in a way that meets the design step of the analysis under Article  XX(a) . 
In respect of the question of whether prices below the thresho lds set out in the measure are 
artificia lly low, the Panel found that it cannot be ruled out that the i mportation of goods  at prices 
below the thresholds could, in practice, reflect artificially low  prices that do  not reflect market 
conditions.  The Appellate  Body considered that, in making this finding, the Panel acknowledged 
that at least some transactions  at or below the thresholds could reflect such prices. The 
Appellate  Body also noted the Panel's finding that the information available suggests that the 
undervaluation of imports is, in fact, one of the methods used for money laundering detecte d by 
the Co lombian authorities.  According to the Appellate  Body, this finding indicates recognition by 
the Panel that, in Colombia, one of the methods used to launder money is  the undervaluation 
of imports.  
In addition, the Appellate  Body noted  that, in assessing the  contrib ution of the measure under the 
necessity  analysis , the Panel addressed Colombia's contention that the compound tariff reduces 
the incentives for using textile, apparel, and footwear imports to launder money. The 
Appellate  Body indicated that, w hile the Panel did not make a definitive finding that the compound WT/AB/27  
 
- 47 - 
 
 tariff discouraged undervaluation practices carried out for money laundering purposes, the Panel 
did make several findings that support Colombia's position that the compound tariff  could  reduce  
the incentive of using under valued imports to launder money.  
Taking the above Panel findings together, the Appellate  Body consider ed that the Panel itself 
recognized that the  compound tariff is not incapable of combating money laundering, such that 
there is a relationship between th at measure and the protection of public morals . Therefore , the 
Appellate  Body indicated  that the Panel was not in a situation in which the measure at issue is 
incapable of protecting public morals.  
For the foregoing reasons, the  Appellate  Body concluded  that the Panel should not have ceased its 
analysis at this stage of its review of Colombia's defence under Article  XX(a). Rather, it was 
incumbent on the Panel to turn to the analysis of the necessity  of the measure. Therefore, th e 
Appellate  Body found that the Panel erred in concluding that Colombia had failed to d emonstrate 
that the measure is designed  to combat money laundering given its recognition that the compound 
tariff is not incapable of combating money laundering, such th at there is a relationship between 
that measure and t he protection of public morals.  
The Appellate  Body therefore reversed  the Panel's finding s that Colombia had failed to 
demonstrate that the compound tariff is designed  to combat money laundering  and that  Colombia 
had not shown that the compound tariff is a measure designed to protect public morals. Since the 
Panel's ultimate findings in respect of Article  XX(a) were based exclusively on these erroneous 
findings, the Appellate  Body also reversed  the Panel' s finding s that Colombia ha d failed to  
demonstrate that the compound tariff is a measure necessary to protect public morals within the 
meaning of Article  XX(a) of the GATT  1994. 
Next, the Appellate  Body turned to consider Colombia's request that the Appell ate Body complete 
the legal analysis and find that the measure at issue is necessary to protect public morals and is 
thus justified under Article  XX(a) of the GATT  1994. The Appellate  Body began by noting that, in a 
finding that was not contested on appeal , the Panel concluded that combating money laundering is 
one of the policies designed to protect public morals in Colombia. The Appellate  Body therefore 
proceed ed to examine whether the findings by the Panel were sufficient to establish that the 
compound t ariff is a measure designed to co mbat money laundering and thus to  protect public 
morals  under Article  XX(a) of the GATT  1994. 
The Appellate  Body's prior examination of Colombia's claim  of error  had revealed that , when 
several findings by the Panel are rea d together , it is clear from its analysis  that the compound 
tariff is not incapable of combating money laundering, such that there is a relationship between 
that measure and the protection of public morals . Therefore, o n the basis of the Panel's findings,  
the Appellate  Body found that  the measure at issue is designed  to protect public morals in 
Colombia within the meaning of Article  XX(a) of the GATT  1994. 
4.3.3.2   Whether Colombia demonstrate d that the compound tariff is "necessary"  to 
protect public morals  
The Appellate  Body proceed ed to examine whether the compound tariff is a measure "necessary" 
to protect public morals under Article  XX(a) of the GATT  1994. First, regarding the importance of 
the interests or values  pursued by the challenged measure, the Appellate  Body noted that the 
Panel had found that, in Colombia , the objective of combating money laundering reflects soci etal 
interests that can be described as vital and important in the highest degree.  
Turning to  the contribution  of the measure to combating mone y laundering, the Appellate  Body 
considered that the same findings of the Panel that led it to conclude that the compound tariff is 
not incapable of combating money laundering, such that there is a relationship between that 
measure and the protection of pu blic morals, also indicate that there may be at least some 
contribution by the compound tariff to the objective of combating money laundering. However, the 
Appellate  Body pointed out that, while the Panel's findings indicate d that there may be at least 
some contribution, they were indeterminate as to the degree of such contribution. Moreover, the 
Appellate  Body considered that certain o ther findings by the Panel highlight the lack  of sufficient 
clarity surrounding the amount or proportion of import transact ions involving the products at issue  
that are actually used for money  laundering purposes. The Appellate  Body understood that, in WT/AB/27  
 
- 48 - 
 
 making such findings, the Panel emphasized that Colombia had not established with sufficient 
clarity the amount or proportion of import transactions involving the relevant products that are, in 
fact, undervalued for money laundering purposes.  The Appellate  Body further  pointed out that 
Panel did not have much clarity as to how effective the disincentive of the compound tariff is as a 
means of combating money laundering. In the Appellate  Body's view, t hese considerations 
regarding the uncertainty surrounding the amount or proportion of imported goods below the 
thresholds that are actually used for money laundering purposes, as well  as the  extent to which  
the compound tariff  acts as a disincentive to money laundering, indicate d the Panel's view that 
Colombia had not  demonstrate d with sufficient clarity the degree of contribution made by the 
compound tariff to the objective  of combati ng money laundering.  
Turning to the trade-restrictiveness  of the measure at issue, the Appellate  Body noted the Panel 's 
finding that the compound tariff is less restrictive on international trade than an import ban or a 
measure having the effects of a ban . The Appellate  Body added that , despite acknowledging that 
the measure is less restrictive than an import  ban, the Panel also raised  the possibility that the 
compound tariff can be  highly trade restrictive, and in some circumstances as restrictive as a ban . 
Therefore, in the Appellate  Body's view, t he findings  by the Panel indicate d the uncertainty as to 
the degree to which the compound tariff can be considered to be less trade restrictive than an 
import ban, and thus support ed the view that Colombia had no t established with suffici ent clarity 
the degree of trade -restrictiveness of the measure.  
Finally, the Appellate  Body noted that, before the Panel, the parties also advanced arguments as 
to whether there are any less trade -restrictive alternatives that are  reasonably available. Given the 
lack of sufficient clarity regarding the degree of contribution of the measure to the objective of 
combating money laundering, and the degree of trade -restrictiveness of the measure, the 
Appellate  Body saw no basis to proce ed with a comparison of the measure at issue with  any 
possible alternative measures  that are reasonably available and achieve an equivalent level of 
protection . 
In the Appellate  Body's view, the Panel's findings thus supported the conclusion that Colombia had 
not demonstrated that the conclusion resulting from a weighing and balancing exercise i s that the 
measure at issue is necessary  to protect public morals.  Therefore, on the basis of the Panel's 
findings, the Appellate  Body found that  Colombia had not de monstrated that th e compound tariff is 
a measure necessary to protect public morals  within the meaning of Article  XX(a) of the 
GATT  1994. 
4.3.4   Article  XX(d) of the GATT  1994  
4.3.4.1   Whether Colombia demonstrate d that the compound tariff is a measure 
"designed"  to secur e compliance with laws or regulations that are not GATT -inconsistent  
Colombia also appeal ed the Panel's finding that Colombia had failed to demonstrate that the 
compound tariff is a measure designed to secure compliance with laws or regulations which are n ot 
inconsistent with the GATT  1994, within the meaning of Article  XX(d) of the GATT  1994. Colombia 
argued that  the Panel's conclusions  regarding whether the measure is designed  to secure 
compliance with Article  323 of Colombia's Criminal Co de, and whether the measure is necessary  to 
secure such compliance, are based entirely on its previous analysis under Article  XX(a). Colombia 
thus argued that the Panel's analysis under Article  XX(d) necessarily suffered  from the same flaws  
as its analysis under Article  XX(a). 
The Appellate  Body observed that the Panel's examina tion of whether the measure is designed  to 
secure compliance with Article  323 of Colombia's Criminal Code relied mainly on reasoning and 
findings it had developed in the context of its analysis unde r Article  XX(a). The Appellate  Body 
explained that, both under Article  XX(a) and Article  XX(d), the design and necessity  steps of the 
legal standard are conceptually distinct, yet related, aspects of the overall inquiry to be 
undertaken into whether a resp ondent has establishe d that the measure at issue is necessary to 
protect public morals , and that such an assessment is not entirely disconnected in the sense that 
certain evidence and considerations may be relevant to both aspects of the defence. The 
exami nation of a defence under both Article  XX(a) and Article  XX(d) requires an initial, threshold 
examination of the design of the measure at issue, including its content, structure, and expected 
operation.  If the assessment of the design of the measure, including its content, structure, and WT/AB/27  
 
- 49 - 
 
 expected operation , reveals that the measure is incapable of,  in the case of Article  XX(a), 
protecting public morals, or, in the case of Article  XX(d), securing compliance with relevant 
provisions of laws or regulations tha t are not GATT -inconsistent, there is not a relationship that  
meets the requirements of the design  step. 
According to the Appellate  Body, provided that its reasoning accounts for the differences in the 
legal standards under paragraph  (a) and paragraph  (d) of Article  XX, the Panel did  not act  
improperly simply because it relie d, in the context of its application of the legal standard under 
Article  XX(d), on reasoning it had developed in assessing Colombia's defence under Article  XX(a). 
The Appellate  Body further noted that Colombia itself had presented the same arguments and 
evidence in respect of both paragraph  (a) and paragraph  (d) of Article  XX. I n both instances, 
Colombia maintained that the compound tariff seeks to combat money laundering so as  to secure  
compliance with Article  323 of Colombia's  Criminal Code  because, by its design, it  reduces the 
incentives for criminal groups to use imports of apparel and footwear for money laundering 
purposes, by me ans of artificially low prices.  In these circumstances , the Appellate  Body 
considered that the Panel did not act improperly by relying on similar considerations and reasoning 
in reaching its conclusions under Article  XX(a) and Article  XX(d).  
The Appellate  Body considered, however, that the concerns it raised in the context of the Panel's 
assessment of whether the compound tariff is designed  to protect public morals under 
Article  XX(a) were also relevant in the context of the assessment under Article  XX(d). In particular, 
the Appellate  Body noted that, by stati ng that it cannot be ruled out  that goods price d below the 
thresholds reflect artificially low  prices, the Panel acknowledged that at least some transactions at 
or below the thresholds could reflect such prices. The Appellate  Body further noted the Panel's  
acknowledgement that, in Colombia, one of the methods used to launder money is the 
undervaluation of imports. Moreover, the Appellate  Body considered that additional findings by the 
Panel show a relationship between the compound tariff and the money laund ering activities that 
Colombia seeks to discourage through the application of the challenged measure. In the 
Appellate  Body's view, these findings demonstrate the Panel's recognition, in respect of its analysis 
under both Article  XX(a) and Article  XX(d), t hat at least some goods priced at or below the 
thresholds could be imported into Colombia at artificially low prices for money laundering 
purposes, and would thus be subject to the disincentive created by the higher specific duties that 
apply to these good s. Thus, the Appellate  Body considered  that the Panel itself recognized that the 
compound tariff is not incapable of securing compliance with Article  323 of Colombia's 
Criminal  Code, such that there is a relationship between that measur e and securing such 
compliance.  
The Appellate  Body stated that, a lthough the Panel concluded that Colombia had failed to establish 
a relationship between the compound tariff and Article  323 of Colombia's Criminal Code , this 
conclusion wa s belied by the Panel finding s it had  examined. The Panel's own analysis indicate d 
that the compound tariff is not incapable of securing compliance with Article  323 of Colombia's 
Criminal Code , such that there is a relationship between that measure and securing such 
compliance . Consequently, th e Panel should not have ceased its analysis at this stage of its review 
of Colombia's defence under Article  XX(d) . 
For these reasons , the Appellate  Body found that the Panel erred in concluding  that Colombia had 
failed to demonstrate that the measure is de signed to secure compliance with laws or regulations 
that are not GATT -inconsistent  given its recognition that the compound tariff is not incapable of 
securing compliance with Article  323 of Colombia's Criminal  Code, such that there is a relationship 
betwe en that measure and securing such compliance . Thus, the Panel  failed to assess the 
necessity  of the measure on the basis of a w eighing and balancing exercise.  
The Appellate  Body therefore reversed the  Panel's finding that Colombia ha d failed to demonstra te 
that the compound tariff is designed  to secure compliance with Article  323 of Colombia's Criminal 
Code. Since the Panel's findings under Article  XX(d) were based on this erroneous finding, the 
Appellate  Body also reversed the  Panel's findings that Colombi a had  failed to demonstrate that th e 
compound tariff is a measure necessary to secure compliance with laws or regulat ions which are 
not inconsistent  with the GATT  1994, within the meaning of Article  XX(d) of the GATT  1994. 
The Appellate  Body then considere d whether it could complete the legal analysis and find that the 
measure at issue meets the requirements set out in Article  XX(d) of the GATT  1994. The 
Appellate  Body stated that, when several findings by the Panel are read together, it is clear from WT/AB/27  
 
- 50 - 
 
 its analysis that the compound tariff is not incapable of securing compliance with Article  323 of 
Colombia's Criminal Code, such that there is a relationship between that measure and securing 
such compliance. Therefore, on the basis of the Panel's findings, the  Appellate  Body found that the 
measure at issue is designed  to secure compliance with laws or regulations which  are 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. 
4.3.4.2   Whether Colombia demonstrate d that the compound tariff is a measure 
"necessary"  to secure compliance with laws or regulations that are not 
GATT -inconsistent  
The Appellate  Body then turned to  examine whether th e compound tariff is a measure necessary  
to sec ure compliance with laws or regulations that are not GATT -inconsistent, within the meaning 
of Article  XX(d) of the GATT  1994. 
With respect to the importance of the interests or values  at stake , the Panel considered that, for 
reasons similar to those  mentio ned in its analysis under Article  XX(a), securing compliance with 
Article  323 of Colombia's Criminal Code reflects societal interests that can be characterized as vital 
and important in the highest degree.  
Turning to the contribution  of the measure to the objective it pursues, the Appellate  Body 
considered  that the same findings  of the Panel that supported the conclusion  that the  compound 
tariff is not incapable of securing compliance with  Article  323 of Colombia's Criminal Code, also 
indicate that there ma y be at least some contribution by the compound tariff to securing such 
compliance. However, while the Panel's findings indicated that there may be at least some 
contribution, they were also indeterminate as to the degree of such contribution. The Panel's 
findings highlight the lack of sufficient clarity surrounding the amount or proportion of import 
transactions involving the products at issue that are actually used for money laundering purposes, 
and indicate that the Panel did not have much clarity as to how effective the disincentive of the 
compound tariff is as a means of combating money laundering. According to the Appellate  Body, 
these considerations indicate the Panel's view that Colombia had not demonstrated with sufficient 
clarity the degree of cont ribution made by the compound tariff to the objective of combating 
money laundering.  
The Appellate  Body then examined the trade-restrictiveness  of the measure at issue . Noting the 
Panel's finding that the compound tariff is less trade-restrictive than a  ban on imports, the 
Appellate  Body considered that t his finding reflects uncertainty as to  the degree  of 
trade-restrictiveness of the measure at issue because it does n ot indicate how much less trade 
restrictive the measure is in comparison to an import ban.  The Appellate  Body also note d that, 
despite acknowledging that the measure  at issue  is less restrictive than an import ban, the Panel 
had previously raised  the possibility that the compound tariff can be highly trade restrictive, and in 
some circumstances  as restrictive as a ban. These  findings  by the Panel, the Appellate  Body 
considered, support the view that Colombia had not established with suffici ent clarity the degree of 
trade-restrictiveness of the measure.  
Having examined the relevant Panel findings , the Appellate  Body underst ood that the Panel's 
weighing and balancing of th e necessity  factors revealed that Colombia had failed to demonstrate 
that the measure is necessary  to secure compliance with laws or regulations that are not 
GATT -inconsistent . 
In the Appellate  Body's view,  the Panel's findings thus support ed the conclusion that Colombia has 
not demonstrated that the conclusion resulting from a weighing and balancing exercise i s that the 
measure at issue is necessary  to secure compliance with Article 323 of Colombia's Criminal Code . 
On the basis of the Panel's findings , the Appellate  Body found  that Colombia has not demonstrated 
that th e compound tariff is a measure necessary to secure compliance with laws or regulations 
which are not i nconsistent w ith the provisions  of the GATT  1994, within the meaning of 
Article  XX(d) of the GATT  1994. WT/AB/27  
 
- 51 - 
 
 4.3.5   Whether Colombia demonstrated that its measure satisfies the requirements of 
the chapeau of Article  XX of the GATT  1994  
Colombia also appealed the Panel's findings p ertaining to the chapeau of Article  XX of the 
GATT  1994. Having recalled its findings that Colombia has not demonstrated that the compound 
tariff is provisionally justified under Article  XX(a) or  Article  XX(d) of the GATT  1994, the 
Appellate  Body did not c onsider it necessary to examine Colombia's claims on appeal pertaining to 
the chapeau of Article  XX of the GATT  1994. The Appellate  Body express ed no view on the Panel's 
reasoning or findings in that regard.  
4.4  Appellate  Body  Report, India – Certain Measures Relating to  Solar Cells and 
Solar  Modules , WT/DS456/AB/R  
This dispute concerned a challenge by the United  States to certain domestic content requirements 
(DCR measures) imposed by India on solar power developers (SPDs) selling electricity to 
governmental a gencies under its Jawaharlal Nehru National Solar Mission. The DCR  measures at 
issue required that certain types of solar cells and modules used by SPDs be made in India.  
Before the Panel, the United  States claimed that the measures at issue are inconsiste nt with 
Article  III:4 of the GATT  1994 because they accord less favourable treatment to imported products 
(solar cells and modules) than to like products of national origin. The United  States also claimed 
that the measures at issue are inconsistent with Article 2.1 of the TRIMs  Agreement because they 
are trade -related investment measures that make the purchase of domestic products a 
requirement to obtain an advantage, thus falling under paragraph  1(a) of the Illustrative List in the 
Annex to the TRIMs Agree ment (Illustrative List).  
The Panel found that India's DCR  measures at issue are inconsistent with WTO non -discrimination 
obligations under Article  III:4 of the GATT  1994 and Article  2.1 of the TRIMs  Agreement. The Panel 
also found that the measures are no t covered by the government procurement exemption under 
Article  III:8(a) of the GATT  1994, because the product being procured (electricity) was not in a 
competitive relationship with the product discriminated aga inst (solar cells and modules).  
Moreover, th e Panel found that India had not demonstrated that its measures are justified under 
Article  XX(j) of the GATT  1994, applicable to measures that are essential to the acquisition or 
distribution of "products in general or local short supply", and/or Article  XX(d), which establishes a 
general exception for measures necessary to "secure compliance" with a WTO Member's "laws or 
regulations", which are not themselves GATT -inconsistent.  
4.4.1   Article  III:8(a) of the GATT  1994  
India appealed the Panel's conclusion that t he DCR measures at issue are not covered by the 
derogation under Article  III:8(a) of the GATT  1994. India contended 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 Program , and refused to consider the facts, evidence and legal arguments 
advanced by India in the present case. In particular, India maintained that the Panel: (i) i gnored a 
fundamental basis of India's argument that solar cells and modules are indistinguishable from solar 
power generation; (ii) erred in its factual and legal assessment that it is not necessary to consider 
whether solar cells and modules qualify as in puts for solar power generation; (iii) erred in 
dismissing India's arguments that sole reliance on the competitive 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; and (iv) erred in reasoning that it could not  
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 th is reasoning.  
The Appellate  Body first recalled 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 leg al. 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 issue with the covered agreements. With respect to the applicability of and conformity 
with the re levant covered agreements, a panel is required to conduct an objective assessment of WT/AB/27  
 
- 52 - 
 
 whether the obligations in the covered agreements, with which an inconsistency is claimed, are 
relevant and applicable to the case at hand, and whether the measures at iss ue conform to, or are 
inconsistent with, the specific obligations provided for in those agreements.  
The Appellate  Body recalled that the Panel had not considered it necessary to resolve whether the 
Appellate  Body left room for an alternative to the competi tive relationship standard, or to decide, 
in the abstract, the meaning of inputs and processes of production as used by the Appellate  Body 
in Canada – Renewable Energy / Canada – Feed-In Tariff Program , in view of its conclusion that 
the DCR measures at is sue in this dispute are not distinguishable in any relevant respect from 
those examined by the Appellate  Body in those earlier disputes. The Appellate  Body noted in this 
regard that, under Article  11 of the DSU, the Panel was required  to consider all factu al and legal 
arguments of the parties that were pertinent for ruling on whether the DCR measures are covered 
by the derogation under Article  III:8(a) of the GATT  1994. 
The Appellate  Body observed that a primary issue of contention between the parties in th e Panel 
proceedings related to the pertinence of the reasoning and findings of the Appellate  Body in 
Canada – Renewable Energy / Canada – Feed-in Tariff Program  regarding the scope of 
Article  III:8(a) of the GATT  1994 with respect to "products purchased". The Appellate  Body had 
found, in those disputes, that the coverage of Article  III:8(a) extends to products purchased that 
are "like" the products discriminated against under Articles  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, and had referred to these as "products that are in a competitive relationship". The 
Appellate  Body had agreed that a close relationship between the product purchased and the 
product discriminated against could be relevant for a separate element of Article  III:8(a) – 
namely, assessing whether a measure can be said to be governing procurement of products 
purchased. However, the Appellate  Body had explained that this was not dispos itive of whether 
Article  III:8(a) applies, because the products purchased were not in a "competitive relationship" 
with the products being discriminated against. Therefore, the Appellate  Body disagreed with India 
that the Appellate  Body's interpretation of  Article  III:8(a) in Canada – Renewable Energy / 
Canada  – Feed-in Tariff Program  suggests that the scope of this provision may extend, in some 
cases, to "inputs" and "processes of production" regardless of whether the product subject to 
discrimination is i n a competitive relationship with the product purchased. The Appellate  Body 
further recalled in this appeal that the issue of whether the cover of Article  III:8(a) may extend to 
discrimination relating to inputs and processes of production used in respect of products purchased 
by way of procurement was a matter which the Appellate  Body, in Canada – Renewable Energy / 
Canada – Feed-in Tariff Program , had explicitly said it was not deciding. The Appellate  Body added 
that this question arises only after the pr oduct 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 the latter issue – i.e. whether products are in a competi tive 
relationship – the Appellate  Body explained that, while 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 do es not displace the competitive 
relationship standard. The Appellate  Body concluded that, 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.  
The Appellate  Body observed that India's appeal under Article  III:8(a) of the GATT  1994 hinged 
largely on its reading of that provision, and in particular on what India saw as the limited scope of 
the competitive relationship standard, as developed by the Appellate in  Canada – Renewable 
Energy / Canada – Feed-in Tariff Program . The Appellate  Body further noted that India had not 
argued before the Panel that a competitive relationship exists between electricity and solar cells 
and modules or  that the Government of India takes title or custody of solar cells and modules. 
Nevertheless, in order fully to dispose of the issues raised by India on appeal, the Appellate  Body 
went on to examine India's arguments to the extent they relate d to the appr oach adopted by the 
Panel in its assessment of India's claims.  
With regard to India's contention that the Panel failed to consider the fundamental characteristics 
of solar cells and modules, and disregarded India's argument that solar cells and modules are  
indistinguishable from solar power generation, the Appellate  Body found that the Panel had 
properly addressed, and rejected, India's arguments that solar cells and modules cannot be 
treated as distinct from solar power and that, by purchasing electricity generated from such cells 
and modules, India was effectively procuring the cells and modules. Moreover, regarding India's WT/AB/27  
 
- 53 - 
 
 claim that the Panel summarily dismissed its argument that solar cells and modules are integral 
inputs for the generation system as co ntrasted with all  other components of a PV generation plant 
that can be classified as ancillary equipment, the Appellate  Body found that the Panel had 
sufficiently considered this argument by India.  
Regarding India's argument that the word "procurement" sh ould not be read to require direct 
acquisition of the product purchased in all cases, the Appellate  Body noted that the fact that 
"procurement" may refer to the process of obtaining products, rather than  to an acquisition itself 
does not mean that, in orde r to be covered under Article  III:8(a), government procurement can be 
effectuated by means of a contractual arrangement other than a purchase as India appeared to 
suggest. Furthermore, the Appellate  Body considered that India had reiterated, in essence, it s 
argument, rejected by the Appellate  Body, that Article  III:8(a) should cover situations where the 
discrimination involves inputs or processes of production, regardless of whether the product 
discriminated against is in a competitive relationship with the  product purchased. The 
Appellate  Body also agreed with the Panel that India's arguments regarding the policy options left 
for WTO Members in case of an overly narrow interpretation of Article  III:8(a), did not have a 
bearing on the proper determination of  the scope of that provision.  
Finally, the Appellate  Body recalled that, before the Panel, India had sought to distinguish from 
Canada – Renewable Energy / Canada – Feed-in Tariff Program  on the facts of the present case, 
rather than to have the Panel re -assess the merits of the Appellate  Body's interpretation and 
application of Article  III:8(a) and relevant reasoning. Based on its review, the Appellate  Body 
found that the Panel was rightly guided by the Appellate  Body's interpretation 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 those disputes.  
For all these  reasons, the Appellate  Body found that the Panel did not fail to make an objective 
assessment of the matter before it pursuant to Article  11 of the DSU in finding that discrimination 
under the DCR measures is not covered by the terms of the government pro curement derogation 
contained in Article  III:8(a) of the  GATT  1994. Consequently, the Appellate  Body upheld the 
Panel's finding that the discrimination relating to solar cells and modules under the DCR  measures 
is not covered by the derogation of Article  III:8(a) of the GATT  1994, and that, therefore, the 
DCR measures are inconsistent with Article  2.1 of the TRIMs  Agreement and Article  III:4 of the 
GATT  1994. 
With regard to the remaining elements under Article  III:8(a) of the GATT  1994, the Appellate  Body 
noted that India's request for completion of the legal analysis was premised on the condition that 
the Appellate  Body 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, the 
Appellate  Body considered that it did not need to address India's further claims and related 
arguments concerning the Panel's interpretation and application of the remaining elements under 
Article  III:8(a).  
4.4.2   Article  XX(j) of t he GATT  1994  
India argued that 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) of the GATT  1994 in the 
context of the specific terms used in that provis ion. Therefore, India requested the Appellate  Body 
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 acquisit ion of such products. India further alleged that the Panel acted inconsistently with 
Article  11 of the DSU in rejecting India's arguments regarding the relevance of sufficient 
manufacturing capacity in interpreting and applying the elements of Article  XX(j). 
The Appellate  Body recalled that an evaluation of a defence under Article  XX of the GATT  1994 
involves a two -tiered analysis, in which a measure must first be provisionally justified under one of 
the paragraphs of Article  XX, and then shown to be consis tent with the requirements of the 
chapeau of Article  XX. Regarding the first part of the analysis, the Appellate  Body recalled that two 
elements must be shown: first, that the measure addresses the particular interest specified in that 
paragraph; and, seco nd, that there is a sufficient nexus between the measure and the interest WT/AB/27  
 
- 54 - 
 
 protected, which is specified through the use of terms such as "necessary to" in Article  XX(d), and, 
in the case of Article  XX(j), "essential to".  
This was the first case in which th e Appellate  Body was called upon to interpret the requirements 
of Article  XX(j). The Appellate  Body began by reviewing its jurisprudence under the other 
paragraphs of Article  XX and, in particular, its recent jurisprudence under Article  XX(d) in 
Colombia  – Textiles  and Argentina – Financial Services . The Appellate  Body considered the 
analytical framework for the "design" and "necessity" elements of the analysis contemplated under 
Article  XX(d) to be relevant mutatis  mutandis  to an analysis of Article  XX(j).  The Appellate  Body 
stated that the examination of a defence under Article  XX(j) would therefore appear to include an 
initial threshold examination of the design of the measure at issue, including its content, structure, 
and expected operation. It added th at the responding party must demonstrate the relationship 
between the measure and "the acquisition or distribution of products in general or local short 
supply". If the assessment of the design of a measure, including its content, structure, and 
expected o peration, reveals that the measure is incapable of addressing "the acquisition or 
distribution of products in general or local short supply", there is no relationship that meets the 
requirements of the design element, and further analysis with regard to wh ether the measure is 
essential would not be required. The Appellate  Body explained that 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".  
The Appellate  Body further recalled that the "design" and "necessity" elements are conceptually 
distinct, but related, aspects of the overall inquiry to be carried out under Article  XX(d). Thus, the 
way a panel organizes its examina tion of these elements may be influenced not only by the 
measures at issue or the laws or regulations identified by the respondent, but also by the manner 
in which the parties present their respective arguments and evidence. The Appellate  Body found 
these considerations to be equally relevant for the analysis under Article  XX(j) in assessing 
whether a measure is "essential to the acquisition or distribution of products in general or local 
short supply".  
Concerning the interpretation of the term "essential" in Article  XX(j), the Appellate  Body recalled 
that, in a continuum ranging from "indispensable" to "making a contribution to", a "necessary" 
measure is located significantly closer to the pole of "indispensable" than to the opposite pole of 
simply "making a contribution to". Noting that the word "essential" is defined as absolutely 
indispensable or necessary, the Appellate  Body observed that the plain meaning of the term thus 
suggests that this word is located at least as close to the "indispensable" end of  the continuum as 
the word "necessary". Having said this, the Appellate  Body recalled that a "necessity" analysis 
under Article  XX(d) involves a process of weighing and balancing a series of factors, and 
considered the same process of weighing and balancin g to be relevant in assessing whether a 
measure is "essential" within the meaning of Article  XX(j). In particular, the Appellate  Body 
considered 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 t he 
challenged measure and reasonably available alternative measures should then be undertaken.  
The Appellate  Body further stated that it must therefore be established that there are "products in 
general or local short supply", and that the challenged measu res are "essential to the acquisition 
or distribution of" such products. The Appellate  Body noted 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 M embers are entitled to an equitable share of the international supply of such 
products", and that Members may take GATT -inconsistent measures under that provision, subject 
to the requirement that such measures "shall be discontinued as soon as the conditio ns giving rise 
to them have ceased to exist". In light of this language, the Appellate  Body considered that a 
proper interpretation of Article  XX(j) requires careful consideration of how the different terms used 
in that provision inform one another, and sh ould thus be holistic in nature.  
Regarding the meaning of the phrase "products in general or local short supply", the 
Appellate  Body observed that the words "products in … short supply" refer generally to products 
available only in limited quantity, scarce , and therefore to products in respect of which there is a 
shortage, that is, a deficiency in quantity; or an amount lacking. The Appellate  Body further 
observed that "supply" is defined as the amount of any commodity actually produced and available WT/AB/27  
 
- 55 - 
 
 for pu rchase, and that it is correlative to the word "demand". 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 pro ducts can be said to be "in 
short supply" when the quantity of a product that is availabl e does not meet demand for 
that product.  
As to the extent of the geographical area or market in which the quantity of "available" supply of a 
product should be compare d to demand, the Appellate  Body observed that Article  XX(j) refers to 
products in "general or local" short supply. The Appellate  Body noted that the definitions of the 
terms "local" and "general" suggest that the terms "general or local" refer to a range o f 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, the Appellate  Body understood the ph rase "products in general or local 
short supply" to be focused on products for which a situation of short supply exists within the 
territory of the Member invoking Article  XX(j). A situation of general short supply could extend 
beyond the boundaries of tha t territory, as long as it also occurs within that territory. The 
Appellate  Body further read the terms "general" and "local", together with the disjunctive "or", to 
indicate that there is no requirement for a Member to demonstrate that the shortage extend s to all 
parts of its territory, but that, depending on the circumstances, 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.  
Regarding the question of whe ther Article  XX(j) speaks to the origin of products that may be 
available in a particular geographical area or market, the Appellate  Body observed that the phrase 
"products in general or local short supply" is immediately preceded by the terms "acquisition  or 
distribution of". Article  XX(j) therefore contemplates measures that seek to redress situations of 
"short supply" by providing for the "acquisition or distribution of" given products. The 
Appellate  Body noted that, 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. Thus, 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. However, there is no reason not to give due regard to the quantity of products 
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 geogra phical area or market. Further, the 
Appellate  Body noted that, 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 do es not follow from such increase that domestic manufacturers will 
necessarily sell their production to domestic buyers, as opposed to exporting their production by 
selling to buyers abroad. The Appellate  Body concluded therefore that an assessment of wheth er 
there is a situation of "products in general or local short supply" should not focus exclusively on 
availability of supply from domestic sources, as opposed to fo reign or international sources.  
The Appellate  Body further noted that Article  XX(j) contemp lates situations of "short supply" that 
may continue over time, but are nonetheless expected not to last indefinitely, and that 
Article  XX(j) requires a careful scrutiny of the relationship between supply and demand based on a 
holistic consideration of tre nds in supply and demand as they evolve over time.  
In sum, the Appellate  Body found that 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 s upply". 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 ta ke 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 r egard should be given to the total quantity of imports that may be available to meet the 
demand in a particular geographical area or market. Thus, it may be relevant to consider the 
extent to which international supply of a product is stable and accessible , including by examining WT/AB/27  
 
- 56 - 
 
 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 capacity, domestic products are not available in all par ts 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 from both 
domestic and international sources in the relevant geographical  market is insufficient to 
meet demand.  
The Appellate  Body added that its interpretation of Article  XX(j) is in consonance with the 
preamble of the 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 and to enhance the means for doing so in a manner consistent with [Members'] 
respective needs and concerns at different levels of economic development", and that the  different 
levels of economic development of Members could, depending on the circumstances, impact the 
availability of supply of a product in a given market.  
Turning to India's claims on appeal, the Appellate  Body disagreed that a lack of sufficient domest ic 
manufacturing capacity would necessarily constitute a product shortage in a particular market, as 
India appeared to suggest. The Appellate  Body understood India's arguments regarding the 
alleged risks inherent to the continued dependence on imported sol ar cells and modules to relate 
to the issue of supply  availability, and agreed that such considerations could, in principle, be 
relevant in assessing whether a situation of "short supply" exists. Yet, 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, the Appellate  Body noted the Panel's finding that India had not 
identified any actual disruptions in imports of solar cells and modules to date, and that SPDs in 
India had not experienced an actual disruption in the supply of aff ordable foreign solar cells 
and modules.  
The Appellate  Body further disagreed with India to the extent that it assumed, first, that all 
imports, in and of themselves, entail supply -related risks and, in that sense, are not available to 
meet demand; and, second, that such risks are intolerable when a sufficient level of domestic 
manufacturing capacity of solar cells and modules has not been met and that a situation of "short 
supply" e xists, as long as domestic manufacturing capacity lies below this level. For the 
Appellate  Body, 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 wheth er a respondent 
has identified 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.  
The Appellate  Body further noted India's argument that the DCR  measures sho uld be seen in light 
of India's policy objectives of: (i) energy security and sustainable d evelopment; and 
(ii) ecologically sustainable growth, while addressing the challenges of climate change. The 
Appellate  Body explained that, while policy consideratio ns such as those referred to by India may 
inform the nature and extent of supply and demand, they do not relieve the responding party 
invoking the exception in Article  XX(j) from the burden of demonstrating that the products at issue 
are "in general or loc al short supply".  
India further contended that, under the Panel's interpretation of Article  XX(j), measures taken to 
redress a situation of short supply can only take the form of export restrictions, and, hence, the 
Panel's interpretation of Article  XX(j) could not  be correct. The Appellate  Body noted that, while 
the text of Article  XX(j) does not contain express language referring to either import or export 
restraints, in contrast with Article  XI:2(a) and Article  XX(i) of the GATT  1994 which refer to expor t 
restrictions, a proper interpretation of the phrase "products in general or local short supply" cannot 
be based merely on textual differences or similarities between Article  XX(j) and other provisions of 
the GATT  1994. The Appellate  Body further disagree d with India that it follows from the Panel's 
interpretation of the phrase "products in general or local short supply" that export restrictions are 
the only type of measure that may be used to redress a situation of "short supply", or that 
Article  XX(j) ca nnot cover measures taking the form of import restrictions. On this basis, the 
Appellate  Body disagreed with India that "short supply" can be determined without regard to 
whether supply from all sources is sufficient to meet demand in the relevant market.  WT/AB/27  
 
- 57 - 
 
 The Appellate  Body turned next to consider India's claim that the Panel acted inconsistently with 
Article  11 of the DSU in addressing India's arguments and evidence regarding the notion of 
sufficient domestic manufacturing capacity. The Appellate  Body noted that India's claim under 
Article  11 of the DSU hinged on India's reading of Article  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 by reference to whether there is sufficient domestic manufacturing of a given 
product. The Appellate  Body observed that the fact that India did not agree with the Panel's 
interpretation and application of Article  XX(j) did not mean that the Panel had committed an error 
amounting to a violation of Article  11 of the DSU. The Appellate  Body also considered that India 
was recasting the arguments that it had made before the Panel under the guise of an Article  11 
claim. The Appellate  Body therefore rejected India's claim that th e Panel acted inconsistently with 
its duties under Article  11 of the DSU.  
Based on its analysis, the Appellate  Body 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), and 
the Panel's ultimate finding that the DCR  measures are not justified under Article  XX(j) of the 
GATT  1994. 
4.4.3   Article  XX(d) of the GATT  1994  
India claimed that the Panel erred in its interpretation and application of Article  XX(d) of the 
GATT 1994 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 Article  XX(d). 
India further argued that the Panel erred in finding that three of the domestic instruments 
identified by India, namely, the National Electricity Policy, the National Electricity Plan, and the 
National Action Plan on Climate Change, do not constitute "laws or regulations"; and by 
consequently focusing its analysis on Sect ion 3 of India's Electricity Act 2003, in isolation of these 
three other instruments.  
In interpreting the meaning of "laws or regulations" in Article  XX(d), the Appellate  Body recalled its 
statement in Mexico – Taxes on Soft Drinks  that the term  refers to rules that form part of the 
domestic 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. The Appellate  Body concluded that "laws or 
regulations" refer to rules of conduct and principles governing behaviour or practice that form part 
of the domestic legal system of a Member. Moreover, it noted its observation in Mexico – Taxes on 
Soft D rinks that "laws or regulations" encompass rules adopted by a WTO Member's legislative or 
executive branches of government. Therefore, in ascertaining whether an alleged rule falls within 
the scope of "laws or regulations" for purposes of Article  XX(d), it  may be relevant to assess 
whether the rule at issue has been adopted or recognized by an authority that is competent to do 
so under the domestic legal system of the Member concerned.  
Turning to the immediate context of the terms "laws or regulations", the  Appellate  Body noted that 
the text of Article  XX(d) refers to "laws or regulations" in respect of which compliance can be 
secured. The Appellate  Body explained that a measure can be said "to secure compliance" with 
"laws or regulations" when it seeks to s ecure observance of specific rules, even if the measure 
cannot be guaranteed to achieve such result with absolute certainty. The Appellate  Body did 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 are accompanied by penalties and 
sanctions to be applied in situations of non -compliance. Instead, the Appellate  Body explained 
that, in assessing whether a rule falls within the scope of "laws or regulation s" under Article  XX(d), 
a panel should consider the degree to which an instrument containing the alleged rule is normative 
in nature, and that it is therefore relevant for a panel to examine whether a rule is legally 
enforceable, or whether it provides for  penalties or sanctions  to be applied in situations 
of non-compliance.  
The Appellate  Body recalled its observation in Argentina – Financial Services  that the more 
precisely a respondent is able to identify specific rules, obligations, or requirements conta ined in 
the relevant "laws or regulations", the more likely it will be able to elucidate how and why the 
inconsistent measure secures compliance with such "laws or regulations". The Appellate  Body 
added that a panel should also consider the degree of speci ficity or precision with which the 
relevant instrument lays down a particular rule of conduct or course of action within the domestic WT/AB/27  
 
- 58 - 
 
 legal system of a Member, as opposed to simply providing a legal basis for action that may be 
consistent with certain obje ctives. The Appellate  Body observed that, while in certain cases a 
respondent 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", 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. The Appellate  Body saw nothing 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. For the 
Appellate  Body, insofar as a  respondent seeks to rely on a rule deriving from several instruments 
or parts thereof, it would still bear the burden of establishing that the instruments or the parts that 
it identifies actually set out the alleged rule. Moreover, the Appellate  Body noted that, while the 
form and title given to an instrument may shed light on its legal status and content, a 
determination of whether an alleged rule falls within the scope of "laws or regulations" for 
purposes of Article  XX(d) cannot be made simply by refere nce to the label given to an instrument 
under the domestic law of a Member, and should, instead, focus on the specific features and 
characteristics of the instruments at issue, including the alleged rules that they may contain.  
The Appellate  Body found the refore 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 rel evant 
instrument(s) and should avoid focusing exclusively or unduly on any single characteristic. 
Specifically, the Appellate  Body indicated that 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 enforce able, 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 instru ments containing the 
rule under the domestic legal system of a Member; and (vi) the penalties or sanctions that may 
accompany the relevant rule. The Appellate  Body stressed that this assessment must always be 
carried out on a case -by-case basis, in light o f the specific characteristics and features of the 
instruments at issue, the rule alleged to exist, and the dome stic legal system of the 
Member  concerned.  
Turning to the Panel's assessment of the domestic instruments identified by India, the 
Appellate  Body began by addressing 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. The Appellate  Body recalled that the 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 party 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. According to the Appellate  Body, 
although 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, there 
may be other ways to demonstrate that an instrument operates with a suffi cient degree of 
normativity. The Appellate  Body therefore disagreed with the Panel 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 le gal system of a Member.  
Next, the Appellate  Body considered India's argument that the Panel erred in its interpretation of 
the phrase "to secure compliance" to the extent that it suggested that this phrase limits the scope 
of Article  XX(d) to measures that  prevent actions that would be illegal under the laws or 
regulations at issue. Noting the Panel's statement that it saw no link or nexus between the 
DCR measures and Section  3 of the Electricity Act, the Appellate  Body did not consider the Panel to 
have fo und 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.  
Finally, the Appellate  Body addressed India's argument that the Pan el 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 WT/AB/27  
 
- 59 - 
 
 achieving ecologically susta inable growth, and that the DCR  measures are required for securing 
compliance with this rule. The Appellate  Body recalled that the Panel analysed each of the 
domestic instruments that India had identified to assess whether they qualify as "laws or 
regulati ons" within the meaning of Article  XX(d). In the Appellate  Body's view, given how India 
presented its case alleging the existence of the obligation of ensuring ecologically sustainable 
growth deriving from several instruments, the Panel could also have beg un by assessing whether 
the passages and provisions of the domestic instruments that India had identified, when 
considered together, set out the rule alleged by India, and whether this qualified as a "law or 
regulation" under Article  XX(d).  
Looking at the passages and provisions of the National Electricity Policy, the National Electricity 
Plan, and the National Action Plan on Climate Change identified by India, the Appellate  Body noted 
that there are differences in the substantive content of the passages an d provisions of these three 
instruments, on the one hand, and the substance of the rule that India alleges they contain, on the 
other hand. Agreeing with the Panel that the text of these passages and provisions is hortatory, 
aspirational, declaratory, and at times solely descriptive, the Appellate  Body considered that 
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 sustaina ble 
growth, as alleged by India. Turning to Section  3 of the Electricity  Act 2003, the Appellate  Body 
noted that the obligation set out in that provision, namely, to periodically prepare, publish, and 
review the National Electricity Policy, and the Nationa l Electricity Plan, is different in content from 
the rule the existence of which India seeks to establish, i.e. to ensure ecologically sustainable 
growth. Moreover, the Appellate  Body observed that Section  3 sets out the legal basis and 
authority for the d evelopment of the National Electricity Policy and the National Electricity Plan. 
Thus, the Appellate  Body found the content of Section  3 to be different from the rule alleged to 
exist by India, and noted that Section  3 does not speak to the degree of norma tivity of the other 
domestic instruments identified by India. The Appellate  Body therefore did not see 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 instrum ents. For these reasons, the Appellate  Body disagreed 
with India that the passages and provisions of the domestic instruments identified by India, when 
read together, set out a 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.  
The Appellate  Body next considered the Panel's assessment of the international instruments 
identified by India. India identified four internat ional instruments: (a) the preamble of the 
WTO Agreement; (b) the United Nations Framework Convention on Climate Change; 
(c) the Rio Declaration on Environment and Development; and (d) the United Nations 
General  Assembly Resolution adopting the Rio+20 Docu ment: "The  Future We Want", adopted by 
the UN General Assembly in 2012. Recalling that "laws or regulations" refer to rules that form part 
of the domestic legal system of a WTO Member, the Appellate  Body noted that, in Mexico – Taxes 
on Soft Drinks it iden tified two ways by which rules deriving from international agreements may 
become part of the domestic legal system of a Member: Members may incorporate such rules, 
including through domestic legislative or executive acts intended to implement an internatio nal 
agreement; and certain international rules may have direct effect within the domestic legal 
systems of a Member without specific domestic action to implement such rules. The Appellate  Body 
explained that, subject to the domestic legal system of a Membe r, there may well be other ways in 
which international instruments or rules can become part of that domestic legal system, and an 
assessment of whether a given international instrument or rule forms part of the domestic legal 
system of a Member must be car ried out on a case -by-case basis, in light 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. The Appellate  Body 
emphasized tha t, 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 Membe r that falls within the 
scope of a "law or regulation" within the meaning of Article  XX(d). This is so because an 
assessment of whether an instrument operates with a sufficient degree of normativity and 
specificity under the domestic legal system of a Memb er so as to set out a rule of conduct or 
course of action, and thereby qualifies as a "law or regulation", must be carried out on a 
case-by-case basis, taking into account all the other relevant factors relating to the instrument and 
the domestic legal sys tem of the Member.  WT/AB/27  
 
- 60 - 
 
 The Appellate  Body then addressed India's contention that the international instruments it had 
identified have direct effect in India's legal system because the Indian legisl ature is not required to 
enact  legislation with a view to incor porating  international law into domestic law before the 
executive branch can take action to implement or execute international instruments. The 
Appellate  Body noted India's submission that the very fact that the executive branch can take 
action to execute the international instruments or rules at issue (e.g. by enacting the 
DCR measures), when they are not in conflict with domestic legislation, shows that these 
international instruments may already form part of its domestic legal system and therefore may be  
acted upon by the executive branch. Nonetheless, the Appellate  Body did not consider that the 
issue of which branch of the Central Government has the power to implement, execute, or 
otherwise give effect to an international instrument within the domestic legal system is, in and of 
itself, determinative of whether such an instrument falls within the scope of "laws or regulations" 
under Article  XX(d). Instead, the Appellate  Body explained that whether a rule set out in an 
international instrument forms part of the domestic legal system of a Member and falls within the 
scope of "laws or regulations" 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 fea tures of 
the domestic legal system of the Member concerned.  
The Appellate  Body next considered 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. The Appellate  Body was of the view that the decisions and obser vations by 
the Supreme Court of India identified by India may serve to highlight the relevance of the 
international instruments and rules for purposes of interpreting provisions of India's domestic law, 
as well as for guiding the exercise of the decision -making power of the executive branch of the 
Central Government. However, these Supreme Court decisions and observations were not 
sufficient to demonstrate that the international instruments identified by India are rules that form 
part of its domestic legal system and fall within the scope of "laws or regulations" under 
Article  XX(d). Insofar as India relied on this material to reinforce its point that the executive 
branch, by enacting the DCR measures , was merely executing the international instruments 
identified, the Appellate  Body recalled that the mere fact that the executive branch takes actions in 
pursuance of the international instruments at issue is not sufficient to demonstrate that such 
international instruments fall within the scope of "laws or regu lations" under Article  XX(d).The 
Appellate  Body therefore upheld the Panel's finding that India failed to demonstrate that the 
international instruments identified by it fall within the scope of "laws or regulations" under 
Article  XX(d) of the GATT  1994 in the present dispute.  
For these reasons, the Appellate  Body upheld the Panel's finding that India ha d 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 that the 
DCR measures are not justified under Article  XX(d) of the GATT  1994. 
4.4.4   "Essentiality" and "necessity" under Articles XX(j) and XX(d), and the chapeau of 
Article  XX of the GATT  1994  
The Appellate  Body recalle d that it had upheld the Panel's finding that solar cells and modules are 
not "products in local or general short supply" in India, within the meaning of Article  XX(j), as well 
as the Panel's finding that India did not demonstrate that th e DCR measures are  measures 
"to secure compliance with laws or regulations which are not inconsistent with the provisions  of 
[the GATT  1994]", as well as the Panel's conclusion that the DCR measures are not justified under 
either Article  XX(j) or Article  XX(d) of the GATT  1994. Given these findings, the Appellate  Body did 
not consider it necessary to examine further 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 did the Appellate  Body consider it necessary to examine India's 
arguments as they relate to the requirements of the chapeau of Article  XX of the GATT  1994. WT/AB/27  
 
- 61 - 
 
 4.4.5   Separate opinion by one Appellate  Body  member  
One Appellate  Body member provided a separate opinion offering remarks on how he viewed the 
Appellate  Body's adjudicatory function, as well as its limits, both in the context of the present 
appea l and in other appeals.  
The Appellate  Body member concerned noted that the DSU describes the Appellate  Body's function 
in broad terms: to "hear appeals from panel cases". Referring to Article  17.12 of the DSU, he 
added that the Appellate  Body is called upo n to review any aspect of a panel's analysis, including a 
panel's legal reasoning, provided that it has been properly raised on appeal . 
The Appellate  Body member in question recalled that, in deciding how to address each of the 
issues raised by the parties , the Appellate  Body is guided by certain overarching principles. First, 
the Appellate  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. Second, there is the need to safeguard the due process rights of the 
parties, for example, in cases where a particular issue has not been sufficiently explored before the 
panel . This places  an important constraint on the Appellate  Body's ability to rule on particular 
issues raised on appeal.  Against this background, the Appellate  Body member concerned  added 
that the decision of the Appellate  Body on how to address each of the issues on appeal should be 
understood as an extension of i ts 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 
not required to provide reasons as to why it adjudicates a particular issue properly raise d by the 
parties on appeal. However, when the Appellate  Body considers, for example, that further findings 
on issues appealed are not necessary in order to facilitate the prompt settlement and effective 
resolution of the dispute, it will explain this in it s report.  
Turning to Article  3.2 of the DSU, the Appellate  Body member recalled that there is nothing in that 
provision that would encourage the Appellate  Body to make law by clarifying existing provisions of 
the WTO Agreement outside the context of resolv ing a particular  dispute. At the same time, 
WTO Members have a systemic interest in receiving an Appellate  Body report that properly clarifies 
the existing provisions of the covered agreements. Such a report by the Appellate  Body 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 Members.  
4.5  Appellate  Body  Report, United  States – Anti-Dumping and Cou ntervailing Measures 
on Large Residential Washers from Korea , WT/DS464/AB/R  
This dispute concerned the definitive anti -dumping and countervailing duties applied by the 
United  States as a result of anti -dumping and countervailing duty investigations conduct ed by the 
United States Department of Commerce (USDOC)  concerning imports of large residential washers 
(LRWs)  from Korea . 
Korea challenged certain aspects of the USDOC's approach to the weighted average -to-transaction 
(W-T) comparison methodology provided for in the second sentence of Article  2.4.2 of the 
Anti-Dumping  Agreement. Specifically, Korea challenged the so -called "Nails II methodology" used 
in the anti -dumping investigation conducted by the USDOC concerning imports of LRWs from 
Korea ( Washers anti-dumping investigation). The Nails II methodology consisted of a two -stage 
test. First, following an allegation of targeted dumping, the standard deviation test aimed at 
establishing whether there were export prices differing among different purchasers, re gions, or 
time periods. Second, the gap test aimed at establishing whether observed price differences were 
significant. The USDOC then evaluated the difference between the weighted average dumping 
margin calculated using the weighted average -to-weighted av erage  (W-W) comparison 
methodology (without zeroing) and that calculated using the weighted average -to-transaction 
(W-T) comparison methodology (with zeroing). In case of a meaningful difference, the 
W-T comparison methodology (with zeroing) was applied to  all export transactions.  
In addition, Korea challenged the so -called "Differential Pricing Methodology" (DPM) that replaced 
the Nails II  methodology as of March 2013 : (i) "as such"; (ii) "as applied" in the first 
administrative review of the anti -dumping order imposing anti -dumping duties on LRWs from WT/AB/27  
 
- 62 - 
 
 Korea; and (iii) the ongoing and future application of the DPM in connection with this investigation. 
Under the DPM, the "Cohen's d test" first evaluates the extent to which the prices to a particular 
purchas er, region, or time period differ significantly from other prices. Second, the "ratio test" 
assesses the extent of the significant price differences for all sales as measured by the Cohen's d 
test. Third, the "meaningful difference" test examines whether u sing the W -W comparison 
methodology can appropriately account for these price differences. If the first two tests are met, 
using the W -W methodology cannot appropriately account for the differences, and the result of the 
ratio test is above 66%, the W -T comparison methodology (with zeroing) is applied to all export 
transactions. Where the result of the ratio test is between 33% and 66%, the W -T comparison 
methodology (with zeroing)  is applied to those sales that pass the Cohen's  d test and the 
W-W compariso n methodology is applied to the remaining sales. Where the result of the ratio test 
is below 33%, the USDOC does not apply the W -T comparison methodology.  
Korea also challenged the USDOC's use of zeroing under the W -T comparison methodology, both 
"as such"  and "as applied" in the Washers anti-dumping investigation. This challenge was raised in 
relation to the USDOC's application of the W -T comparison methodology with zeroing to all 
transactions in the Washers anti-dumping investigation and the USDOC's use o f zeroing in respect 
of those sales to which it applies the W -T compar ison methodology under the  DPM. 
With regard to the United  States' countervailing measures, Korea challenged under the 
SCM Agreement the USDOC's determinations that two tax credit program mes were specific. 
Moreover, Korea raised claims under the SCM  Agreement and the GATT  1994 challenging the 
manner in which the USDOC calculated the ad valorem  subsidy ra te for Samsung 
Electronics  Co., Ltd (Samsung) under those programmes.  
With regard to th e Washers  anti-dumping investigation, the Panel found that the United  States 
acted inconsistently with the second sentence of Article  2.4.2 of the Anti -Dumping Agreement by: 
(i) applying the W -T comparison methodology to transactions other than those const ituting the 
patterns of transactions that the USDOC had determined to exist; and (ii) merely focusing on the 
difference between the margin of dumping calculated using the W -W comparison methodology and 
the margin of dumping calculated using the W -T compari son methodology, and by failing to 
consider whether the factual circumstances surrounding the relevant price differences were 
suggestive of something other than targeted dumping. In addition, the Panel found that Korea 
failed to establish that the United  States acted inconsistently with the second sentence of 
Article  2.4.2 by determining the existence of a pattern of export prices which differ significantly 
among purchasers, regions or time periods on the basis of purely quantitative criteria, without any 
qualitative assessment of the reasons for the relevant price differences and  by failing to explain 
why the relevant price differences could not be taken into account appropriately by the 
transaction -to-transaction (T -T) comparison methodology.  
With regard t o the DPM, the Panel found that the DPM is inconsistent with the second sentence of 
Article  2.4.2 because: (i) it applies the W -T comparison methodology to non -pattern transactions 
when the aggregated value of sales to purchasers, regions, and time periods  that pass the 
"Cohen's d test" accounts for 66% or more of the value of total sales; (ii) in applying the 
"meaningful difference test", the DPM focuses on the difference between the margin of dumping 
calculated using the W -W comparison methodology and the  margin of dumping calculated using 
the W -T comparison methodology or the mixed comparison methodology; and (iii) by aggregating 
random and unrelated price variations, the DPM does not properly establish a pattern of export 
prices which differ significantl y among different purchasers, regions or time periods. The Panel also 
found that Korea had failed to establish that the DPM is inconsistent with the second sentence of 
Article  2.4.2 for several other reasons.  
With respect to zeroing, the Panel found that t he United  States' use of zeroing when applying the 
W-T comparison methodology is inconsistent "as such" with Article s 2.4.2 and 2.4  of the 
Anti-Dumping  Agreement and "as applied" in the Washers  anti-dumping investigation. 
Furthermore, the Panel found that the United  States' use of zeroing when applying the 
W-T comparison methodology in administrative reviews is inconsistent "as such" with Article  9.3 of 
the Anti -Dumping  Agreement and Article  VI:2 of the GATT  1994. 
Finally, with respect to the countervailing  duties, the Panel found the USDOC's original and remand 
determinations that the RSTA Article  10(1)(3) tax credit programme is de facto specific because 
Samsung received subsidies under that programme in disproportionately large amounts to be WT/AB/27  
 
- 63 - 
 
 inconsistent with Article  2.1(c) of the SCM  Agreement. Moreover the Panel found the USDOC's 
original and remand determinations that the RSTA Article  10(1)(3) tax credit programme is 
de facto specific because Samsung received subsidies under that programme in disproport ionately 
large amounts to be inconsistent with Article  2.1(c) of the SCM  Agreement. In addition, the Panel 
found that Korea failed to establish that: (i) the USDOC's determination of regional specificity in 
respect of the RSTA Article  26 tax credit program me is inconsistent with Article  2.2 of the 
SCM Agreement; (ii) the USDOC's failure to tie the subsidies claimed by Samsung under the RSTA 
Article  10(1)(3) and Article  26 tax credit programmes to Samsung's digital appliance products 
(including LRWs) is inco nsistent with Article  19.4 of the SCM  Agreement and Article  VI:3 of the 
GATT  1994; and (iii) the USDOC acted inconsistently with Article  19.4 of the SCM  Agreement and 
Article  VI:3 of the GATT  1994 by limiting the denominator to the sales value of products produced 
by Samsung in Korea when allocating the benefit conferred to Samsung under the RSTA 
Article  10(1)(3) tax credit programme.  
4.5.1   Claims under the Anti -Dumping  Agreement and related claims under the 
GATT  1994  
4.5.1.1   The relevant "pattern" for purposes of the se cond sentence of Article  2.4.2 of 
the Anti -Dumping Agreement  
On appeal, the United  States claimed that the Panel erred in its interpretation of the relevant 
pattern under the second sentence of Article  2.4.2 of the Anti -Dumping Agreement because it 
conclud ed that the relevant pattern comprises only low -priced export transactions to each 
particular target (a purchaser, or a region, or a time period), while other higher -priced export 
transactions to other purchasers, regions, or time periods are non -pattern t ransactions. In 
particular, the United  States submitted that a pattern includes both lower and higher export prices 
that differ significantly from each other and that the relevant pattern is one that would transcend 
multiple purchasers, regions, or time pe riods. The United  States also argued that the focus does 
not need to be on export sales that are priced lower than other export sales and that identifying a 
pattern does not require an assessment of how export prices relate to normal value.  
The Appellate  Body, first, considered that, in the context of the second sentence of Article  2.4.2, a 
pattern can be defined as a regular and intelligible form or sequence discernible in certain actions 
or situations. This means that there must be regularity to the seque nce of export prices which 
differ significantly and this sequence must be capable of being understood. The Appellate  Body 
hence excluded the possibility of a pattern merely reflecting random price variation.  
The Appellate  Body considered that, whereas an i nvestigating authority would analyse the prices of 
all export sales made by the relevant exporter or producer to identify a pattern, the distinguishing 
factor that allows that authority to discern which export prices form part of the pattern would be 
that the prices in the pattern differ significantly from the prices not in the pattern. As the 
Appellate  Body noted, its interpretation : (i) accords with the ordinary meaning of the word 
pattern; and (ii) gives meaning and effect to the second sentence of Article 2.4.2, whose function 
is to allow investigating authorities to identif y and address targeted dumping.  
On this basis, the Appellate  Body agreed with the Panel that , under the second sentence of 
Article  2.4.2, a sub -set of export transactions is set aside  for specific consideration and that once 
prices are identified as being different from other prices, they constitute the relevant pattern. 
Although the Appellate  Body recognized that a pattern may be identified in a variety of factual 
circumstances, it co nsidered, in light of the function of the second sentence of Article  2.4.2 to 
address targeted dumping and in light of the fact that the Anti -Dumping Agreement is concerned 
with injurious dumping, that the relevant pattern for the purposes of the second se ntence of 
Article  2.4.2 comprises prices that are significantly lower than other export prices.  
The Appellate  Body turned next to the issue of whether a pattern can be found to exist across 
purchasers, regions, or time periods, as argued by the United  States. The Appellate  Body recalled 
that, pursuant to the second sentence of Article  2.4.2, a pattern involves export prices which differ 
significantly in relation to specified sub -groups, namely, among different purchasers, regions or 
time periods. The Appell ate Body agreed with the Panel that the word "among" refers to something 
in relation to the rest of the group it belongs to, and, as such, serves to specify the dimensions in 
relation to which export prices which differ significantly may be discerned. Acco rding to the WT/AB/27  
 
- 64 - 
 
 Appellate  Body, this suggests that each category should be considered on its own. As such, a 
pattern of prices which differ significantly among different purchasers must be found in the price 
variation within purchasers, as between one or more  particular purchasers and the other 
purchasers (with the same applying to regions and time periods, respectively).  
Consistent with the Appellate  Body's statement in EC – Bed Linen that there are three kinds of 
targeted dumping, namely dumping that is targ eted to certain purchasers, targeted to certain 
regions, or targeted to certain time periods, the Appellate  Body concluded that the words "or" and 
"among", as used in the phrase "among different purchasers, regions or time periods", cannot be 
interpreted t o mean that the three categories can be considered cumulatively to find one single 
pattern. Accordingly, in order to find a pattern, the export prices to one or more particular 
purchasers must differ significantly from the prices to the other purchasers, o r the export prices in 
one or more particular regions must differ significantly from the prices in the other regions, or the 
export prices during one or more particular time periods must differ significantly from the prices 
during the other time periods. The Appellate  Body clarified that its interpretation does not exclude 
the possibility that the same exporter or producer could be practicing more than one of the three 
types of targeted dumping in parallel and that a pattern of significantly differing price s to a certain 
category may overlap with a pattern of significantly differing prices to another category (e.g. the 
same transactions could target certain purchasers as well as certain regions).  
Based on the foregoing, the Appellate  Body considered that a pattern for the purposes of the 
second sentence of Article  2.4.2 comprises all the export prices to one or more particular 
purchasers which differ significantly from the export prices to the other purchasers because they 
are significantly lower than those o ther prices, or all the export prices in one or more particular 
regions which differ significantly from the export prices in the other regions because they are 
significantly lower than those other prices, or all the export prices during one or more particu lar 
time periods which differ significantly from the export prices during the other time periods because 
they are significantly lower than those other prices. The Appellate  Body thus upheld the Panel's 
conclusions regarding the relevant pattern.  
4.5.1.2   Whether th e Panel erred in finding that "the DPM is inconsistent 'as such' with 
the second sentence of Article  2.4.2 because, by aggregating random and unrelated 
price variations, it does not properly establish 'a pattern of export prices which differ 
significantly among different purchasers, regions or time periods'"  
The Appellate  Body then turned to the United States' claim that the Panel erred in finding that the 
DPM is  inconsistent "as such" with the second sentence of Article  2.4.2 because, by aggregating 
random  and unrelated price variations, it does not properly establish a pattern of export prices 
which differ significantly among different purchasers, regions or time periods.  
The Appellate  Body recalled that the DPM aggregates prices found to differ among diff erent 
purchasers, among different regions, and among different time periods as well as aggregates 
prices that are higher and lower than other export prices within a given category for the purposes 
of identifying a single pattern. The Appellate  Body further  recalled its earlier conclusions regarding 
the pattern, namely, that a single pattern cannot be found to exist across purchasers, regions, and 
time periods, and that it cannot be identified by considering prices that are higher than other 
prices. On this basis, the Appellate  Body upheld the Panel's finding that the DPM is inconsistent "as 
such" with the second sentence of Article  2.4.2 because, by aggregating random and unrelated 
price variations, it does not properly establish a pattern of export prices w hich differ significantly 
among different purchasers, regions or time periods . 
4.5.1.3   Whether the Panel erred in finding that the W -T comparison methodology 
should only be applied to "pattern transactions"  
The United  States appealed the Panel's findings regarding  the scope of application of the W -T 
comparison methodology. The United  States challenged the Panel's finding that the W -T 
comparison methodology should only be applied to the transactions constituting the pattern. 
Rather, the United States considered that , once the conditions for its use are met, this 
methodology can be applied to all transactions. In particular, recalling that the second sentence of 
Article  2.4.2 of the Anti -Dumping Agreement refers to "individual export transactions", the WT/AB/27  
 
- 65 - 
 
 United  States c ontended that the word "individual" merely suggests that prices of single, separate 
export transactions may be compared to a normal value establish ed on a weighted average basis.  
The Appellate  Body recalled that the second sentence of Article  2.4.2 refers to "[a] normal value 
established on a weighted average basis [that] may be compared to prices of individual export 
transactions". The Appellate  Body considered that the term "individual export transactions" draws 
meaning from the immediate context in which  it appears. It observed that the second sentence of 
Article  2.4.2 requires that the investigating authority provide an explanation as to why such 
differences cannot be taken into account appropriately by the use of a W -W or T -T comparison, 
whereby the ter m "such differences" refers back to the export prices which differ significantly 
forming part of the pattern. On this basis, the Appellate  Body considered that recourse to the W -T 
comparison methodology is permissible only to the extent that it is necessar y to remedy the 
inability of the normally applicable comparison methodologies to take into account appropriately 
the identified pattern. Furthermore, under the first sentence of Article  2.4.2, the consideration is in 
respect of all export transactions, whe reas the emphasis in the second sentence of Article  2.4.2 is 
on a pattern. Finally, the Appellate  Body noted that the structure of Article  2.4.2, which 
distinguishes the normally applicable W -W and T -T comparison methodologies from the 
exceptional W -T comp arison methodology, further indicates that the W -T comparison methodology 
should only be applied to those transactions justifying its use, namely, the pattern transactions.  
The Appellate  Body observed that this interpretation : (i) gives meaning and effect to the second 
sentence of Article  2.4.2, whose function is to allow investigating authorities to identify and 
address targeted dumping; (ii) accords with the object and purpose of the Anti -Dumping 
Agreement, which allows Members to take anti -dumping measur es to counteract injurious 
dumping and imposes disciplines on the use of such anti -dumping measures; and (iii) is in line 
with the Appellate  Body's observations in US ‒ Zeroing (Japan). In that case the Appellate  Body 
read the phrase "individual export tra nsactions" as referring to the transactions that fall within the 
relevant pricing pattern. Thus, it considered that this universe of export transactions would 
necessarily be more limited than the universe of export transactions to which the symmetrical 
comparison methodologies in the first sentenc e of Article  2.4.2 would apply.  
Based on the foregoing, the Appellate  Body upheld the Panel's finding that the W -T comparison 
methodology should only be applied to transactions that constitute the pattern of export  prices 
which differ significantly among different purchasers, regions , or time periods. It further upheld 
the Panel's consequential findings: (i) that the United  States acted inconsistently with the second 
sentence of Article  2.4.2, by applying the W -T comparison methodology to transactions other than 
those constituting the patterns of transactions that the USDOC had determined to exist in the 
Washers  anti-dumping investigation; and (ii) that the DPM is inconsistent "as such" with 
Article  2.4.2, because it  applies the W -T comparison methodology to non -pattern transactions 
when the aggregated value of sales to purchasers, regions, and time periods that pass the Cohen's 
d test accounts for 66% or more of the value of total sales.  
4.5.1.4   The extent to which price dif ferences are to be assessed quantitatively, 
qualitatively, and in light of the "reasons" for these price differences  
Korea claimed that the Panel erred in finding that a pattern of export prices which differ 
significantly can be established solely based on  quantitative differences , regardless of the factual 
context of the prices and the differences. Korea also argued that the Panel mischaracterized  its 
claim as if it were solely that the authority must state the reasons why prices differ, rather than 
more g enerally assess qualitatively the price differences at issue.  
The Appellate  Body first addressed the question of whether the Panel mischaracterized  Korea's 
claim. The Appellate  Body considered that Korea's claim, as set out in its panel request, was not 
limited to claiming that the investigating authority must consider the reasons for the price 
differences to find a pattern. The Appellate  Body understood the Panel to have concluded that both 
the Nails  II methodology and the DPM involve a purely quantitative  analysis, which the Panel did 
not consider to be inconsistent with the second sentence of Article  2.4.2 of the 
Anti-Dumping  Agreement . As such, the Appellate  Body understood the Panel not to have limited its 
analysis to the question of whether the investi gating authority must consider the reasons for the 
price differences, but to have addressed more generally the issue of whether a qualitative analysis 
needs to be conducted. The Appellate  Body thus found that the Panel sufficiently addressed WT/AB/27  
 
- 66 - 
 
 Korea's claims  and arguments regarding the need for a qualitative analysis, and not only whether 
the USDOC would have needed to consider the rea sons for the price differences.  
Next, the Appellate  Body considered whether the Panel erred in finding that a pattern of expor t 
prices which differ significantly can be established on the basis of purely quantitative criteria . The 
Appellate  Body was of the view that the word "significant" can be defined as "important, notable or 
consequential" and that it has both quantitative an d qualitative dimensions. Accordingly, assessing 
the extent of the differences in export prices to establish whether those export prices differ 
significantly for the purposes of the second sentence of Article  2.4.2 entails both quantitative and 
qualitative  assessments. The Appellate  Body considered that, as part of the qualitative 
assessment, circumstances pertaining, inter alia, to the nature of the product or the markets may 
be relevant for the assessment of whether differences are significant in the circ umstances of a 
particular case. Therefore, the Appellate  Body disagreed with the Panel to the extent the Panel 
considered that an investigating authority may properly find that certain prices differ significantly 
within the meaning of the second sentence o f Article  2.4.2 if they are notably greater in purely 
numerical terms.  
The Appellate  Body, however, took the view that the words "significantly" and "pattern" in the 
second sentence of Article  2.4.2 do not imply an examination into the cause of (or reasons  for) the 
differences in prices. As the Appellate  Body recalled, the second sentence of Article  2.4.2 requires 
an investigating authority to find a pattern of export prices which differ significantly among 
different purchasers, regions or time periods. The  text of this provision does not impose an 
additional requirement to ascertain whether the significant differences found to exist are 
unconnected with targeted dumping, nor does it imply an examination of the motivation for, or 
intent beh ind, the differenc es in prices.  
Based on the foregoing, the Appellate  Body found that the requirement to identify prices which 
differ significantly means that the investigating authority is required to assess quantitatively and 
qualitatively the price differences at issue. This assessment may require the investigating authority 
to consider certain objective market factors, such as circumstances regarding the nature of the 
product under consideration, the industry at issue, the market structure, or the intensity of 
competitio n in the markets at issue, depending on the case at hand. The Appellate  Body agreed, 
however, with the Panel that an investigating authority is not required to consider the cause of 
(or reasons for) the price differences to establish the existence of a pat tern under the second 
sentence of Article  2.4.2.  
Consequently, the Appellate  Body reversed the Panel's finding in respect of the Washers  
anti-dumping investigation to the extent that the Panel found that a pattern of export prices which 
differ significantl y among purchasers, regions or time periods can be established on the basis of 
purely quantitative criteria. The Appellate  Body also reversed the Panel's finding in respect of the 
DPM to the extent that the Panel found that the existence of a pattern of ex port prices which differ 
significantly among purchasers, regions or time periods can be established on the basis o f purely 
quantitative criteria.  
4.5.1.5   Whether an explanation needs to be provided with respect to both the W -W and 
the T -T comparison methodologies  
The Appellate  Body then turned to consider Korea's claims regarding the requirement in the 
second sentence of Article  2.4.2 of the Anti -Dumping Agreement that the investigating authority 
provide  an explanation as to why such price differences cannot be tak en into account appropriately 
by the use of a W-W or T-T comparison. Korea claimed that an explanation has to be provided with 
respect to both the W -W and the T -T comparison methodologies that are normally used when the 
application of the exceptional W -T comparison methodology is considered under the second 
sentence of Article  2.4.2.  
Looking, first, at the text of the explanation requirement in the second sentence of Article  2.4.2, 
the Appellate  Body observed that, depending on the context in which it is us ed, the conjunction 
"or" can be exclusive or inclusive. It further observed that, if the second sentence of Article  2.4.2 
were to include the conjunction "and" instead of the conjunction "or", this would suggest that the 
authority is required to use the W -W and the T -T comparison methodologies in combination. Using 
the conjunction "and" instead of the conjunction "or" was, therefore, not viable to indicate that WT/AB/27  
 
- 67 - 
 
 both methodologies should be addressed in the investigating authority's explanation. Turning to 
the indefinite article "a" and the singular form of the word "comparison" in this provision, the 
Appellate  Body disagreed with the Panel that these suggest that an explanation with regard to only 
one of the two normally applicable comparison methodologies c omports with the second sentence 
of Article  2.4.2.  
Second, the Appellate  Body considered that interpreting the second sentence of Article  2.4.2 as 
requiring that an explanation be provided with respect to both the W -W and the T -T comparison 
methodologies g ives proper recognition to the text of that provision and to the distinction between 
the normally applicable methodologies in the first sentence of Article  2.4.2 and the exceptional 
W-T comparison methodology in the second sentence. The Appellate  Body specified that, although 
the W -W and T -T comparison methodologies are likely to yield substantially equivalent results, the 
possibility that, in a particular case, they might yield different results and might impact differently 
the possible use of the W -T comp arison metho dology, should not be excluded.  
Finally, the Appellate  Body disagreed with the Panel's reasoning that the investigating authority's 
initial discretion of choosing between the W -W and T -T comparison methodologies under the first 
sentence of Article 2.4.2 would be undermined by requiring that an explanation be provided with 
respect to both these methodologies. The Appellate  Body acknowledged that an investigating 
authority has a choice between the W -W and T -T comparison methodologies under the fir st 
sentence of Article  2.4.2. However, the Appellate  Body considered that this choice is unrelated to 
the requirement to explain why these two methodologies are not appropriate to unmask targeted 
dumping such that the investigating authority contemplates t he application of the W -T comparison 
methodology.  
For these reasons, the Appellate  Body considered that an investigating authority has to explain 
why both the W -W and the T -T comparison methodologies cannot take into account appropriately 
the differences i n export prices that form the pattern. The Appellate  Body added that, in 
circumstances where the W -W and T -T comparison methodologies would yield substantially 
equivalent results and where an explanation has been provided with respect to one of these two 
methodologies, the explanation to be included with respect to the other may not need to be as 
elaborate.  
Accordingly, the Appellate  Body reversed the Panel's finding that Korea failed to establish that the 
United  States acted inconsistently with the second sentence of Article  2.4.2 in the Washers  
anti-dumping investigation by failing to explain why the relevant price differences could not be 
taken into account appropriately by the T -T comparison methodology. The Appellate  Body also 
reversed the Panel's findi ng that Korea failed to establish that the DPM is inconsistent with the 
second sentence of Article  2.4.2 when, having concluded that the W -W comparison methodology 
cannot appropriately take into account the observed pattern of significantly different price s, it does 
not also consider whether the relevant price differences could be taken into account appropriately 
by the T -T comparison methodology.  
4.5.1.6   Systemic disregarding  
4.5.1.6.1   Korea's other appeal under the second sentence of Article  2.4.2 of the 
Anti-Dumping Agree ment  
The Appellate  Body began by recalling that the USDOC applies a mixed comparison methodology 
as part of the DPM. In cases where the value of the transactions that pass the Cohen's d test is 
between 33% and 66% of the value of the total export transacti ons, the W -T comparison 
methodology with zeroing is applied to these transactions. For the remaining transactions, i.e. the 
transactions that do not pass the Cohen's d test, the W -W comparison methodology is used. The 
Appellate  Body noted that, in the firs t administrative review of the Washers  anti-dumping order, 
the issue of "systemic disregarding" arose when , in aggregating the comparison results, the 
USDOC did not permit the overall negative comparison result arising from the application of the 
W-W compa rison methodology to offset the evidence of dumping from the application of the W -T 
comparison methodology.  
The Panel rejected Korea's claim that the USDOC's use of systemic disregarding under the DPM is 
inconsistent "as such" with the second sentence of Article 2.4.2 of the Anti -Dumping Agreement. WT/AB/27  
 
- 68 - 
 
 On appeal, Korea asserted that the Panel's approach essentially created two margins of dumping, 
one for the subset to which the W -T comparison methodology is applied, and another for the 
subset using the W -W comp arison methodology. Korea argued that, although the Panel correctly 
found that zeroing could not apply to either of these two subsets, the Panel allowed the functional 
equivalent of zeroing by permitting the combining of the two subsets while refusing offs ets from 
the subset based on the normal comparison methodologies when determining the overall dumping 
and margin of dumping. Korea claimed that the Panel's reasoning had no basis in the text or 
context of Article  2.4.2.  
The Appellate  Body recalled that Article 2.4.2 contains two sentences, which set out the 
methodologies that investigating authorities may use to establish margins of dumping. It recalled 
its prior jurisprudence that the concepts of "dumping" and "margins of dumping" are the same 
throughout t he Anti -Dumping Agreement and that the definition of "dumping" in Article  2.1 of the 
Anti-Dumping Agreement and Article  VI:1 of the GATT  1994 are central to the interpretation of 
other provisions of the Anti -Dumping Agreement. The Appellate  Body further re called that the 
Anti-Dumping Agreement prescribes that dumping determinations are to be made in respect of 
each exporter or foreign producer examined  because dumping is the result of the pricing behaviour 
of individual exporters or foreign producers.  
In re spect of the W -W comparison methodology, the Appellate  Body recalled its findings in 
EC ‒ Bed Linen  that the word "all" in the phrase "all comparable export transactions" in the first 
sentence of Article  2.4.2 makes it clear that Members may only compare those export transactions 
which are comparable, but they must compare all such transac tions. Moreover, it recalled the 
findings in US – Softwood Lumber V , that, although an investigating authority may undertake 
multiple averaging to establish margins of dumping for a product under investigation, the results 
of the multiple comparisons at th e sub -group level are not margins of dumping within the meaning 
of Article  2.4.2. Thus, it is only on the basis of aggregating all intermediate values that an 
investigating authority can establish margins of dumping for the product under investigation. As 
regards the T -T comparison methodology, the Appellate  Body noted that the absence of the phrase 
"all comparable export transactions" in the latter part of the first sentence of Article  2.4.2 does not 
suggest that an investigating authority is free to disre gard certain export transactions from the 
applicable universe of export transactions when establishing margins of dumping. It also recalled 
the considerations in US – Zeroing (Japan)  that the phrase "all comparable export transactions" is 
not pertinent for  this methodology because under the T -T comparison methodology, all export 
transactions are taken into account on an individual basis and matched with the most appropriate 
transactions in the domestic market.  
Accordingly, in the Appellate  Body's view, an i nvestigating authority is not allowed to disregard, in 
establishing dumping and margins of dumping under the normally applicable W -W or T -T 
comparison methodologies, any transactions that make up the universe of export transactions to 
be examined thereunde r. In other words, all the export transactions of the like product by a given 
exporter or foreign producer have to be taken into account.  
The Appellate  Body turned next to the W -T comparison methodology set forth in the second 
sentence of Article  2.4.2. It  noted that this methodology envisaged an asymmetrical comparison 
between a normal value established on a weighted average basis and prices of individual export 
transactions. Recalling its earlier findings that these individual export transactions refer to  the 
pattern transactions, the Appellate  Body next turned to consider the question of how dumping and 
margins of dumping are to be established under the second sentence of Article  2.4.2.  
The Appellate  Body recalled the Panel's statement, referring to the Appellate  Body report in 
US ‒ Zeroing (Japan) , that there appears to be some tension between the Appellate  Body's 
understanding of the limited scope of application of the W -T comparison methodology and its 
reference to the fundamental disciplines that "dumping" and "margins of dumpin g" pertain to an 
exporter or foreign producer, and to the product as a whole, taking into account all export 
transactions of the exporter or foreign producer concerned. The Appellate  Body observed that the 
findings in US ‒ Zeroing (Japan)  referred to by th e Panel concerned the first sentence of 
Article  2.4.2 and should be read in the context of the Appellate  Body's findings regarding 
model  zeroing.  
The Appellate  Body further noted that the establishment of dumping and margins of dumping, for 
the product und er investigation as a whole and by taking into account all export transactions of a WT/AB/27  
 
- 69 - 
 
 given exporter or foreign producer, is to be carried out in respect of the applicable universe of 
export transactions for each of the comparison methodologies set forth in Article  2.4.2. Recalling 
its findings in US – Zeroing (Japan)  and US – Softwood Lumber V ( Article  21.5 – Canada) , 
the Appellate  Body found that, under the W -T comparison methodology set forth in the second 
sentence of Article  2.4.2, the applicable universe  of export transactions is more limited than under 
the first sentence. The Appellate  Body, thus, concluded that, not only is the application of the W -T 
comparison methodology limited to pattern transactions, but also the second sentence provides for 
establ ishing dumping and margins of dumping on the basis of the limited universe of export 
transactions to which the W -T comparison methodology applies – i.e. the pattern transactions.  
The Appellate  Body was also of the view that the function of the second sente nce of Article  2.4.2 
supported a reading of that provision as providing for the establishment of margins of dumping on 
the basis of pattern transactions. It recalled that the function of the second sentence is to allow an 
investigating authority to identif y and address targeted dumping. According to the Appellate  Body, 
it is only certain export transactions – those that constitute the pattern under the second sentence 
by differing significantly from the remaining export transactions of an exporter or foreig n producer 
– that are aimed at or targeted to a purchaser, region, or time period. In light of this function, the 
second sentence permits an investigating authority to establish margins of dumping through the 
application of the W -T comparison methodology e xclusively to pattern transactions. The 
Appellate  Body observed that the second sentence says nothing about including transactions that 
are not part of the pattern (i.e. the non -pattern transactions) in the comparison process required 
to establish margins of dumping. According to the Appellate  Body, if an investigating authority 
were required to conduct comparisons for non -pattern transactions, by applying one of the two 
normally applicable comparison methodologies, and then aggregate the result of this com parison 
with the result of the W -T comparison methodology applied to pattern transactions, the targeted 
dumping found in respect of pattern transactions would be re -masked. This would occur when the 
comparison results arising from non -pattern transactions yield an overall negative 
comparison  result.  
Moreover, the Appellate  Body found no basis in the second sentence of Article  2.4.2 to conclude, 
as Korea asserted, that the function of the second sentence is to allow an investigating authority 
to undertake a more careful and granular examination of individual export prices. The 
Appellate  Body considered that Korea's proposed interpretation was no different from what is 
already contemplated under the T -T comparison methodology. Accordingly, the Appellate  Body 
found that the Panel did not err in characterizing the function of the second sentence of 
Article  2.4.2 as addressing or unmasking targeted dumping.  
The Appellate  Body considered next the question of how to calculate the margin of dumping as a 
percentage of  the exports of a given exporter or foreign producer. According to the 
Appellate  Body, while the numerator should comprise only pattern transactions to the exclusion of 
non-pattern transactions, the denominator must reflect the universe of all export trans actions of a 
given exporter or foreign producer and, thus, should comprise the value of all the sales of a given 
exporter or foreign producer of the like product. It recalled that Article  6.10 of the 
Anti-Dumping  Agreement provides for the determination of  an individual margin of dumping for 
each known exporter or producer concerned of the product under investigation. The 
Appellate  Body stated that in order to address targeted dumping, the margin of dumping under the 
second sentence of Article  2.4.2 is to b e determined for each exporter or producer, and not just for 
the targeted sales by that exporter or producer. The Appellate  Body found that, on the one hand, 
the existence of a "pattern" within the meaning of the second sentence of Article  2.4.2, and thus 
targeting by exporters or foreign producers, justifies determining dumping on the basis of the W -T 
comparison methodology applied to pattern transactions, while excluding from consideration 
non-pattern transactions. On the other hand, this amount of dumpin g based on the targeted sales 
must be divided by all the export sales of a given exporter or foreign producer in order to 
determine the margin of dumping and the corresponding anti -dumping duty for that  exporter or 
foreign producer.  
The Appellate  Body turned next to Korea's challenge of the systemic disregarding of non -pattern 
transactions by the USDOC in the establishment of margins of dumping under the DPM. The 
Appellate  Body noted that this argument was premised on the assumption that the second 
sentence  of Article  2.4.2 permits the combining of the W -T comparison methodology with the W -W 
or T-T comparison methodology. The Appellate  Body recalled its earlier findings in this dispute that 
the second sentence of Article  2.4.2 permits the establishment of ma rgins of dumping on the basis WT/AB/27  
 
- 70 - 
 
 of the W -T comparison methodology applied to pattern transactions, while excluding from 
consideration non -pattern transactions. It further observed that, although the second sentence of 
Article  2.4.2 mentions the W -W and T -T comparison methodologies, this reference appears in the 
context of the requirement to explain why neither of these symmetrical comparison methodologies 
is capable of taking into account the "export prices which differ significantly". The second 
sentence, ho wever, does not provide for the application of the W -W and T -T comparison 
methodologies anew. The Appellate  Body, thus, concluded that there is nothing in the text of the 
second sentence read in the context of the entire Article  2.4.2 that supports a readi ng of 
Article  2.4.2 as permitting the application of the W -W and T -T comparison methodologies to a 
reduced universe of export transactions, whether these are pattern transactions or  non-pattern 
transactions.  
Moreover, the Appellate  Body reasoned that, conducting a separate comparison under one of the 
two symmetrical comparison methodologies (i.e. W -W or T -T) for non -pattern transactions would 
undermine the function of the second sentence of Article  2.4.2 to address targeted dumping. 
According to the Appella te Body, it is on the basis of the pattern transactions that are targeted to 
purchasers, regions, or time periods, that margins of dumping are established under the second 
sentence. In the Appellate  Body's view, to aggregate the results of a symmetrical co mparison 
methodology applied to non -pattern transactions may either mask the targeted dumping (if the 
overall comparison result is negative) or inflate the margin of dumping (if the overall comparison 
result is positive) in a manner that is not provided fo r in the second sentence and that would 
compromise its function of effectively addressing targeted dumping.  
The Appellate  Body concluded that the second sentence of Article  2.4.2 does not allow the 
combining of the normal W -W or T -T comparison methodology with the exceptional W -T 
comparison methodology. The Appellate  Body explained that this provision does not provide for 
conducting separate comparisons for transactions within the "pattern" under the W -T comparison 
methodology and for those outside the patt ern under the W -W or T -T comparison methodology. 
The second sentence neither contemplates the exclusion from consideration of the result of the 
latter, if it yields an overall negative comparison result, nor its aggregation with the results of the 
W-T comp arison, if it yields an overall positive comparison result. Accordingly, the Appellate  Body 
found that this provision does not envisage systemic disregar ding as described by the Panel.  
The Panel found that the exclusion of systemic disregarding of negative  comparison results 
obtained from an application of the W -W comparison methodology to "non -pattern transactions" 
would lead to mathematical equivalence with the results of the application of the W -W comparison 
methodology to all export transactions. On app eal, Korea asserted that the Panel found 
mathematical equivalence despite the fact that mathematical equivalence has been considered and 
rejected by the Appellate  Body previously on numerous occasions. The Appellate  Body found that 
comparing weighted avera ge normal value with pattern transactions only will not normally yield 
results that are mathematically or substantially equivalent to the results obtained from the 
application of the W -W comparison methodology to all export transactions. Noting that 
mathem atical equivalence or substantial equivalence would arise only if one were to take the view 
that the second sentence of Article  2.4.2 envisages the combining of comparison methodologies, 
the Appellate  Body observed that it had already rejected this interpr etation of the second sentence 
of Article  2.4.2 as permitting  the combination of comparison methodologies . 
In light of the above, the Appellate  Body declared moot the Panel's finding that Korea failed to 
establish that the United  States' use of systemic di sregarding un der the DPM is inconsistent 
"as such" with the second sentence of Article  2.4.2 of the Anti -Dumping Agreement. Instead, the 
Appellate  Body concluded that, when the requirements of the second sentence of Article  2.4.2 are 
fulfilled, an investig ating authority may establish margins of dumping by comparing a weighted 
average normal value with export prices of pattern transactions, while excluding non -pattern 
transactions from the numerator, and dividing the resulting amount by all the export sales  of a 
given exporter or foreign producer.  
4.5.1.6.2   Korea's other appeal under Article  2.4 of the Anti -Dumping Agreement  
Korea argued that the Panel's finding that systemic disregarding is not inconsistent with Article  2.4 
of the Anti -Dumping Agreement, repeats the same legal errors that Korea identified with regard to 
the Panel's interpretation of the second sentence of Article  2.4.2 of the Anti -Dumping Agreement, 
that dumping can exist within a subset of the export sales. Korea requested the Appellate  Body to WT/AB/27  
 
- 71 - 
 
 reverse the Panel's findings under Article  2.4 and to complete the legal analysis to find that 
systemic disregarding is inconsistent with the "fair comparison" requirement in Article  2.4. 
The Appellate  Body began by recalling that the introductory clause of Article 2.4.2 expressly 
makes this provision subject to the provisions governing fair comparison in Article  2.4. The 
Appellate  Body considered that the application of all three comparison methodologies (i.e. W -W, 
T-T, and W -T) set out in Article  2.4.2 is expr essly made subject to the "fair comparison" 
requirement in Article  2.4. The Appellate  Body explained that the obligation to undertake a fair 
comparison between normal value and export prices arises in respect of the applicable universe of 
export transactio ns to which each of the three comparison methodologies set out in Article  2.4.2 
applies and further that Articles 2.4 and 2.4.2 not only inform each other, but must be read 
together harmoniously. The Appellate  Body stated that the exceptional nature of the  W-T 
comparison methodology, consistent with the function of the second sentence of Article  2.4.2 to 
address targeted dumping by considering a limited universe of export transactions, confirmed that 
the "fair comparison" requirement in Article  2.4 applies only in respect of pattern  transactions. The 
Appellate  Body, thus, concluded that, the exclusion of non -pattern transactions from the 
establishment of dumping and margins of dumping under the second sentence of Article  2.4.2 
comports with the notions of im partiality, even -handedness, and lack  of bias reflected in the 
"fair comparison" requirement in Article  2.4. 
The Appellate  Body noted that, although the Panel considered that an investigating authority could 
establish the existence of margins of dumping by  focusing on pattern transactions to the exclusion 
of non -pattern transactions, the underlying assumption of the Panel was that the combined 
application of comparison methodologies was not excluded under the second sentence of 
Article  2.4.2. Recalling that  it had already rejected an interpretation of the second sentence as 
allowing the combining of comparison methodologies, the Appellate  Body declared moot the 
Panel's finding that Korea failed to establish that the United  States' use of systemic disregardin g 
under the DPM is inconsistent "as such" with Article  2.4 of the Anti -Dumping Agreement.  
4.5.1.7   Zeroing under the W -T comparison methodology  
4.5.1.7.1   The United  States' appeal under Article  2.4.2 of the Anti -Dumping Agreement  
The United  States claimed that the Panel erre d in finding that the use of zeroing in connection with 
the application of the W -T comparison methodology is inconsistent with the second sentence of 
Article  2.4.2 of the Anti -Dumping Agreement, when the conditions for recourse to this 
methodology have bee n fulfilled. The United  States argued that, an examination of the text and 
context of Article  2.4.2 leads to the conclusion that zeroing is permissible, and indeed necessary, 
when applying the W -T comparison methodology.  
The Appellate  Body recalled that in establishing dumping and margins of dumping pursuant to the 
W-W and T -T comparison methodologies under the first sentence of Article  2.4.2, an investigating 
authority is under an obligation to take into account all transactions that make up the applicable  
universe of export transactions. These prior findings that zeroing is not permitted under either of 
the two symmetrical comparison methodologies set forth in the first sentence, flow from the 
Appellate  Body's jurisprudence that the concepts of "dumping" a nd "margins of dumping" are the 
same throughout the Anti -Dumping Agreement. Thus margins of dumping are established for the 
product under investigation as a whole, and for each exporter or foreign producer, by including in 
the comparison all the export tra nsactions of the like product by that exporter or foreign producer.  
Then the Appellate  Body turned to the question of whether zeroing is permitted under the W -T 
comparison methodology set forth in the second sentence of Article  2.4.2. It recounted its earl ier 
finding that the term "individual export transactions " mentioned in the second sentence refers to 
the pattern of export prices identified by the investigating authority which differ significantly from 
other export prices. The Appellate  Body noted that this conclusion is supported by the text and 
context of Article  2.4.2, taking into account the function of the second sentence of allowing an 
investigating authority to identify and address targeted dumping. The Appellate  Body also 
explained that the refer ence to the term "individual export transactions " in the second sentence 
highlights the asymmetrical nature of the W -T comparison methodology, whereby a normal value 
established on a weighted average basis is compared to prices of individual export transac tions. 
Thus, the Appellate  Body found no basis in the second sentence to read the term "individual export WT/AB/27  
 
- 72 - 
 
 transactions " as permitting the exclusion of individual pattern transactions priced above normal 
value from the establishment of margins of dumping pu rsuant to the asymmetrical W -T 
comparison methodology.  
The Appellate  Body further reasoned that zeroing within the pattern would necessarily amount to a 
definition of the pattern as limited to those export transactions involving one or more particular 
purchasers, regions, or time periods that are below normal value, as it is only those sales that 
would be taken into account when establishing margins of dumping with the use of zeroing. The 
pattern, as the Appellate  Body found, is composed of all the export p rices to one or more 
particular purchasers, particular regions, or particular time periods. Accordingly, it considered that 
to allow zeroing within the pattern would disconnect the notion of pattern as properly identified 
under the second sentence (as comp rising all export sales to one or more particular purchasers, 
regions, or time periods) from the pattern to which the W -T comparison methodology is applied 
when establishing margins of dumping in order to address targeted dumping. The Appellate  Body 
found no legal basis under the second sentence of Article  2.4.2 for considering only those sales to 
one or more purchasers, regions, or time periods that are below normal value for establishing 
margins of dumping.  
The Appellate  Body further recalled that the sec ond sentence of Article  2.4.2 provides for an 
exception to the normally applicable symmetrical comparison methodologies under the first 
sentence in order to allow investigating authorities to identify and address targeted dumping. The 
Appellate  Body consid ered that, by conducting a comparison between normal value and all 
transactions included in the identified "pattern", an investigating authority is able to address the 
targeted dumping that is identified and that corresponds to that particular pattern. The  
Appellate  Body explained that there would be nothing more to unmask once the comparison had 
been conducted between normal value and export prices for pattern transactions (to the exclusion 
of non -pattern transactions). While zeroing within a pattern that includes sales above normal value 
increases the margin of dumping, it does not unmask the targeted dumping that corresponds to 
the properly identified pattern of significantly lower sales, whereby such pattern includes sales 
below and above normal value.  The Appellate  Body explained that this interpretation gives 
meaning and effect to the second sentence of Article  2.4.2 because it allows for the identification 
of the relevant pattern within the meaning of that provision and allows an investigating authorit y 
to address targeted dumping by applying the W -T comparison methodology to the limited universe 
of individual export transactions that form the properly identified pattern.  
The Appellate  Body next turned to consider the United  States' reliance on the Appellate Body's 
statement in US – Softwood Lumber V ( Article  21.5 – Canada)  that, it could be argued that the use 
of zeroing under the two comparison methodologies set out in the first sentence of Article  2.4.2 
would enable investigating authorities to captur e pricing patterns constituting targeted dumping, 
thus rendering the third methodology inutile.  The United  States asserted that this observation by 
the Appellate  Body implies that it is possible to use zeroing to capture pricing patterns constituting 
targeted dumping. The Appellate  Body recalled that the referenced dispute (which dealt with the 
T-T comparison methodology under the first sentence of Article  2.4.2), was addressing the second 
sentence in view of the panel's contextual reliance on that provisio n. The Appellate  Body explained 
that, it had considered that the use of zeroing under the comparison methodologies provided in 
the first sentence of Article  2.4.2 to unmask targeted dumping would have deprived the second 
sentence, the function of which is to address targeted dumping, of its effet utile. However, in that 
dispute the Appellate  Body did not pronounce on how targeted dumping should be addressed 
under the second sentence of Article  2.4.2. In any event, in US – Softwood Lumber V 
(Article  21.5 – Canada) , the Appellate  Body had not suggested that giving effect to the second 
sentence of Article  2.4.2 would require establishing margins of dumping by applying the W -T 
comparison methodology with zeroing to the applicable universe of export transactions,  i.e. the 
pattern transactions.  
The Appellate  Body next addressed the United  States' argument that, assuming that under both 
the W -W and W -T comparison methodologies the margins of dumping are based on the same 
normal value and export sales data, if zeroin g is prohibited under both comparison methodologies, 
then they will yield mathematically equivalent results. The Appellate  Body explained that, under 
the second sentence of Article  2.4.2, comparing normal value with pattern transactions (identified 
consist ently with that provision) only will not normally yield results that are mathematically or 
substantially equivalent to the results obtained from the application of the W -W comparison 
methodology to all export transactions. The Appellate  Body then turned to  consider the WT/AB/27  
 
- 73 - 
 
 United  States' assertion that the Panel's approach of applying the W -T comparison methodology to 
a subset of transactions without zeroing is in essence equivalent to the application of the W -W 
comparison methodology to the same subset of tran sactions without zeroing. The Appellate  Body 
explained that, in keeping with the function of the second sentence to address targeted dumping, 
once the relevant pattern has been identified, the fact that the application of the W -T comparison 
methodology to that identified pattern leads to equivalent results as the application of the W -W 
comparison methodology to the same pattern does not undermine the effet utile of the second 
sentence. Nor does it lead to equivalent results between the application of the sy mmetrical 
comparison methodologies normally used under the first sentence to the universe of all export 
transactions and the application of the W -T comparison methodology to the limited universe of 
pattern transactions.  
Finally, the Appellate  Body addresse d the United  States' argument that the negotiating history of 
the Anti -Dumping  Agreement confirms that zeroing is permissible when applying the asymmetrical 
and exceptional W -T comparison methodology set forth in the second sentence of Article  2.4.2. 
The Appellate  Body recalled its earlier findings that, under the second sentence, an investigating 
authority can use the W -T comparison methodology to address targeted dumping by establishing 
margins of dumping based on the properly identified pattern of export  prices which differ 
significantly and which are targeted at purchasers, regions, or time periods. In so doing, an 
investigating authority is not allowed to use zeroing under the W -T methodology. The 
Appellate  Body stated that it had reached this conclusio n based on the text and context of 
Article  2.4.2 read in light of the object and purpose of the Anti -Dumping Agreement. Accordingly, 
the Appellate  Body considered that it was not necessary to have recourse to the negotiating 
history of the Anti -Dumping Agr eement in order to confirm the meaning of the second sentence of 
Article  2.4.2.  Nevertheless, having considered the United  States' arguments regarding the 
negotiating history of the Anti -Dumping Agreement, the Appellate  Body concluded that these 
documents did not support a reading of the second sentence of Article  2.4.2 as permitting zeroing.  
In light of the foregoing considerations, the Appellate  Body found that the exceptional W -T 
comparison methodology in the second sentence of Article  2.4.2 requires a c omparison between a 
weighted average normal value and the entire universe of export transactions that fall within the 
pattern as properly identified under that provision, and irrespective of whether the export price of 
individual pattern transactions is ab ove or below normal value. Zeroing the negative intermediate 
comparison results within the pattern, according to the Appellate  Body, is neither necessary to 
address targeted dumping, nor is it consistent with the establishment of dumping and margins of 
dumping as pertaining to the universe of export transactions identified under the second sentence 
of Article  2.4.2. Therefore, the Appellate  Body upheld the Panel's findings, that the United  States' 
use of zeroing when applying the W -T comparison methodology is inconsistent "as such" with 
Article  2.4.2 of the Anti -Dumping Agreement and that the USDOC acted inconsistently with 
Article  2.4.2 by using zeroing when applying the W -T comparison methodology in the Washers  
anti-dumping investigation.  
4.5.1.7.2   The United  States ' appeal under Article  2.4 of the Anti -Dumping Agreement  
The United  States argued that the Panel's findings of inconsistency regarding the use of zeroing in 
the application of the W -T comparison methodology with Article  2.4 of the Anti -Dumping 
Agreement re st on its earlier findings of inconsistency under the second sentence of Article  2.4.2 
of the Anti -Dumping Agreement. Thus, the United  States submitted that, since the Panel's findings 
under Article  2.4.2 are erroneous, the Panel's findings under Article  2.4 likewise are erroneous and 
should be reversed.  
The Appellate  Body recalled its earlier findings that the second sentence of Article  2.4.2 allows an 
investigating authority to establish dumping and margins of dumping by applying the W -T 
comparison method ology to pattern transactions without having recourse to zeroing. The 
Appellate  Body recalled that it had upheld the Panel's findings in this regard. It considered that 
zeroing the intermediate negative comparison results has the effect of not only inflati ng the 
magnitude of dumping, but it also makes a positive determination of dumping more likely in 
circumstances where the export prices above normal value exceed those that are below normal 
value. The Appellate  Body further explained that by setting to zer o individual export transactions 
that yield a negative comparison result, an investigating authority fails to compare all comparable 
export transactions that form the applicable universe of export transactions as required under the WT/AB/27  
 
- 74 - 
 
 second sentence of Article 2.4.2, thus failing to make a fair comparison within the meaning of 
Article  2.4. 
The Appellate  Body thus upheld the Panel's findings that the United  States' use of zeroing when 
applying the W -T comparison methodology is inconsistent "as such" with Article 2.4 of the 
Anti-Dumping Agreement and that the USDOC acted inconsistently with Article  2.4 by using 
zeroing when applying the W -T comparison methodology in the Washers  anti-dumping 
investigation.  
4.5.1.7.3   The United  States' appeal under Article  9.3 of the Anti -Dumping Agreement 
and Article  VI:2 of the GATT  1994  
The United  States argued that the Panel's findings under Article  9.3 of the 
Anti-Dumping  Agreement and Article  VI:2 of the GATT  1994 were based on the Panel's earlier 
flawed findings under Article  2.4.2 of  the Anti -Dumping Agreement and therefore had to be 
reversed. The United  States submitted that a margin of dumping established on the basis of the 
W-T comparison methodology when the conditions for its use have been fulfilled, is a margin of 
dumping proper ly determined under Article  2 of the Anti -Dumping Agreement and, consequently, 
any anti -dumping duty levied pursuant thereto, would not breach either Article  9.3 of the 
Anti-Dumping  Agreement, or Article  VI:2 of the GATT  1994. 
The Appellate  Body explained that Article  9.3 refers to the margin of dumping as established under 
Article  2, which represents the ceiling for anti -dumping duties levied pursuant to Article  9.3 of the 
Anti-Dumping Agreement and Article  VI:2 of the GATT  1994. Accordingly, if margins of  dumping 
are established inconsistently with Article  2.4.2 by using zeroing under the W -T comparison 
methodology, the corresponding anti -dumping duties that are levied will also be inconsistent with 
Article  9.3 of the Anti -Dumping Agreement and Article  VI:2 of the GATT  1994, as they will exceed 
the margin of dumping that should have been established under Article  2. According to the 
Appellate  Body, given that zeroing is not permitted under the W -T comparison methodology 
pursuant to the second sentence of Article 2.4.2 in original anti -dumping investigations, it also 
cannot be permitted in respect of administrative reviews.  
In light of the above, the Appellate  Body upheld the Panel's finding that the United  States' use of 
zeroing when applying the W -T compari son methodology in administrative reviews is inconsistent 
"as such" with Article  9.3 of the Anti -Dumping Agreement and Article  VI:2 of the GATT  1994. 
4.5.1.7.4   Separate opinion of one Appellate  Body  member regarding zeroing under the 
W-T comparison methodology  
One m ember of the Division disagreed with the ruling of the majority of the Appellate  Body that 
zeroing is not permitted under the W -T comparison methodology provided for in the second 
sentence of Article  2.4.2 of the Anti -Dumping Agreement and expressed a sepa rate opinion.  
The Appellate  Body member began by recalling that the text of the second sentence of 
Article  2.4.2 has no qualifier, and it does not specify how the investigating authority is to conduct 
the comparison between a weighted average normal value and prices of individual export 
transactions, once it finds the requisite pattern and provides the requisite explanation. Noting that 
the second sentence of Article  2.4.2 is an exception and has the function of unmasking targeted 
dumping and addressing it,  he was of the view that the question that needed to be answered was, 
what are the limits, if any, that the Anti -Dumping  Agreement places on what an investigating 
authority may do to unmask and deal with targeted dumping.  
According to this Appellate  Body member, the majority's interpretation would permit investigating 
authorities to deal with targeted dumping only partially, and possibly ineffectively , since within the 
pattern, prices above normal value will cancel out – or re -mask – partly or completely, t he 
targeted dumping that results from prices below normal value. In his opinion, such an incomplete 
approach is not required by the text of the second sentence read in the context of the entire 
Article  2.4.2 and in light of the object and purpose of the An ti-Dumping  Agreement. In addition, it 
unduly restricts the regulatory leeway that should be accorded to investigating authorities to deal 
with targeted dumping. Having found that, when applying the second sentence of Article  2.4.2, 
investigating authoritie s are to focus only on pattern transactions, he was of the opinion WT/AB/27  
 
- 75 - 
 
 that investigating authorities are permitted to zero those pattern transactions that are priced 
above normal value, and to calculate dumping only on the basis of pattern transactions priced  
below normal value. Such an approach, according to this Appellate  Body member, would deal fully 
with targeted dumping by dividing the full amount of such dumping – instead of an amount 
diminished by non -dumped prices – by the full value of an exporter's s ales. 
This m ember of the Appellate  Body was of the view that previous Appellate  Body jurisprudence 
supported in -pattern zeroing under the second sentence of Article  2.4.2. He recalled that in 
US ‒ Softwood Lumber V ( Article  21.5 – Canada) , the Appellate  Body, in finding that a prohibition 
on the use of zeroing under the T -T comparison methodology would not render the second 
sentence of Article  2.4.2 meaningless, stated that, "on the contrary, … th e use of zeroing under 
the two comparison methodologies set out in the first sentence of Article  2.4.2 would enable 
investigating authorities to capture pricing patterns constituting 'targeted dumping', thus rendering 
the third methodology inutile. " Accord ing to him, the Appellate  Body's prior findings regarding the 
exceptional nature of the W -T comparison read in light of the aforesaid statement in 
US ‒ Softwood Lumber V ( Article  21.5 – Canada)  imply that zeroing is permissible under the W -T 
comparison methodology in order to identify and address targeted dumping.  
Moreover, this Appellate  Body member also recalled that in the aforesaid dispute, the 
Appellate Body, in the context of the T -T comparison methodology, had stated that the reference 
to export prices in the plural, without further qualification, suggested that all of the results of the 
transaction -specific comparisons should be included in the a ggregation for purposes of calculating 
the margins of dumping. In contrast, he reasoned that, the fact that the second sentence of 
Article  2.4.2, unlike the first sentence, uses the phrase "prices of individual export transactions" 
(the word "individual" b eing the qualifier) indicates that not all the transaction -specific 
comparisons arising from the export prices that form part of the pattern need to be aggregated in 
order to calculate dumping.  
Accordingly, he took the view that, allowing an investigating authority to zero within the pattern 
under the second sentence of Article  2.4.2 is not only a permissible interpretation within the 
meaning of the second sentence of Article  17.6(ii), but that it is a more defensible interpretation 
within the meaning of th e first sentence of Article  17.6(ii) of the Anti -Dumping  Agreement.  
In light of the above, this Appellate  Body member disagreed with the finding of the majority that 
zeroing within the "pattern" under the W -T comparison methodology of the second sentence of 
Article  2.4.2 of the Anti -Dumping Agreement is not permissible. Consequently, he also disagreed 
with the findings of the majority on zeroing under Articles  2.4 and 9.3 of the 
Anti-Dumping  Agreement and Article  VI:2 of the GATT  1994. 
4.5.2   Claims under the SCM  Agreement and related claims under the GATT  1994  
4.5.2.1   The Panel's upholding of the USDOC's determination that the RSTA Article  26 
tax credit programme was regionally specific  
Korea claimed that the Panel erred in its interpretation and application of Article  2.2 of the 
SCM Agreement by upholding the USDOC's determination that the RSTA Article  26 tax credit 
programme was regionally specific. Korea's appeal focused on the Panel's interpretation and 
application of certain terms contained in Article  2.2, namely: (i) "certain enterprises"; 
(ii) "designated"; and (iii)  "geographical region".  
Korea argued, first, that the term "certain enterprises" only refers to entities with legal 
personality, such as companies, whereas manufacturing facilities, which do not have leg al 
personality, do not fall within the scope of the term. The Appellate  Body noted that the definition 
of the word "enterprise" does not indicate that such term signifies only an entity with legal 
personality. To the contrary, the text of Article  2.2 does not exclude that a sub -unit or a 
constituent part of a company – including, but not limited to, its branch offices or the facilities 
where it conducts manufacturing operations – may fall within the scope of the term "certain 
enterprises" despite not necess arily having distinct legal personality. The Appellate  Body also 
noted the immediate context provided by the word "located" and stated that not every activity 
conducted by an enterprise in a given region would suffice for that enterprise to be located ther e. 
However, an enterprise may be located in a certain region if it effectively establishes its WT/AB/27  
 
- 76 - 
 
 commercial presence in that region, including by setting up a sub -unit such as a branch office or a 
facility for manufacturing operations. When a measure limits eligibility for a subsidy based on the 
geographical location of any of these sub -units or constituent parts of an enterprise, that measure 
will be regionally specific.  
Second, Korea maintained that the "designation" of a region must be done affirmatively, not by 
implication or suggestion. In its view, the RSTA Article  26 tax credit programme could not be said 
to affirmatively designate a geographical region, as it merely disqualified investments made in the 
Seoul overcrowding area from eligibility for subsi dies that would otherwise be available. Based on 
the relevant definition of the verb "designate", the Appellate  Body considered that the 
identification of a region for purposes of Article  2.2 may be explicit or implicit, provided that the 
relevant region i s clearly discernible from the text, design, structure, and operation of the subsidy 
measure at issue. For the Appellate  Body, it is irrelevant that the coverage of the RSTA Article  26 
tax credit programme was couched in negative terms – i.e. it excluded i nvestments made in the 
Seoul overcrowding area from eligibility for subsidies otherwise available. In essence, the 
programme had the effect of discouraging certain investments in one portion of the Korean 
territory and, at the same time, encouraging those investments i n another portion of the 
Korean  territory.  
Third, Korea submitted that, since the Seoul overcrowding area accounts for only 2% of the 
national territory, the area covered by the RSTA Article  26 tax credit programme – i.e. the 
remainder of the country – was too large, too unbounded, and insufficiently demarcated to be 
considered as a "designated geographical region". Korea also stressed that the programme was 
based on neutral and objective eligibility criteria, consistently with Article  2.1(b) o f the 
SCM Agreement, and constituted an effective policy tool to address overcrowding and urban 
sprawl. The Appellate  Body rejected Korea's arguments. It observed that the term "geographical 
region" in the text of Article  2.2 is not qualified in any way; t herefore, any identified tract of land 
within the jurisdiction of a granting authority may, irrespective of its size, constitute a 
geographical region. As the boundaries of the area falling within the scope of the RSTA Article  26 
tax credit programme were clearly delineated in the relevant regulations, the Appellate  Body saw 
no reason why such identified tract of land would not qualify as a designated geographical region. 
The Appellate  Body also explained that a subsidy that sets forth neutral and objective  eligibility 
criteria with respect to a given region, consistently with Article  2.1(b), may nonetheless be 
regionally specific under Article  2.2. Finally, the Appellate  Body observed that Members are, in 
principle, free to pursue legitimate objectives, suc h as addressing overcrowding and urban sprawl, 
through measures other than subsidy programmes, including zoning regulations or prohibitions to 
build in certain areas. However, when they choose to do so through the bestowal of regionally 
specific subsidies,  the disciplines of the SCM Agreement will apply.  
In sum, the Appellate  Body agreed with the Panel that the RSTA Article  26 tax credit programme 
effectively designated the region where the relevant eligible investments were to be made in order 
to qualify f or the subsidy at issue, thereby being "limited to certain enterprises located within a 
designated geographical region" within Korea's jurisdiction. The Appellate  Body therefore upheld 
the Panel's finding that the USDOC's determination of regional specific ity with respect to the RSTA 
Article  26 tax programme wa s not inconsistent with Article  2.2 of the SCM  Agreement.  
Korea further claimed that, in articulating its findings on regional specificity, the Panel did not 
adequately review the USDOC's determinatio n, thereby failing to conduct an objective assessment 
of the matter before it and acting inconsistently with its duties under Article  11 of the DSU. The 
Appellate  Body observed that Korea's claims under Article  2.2 were not directed at the USDOC's 
assessme nt of the evidence before it, nor did they require the Panel to closely examine the 
specifics of the USDOC's determination or the facts on the record of the investigation. Rather, the 
thrust of Korea's argumentation touched on the interpretation of Article s 2.1(b) and 2.2 of the 
SCM Agreement. As the Panel had addressed all such interpretative arguments, the Appellate  Body 
found that the Panel did not act inconsistently with its duties under Article  11 of the DSU in 
articulating its findings on regional spe cificity.  WT/AB/27  
 
- 77 - 
 
 4.5.2.2   The Panel's upholding of the USDOC's determination that the tax credits 
received by Samsung under Articles 10(1)(3) and 26 of the RSTA are not tied to any 
particular products  
Korea claimed that, by upholding the USDOC's determination that the tax  credits received by 
Samsung under Articles  10(1)(3) and 26 of the RSTA were not tied to particular products, the 
Panel erred in its interpretation and application of Article  19.4 of the SCM  Agreement and 
Article  VI:3 of the GATT  1994. First, Korea argued that, by focusing on Samsung's intended use of 
the proceeds of the tax credits, both the USDOC and the Panel applied an incorrect tying test. 
Second, Korea submitted that the Panel erred by affirming the USDOC's dismissal of certain 
evidence submitted by S amsung that would have enabled the USDOC to single out the qualifying 
expenditures and the related tax credits accruing to Samsung's digital appliance business unit.  
The Appellate  Body noted that both the USDOC's determination and the Panel's reasoning inv olved 
a two -step analysis. First, both applied a test whereby a subsidy is tied to a product only if the 
intended use of that subsidy is known to the granting authority, and so acknowledged prior to or 
concurrent with its bestowal. Second, in light of this  test, both the USDOC and the Panel did not 
consider it necessary to take into account some evidence submitted by Samsung, which 
purportedly showed the amount of eligible expenditures made by the digital appliance business 
unit, as well as the tax credits that those expenses generated under Articles  10(1)(3) and  26 of 
the RSTA. The Appellate  Body thus found it useful to examine each o f these two analytical steps 
in turn. 
With regard to the test applied by the USDOC and endorsed by the Panel, the Appellate  Body 
stated that a subsidy is tied to a particular product if the bestowal of that subsidy is connected to, 
or conditioned upon, the production or sale of the product concerned. An assessment of whether 
this connection or conditional relationship exists wil l inevitably depend on the specific 
circumstances of each case. In conducting such an assessment, an investigating authority must 
examine the design, structure, and operation of the measure granting the subsidy at issue and 
take into account all the releva nt facts surrounding the granting of that subsidy. Against this 
backdrop, the Appellate  Body considered that the test applied by the USDOC and endorsed by the 
Panel meant that a subsidy cannot be tied to a product if: (i) the financial contribution is conf erred 
on the recipient after the eligible activities have occurred; and (ii) the recipient is not required to 
spend the proceeds of the subsidy on the same type of activities that gave rise to eligibility.  
The Appellate  Body considered that the fact that t he recipient obtains the proceeds of a subsidy 
before, at the same time as, or after conducting the eligible activities is not, in and of itself, 
dispositive of whether that subsidy is tied to a particular product. In all those situations, the 
bestowal of a subsidy may be connected to, or conditioned on, the production or sale of a 
particular product. Indeed, even when that subsidy operates in a manner whereby the recipient 
will obtain the proceeds after the eligible activity has occurred, the expectation t o obtain those 
proceeds may induce the recipient to engage in the production or sale of the product giving rise to 
eligibility. The Appellate  Body observed that the proceeds deriving from certain types of financial 
contribution, such as grants or loans, ar e usually paid before the recipient undertakes a certain 
activity; conversely, the proceeds of other types of financial contribution, such as cash saved as a 
result of tax credits and other forms of revenue forgone, are normally obtained after the recipien t 
has become entitled to receive them or has carried out the eligible activity. Excluding the existence 
of a product -specific tie whenever the recipient obtains the proceeds of a subsidy after it has 
carried out the eligible activities could result in an u nwarranted distinction between those different 
types of financial contribution.  
Similarly, the Appellate  Body was not persuaded by the USDOC's and the Panel's focus on the 
recipient's intended use of the proceeds of a subsidy. According to the Appellate  Body, the fact 
that a financial contribution, once collected by the recipient, may be spent on activities different 
from those for which it was bestowed is not, in and of itself, sufficient to exclude the existence of a 
product -specific tie. Unless a subsidy  programme expressly determines the way in which the 
recipient has to spend the proceeds of the subsidy, the recipient will always be free, in principle, to 
finance product -specific activities with resources other than those provided by the granting 
author ity. Accordingly, under the USDOC's and the Panel's test, hardly any subsidy would ever be 
considered tied to a particular product, for the recipient would be able to escape such tie by 
spending the proceeds on different activities. For the Appellate  Body, an appropriate inquiry into 
the existence of a product -specific tie requires a scrutiny of the design, structure, and operation of WT/AB/27  
 
- 78 - 
 
 the subsidy at issue. Based on this assessment, a subsidy that does not restrict the recipient's use 
of the proceeds of the financial contribution may, nonetheless, be found to be tied to a particular 
product if, for instance, it induces the recipient to engage in activities connected to that product.  
The Appellate  Body turned next to the Panel's affirmation of the USDOC's dism issal of certain 
evidence submitted by Samsung. The Appellate  Body recalled that the USDOC was required to 
evaluate all evidence relevant to its inquiry into the existence of a product -specific tie, and to 
provide reasoned and adequate explanations for its  determination. The Appellate  Body considered 
that, in order to fulfil such duties, the USDOC should have reviewed the evidence submitted by 
Samsung, which would have allegedly enabled it to single out the qualifying expenditures and the 
related tax credit s accruing to the digital appliance business unit. The fact that such evidence was 
created ad hoc for the purposes of the Washers  countervailing duty investigation, and was not 
expressly required under the Korean legislation at issue – i.e. Articles 10(1)( 3) and 26 of the 
RSTA  – did not suffice to relieve the USDOC of its duty to review it. Thus, the Appellate  Body 
found that, by too readily dismissing the relevance of that evidence, the USDOC failed to evaluate 
all of the relevant evidence, and that, by up holding the USDOC's dismissal of that evidence, the 
Panel erroneously concluded that the explanations provided by the USDOC were reasoned and 
adequate.  
In sum, the Appellate  Body concluded that the Panel: (i) improperly endorsed the flawed tying test 
applied by the USDOC in the Washers  countervailing duty investigation; and  (ii) improperly upheld 
the USDOC's dismissal of certain evidence submitted by Samsung that was potentially relevant to 
the inquiry into the existence of a product -specific tie. Therefore , the Appellate  Body reversed the 
Panel's finding that the USDOC determination that the tax credits received by Samsung under 
Articles 10(1)(3) and 26 of the RSTA are not tied to any particular products is not inconsistent with 
Articles 19.4 of the SCM Agr eement and VI:3 of the GATT  1994; and found, instead, that the 
USDOC's determination is inconsistent with such provisions.  
4.5.2.3   The Panel's upholding of the USDOC's attribution of the tax credits received by 
Samsung under Article  10(1)(3) of the RSTA to Samsung 's domestic production only  
Korea claimed on appeal that, by upholding the USDOC's attribution of the tax credits received by 
Samsung under Article  10(1)(3) of the RSTA to Samsung's domestic production only, the Panel 
erred in its interpretation and applic ation of Article  19.4 of the SCM  Agreement and Article  VI:3 of 
the GATT  1994. In particular, Korea submitted that the Panel improperly upheld the USDOC's 
presumptive allocation of subsidies to domestic production, and stressed that, during the course of 
the Washers  countervailing duty investigation , Samsung submitted arguments and evidence which 
effectively rebutted this presumption.  
The Appellate  Body noted that the subsidized products relevant for calculating per unit 
subsidization are those manufactured,  produced, or exported by the recipient. However, according 
to the Appellate  Body, nothing in the SCM Agreement indicates that such products should be 
further limited to those produced by the recipient within the jurisdiction of the subsidizing Member. 
Rather, a subsidy may be bestowed on the recipient's production outside the jurisdiction of the 
subsidizing Member. For instance, if the recipient is a multinational corporation with facilities 
located in multiple countries, the subsidized products may, depen ding on the circumstances of the 
case, include that corporation's production in those multiple countries. In order to appropriately 
identify the subsidized products, investigating authorities should examine the arguments and 
evidence submitted by intereste d parties, as well as the specific facts surrounding the bestowal of 
the subsidy at issue.  
Against this backdrop, the Appellate  Body was not persuaded by the Panel's statement that any 
positive effect that Samsung's Korea -based R&D activities might have on  Samsung's overseas 
production does not constitute a benefit within the meaning of Article  1.1(b) of the 
SCM Agreement. For the Appellate  Body, the identification of the recipient of the "benefit" is 
distinct from, and should not prejudge, the calculation of the amount of subsidy that has been 
bestowed upon the products produced by the recipient, so as to determine properly the amount of 
countervailing duty to be imposed on such products in accordance with Article  19.4 of the 
SCM Agreement and Article  VI:3 of the GATT  1994. Thus, the fact that Samsung is the recipient of 
the benefit deriving from the bestowal of subsidies under Article  10(1)(3) of the RSTA does not, in 
and of itself, preclude a finding that those subsidies may be allocated also to the produc tion of 
Samsung's overseas subsidiaries. Accordingly, the Appellate  Body considered that the Panel unduly WT/AB/27  
 
- 79 - 
 
 conflated the concept of "recipient of the subsidy" under Article  1 of the SCM  Agreement with the 
concept of "subsidized product" for purposes of calc ulating per unit subsidization under Article  19.4 
of the SCM  Agreement and Article  VI:3 of the GATT  1994. 
Similarly, the Appellate  Body was not convinced by the Panel's affirmation of the USDOC's 
presumptive allocation of subsidies to Samsung's domestic pr oduction. While that presumption 
could, in principle, be rebutted, the only way to do so was for Samsung to show that the 
Government of Korea explicitly stated, in the application and/or approval documents, that the 
subsidy was being provided for more than  domestic production. The Appellate  Body considered 
that the expressed intent of a subsidizing authority, as evinced by the face of the measure 
granting the subsidy, cannot be the sole factor relevant to the allocation of that subsidy to the 
products manuf actured by the recipient in the context of calculating per unit subsidization. 
Instead, the USDOC should have evaluated Samsung's arguments and evidence that, allegedly, 
would have enabled it to allocate the tax credits Samsung received under Article  10(1) (3) of the 
RSTA across its worldwide production. Thus, the Appellate  Body concluded that, by focusing solely 
on the face of the measure, the USDOC failed to evaluate all of the relevant evidence, and that, by 
upholding the USDOC's determination, the Panel erroneously concluded that the explanations 
provided by the USDOC were reasoned and adequate.  
In sum, the Appellate  Body concluded that the Panel: (i) erroneously conflated the concept of 
"recipient of the benefit" with the concept of "subsidized product";  and (ii) improperly condoned 
the USDOC's failure to assess all the arguments and evidence submitted by interested parties and 
other relevant facts surrounding the bestowal of tax credits under Article  10(1)(3) of the RSTA . 
Therefore, the Appellate  Body reversed the Panel's finding that the USDOC's attribution of the tax 
credits received by Samsung under Article  10(1)(3) of the RSTA exclusively to Samsung's 
domestic production is not inconsistent with Article  19.4 of the SCM Agreement and Article  VI:3 of 
the GATT  1994; and found, instead, that the USDOC's determin ation is inconsistent with 
such provisions.  
4.6  Appellate  Body  Report, European Union – Anti-Dumping Measur es on Biodiesel from 
Argentina , WT/DS473/AB/R  
This dispute concern ed a challenge by Argentina a gainst two sets of measures of the 
European  Union: (i) the anti -dumping measure on imports of biodiesel from Argentina; and (ii) the  
second sub paragraph  of Article  2(5) of the Council Regulation (EC) No.  1225/2009 of 
30 November  2009 on protection against dumped imports from countries not members of the 
European  Community ( Basic Regulation ). 
The anti -dumping measure imposed by the European  Union on imports of biodiesel from Argentina 
was adopted at the conclusion of an anti -dumping investigation on imports of biodiesel originating 
in Argentina and Indonesia. The investigation was initiated by the European  Commission, following 
a complaint by the European Biodiesel Board (EBB). The EU  autho rities found that , because  the 
biodiesel market in Argentina was heavi ly regulated by the State, domestic sales of biodiesel were 
not made in the ordinary course of trade. For this reason, the EU authorities construct ed the 
normal value of the biodiesel from Argentina on the basis of costs of production of biodiesel plus a 
reasonable amount for selling, general and administrative expenses . The EU authorities also found 
that soybeans are the main raw material purchased and used in the production of biodiesel in 
Argentina. It was undisputed that the cost of raw materials is the  largest cost component in 
producing biodiesel.  
In constructing the normal value in the Provisional Regulation, the EU authorities noted the 
EBB's  allegation  that, under  Argentina's Differential Export Tax (DET) system, Argentina imposes 
differential taxes  on exports of soybeans, soybean oil, and biodiesel, and, specifically, that the 
taxes imposed on exports of the raw materials are higher than those imposed on exports of the 
finished product. The EBB alleged that the DET system depresses the domestic pric e of soybeans 
and soybean oil, and therefore distorts the costs of production of biodiesel producers in Argentina. 
The EU authorities considered, however, that, due to a lack of information at that time, the 
question as to whether the Argentine biodiesel p roducers' records reasonably reflect ed the costs 
associated with the production of biodiesel would be further examined at the definitive stage. 
Thus, despite the EBB's allegation, the EU authorities used the actual costs of soybeans reported in 
the Argenti ne producers' records in calculating the constructed normal value for biodiesel . WT/AB/27  
 
- 80 - 
 
 In the Definitive Regulation, the EU authorities found that the DET system in Argentina depressed 
the domestic price of soybeans and soybean oil to an artificially low level, affecting the costs of 
Argentine biodiesel producers. The EU  authorities established that the domestic prices of soybeans 
and soybean oil were essentially equivalent to the international prices minus exporting expenses 
and the amount of the export tax. The  EU authorities thus concluded that the costs of the main 
raw material were not reasonably reflected in the records kept by the Argentinean producers under 
investigation. The EU authorities therefore decided to revise the construction of the normal value 
in the Provisional Regulation and disregard the actual costs of soybeans as reported by the 
Argentine producers in their records. Instead, such actual costs were replaced by a surrogate price 
for soybeans in Argentina, namely, the average of the reference p rices of soybeans published by 
the Argentine  Ministry of Agriculture for export FOB Argentina, minus fobbing costs, during the 
investigation period.  
Furthermore, the Definitive Regulation confirmed the provisional findings of dumping, injury, and 
causation , although certain aspects of the findings were modified. In particular, the figures relating 
to two of the macroeconomic indicators examined by the EU authorities – the production capacity 
and capacity utilization rate of the EU industry – were modified i n light of the revised data 
submitted by the EBB subsequent to the Provisional Regulation. The EBB claimed that the data 
previously submitted regarding the total EU production capacity included idle capacity  and 
therefore had to be reduced. The EU authorit ies accepted the revised data on production capacity 
submitted by the EBB, which led to a downward adjustment to the production capacity figures, and 
an upward adjustment to the capacity utilization rates, in the Definitive Regulation.  
The Basic Regulation  is the basic EU legal instrument on the protection against dumped imports 
from countries that are not member States of the European Union. It contains language identical 
or similar to that used in the Anti -Dumping  Agreement, together with additional provi sions and 
details that have no direct counterpart in the Anti -Dumping  Agreement.  Article  2(5) of the 
Basic Regulation contains four subparagraphs. The second  subparagraph  of Article  2(5) provides 
that, "[i]f costs associated with the production and sale of  the product under investigation are not 
reasonably reflected in the records of the party concerned, they shall be adjusted or established on 
the basis of the costs of other producers or exporters in the same country or, where such 
information is not avail able or cannot be used, on any other reasonable basis, including 
information from other representative markets."  
Before the Panel, Argentina claimed that the anti -dumping measure on biodiesel is inconsistent 
with several provisions of the Anti -Dumping Agre ement and the GATT  1994. Specifically, 
Argentina  alleged that the European Union acted inconsistently with: (i)  Article  2.2.1.1 of the 
Anti-Dumping Agreement by failing to calculate the cost of production of the product under 
investigation on the basis of records kept by the Argentine producers, and by including costs not 
associated with the production and sale of biodiesel in the calculation of the cost of production; 
(ii) Article  2.2 of the Ant i-Dumping Agreement and Article  VI:1(b)(ii) of the GATT  1994 by failing 
to construct the normal value of the exports of biodiesel on the basis of the cost of production in 
the country of origin; (iii)  Articles  2.2 and 2.2.2(iii) of the Anti -Dumping  Agreement by failing to 
base the profit -margin component of the const ructed normal value on a reasonable method within 
the meaning of Article  2.2.2(iii); (iv)  Article  2.4 of the Anti -Dumping  Agreement by failing to make 
due allowance for differences affecting price comparability and thus precluding a fair comparison 
between  the normal value an d the export price; (v) Article  9.3 of the Anti -Dumping  Agreement 
and Article  VI:2 of the GATT  1994 by imposing anti -dumping duties in excess of the margins of 
dumping that should have been established under Article  2 of the Anti -Dumpin g Agreement; 
(vi) Articles 3.1 and  3.4 of the Anti -Dumping  Agreement with regard to the EU authorities' injury 
determination; and (vii)  Articles  3.1 and 3.5 of the Anti -Dumping  Agreement with regard to the 
EU authorities' non -attribution analysis and findi ng that the injury suffered by the EU domestic 
industry did not result from factors other than dumped imports.  
Furthermore, Argentina claimed that the second sub paragraph  of Article  2(5) of the 
Basic Regulation is inconsist ent "as such" with: (i) Article  2.2.1.1 and, as a consequence, 
Article  2.2 of the Anti -Dumping  Agreement and Article  VI:1(b)(ii) of the GATT  1994 by providing 
that the authorities shall reject or adjust the cost data in the records of producers or exporters 
under investigation when those costs reflect prices that are "abnormally or artificially  low" as a 
result of an alleged market distortion ; (ii) Article  2.2 of the Anti -Dumping  Agreement and 
Article  VI:1(b)(ii) of the GATT  1994 by providing that the costs shall be adjusted or established  in 
certain cases on any other reasonable basis, including information from other representative WT/AB/27  
 
- 81 - 
 
 markets; and, as a consequence, (iii) Article  XVI:4 of the WTO Agreement  and Article  18.4 of the 
Anti-Dumping  Agreement.  
With respect to the claims against the anti-dumping measure on biodiesel , the Panel found that 
the European  Union acted inconsistently with Article  2.2.1.1 of the Anti -Dumping  Agreement by 
failing to calculate the cost of production of the product under investigation on the basis of the 
record s kept by the producers.  The Panel also found that the European  Union acted inconsistently 
with Article  2.2 of the Anti -Dumping  Agreement and Article  VI:1(b)(ii) of the GATT  1994 by using 
in the construction of the normal value a "cost" that was not the co st prevailing in Argentina.  
Further,  the Panel found that Argentina had not established that the European  Union acted 
inconsistently with Article  2.4 of the Anti -Dumping  Agreement by failing  to make a fair comparison 
between the normal value and the export  price.  In addition, t he Panel found  that the 
European  Union acted inconsistently with Article  9.3 of the Anti -Dumping  Agreement and 
Article  VI:2 of the GATT  1994 by imposing anti -dumping duties in excess of the margin of dumping 
that should have been esta blished under Article  2 of the Anti -Dumping  Agreement.  Finally, the 
Panel found that Argentina had not established that the European  Union's non -attribution analysis 
was inconsistent with Articles  3.1 and 3.5 of the Anti -Dumping  Agreement.  
As regards the c laims concerning the second sub paragraph  of Article  2(5) of the Basic Regulation , 
the Panel found that Argentina had not established that the  second sub paragraph  of Article  2(5) of 
the Basic Regulation is inconsistent "as such" with Article  2.2.1.1 of the Anti-Dumping  Agreement.  
The Panel also found  that Argentina had not established that the second  subparagraph  of 
Article  2(5) of the Basic Regulation is inconsistent "as such" with Article  2.2 of the 
Anti-Dumping  Agreement and Article  VI:1(b)(ii) of the GATT 1994. Finally, the Panel found that 
the second sub paragraph  of Article  2(5) of the Basic Regulation is not inconsistent with 
Article  XVI:4 of the WTO  Agreement and Article  18.4 of the Anti -Dumping  Agreement.  
4.6.1   Claims regarding the anti-dumping measure on i mports of biodiesel from 
Argentina  
4.6.1.1   Determination of dumping  
4.6.1.1.1   Article  2.2.1.1 of the Anti -Dumping Agreement   
The European Union appeal ed the Pa nel's finding that the European  Union acted inconsistently with 
Article  2.2.1.1 of the Anti -Dumping Agreement by f ailing to calculate the cost of production of the 
product under investigation on the basis of the records kept by the producers.  The Appellate  Body 
first interpreted the second condition in the first sentence of Article  2.2.1.1, before addressing 
various c laims of errors by the European Union concerning the Panel's interpretation and 
application of this provision.  
4.6.1.1.1.1   The second condition in the first sentence of Article  2.2.1.1  
The Appellate  Body noted that  the EU  authorities relied explicitly on the second co ndition  – 
namely, that the records "reasonably reflect the costs associated with the production and sale of 
the product under consideration " – to discard the records kept by the Argentine  producers under 
investigation insofar as they pertained to the cost of soybeans. Thus, the Appellate  Body stated, 
for purposes of resolving this dispute, it was the meaning of this condition that had to  be 
ascertained, and not whether there were other circumstances in which the obligation in the 
first sentence of Article  2.2.1.1 would not apply.  
The Appellate  Body considered that the phrase "costs associated with the production and sale of 
the product under consideration", read together with the reference to "records kept by the 
exporter or producer under investigation", makes it clear that the second  condition refers to those 
costs incurred by the investigated exporter or producer that have a relationship with the 
production and sale of the product under consideration.  Moreover,  the Appellate  Body noted  that it 
is the recor ds of the individual exporters or producers under investigation that are subject to the 
condition to reasonably reflect the costs. Turning to the relevant context, the Appellate  Body 
contrasted the two conditions in the first sentence of Article  2.2.1.1, n oting that the first condition  
concerns the general accounting and reporting practices  of the exporter or producer, whereas the WT/AB/27  
 
- 82 - 
 
 second  condition concerns the records' reasonable reflection of the costs  associated with the 
production and sale of the product  under consideration in a specific anti -dumping proceeding . 
The Appellate  Body considered that its understanding of the second condition in the first sentence 
of Article  2.2.1.1 is confirmed by the second and third sentences of Article  2.2.1.1 and footnote  6 
of the Anti -Dumping  Agreement , which set out rules for the allocation and adjustment of costs. In 
the Appellate  Body's view, t he cost allocations and adjustments contemplated in these provisions 
allow an investigating authority to obtain a more precise calculation of the costs associated with 
the product under consideration for the specific exporter or producer by ensuring or verifying that 
there is a genuine relationship between the costs reflected in the exporter's or producer's records 
and the costs a ssociated with the production and sale of the specific product under consideration. 
To the Appellate  Body, this context supports the understanding that the second  condition in the 
first sentence of Article  2.2.1.1 relates to whether the records of the expo rter or producer suitably 
and sufficiently correspond to or reproduce the costs that have a genuine  relationship with the 
production and sale of the specific product under consideration.  The Appellate  Body found that 
Article  2.2 of the Anti -Dumping  Agreeme nt also provides contextual support for its understanding. 
In particular, Article  2.2 concerns the establishment of the normal value through an appropriate 
proxy for the price of the like product in the ordinary course of trade in the domestic market of th e 
exporting country . To the Appellate  Body, this supports the view that the  condition at issue 
concerns the  costs that have a genuine relationship with the production and sale of the product 
under consideration , because these are the costs that would form the basis for the price of the like 
product if it were sold in the ordinary course of trade in the domestic market . 
The Appellate  Body considered that  the object and purpose of the Anti -Dumping  Agreement is to 
recognize the right of Members to take anti -dumping measures to counteract injurious dumping 
while, at the same time, imposing substantive conditions and de tailed procedural rules on 
anti-dumping investigations and on the imposition of anti -dumping measures. The Appellate  Body 
concluded that its  under standing of the second condition in the first sentence of Article  2.2.1.1 of 
the Anti -Dumping  Agreement is consistent with such object and purpose.  
In sum, the Appellate  Body understood the second condition in the first sentence of Article  2.2.1.1 
of the A nti-Dumping  Agreement as referring to whether the records kept by the exporter or 
producer suitably and sufficiently correspond to or reproduce those costs incurred by the 
investigated exporter or producer that have a genuine relationship with the producti on and sale of 
the specific product under consideration.  
4.6.1.1.1.2   Whether the Panel erred in its interpretation and application of 
Article  2.2.1.1  
The European  Union claimed  that the Panel erred in finding that th e second condition in the 
first sentence of Article  2.2.1.1 of the Anti -Dumping  Agreement refers to the actual costs incurred 
by the investigated exporter or producer. The Appellate  Body considered that, a lthough 
Article  2.2.1.1 does not explicitly refer to "actual" costs, the Panel stated that the conditio n at 
issue relates to whether the costs in a producer's or exporter's records correspond – within 
acceptable limits – in an accurate and reliable manner to all the actual costs incurred by the 
particular producer or exporter for the product under considera tion. Read ing the Panel's use of the 
word " actual " in light of the broader reasoning of the Panel findings, the Appellate  Body 
understood the Panel to have considered that the second  condition concerns the costs incurred by 
the investigated exporter or producer that are genuinely related to the production and sale of the 
product under consideration in a particular anti -dumping investigation. Thus, the Appellate  Body 
did not consider that the Panel's use of the word "actual" was in error.  
The European  Union also claimed that the Panel erred in finding that the second condition in the 
first sentence of Article  2.2.1.1 of the Anti -Dumping  Agreement does not include a general 
standard of reasonableness . The Appellate  Body failed to see any textual support in Article 2.2.1.1 
for this argument. The Appellate  Body observe d that the adverb "reasonably" in Article  2.2.1.1 
modifies the verb "reflect" in a phrase where the subject of the sentence is the records. To the 
extent that costs are genuinely related to the prod uction and sale of the product under 
consideration in a particular anti -dumping investigation, the Appellate  Body did not consider that 
there is an additional or abstract standard of reasonableness that governs the meaning of "costs" 
in the second conditio n in the first sentence of Article  2.2.1.1.  WT/AB/27  
 
- 83 - 
 
 The Appellate  Body also addressed the multiple discrete instances  where  the European  Union 
allege d that the Panel erred in interpreting the first sentence  of Article  2.2.1.1 of the 
Anti-Dumping  Agreement. The Appellate  Body disagreed with the European  Union and did not 
consider that the Panel erred in those instances.  
The Appellate  Body then turned to the European Union's claim that the Panel erred in its 
application of the provision at issue to the anti -dumping m easure on biodiesel. Noting that the 
European  Union did not advance any argument that was separate and different from its arguments 
concerning the alleged errors in the Panel's interpretation of this provision, the Appellate  Body 
agreed with the Panel's  finding that the European Union acted inconsistently with Article  2.2.1.1 by 
failing to calculate the cost of production of the product under investigation on the basis of the 
records kept by the producers.  
The Appellate  Body therefore  found  that the Panel d id not err in its interpretation or application of 
the second condition in the first sentence of Article  2.2.1.1 of the Anti -Dumping  Agreement. 
Consequently, the Appellate  Body upheld the Panel's finding that the European Union acted  
inconsistently with Article 2.2.1.1 by failing to calculate the cost of production of the product under 
investigation on the basis of the records kept by the producers.  
4.6.1.1.2   Article  2.2 of the Anti -Dumping Agreement and Article  VI:1(b)(ii) of the 
GATT  1994  
4.6.1.1.2.1   Whether the Panel erred in  its interpretation of Article  2.2 of the 
Anti-Dumping  Agreement and Article  VI:1(b)(ii) of the GATT  1994  
Argentina claimed that the Panel erred in its interpretation of Article  2.2 of the 
Anti-Dumping  Agreement and Article  VI:1(b)(ii) of the GATT  1994 when stating that these 
provisions do not limit the sources of information that may be used in establishing the costs of 
production . To Argentina , given that "cost of production" refers to expenses incurred in the 
production of the product concerned in the co untry of origin, the information and evidence used to 
calculate those costs are necessarily those from the country of origin.  
The Appellate  Body considered that the phrase  "cost of production  […] in the country of origin" in 
Article  2.2 of the Anti -Dumping  Agreement and Article  VI:1(b)(ii) of the GATT  1994 may be 
understood as a reference to the pri ce paid or to be paid to produce something within the country 
of origin.  These provisions do not contain additional qualifying language limiting the sources of 
information or evidence to only those sources inside the country of origin. The reference to "in the 
country of origin", however, indicates that, whatever information or evidence is used to determine 
the "cost of production", it must be apt to or capable of  yielding a cost of production in the country 
of origin. This, in turn, suggests that information or evidence from outside the country of origin 
may need to be adapted in order to ensure that it is suitable to determine a cost of production in 
the country of origin.  
Turning to the relevant context, the Appellate  Body considered that the first sentence of 
Article  2.2.1.1  does not  preclude  information or evidence from other sources from being used in 
certain circumstances. In some circumstances, the informati on in the records kept by the exporter 
or producer under investigation may need to be analysed or verified using documents, information, 
or evidence from other sources, incl uding from sources outside the country of origin. These 
considerations support the understanding that the determination of the "cost of production in the 
country of origin" in Article  2.2 may take account of evidence from outside the country of origin.  
The Appellate  Body further observe d that the scope of the obligation to calculate the costs on the 
basis of the records in the first  sentence in Article  2.2.1.1 is narrower than the scope of the 
obligation to determine the cost of production in the country of origin in Article  2.2. In 
circumstances where the obligation in the first sentence  of Article  2.2.1.1 does not apply, or where 
relevant information from the exporter or producer under investigation is not available, an 
investigating authority is not prohibited from relying on information other than that contained in 
the records kept by the exporter or producer, including in -country and out -of-country evidence. 
This, however, does not mean that an investigating authority may simply substitute the costs from 
outside the country of origin for the cost of production in the country of origin.  Whatever the 
information that it uses, an investigating authority has to ensure that such information is used to WT/AB/27  
 
- 84 - 
 
 arrive at the cost of production in the country of origin. Compliance with this obligation may 
require the investigating authority to adapt th e information that it collects.  
In its appeal, the Europ ean Union claim ed that the Panel erred in its interpretation of Article  2.2 of 
the Anti -Dumping  Agreement. The Appellate  Body understood  the European  Union's claim of error 
under Article  2.2 to be dependent on its claim of error under Article  2.2.1.1  of the 
Anti-Dumping  Agreement. As the Appellate  Body had found that the Panel did not err in its 
interpretation of Article  2.2.1.1, the Appellate  Body reject ed the European  Union's claim . 
On the basis of t he above, the Appellate  Body considered that the Panel did not err in its 
interpretation of Article  2.2 of the Anti -Dumping  Agreement and Article  VI:1(b)(ii) of the 
GATT  1994. 
4.6.1.1.2.2   Whether the Panel erred in its application of Article  2.2 of the 
Anti-Dumping  Agreement to the anti -dumping measure at issue  
The European  Union claimed that the Panel erred in finding that the European  Union acted 
inconsistently with Article  2.2 of the Anti -Dumping  Agreement by not using the cost of production 
in Argentina when constr ucting the normal value of biodiesel.  The European Union argued that the 
Panel failed to recognize that: (i)  a price derived from a price at the border can be characterized as 
both an international and a domestic price; and (ii)  the subtraction of the fobb ing costs from the 
published reference price renders the surrogate price for soybeans used by the EU  authorities a 
reasonable proxy for the price of soybeans in Argentina that would have existed  in the absence of 
the distortion caused by the Argentine  DET system.  
The Appellate  Body considered that domestic prices may reflect world prices and, in such 
circumstances, a price at the border could be simultaneously characterized as both an international 
and a domestic price. The Appellate  Body did not consider, however, that the Panel failed to take 
such considerations into account. Rather, the Panel's analysis focused on the EU  authorities' 
understanding of the surrogate price for soybeans. Other than pointing to the deduction  of fobbing 
costs, the European  Union had not asserted that the EU  authorities adapted, or even considered 
adapting, the information used in their calculation in order to ensure that it represented the cost of 
production in Argentina . On the contrary, the EU  authorities specifically selected  the surrogate 
price for soybeans to remove the perceived distortion in the cost of soybeans in Argentina. As the 
Panel stated, the EU authorities selected and used this particular information precisely because it 
did not represent the cost of soybeans in Argentina. Thus, the Appellate  Body agree d with the 
Panel that the surrogate price for soybeans  used by the EU  authorities did not represent the cost 
of soybeans in Argentina for producers or exporters of biodiesel. Accordingly, the Appellate  Body 
did not consider that the European  Union ha d established that the Panel erred in its application of 
Article  2.2 of the Anti -Dumping  Agreement in finding that the European Union acted inconsistently 
with Article  2.2 of the Anti -Dumping  Agreement and Article  VI:1(b) (ii) of the GATT  1994 by not 
using the cost of production in Argentina when constructing the normal value of biodiesel.  
Consequently, the Appellate  Body upheld  these findings of the Panel.  
4.6.1.1.3   Article  2.4 of the Anti -Dumping Agreement  
Argentina appealed  the Pa nel's finding that Argentina did not establish that the European  Union 
acted inconsistently with Article  2.4 of the Anti -Dumping  Agreement  by failing to make due 
allowance  for differences which affect price comparability within the meaning of this provisio n. 
Argentina allege d that the Panel erred in its interpretation of Article  2.4, because  the Panel 
articulated a general proposition that  is not supported by the text of Article  2.4 or relevant 
Appellate  Body findings in past disputes.  Argentina contended  that the Panel also erred in its 
application of Article  2.4. 
The Appellate  Body observe d that the Panel read the Appellate  Body's findings in EC – Fasteners 
(China) ( Article  21.5 – China)  as being consistent with the general proposition  that differences 
arising from the methodology applied for establishing the normal value cannot, in principle, be 
challenged under Article  2.4 as "differences affecting price comparability".  The Appellate  Body 
stated that it did not  share the Panel's understanding that t he Appellate  Body report in  that 
dispute contain ed any such general proposition. Rather, t he reasoning in that report was tailored 
to the circumstances of that dispute, in which Article  2.4 of the Anti -Dumping  Agreement had to be WT/AB/27  
 
- 85 - 
 
 read in the context of the secon d Ad Note to Article  VI:1 of the GATT  1994 and Section  15(a) of 
China's  Accession Protocol. The Appellate  Body emphasized that n either of those provisions was 
relevant for purposes of this dispute. Moreover, the Appellate  Body stated that it  would have 
serious reservations regarding what the Panel referred to as the "general proposition" , given that 
the text of Article  2.4 itself makes clear that due allowance shall be made in each case, on 
its merits . 
Recalling that it had upheld the Panel's findings that the EU authorities acted inconsistently with 
Articles  2.2.1.1 and 2.2 of the Anti -Dumping  Agreement in constructing the norma l value, and  
notwithstanding its reservations about certain aspects of the  Panel's analysis under Article  2.4 of 
the Anti -Dumping  Agreement, the Appellate  Body did not  consider it fruitful, in the particular 
circumstances of this dispute, to further examine whether the EU authorities also failed to conduct 
a fair comparison in comparing the constructed normal value to the export price . The 
Appellate  Body therefore found it unnecessary to rule on Argentina's claim at issue . 
4.6.1.2   Imposition of anti -dumping duties – Article  9.3 of the Anti -Dumping  Agreement  
The European  Union appealed  the P anel finding that the European Union ac ted inconsisten tly with 
Article  9.3 of the Anti -Dumping Agreement and Article  VI:2 of the GATT  1994 by imposing 
anti-dumping duties in excess of the margins of dumping that should have  been established under 
Article  2 of the Anti -Dumping Agreement and Article  VI:1 of the  GATT  1994, respectively. The 
European  Union argued that the Panel  erred in its interpretation and application of Article  9.3 by: 
(i) considering that this provision calls for a comparison between the amount of duties and the 
dumping margins that should ha ve been calculated consistently wit h Article  2 of the 
Anti-Dumping  Agreement, and that a violation of Article  2 automatically results in a violation of 
Article  9.3; and (ii) relying on the margins of dumping calculated in the Provisional Regulati on in 
applying Article  9.3 to the facts of this dispute.  
The Appellate  Body shared the  Panel's understanding that the margin of dumping referred to in 
Article  9.3 relates to a margin that is established consistently with Article  2. Noting that Article  9.3 
provides t he benchmark against which the WTO–consistency of the amount of the anti -dumping 
duty must be examined, the Appellate  Body considered that it would frustrate the function of 
Article  9.3 if the margin of dumping were itself inc onsistent with the Anti -Dumpin g Agreement. The 
Appellate  Body found support for the above understanding in the context provided by Article  9.2 of 
the Anti -Dumping  Agreement and Article  VI:2 of the GATT  1994, as well as in relevant past 
Appellate  Body reports . Furthermore, in the Appell ate Body's view, t he Panel  properly found that 
an inconsistency with Article  2 does  not necessarily mean that the anti -dumping duty actually 
applied will exceed  the correct margin of dumping, for example, due to t he application of the 
lesser duty rule. Thus, in order to succeed with a claim under Article  9.3, a complainant must  show 
that anti -dumping duties are imposed at a rate that is higher than the dumping margin that would 
have been established had the authority acted consistently with Article  2. The Appellate  Body 
noted that such a showing will depend on the specific circumstances of each dispute.  
The Appellate  Body considered that the Panel's reliance on the margin  of dumping  calculated in the 
Provisional Regulation in reaching its findings was approp riate in light of the specific circumstances 
of this case , including the fact that: (i)  the change in the basis for constructing the normal value 
that the EU authorities made between the Provisional and Definitive Regulations led to the finding 
of inconsis tency with Articles  2.2.1.1 and  2.2 of the Anti -Dumping  Agreement ; (ii) this change 
significantly increased the margin of dumping  and duty rates,  in comparison to the provisional 
stage ; and (iii)  the consistency with Article  2 of the margin  of dumping calc ulated in the 
Provisional Regulation ha d not been questioned. Thus,  the Appellate  Body found  that the Panel did 
not err in finding that Argentina  had made a prima  facie case that the European  Union acted 
inconsistently with Article  9.3 of the Anti -Dumpin g Agreement, which the European  Union ha d 
failed to rebut.  The Appellate  Body also agreed  with the Panel that the above  considerations 
applied mutatis  mutandis  to Argentina's claim under Article  VI:2 of the GATT  1994. 
For these reasons, the Appellate  Body upheld the Panel's finding that the European  Union acted 
inconsistently with Article  9.3 of the Anti -Dumping  Agreeme nt and Article  VI:2 of the GATT  1994. WT/AB/27  
 
- 86 - 
 
 4.6.1.3   Non-attribution in causation determination – Articles 3.1 and 3.5 of the 
Anti-Dumping Agreement  
Argentin a appeal ed the Panel's finding that Argentina failed to establish that the EU authorities' 
treatment of overcapacity as an "other factor" causing injury to the EU domestic industry  was 
inconsistent with Articles  3.1 and 3.5 of the Anti -Dumping  Agreement.  
Noting that the Panel stated that the revised data did not have a significant role in the 
EU authorities' conclusion in the Definitive Regulation on overcapacity as an "other factor " causing 
injury , Argentina alleged that the Panel erred in its interpretati on of Articles  3.1 and 3.5 in 
considering it relevant to examine the role of the revised data in the EU authorities' conclusion on 
overcapacity. In the Appellate  Body's view, however, the totality of the Panel's analysis ma de it 
clear that the Panel found that the EU authorities' non -attribution analysis was not based on or 
affected by  the revised data. Thus, contrary to Argentina's argument, the Appellate  Body did not 
consider  the Panel to have articulated a standard whereby it was relevant to examine whet her the 
revised data played a significant role in the EU authorities' non -attribution analysis . 
The Appellate  Body therefore found that the Panel did not err in interpreting Articles  3.1 and 3.5 of 
the Anti -Dumping  Agreement.  
The Appellate  Body went on to address Argentina's claim that the Panel erred  in its application of 
Articles  3.1 and 3.5 of the Anti -Dumping  Agreement. First, the Appellate  Body considered that 
Argentina failed to establish that the Panel erred in finding  that the EU authorities' non -attribution 
analysis concerning overcapacity in the Definitive  Regulation was not based on or affected by the 
revised data . Second, the Appellate  Body considered that the Panel's statement that 
"overcapacity" and "capacity utilization" are logically related was consistent with the way in which 
these concepts were used in the investigation. In the Appellate  Body's view, while "overcapacity" 
described, in absolute terms, the production capacity that the EU domestic industry had not  used, 
"capacity utilization" described, in relative terms, the production capacity that the EU domestic 
industry had used. Thus,  the Appellate  Body considered that the Panel did not err in finding that 
the EU authorities were not required to give priority to the evolution of the domes tic industry's 
overcapacity in absolute terms as opposed to its evolution in relative terms . Finally, the 
Appellate  Body considered that, contrary to Argentina's argument, the EU authorities' assessment 
that capacity utilization remained low was consistent  with the evidence before them. For these 
reasons, the Appellate  Body upheld the Panel's finding that Argentina failed to establish that the 
European Union's non -attribution analysis was inconsistent with Articles  3.1 and 3.5 of the 
Anti-Dumping  Agreement.  
4.6.2   Claims regarding the second sub paragraph  of Article  2(5) of the Basic Regulation  
Before addressing Argentina's claims of error, the Appellate  Body noted that, when a 
Member's  municipal law is challenged "as such", a panel must ascertain the meaning of tha t law 
for the purpose of determining whether that Member has complied with its WTO obligations. In this 
regard, a panel must conduct an independent assessment of the meaning of the municipal law at 
issue, and should not simply defer to the meaning attribut ed to that law by a party to the dispute. 
In conducting its assessment, a panel must undertake a holistic assessment of all the relevant 
elements before it.  The Appellate  Body stressed that a  panel's assessment of municipal law for the 
purpose of determini ng its consistency with WTO obligations is subject to appellate review under 
Article  17.6 of the DSU. Just as it is necessary for the panel to seek a detailed understanding of 
the municipal law at issue, so too is it necessary for the Appellate  Body to rev iew the panel's 
examination of that municipal law.  
4.6.2.1   Article  2.2.1.1 of the Anti -Dumping  Agreement  
Argentina claimed  that the Panel erred in finding that the second sub paragraph  of Article  2(5) of 
the Basic  Regulation  does not require the  European  Union to d etermine that a producer's records 
does not meet the second condition in the first sentence of Article  2.2.1.1 of the 
Anti-Dumping  Agreement when those records reflect prices that are considered to be artificially or 
abnormally low as a result of a distort ion. Argentina  further claimed  that the Panel acted 
inconsistently with Article  11 of the DSU by failing to undertake  a holistic assessment  of all the 
different elements put forward by Argentina beyond the text of the measure, in order to ascertain 
the mea ning of the second  subparagraph  of Article  2(5) of the Basic  Regulation.  WT/AB/27  
 
- 87 - 
 
 According to Argentina, Article  2.2.1.1 of the Anti -Dumping  Agreement does not allow an 
investigating authority to reject or adjust costs simply because such costs are considered to b e 
abnormally or artificially low due to a distortion. Argentina argue d, therefore, that by providing 
that the EU  authorities shall reject or adjust the records of the party under investigation  when 
those records  reflect costs which are abnormally or artifi cially low due to an alleged market 
distortion, the second sub paragraph  of Article  2(5) of the Basic  Regulation is inconsistent with 
Article  2.2.1.1 of the Anti -Dumping  Agreement.  
The Appellate  Body reviewed the Panel's evaluation of all the elements submi tted by Argentina, 
consisting of: (i) the relevant text of the Basic  Regulation; (ii) the legislative history that led to the 
introduction of the measure at issue into the Basic  Regulation, including academic articles; the 
alleged consistent practice of th e EU authorities ; and (iii) certain judgments of the General  Court 
of the European  Union. Following its review, the Appellate  Body found  that Argentina ha d not 
established that the Panel erred in its assessment of the second  subparagraph  of Article  2(5) of  
the Basic  Regulation. Like the Panel, the Appellate  Body found no  support in the text of the 
Basic Regulation, or in the other elements relied on by Argentina, for the view that the 
second  subparagraph  of Article  2(5) concerns the determin ation that the r ecords of the party 
under investigation do not reasonably reflect the costs associated with the production and sale of 
the product under consideration when those records reflect prices that are considered to be 
artificially or abnormally low as a result of  a distortion.  Instead, the Appellate  Body shared the 
Panel's view that the second sub paragraph  of Article  2(5) comes into play only after a 
determination has been made under the first  subparagraph  that the records do not reasonably 
reflect the costs assoc iated with the production and sale of the product under consideration.  
As regards Argentina's claim under Article  11 of the DSU, the Appellate  Body consider ed that the 
Panel had conducted a proper examination and undert aken a holistic assessment of the var ious 
elements before it. T herefore, the Appellate  Body reject ed Argentina's claim that the Panel had 
acted inconsistently with Article  11 of the DSU.  
For these reasons, the Appellate  Body upheld the Panel's finding that Argentina had not 
established that t he second sub paragraph  of Article  2(5) of the Basic  Regulation is inconsistent 
"as such" with Article  2.2.1.1 of the Anti -Dumping  Agreement.  
4.6.2.2   Article  2.2 of the Anti -Dumping  Agreement and Article  VI:1(b)(ii) of the 
GATT  1994  
Argentina request ed the Appellat e Body to reverse the Panel's finding that Argentina had not 
established that the second  subparagraph  of Article  2(5) of the Basic Regulation is inconsistent 
"as such" with Article  2.2 of the Anti -Dumping  Agreement and Article  VI:1(b)(ii) of the GATT  1994. 
Argentina  advance d three grounds in support of its appeal.  First, Argentina argue d that the Panel 
erred in ascertaining the meaning of the second sub paragraph  of Article  2(5) of the 
Basic Regulation by finding that, even when "information from other repre sentative markets" is 
used, the second  subparagraph  of Article  2(5) does not require the EU  authorities to establish the 
costs of production so as to reflect costs prevailing in other countries. Second, Argentina 
maintained  that, in ascertaining the meanin g of the second  subparagraph  of Article  2(5) of the 
Basic Regulation, the Panel acted inconsistently with Article  11 of the DSU by failing to undertake a 
holistic assessment  of all of the different elements put forward  by Argentina. Third, 
Argentina  allege d that the Panel erred in finding that , in order for Argentina to prevail on its claim,  
Argentina had to demonstrate that the second sub paragraph  of Article  2(5) cannot be applied in a 
WTO-consistent manner.  
The Appellate  Body first observed that there is no basis, either in the practice of the GATT and the 
WTO generally or in the provisions of the Anti -Dumping  Agreement, for finding that only certain 
types of measures can be challenged "as such". Allowing measures to be the subject of dispute 
settlement pr oceedings, whether or not they are of a mandatory character, is consistent with the 
comprehensive nature of the right of Members, enshrined in Article  3.2 of the DSU, to resort to 
dispute settlement to preserve their rights and obligations under the covere d agreements. 
Furthermore, the Appellate  Body stated that measures involving discretionary aspects may be 
found to violate certain WTO  obligations "as such".  The Appellate  Body found that a measure may 
be found to be inconsistent "as such", if it restricts , in a material way, the discretion  of the 
domestic authorities  to act in a WTO -consistent manner . The Appellate  Body emphasized that 
precisely what is required to establish that a measure is inconsistent "as such" will vary, depending WT/AB/27  
 
- 88 - 
 
 on the particular ci rcumstances of each case, including the na ture of the measure and the 
WTO obligations at issue.  
As with the claim of error under Article  2.2.1.1 of the Anti -Dumping  Agreement, t he 
Appellate  Body reviewed the Panel's evaluation of all the elements submitted  by Argentina. These 
elements  consisted of the relevant text of the Basic  Regulation, the legislative history that led to 
the introduction of the measure at issue into the Basic  Regulation, the alleged consistent practice 
of the EU  authorities, and certain  judgments of the General  Court of the European  Union.  
Turning to Argentina's first ground of appeal, the Appellate  Body understood the 
second  subparagraph  of Article  2(5) of the Basic Regulation as allowing for a wide range of 
possible actions by the EU  authorities . The Appellate  Body considered that none of the elements 
relied on by Argentina demonstrated that the second sub paragraph  of Article  2(5) precludes the 
possibility that the EU  authorities could use information from other representative markets b ut 
adapt that information to ensure that it reflects the cost of production in the country of origin.  
Accordingly, the Appellate  Body found that Argentina ha d not established that the Panel erred in 
rejecting Argentina's  assertion that the second sub paragr aph of Article  2(5) of the Basic  Regulation 
means that, whe n the costs of other domestic producers or exporters in the same country cannot 
be used, the EU  authorities are required to  use information from other representative markets that 
does not reflect t he costs of production in the country of origin.  
As regards Argentina's claim under Article  11 of the DSU, the Appellate  Body consider ed that, in 
ascertaining the meaning of the second  subparagraph  of Article  2(5) of the Basic Regulation , the 
Panel had conducted a proper examination and undert aken a holistic assessment of the various 
elements before it. T herefore, the Appellate  Body reject ed Argentina's claim that the Panel had 
acted inconsistently with Article  11 of the DSU.  
With respect to Argentina's thi rd ground of appeal, the Appellate  Body agreed with the Panel  that 
the second sub paragraph  of Article  2(5) of the Basic  Regulation  is capable of being applied in a 
WTO-inconsistent manner. However, to the extent that the Panel may have been expressing a 
legal standard for an "as such" challenge when it stated that Argentina ha d not demonstrated that 
the second sub paragraph  of Article  2(5) cannot be  applied in a WTO -consistent manner, the 
Appellate  Body considered this to be a  misreading of a statement by th e Appellate  Body in 
US ‒ Carbon Steel (India) . The Appellate  Body clarified that the finding in that dispute related to 
the nature of the WTO obligation at issue, and the burden of proof with regard to India's  assertion 
as to the meaning of the municipal l aw at issue  in that dispute . 
That said, the Appellate  Body considered that the mere fact tha t the application of the 
second  subparagraph  of Article  2(5) could, in some circumstances, lead to WTO -inconsistency was 
not sufficient to discharge Argentina's bur den to make a prima  facie case that the 
second  subparagraph  of Article  2(5) of the Basic Regulation is inconsistent "as such" with 
Article  2.2 of the Anti -Dumping  Agreement and Article  VI:1(b)(ii) of the GATT  1994. For the 
Appellate  Body, nothing in the se cond sub paragraph  of Article  2(5) of the Basic  Regulation 
precludes the possibility that, when the EU  authorities rely on "information from other 
representative markets", they could adapt that information to reflect the costs of production in the 
country o f origin, in a manner consistent with Article  2.2 of the Anti -Dumping  Agreement and 
Article  VI:1(b)(ii) of the GATT  1994. Therefore,  the Appellate  Body found  that Argentina ha d not 
satisfied its burden of proving that the second sub paragraph  of Article  2(5) of the Basic  Regulation 
restricts, in a material way, the discretion of the EU  authorities to calculate  the costs of production 
in a manner consistent with Article  2.2 of the Anti -Dumping  Agreement and Article  VI:1(b)(ii) of 
the GATT  1994. 
For these reas ons, the Appellate  Body upheld the Panel's finding that Argentina had not 
established that the second sub paragraph  of Article  2(5) of the Basic  Regulation is inconsistent 
"as such" with Article  2.2 of the Anti -Dumping  Agreement and Article  VI:1(b)(ii) of t he GATT  1994. 
4.6.2.3   Article XVI:4 of the WTO Agreement and Article 18.4 of the 
Anti-Dumping  Agreement  
Argentina submit ted that, because the second sub paragraph  of Article  2(5) of the Basic Regulation 
is inconsistent "as such" with Articles  2.2.1.1 and 2.2 of the  Anti-Dumping  Agreement and WT/AB/27  
 
- 89 - 
 
 Article  VI:1(b)(ii) of the GATT  1994, it necessarily follow ed that the second sub paragraph  of 
Article  2(5) of the Basic  Regulation is also inconsistent with Article  XVI:4 of the WTO  Agreement 
and Article  18.4 of the Anti -Dumping  Agreement.  
Argentina advance d no arguments in support of its consequential claims under Article  XVI:4 of the 
WTO Agreement and Article  18.4 of the Anti -Dumping  Agreement that were separate from its 
arguments in support of its claims under Articles  2.2.1.1  and 2.2 of the Anti -Dumping  Agreement 
and Article  VI:1(b)(ii) of the GATT  1994. Having  upheld the Panel's findings under those 
provisions, the Appellate  Body upheld the Panel's finding that Argentina had not established that 
the second sub paragraph  of Article 2(5) of the Basic  Regulation is inconsistent with Article  XVI:4 of 
the WTO Agreement and Article  18.4 of the Anti -Dumping  Agreement.  WT/AB/27  
 
- 90 - 
 
 5  PARTICIPANTS AND THI RD PARTICIPANTS IN A PPEALS  
A total of 2 9 WTO Members participated  at least once as appellant, oth er appellant, appellee, or 
third participant in appeals for which an Appellate  Body report was circulated in 201 6. 8 Members 
participated at least once as the main participants, and 27 Members participated, at least once, as 
third participants.  
As of the e nd of 201 6, 74 of the 164 WTO Members had participated in appeals in which 
Appellate  Body reports were circulated between 1996 and 201 6. Further information on the 
participation of WTO Members in appeals is provided in Annex 11.  WT/AB/27  
 
- 91 - 
 
 6  PROCEDURAL ISSUES AR ISING IN APPEALS  
This section highlights the procedural issues that were addressed in the Appellate Body reports 
circulated in 2016.  
6.1  Treatment of confidential information  
In US – Washing Machines , Korea and the United  States joint ly requested that the Appellate  Body 
Division hearing the appeal to adopt, pursuant to Rule  16(1) of the Working Procedures, additional 
procedures for the protection of business confidential information  (BCI) on the basis of the 
BCI procedures adopted by the Panel. The European Union, a third party in the dispute, submitted 
that BCI procedures at the appellate stage should not be based on the Panel's BCI procedures, 
which in the European Union's view, had, in certain respects, been superseded by recent rulings by 
the Appellate Body.  
The D ivision adopted a Procedural Ruling granting additional protection to the information, which 
had been designated as BCI in the submissions to the Appellate Body and in the panel record. The 
Division recalled that, in EC and certain member States – Large Ci vil Aircraft , the Appellate Body 
considered that the DSU and the Rules of Conduct  already provide for confidentiality, and that any 
additional protection must be justified. Moreover, the Division observed that, while participants 
requesting particularized arrangements have the burden of justifying that such arrangements are 
necessary in a given case adequately to protect certain informa tion, it is the task of the 
WTO adjudicator and not of the parties to determine whether additional protection in the form o f 
BCI procedures is called for. The Division further recalled that, in China – HP-SSST (Japan) / 
China  ‒ HP-SSST (EU) , the Appellate Body stated that in determining the scope and content of 
such procedures, the panel must consider the effect that these procedures may have on the 
exercise by the panel of its adjudicative duties under the DSU and other covered agreements, the 
parties' rights to due process, the rights of the third parties, and the rights and systemic interests 
of other WTO Members. The Division agreed with the United  States and Korea that the information 
for which  additional protection was sought related to sensitive commercial data of the companies 
concerned. The Division therefore provided additional protection to BCI and specified the terms of 
such protection.  
6.2  Extension of time -period for Appellate Body member t o complete an appeal  
In Colombia – Textiles  and EU – Biodiesel , the Appellate Body informed the participants and third 
participants that, in accordance with Rule  15 of the Working Procedures for Appellate Review, the 
Appellate Body had notified the Chair o f the DSB of its decisi on to authorize Appellate Body 
member Mrs  Yuejiao Zhang to complete the disposition of these appeals , even though her second 
term expired  before the completion of the appellate proceedings.  Likewise, in India – Solar Cells , 
the Appel late Body authorize d Appellate Body m ember Mr  Seung Wha Chang to complete the 
disposition of th at appeal, even though his term expire d before the completion of the appellate 
proceedings.  
6.3  Time limits for the filing of written submissions  
In India – Solar Ce lls, the United  States requested the Appellate Body Division hearing th e appeal 
to extend the deadline for the filing of its appellee's submission by one day. The United  States 
noted that its appellee's submission in another pending appellate proceeding, n amely, US – 
Washing Machines (DS464), was also due on the same day as the deadline for filing its appellee's 
submission in India – Solar Cells . The Division issued a Procedural Ruling, extend ing the deadline 
for the United  States to file its appellee's sub mission by one day. Moreover, in order to provide the 
third participants sufficient time to incorporate reactions to the appellee's submission into their 
third participants' submissions, the Division decided, pursuant to Rule  16(2) of the Working 
Procedure s, to also extend the deadline for the filing of the third participants' submissions and 
third participants' notifications  by one day . 
In Argentina – Financial Services , on the day set out in the Working Schedule for Appeal for filing 
third participants' s ubmissions and executive summaries, just prior to the 5  p.m. deadline, 
Australia sent an e -mail communication to the Appellate Body  and the participants and 
third participants indicating that it had omitted to include the  executive summary of its WT/AB/27  
 
- 92 - 
 
 third participant's written submission, and that it would endeavour to send the executive summary 
the following morning. The following day, Australia filed an  executive summary of its 
third participant's submission. On the same day, the Appellate Body Division hear ing this appeal 
sent a letter to Australia, informing it that the executive summary had not been filed in accordance 
with the official Working Schedule and inviting Australia to file a written request explaining why 
the executive summary should nonetheless  be accepted.  
Australia filed a request that the executive summary of its third participant's submission be 
accepted should the Division consider that there was no unfairness to any of the participants in 
this appeal, and taking account of the short length  and limited scope of its written submission, and 
that the absence of an executive summary had been rectified as quickly as possible. The 
Appellate  Body observed that compliance with established time periods by all participants 
regarding the filing of subm issions is an important element of due process of law and a matter of 
fairness and orderly procedure, which are referred to in Rule  16(1) of the Working Procedures. The 
Appellate Body considered that these considerations are also valid with respect to exec utive 
summaries of written submissions. In the particular circumstances of the case, the Appellate  Body 
accepted the executive summary of Australia's third participant's written submission.  
6.4  Requests regard ing the conduct of the oral hearing  
In US – Washing  Machines , the Appellate Body Division hearing the appeal asked the United  States 
and Korea to keep their opening statements at the oral hearing to 30  minutes each and the third 
participants to keep their opening statements to a maximum of five minutes eac h. China requested 
the Division to allocate a further five minutes for its opening statement in light of  China's  direct 
and immediate interest in the issues raised in this appeal . China explained  that several issues of 
interpretation raised in this appeal were directly relevant to the then parallel panel proceedings in 
US – Anti-Dumping Methodologies (China)  (DS471). The Division informed China that, in light of 
the many issues raised in this appeal and in order to be able to complete the hearing within a 
reasonable time -frame, the Division did not consider that it would be appropriate to extend the 
time allocated for opening statements.  
In EU – Biodiesel , the European  Union requested a period of 50 minutes to deliver its oral 
statement at the hearing. The E uropean  Union expressed the view that there was an unusual 
volume of third participant submissions in this appeal, and that those submissions referred to a 
number of points that had not been raised by Argentina. The European  Union asserted that it 
needed t o have a full opportunity to address these additional points on its own motion and in an 
appropriately structured way. The European Union also requested that additional procedures be 
adopted for: (i) public observation of the oral hearing; and (ii) viewing  of a recording of the oral 
hearing by third  participants.  The Appellate Body Division hearing the appeal informed the 
participants and third  participants that they would be accorded, respectively, 35  minutes each and 
seven  minutes each for their oral stat ements at the hearing. The Division also issued a Procedural 
Ruling in which it declined the European  Union's request to adopt additional procedures: (i) to 
allow public observation of the oral hearing, and (ii)  to enable the third  participants to view a v ideo 
recording of the oral hearing.  
6.5  Reasons for the extension of the time -period for the circulation of Appellate Body 
reports  
The 90 -day time -period stipulated in Article  17.5 of the DSU for the circulation of reports was 
exceeded in all the appellate pro ceedings in respect of which Appellate Body reports were 
circulated in 2016. For each appellate proceeding, the Appellate Body communicated to the 
DSB Chairman the reasons why it was not possible to circulate the Appellate Body report within 
the 90 -day per iod. 
These reasons included  the substantial workload of the Appellate  Body, scheduling difficulties 
arising from overlap in the composition of the Divisions hearing appeals concurrently pending 
before the Appellate  Body, the length of the submissions filed , the number and complexity of the 
issues raised, the shortage of staff in the Appellate  Body Secretariat , and  the demands that 
concurrent appellate proceedings had placed  on the WTO Secretariat's translation services . In 
Argentina – Financial Services  and Colombia – Textiles , there were additional constraints owing to 
the need for Spanish -speaking staff of which the Appellate Body Secretariat only had a limited WT/AB/27  
 
- 93 - 
 
 number , and the need to translate documents from Spanish into English for non -Spanish -speaking 
Appellate Body member s and staff.  
6.6  Correction of clerical errors  
In US – Washing Machines , Korea requested authorization, pursuant to Rule  18(5) of the 
Working  Procedures, to correct certain clerical errors in its Notice of Other Appeal, other 
appellant's su bmission, and appellee's submission. The Appellate Body Division hearing the appeal  
provided the United States, the third participants, and third parties with an opportunity to 
comment in writing on the request. Having received no objections to Korea's req uest, the Division 
authorized Korea to correct the clerical errors in its Notice of Other Appeal, other appellant's 
submission, and appellee's submission.  WT/AB/27  
 
- 94 - 
 
 7  ARBITRATION  UNDER ARTICLE  21.3( C) OF THE DSU  
The DSU does not specify who shall serve as an arbitrat or under Article  21.3(c) of the DSU to 
determine the reasonable period of time for the implementation by a WTO Member of the 
recommendations and rulings adopted by the DSB in dispute settlement cases. The parties to the 
arbitration select the arbitrator by  agreement or, if they cannot agree on an arbitrator, the 
Director -General of the WTO appoints the arbitrator. In all but one arbitration proceeding, all those 
who have served as arbitrators pursuant to Article  21.3(c) have been current or former 
Appellate  Body member s.34 In carrying out arbitrations under Article  21.3(c), Appellate Body 
member s act in an individual capacity.  
7.1  Colombia — Measures Relating to the Importation of Textiles, Apparel and 
Footwear , WT/DS461/13  
On 22  June 2016, the Dispute Settlement  Body (DSB) ado pted the Panel and Appellate  Body 
Reports  in Colombia – Measures Relating to the Importation of Textiles, Apparel and Footwear . 
This dispute concern ed the imposition by Colombia of a compound tariff  on the importation of 
certain textiles, ap parel, and footwear . 
The Appellate  Body upheld the  Panel's finding 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, in the instances ide ntified in the Panel Report, the compound tariff 
exceeds the bound tariff rates in Colombia's Schedule of Concessions, and is therefore inconsistent 
with Article  II:1(a) and (b) of the GATT  1994. With respect to Article  XX(a) of the GATT  1994, the 
Appellat e Body found that the measure at issue is designed to protect public morals in Colombia 
within the meaning of Article  XX(a).  However, the Appellate  Body found that Colombia ha d not 
demonstrated that the compound tariff is a measure "necessary to protect pu blic morals " within 
the meaning of Article  XX(a).  With respect to Article  XX(d) of the GATT  1994, the Appellate  Body 
found that that the measure at issue is designed to secure compliance with laws or regulations 
which are not inconsistent with the GATT  1994, namely, Article  323 of Colombia's Criminal Code, 
within the meaning of Article  XX(d).  However, the Appellate  Body found that Colombia ha d not 
demonstrated that the compound tariff is a measure "necessary to secure compliance with laws or 
regulations whi ch are not inconsistent" with the GATT  1994, within the meaning of Article  XX(d).  
The Appellate  Body therefore recommended that Colombia bring its measure, found in its report, 
and in the panel report as modified by the Appellate  Body report, to be inconsi stent with the 
GATT  1994, into conformity with its obligations under that Agreement.  
At the meeting of the DSB held on 22  June 2016, Colombia informed the DSB of its intention to 
implement the DSB's recommendations and rulings in this dispute, and stated t hat it would need a 
reasonable period of time in which to do so. Consultations between the parties  failed to result  in an 
agreement on the reasonable period of time for implementation . Panama therefore requested that 
this period be determined through bindi ng arbitration pursuant to Article  21.3(c) of the DSU. 
Colombia and Panama were unable to agree on an arbitrator. The Director -General appointed  
Mr Giorgio Sacerdoti  as the Arbitrator on 30 August 2016 . Mr Sacerdoti accepted this appointment 
on 5 September  2016.  
Colombia requested  a reasonable period of time for implementation of 12 months, taking into 
account: (i) the procedural steps set out  in Colombia's  domestic regulatory framework ; (ii) the fact 
that the compound tariff is designed to be a measure to combat money laundering falling within 
the scope of subparagraphs (a) and (d) of Article  XX of the GATT  1994; (iii) the complexity of 
designing the implementation measure in light of the Panel and Appellate  Body Reports; 
and (iv) Colombia's  status as a dev eloping country.  Colombia indicated that it s ought to issue two 
"mutually -supportive decrees" – i.e. a tariff decree and a customs decree – as part of the 
implementation process.  
Panama responded that the reasonable period of time for implementing the 
DSB's recommendations and rulings in this dispute should be  66 days. Panama argued that 
                                               
34 Mr Simon Farbenbloom  served as the Arbitrator  in United States – Anti-Dumping Measure s on Certain 
Shrimp from Viet Nam . Mr Farbenbloom had previously served as chairperson of the Panel in the underlying 
dispute . WT/AB/27  
 
- 95 - 
 
 Colombia's implementation obligation was limited to ensuring that its tariffs on the products at 
issue did not exceed the bound levels set out in its Schedule of Concession s and that any action 
unrelated to , or going beyond , the removal of  the inconsistency with Article  II:1(a) and (b ) could 
not be included in the reasonable period of time . 
The Arbitrator examined,  as a preliminary matter, the findings of the Panel and the Appellate  Body 
in the underlying dispute to ascertain whether the two decrees proposed by Colombia fell within 
the range of measures that would be capable of achieving prompt compliance with the DSB's 
recommendations and rulings . The Arbitrator noted that the Appellate  Body recognized that there 
was a relationship between the compound tariff and the objective of combating money laundering 
in Colombia. The Arbitrator considered that,  in determining the reasonable period of time, it was 
relevant to take into a ccount that the DSB's recommendations and rulings imply that Colombia 
may decide to adopt measures pursuing the policy objective of combating money laundering, as 
long as they are apt in form, nature, and content to bring Colombia into compliance with its 
obligations under the GATT  1994. Consequently, the Arbitrator considered that the time needed to 
enact these decrees should be included in the calculation of the reasonable period of time f or 
implementation.  
With respect to Colombia's contention that, in t he first stage  of implementation, it needed 
six months to analyse the Panel and Appellate  Body Reports and to evaluate how to implement the 
recommendations and rulings of the DSB , the Arbitrator agreed that the determination of the 
reasonable period of tim e should include time to conduct the preparatory process. However, the 
Arbitrator was of the view that some of the preparatory steps envisaged by Colombia could be 
pursued in parallel and within shorter time frames. Hence, the Arbitrator considered that th e first 
stage described by Colombia could be completed in less than four months.  
Colombia identified seven steps that it would take in  the second stage  of implementation : (i) the 
issuance of a recommendation by the Committee on Customs, Tariffs and Interna tional Trade 
Affairs (Triple A Committee); (ii) the preparation of the draft tariff decree and of the draft customs 
decree and its accompanying resolutions; (iii) public consultations; (iv) the issuance of an opinion 
by the Superintendent of Industry and C ommerce on the potential impact of the proposed decrees 
on the conditions of competition; (v) the review and signature of the decrees by the Minister of 
Trade and the Minister of Finance; (vi) the review of the decrees by the Secretariat of the Office of 
the President of the Republic and the Pre sident's signature; and (vii)  the publication and entry into 
force of the decrees.  
In examining these steps, t he Arbitrator noted that some of the component steps of the 
second  stage  were administratively mandated. The Arbitrator also note d that the tariff decree and 
the customs decree must be prepared by  the Ministry of Trade, Industry and Tourism, and the  
Dirección de Impuestos y Aduanas Nacionales (DIAN) , respectively . Moreover , the Arbitrator 
observed that  enactme nt of the decrees at issue required  the signature by the President of 
Colombia and subsequent publicat ion in the Official Gazette and entry into force.  
With regard to public consultations, the Arbitrator referred to several examples provided by 
Panama show ing that, in several instance s, the Colombian authorities had  held public consultations 
prior to issuing a decree related to the imposition of tariffs. In the Arbitrator's view, t hese 
examples demonstrate d that the rel evant Colombian authorities had  conduc ted public 
consultations in the process of enacting decrees. The Arbitrator added that  conducting public 
consultations during the rule -making process is commonly associated with good governance 
practices in contemporary polities, and should, in the present  case, be taken into account when 
determining the reasonable period of time for implementation. With regard to  obtaining an opinion 
from the Superintendent of Industry and Commerce,  the Arbitrator disagree d with Pa nama's 
position that this step wa s unneces sary in the present case. The Arbitrator added that, while he 
did not object to either of these two  steps , he had some reservations about the time  frame 
proposed by Colombia.  
The Arbitrator further observe d that some of the legal instruments serving as a basis for various 
steps of the second stage did not appear to prescribe any minimum mandatory time frames, and, 
for those that did, such time frames were  shorter than the time requested by Colombia. Therefore, 
the Arbitrator considered that  Colombia's  legal process for enacting the tariff decree and the 
customs d ecree was characterized by a con siderable degree of flexibility . Thus,  the Arbitrator 
considered that there appeared  to be a certain amount of flexibility within the normal WT/AB/27  
 
- 96 - 
 
 administrative process tha t Colombia may be expected to utilize in good faith in order to ensure 
prompt compliance with the recommendations and rulings of the DSB.  
Moreover, the Arbitrator observed that some of the steps outlined by Colombia could be carried 
out in parallel , and th at there seemed  to be a degree of overlap in the composition of some of the 
Colombian authorities that take part in the various steps of the decision -making process. 
Therefore , in view of the extensive pr eparatory work during the first  stage and the 
decisi on-making process related to the recommendation of the Triple  A Committee, the Arbitrator  
consider ed that the time frames for some of the latter  steps outlined by Colombia could be 
shortened without compromising the ability of the relevant author ities to c arry out the 
relevant  tasks. 
In addition, Colombia estimated  that the preparation of the customs decree and i ts accompanying 
resolutions would  take two months, and that  the preparation of the draft tariff decree would 
take one month . While the Arbitrator  acknowledge d Colombia's efforts in preparing the customs 
decree and its accompanying resolutions in tandem, he also expect ed Colombia to make use of all 
possible synergies and flexibilities in the decision -making process so that it could  promptly bring 
itself into compliance with its WTO obligations. Therefore,  the Arbitrator concluded that Colombia 
could  be expected to prepare the tariff decree, on the one hand, and the customs decree and its 
accompanying resolutions, on the other hand, in parallel and with in a shorter time  frame than the 
one proposed by Colombia.  
With respect to the final part of the second  stage , the Arbitrator acknowledged that  draft decrees 
subject t o the President's signature had to  comply with certain legal formalities before being 
signed by the President of Colombia. Given the need to guarantee that the process of preparing 
the decrees adheres to the required legal formalities,  the Arbitrator stated that  the two-week 
period for the review of the decrees by the Secretariat of the Office  of the President an d the 
President's signature did  not seem excessive.  At the same time, the Arbitrator n oted that Colombia 
requested  one month for the publication of the decrees in the Official Gazette and their entry into 
force. In the Arbitrator's view , this time  frame was not fully warranted in light of the requirements 
under Colombian law for the publication a nd entry into force of decrees.  
Having examined all the arguments and evidence regarding the various steps under the 
second  stage, the Arbitrato r concluded that, while the steps outlined by Colombia we re warranted 
in order to enact the tariff decree and the customs decree, Colombia would be able to  complete all 
of these steps in less than the time it requested . Therefore, the Arbitrator  consider ed that the 
second  stage described by Colombia could  be completed in less than four months.  
Finally, both Colombia and Panama submit ted that Article  21.2 of the DSU requires taking  into 
account their respective statu s as developing countries as a particular circumstanc e in determining 
the reasonable period of time for implementation in the present case.  The Arbitrator noted that, in 
a situation where both the implementing and the complaining Member are developing countries, 
the requirement provided in Article  21.2 is of little relevance, except if one party succeeds in 
demonstrating that it is more severely affected by problems related to its developing country 
status than the other party with respect to measures that have been subject to dispute settlement. 
The Arbitrator stated that , while he  recognized that the means of implementation chosen by 
Colombia may comprise measures see king to combat money laundering, he did  not consider that , 
beyond this recognition, the developing country status of both parties had altered his conclusion as 
to the reasonable period of time for implementation.  
In light of the foregoing considerations, the Arbitrator determined that the reasonable period of 
time for Colombia to implement the recommendations and rulings of the DSB in this dispute was 
seven  months from 22  June 2016, expiring on 22  January  2017.  WT/AB/27  
 
- 97 - 
 
 8  OTHER ACTIVITIES  
8.1  WTO 20th Anniversary Conferences  
In 2016, the Appellate  Body continued its series of conferences to celebrate the Twentieth 
Anniversary of the WTO and its dispu te settlement mechanism. The conferences have been hosted 
by academic institutions and have focused on current dispute settlement issues and the 
Appellate  Body's contribution to the settlement of disputes and other aspects of WTO law. 
Participants have inc luded current and former Appellate Body member s, high -ranking government 
representatives, WTO officials, academics, journalists, students, and civil society representatives. 
The first four conferences in the series were held in 2015:  (i) 15 May 2015 in Ita ly; 
(ii) 2-6 July 2015 in China; (iii) 28  August  2015 in Korea; and (iv) 2 -4 December  2015 in Mexico.  
The fifth conference was held in Cambridge (Massachusetts), Unite d States of America, from 
28 to 29 April 2016. It was orga nized by Harvard University. Mr  Thomas R. Graham, 
Appellate  Body member , was on the conference steering committee. The conference addressed a 
wide range of topics concerning WTO dispute settlement, including the future of trade remedies, 
the impact of free trade agreements , digital trad e, services, and institutional resource constraints.  
The sixth and final conference will take place in Delhi, India in February 2017. It will be organized 
by the Nat ional Law University, Delhi. Mr  Ujal Singh Bhatia, Appellate Body member , is on the 
confere nce steering committee.  
8.2  WTO internship programme  
The Appellate  Body Secretariat participates in the WTO internship programme, which allows 
post-graduate university students to gain practical experience and a deeper knowledge of the 
global multilateral trad ing system in general, and WTO dispute settlement procedur es in particular. 
Interns in the Appellate  Body Secretariat obtain first -hand experience of the procedural and 
substantive aspects of WTO dispute settlement and, in particular, appellate proceedings . 
The internship programme is open to nationals of WTO Members and to nationals of countries and 
customs territories engaged in accession negotiations. An internship is generally for a three -month 
period. During 201 6, the Appellate  Body Secretariat welcome d interns from China, Finland, 
France,  Greece, the Netherlands, Sri Lanka, and Ukraine . A total of 13 7 post-graduate students, of 
over 50 nationalities, have completed internships with the Appellate  Body Secretariat since 1998. 
Further information about th e WTO  internship programme, including eligibility requirements and 
application instructions, may be obtained  online  at: 
<https://www.wto.org/english/thewto_e/vacan_e/intern_e.htm > 
8.3  The WTO Digital Dispute Settlement Registry  
The WTO Digital Dispute Settleme nt Registry is being developed as a comprehensive application to 
manage the workflow of the dispute settlement process, as well as to maintain digital information 
about disputes. This application features: (i) a secure electronic registry  for filing and se rving 
dispute settlement documents online; (ii) a central electronic storage facility for all dispute 
settlement records; and (iii) a research facility on dispute settlement information and statistics.  
The Digital Registry will provide for the electronic f iling of submissions in disputes, and for 
the creation of an e -docket of all documents submitted in a particular case. The system will 
feature: (i)  a facility to securely file submissions and other dispute -related documents 
electronically; (ii)  a means of paperless and secure service on other parties of submissions and 
exhibits; and (iii)  a comprehensive calendar of deadlines to assist Members and the Secretariat 
with workflow management.  
As a storage facility, the Digital Registry will provide access to in formation about WTO disputes, 
in particular, it will serve as an online repository of all panel and Appellate  Body records. As a 
research facility, the Digital Registry will allow Members and the public to search the digital records 
of publicly available d ata of past disputes. Users will have access to a broader range of information 
and statistics than in the past. With the extent of the information available, WTO  Members and the WT/AB/27  
 
- 98 - 
 
 Secretariat, as well as the interested public, will be able to generate more i n-depth and 
informative statistics on WTO dispute settlement activity.  
In 2016, the Appellate  Body participated in the final development and testing of the DDSR 
application as well as in the drafting of a comprehensive User Guide, which will be provided to  
Members. The DDSR entered a  pilot phase in July 2015 . During this phase, parties and panelists 
may volunteer to use the DDSR in parallel with the existing paper filing procedures. By 2016, the 
e-filing tool of the DDSR had been tested at the panel stage i n a few disputes, and was also tested 
in the appellate proceedings in India ‒ Solar Cells . The testing of the DDSR in the pilot phase may 
continue for one or two more years before the DDSR is fully launched.  
8.4  Technical assistance, moot court competitions , and other outreach activities  
In 2016, Appellate  Body Secretariat staff  participated in the WTO Biennial Technical Assistance and 
Training Plan for 2016 -2017.35 This was particularly in relati on to training government officials in 
dispute settlement procedures and practices in specialized courses, national seminars, regional 
trade policy courses, and advanced trade policy courses. Appellate  Body Secretariat staff also 
provided training to visiting university students from different parts of the world.  
Furthermore, in 2016, Appellate  Body Secretariat staff along with colleagues from the 
WTO Secretariat participated as panelists in various moot court competitions.  The WTO is 
committed to supporting the development of international trade l aw and WTO -related studies. 
One proven tool of such development is a simulation of WTO panel p roceedings, in fora commonly 
referred to as WTO Moot Court Competitions. In such a Moot Court Competition, each participating 
student team represents both the complainant and the respondent in the fictional case and 
prepares both written and oral submissio ns. Oral pleadings are made before panels consisting of 
WTO law experts and a winning team is selected.  Importantly, since 2003, the WTO has supported 
the annual Mo ot Court Competition on WTO Law  organized by the European Law Students' 
Association (ELSA). The ELSA Moot Court Competition involves teams from universities in Africa, 
Asia-Pacific, Europe, Latin America, and North America.  
While the WTO is firm in its commitment to support moot court competitions on international trade 
issues, in general, ELSA i s of special interest in that it offers a global moot court competition. This 
competition therefore provides teams with the opportunity to interact and compete on a global 
stage with the best teams from the other regions, an opportunity that would not aris e in a regional 
competition. Moreover, several WTO staff members participate as judges and in other capacities, 
thereby giving students the opportunity to interact with those working directly on WTO issues.  
Additionally, the ELSA Moot Court competition has  created an avenue for interaction between WTO 
Member government officials, local university professors, and the participants of the competing 
teams.  This has increased information exchange at the national level, and discourse on 
international trade law an d other WTO -related issues.  
In 2016, staff from the WTO and Appellate  Body Secretariats provided  support to the global ELSA 
moot court competition through technical advice on the subject matter, sending WTO staff to 
participate as panelists in the various regional rounds, and hosting the Final Oral Round in 
Geneva,  Switzerland.  
 
                                               
35 WT/COMTD/W/211.  WT/AB/ 27 
 
- 99 - 
 
 ANNEX 1 
EXECUTIVE SUMMARIES OF WRITTEN SUBMISSIO NS IN APPELLATE PROC EEDINGS  
The Working Procedures for Appellate Review1 (Working Procedures) identify the written 
submissions that WTO Members participating in appeals are to submit in appellate proceedings, as 
well as the deadlines and modalities for the submission of such documents. For many years, the 
Appellate  Body has requested participants in appellate proceedings to submit exec utive summaries 
of their written submissions by the same deadline as for the written submissions themselves. 
These executive summaries were intended to assist the Appellate  Body in summarizing the 
arguments of the participants in its report in each proceed ing. On 11  March  2015, the 
Appellate  Body circulated a Communication to all WTO Members2 titled "Executive Summaries of 
Written Submissions in Appellate Proceedings". In this communication, the Appellate  Body 
inform ed the WTO Membership about  its proposed  new guidelines regarding executive summaries.  
In particular, the Appellate  Body introduced  two new aspects to the practice of asking participants 
in appeals to submit executive summaries of their written submissions. First, the Appellate  Body 
requested  not only the participants but also each third participant that elects to file a written 
submission in an appeal to submit an executive summary of such written submission at the same 
time. Second, instead of  using the executive summaries to assist in drafting its own description of 
the arguments of the participants, the Appellate  Body started annex ing, to each of its reports , the 
executive summaries submitted by the part icipants and third participants  in the relevant appellate 
proceedings.  
The guidelines seek t o allow WTO Members to summarize their own positions and supporting 
arguments in their own words, while at the same time encouraging a degree of harmonization in 
the structure and length of such summaries. It was hoped that the new approach would enable th e 
Appellate  Body to make optimal use of its limited resources, and to re -direct resources formerly 
used to summarize the arguments of the participants and third participants to other areas of 
appeal work.  
In 2015, the Appellate  Body implement ed this new ap proach on a trial basis for the first time in 
the appeal s in Peru – Agricultural Products  (WT/DS457) and China – HP-SSST (Japan) / 
China  ‒ HP-SSST (EU)  (WT/DS454 / WT/DS460 ). In 2016, the participants and third participants 
submit ted executive summaries of their written submissions  in all the disputes before the 
Appellate  Body. Appellate  Body reports circulated in 2016 that reflect the new approach are: 
EC ‒ Fasteners ( Article  21.5 – China) ; Argentina – Financial Services ; Colombia – Textiles , 
India ‒ Solar Cells ; EU – Biodiesel ; and US – Washing Machines . 
The Appellate  Body is consider ing whether it would be  useful to incorporate some or al l aspects of 
these guidelines into the Working Procedures now that  both the Appellate  Body and Members have 
had some experience with the guidelines now introduced on a trial basis. The Appellate  Body notes 
that amendments to the Working Procedures will in any event be necessary in the near -term 
future once the Digital Dispute Settlement Registry is launched. With respect to these matters, the 
Appellate  Body will engage in consultations as required or appropriate.3 
                                               
1 WT/AB/WP/6, 16 August 2010.  
2 WT/AB/23, 11 March 2015 . 
3 With respect to amendments to the Working Procedures , Article  17.9 of the Understanding on Rules 
and Procedures Governing the Settlement of Disputes provides for the Appellate  Body to draw up its working 
procedures in consultation with the Chair of the Dispute Settlement Body (DSB) and the Director -General,  and 
Rule 32(2) of the Working Procedures  specifies that the same procedures apply in the event of amendments to 
those working procedures. The DSB has also adopted procedures for consultations between the Chair of the 
DSB and WTO Members with respect to am endments to the Working Procedures . This Decision is set out in 
document WT/DSB/31.  WT/AB/ 27 
 
- 100 - 
 
 ANNEX 2 
LIMITS ON THE LENGTH  OF WRITTEN SU BMISSIONS  
The Appellate  Body observed a significant increase in the length of the appellants' and appellees' 
written submissions, as measured by the word count of th ose submissions between January  2009 
and October  2015.  While in the first five cases in the  period considered the average number of 
words per submission was 26,965, the average number of words per submissio n in the last five 
cases of the period considered was 34,982, which represents an increase of almost 30% in the 
length of the appellants' and  appellees' submissions. Accordingly, on 23  October  2015, the 
Appellate  Body circulated a communication to all WTO Members, regarding possible introduction of 
limits on the length of written submissions1 with a view to managing its increasing workload.  
The Appellate  Body identified a number of questions and considerations in order to initiate 
reflection and discussion among and with WTO Members . In particular, the Appellate  Body 
proposed that WTO Members consider: (i)  what the effects would be of setting li mits on the length 
of written submissions in WTO  appellate proceedings ; (ii) whether the same limit s on length 
should apply to all writ ten submissions in all appeals and, i f not, what objective criteria should be 
used to determine the applicable limit s; and (iii) whether the rules setting limits on the length of 
written submissions should provide for the possibility to request, in exceptional circumstances, an 
extension of such limits . 
The Appellate  Body received comments from Australia2, Colombia3, the Eur opean Union4, Japan5, 
Mexico6, Norway7, and the United  States.8 
In principle, Australia and Norway supported uniform page limits for written submissions in all 
appeals . Australia noted that a ny guidelines that the Appellate  Body may wish to adopt in this 
regard could include, for example, suggested page or word limit s for simple, complex and highly 
complex appeals. In Australia's view , while limits on appellants' and appellees' written submissions 
should normally match each other, it may be necessary  to allow a respondent greater length in 
disputes involving multiple complainants.  Both Australia and Norway considered  that any extension 
from such limits should be granted only in exceptional circumstances, to be decided on a case -by-
case basis.  
Colombia, the E uropean  Union, Japan, Mexico, and the United  States did not support the 
introduction of limits on the length of written submissions.  Colombia the European  Union, Japan, 
and Mexico viewed  page limits as an infringement of WTO Members' due process rights.  For Japan, 
such page limits would also be contrary to Articles  16.4 and 17 of the DSU which  provide that only 
parties to a dispute can define and delineate the scope of an appeal, and thus determine which 
issue or issues are to be reviewed by the Appellate  Body. 
Additionally, the European  Union, Japan, and the United  States pointed out that page limits would 
be impracticable for a variety of reasons. The European  Union submitted that the length of written 
submissions is determined largely by factors that are beyond the participants' control, including 
the quality of the underlying panel report, the number of claims raised, and the factual complexity 
of the dispute.  Japan argued  that adopting a uniform page limit applicable to all appeals could lead 
to parties filing additional submissions later in a proceeding to address issues that they had not 
fully addressed in their "initial" written submissions , and would therefore not alleviate the 
workload of the Appellate  Body. The United  States added  that setting page limits could increase 
burdens on the Appellate  Body and participants, and risk diverting resources away from the merits 
                                               
1 JOB/AB/2, 23 October 2015.  
2 Communication from Australia, dated 22 January 2016.  
3 Communication from  Colombia, dated 13 November 2015.  
4 Communication from  the European  Union, dated 14 December 2015.  
5 Communication from  Japan, dated 31 March 2016.  
6 Communication from  Mexico, dated 31 March 2016.  
7 Communication from  Norway, dated 31 March 2016.  
8 Communication from  the United States, 31 March 2016.  WT/AB/27  
 
- 101 - 
 
 of the claims raised in a particular appeal. The United  States underscored that page limits may 
mean that the Appellate  Body receives le ss complete and informative submissions, thus increasing 
the workload of the Appellate  Body. Page limits could also result in a participant having to reduce 
the number of issues appealed or arguments presented, without regard to the merit of those 
issues o r arguments. Recalling that the average length of written submissions varies from case -to-
case, and that the length of appellees' submissions has in fact declined in recent appeals, the 
United  States submitted that it would not be appropriate or effective to apply the same page limit 
to all appeals. Furthermore,  factors such as the complexity of the issues raised on appeal, or 
number of issues raised, could not be taken into account pri or to the filing of the appeal.  
As alternatives to page limits, Colombia  suggested: (i)  optimization of processes relating to 
document management (including translation); (ii) establishment  of a working group within the 
Appellate  Body comprising a suitable number of persons involved in all aspects of the disputes; 
and (iii) introduction of staff with specific legal and economic expertise in all areas. The 
European  Union suggested  guidelines by the Appellate  Body urging the participants to keep their 
written submissions concise  or guidance on how to structure submissions so as t o avoid 
unnecessary reproduction of findings by the panel, case law, and arguments presented to the 
panel. Mexico suggested  that the Appellate  Body may wish instead to consider establishing on a 
trial basis  a non -binding  scheme or guidelines regarding the maximum length of written 
submissions . 
Having considered the reactions of WTO Members, the Appellate  Body decided not to pursue the  
introduction of limits on the length of written submissions . WT/AB/27  
 
- 102 - 
 
 ANNEX 3 
COMMUNICATION S FROM APPELLATE BODY MEMBE RS AND FORMER  
APPELLATE BODY MEMBE RS CONCERNING OPPOSI TION TO  
THE REAPPOINTMENT OF  AN APPELLATE BODY ME MBER  
COMMUNICATION TO THE DISPUTE SETTLEMENT B ODY FROM CURRENT APP ELLATE 
BODY  MEMBERS DATED 18 MAY  2016  
Dear Ambassador Carim,  
We have followed the recent statement of opposition to the reappointment of Mr Seung Wha 
Chang and the reasons for that opposition, which were provided to members of the press. We are 
concerned about the accuracy of some of those reasons and, in particular, about the risks they 
may carry for t he trust that WTO Members place in the independence and impartiality of Appellate 
Body member s, on which the dispute settlement system depends.  
With regard to accuracy, no case is the result of a decision by one Appellate Body member , nor 
should interpreta tions or outc omes be attributed to a single m ember. Appeals ar e heard and 
decided by three m embers who are chosen randomly to constitute the Division for each particular 
case. During a Division 's consideration of a case, there is always a formal, intensive  exchange of 
views, in person in Geneva, between the three Div ision m embers and the Appellate Body member s 
who are not on the Division. Our reports are reports of the Appellate Body.  
Our mandate states in Articles 3.2, 17, and 19.2 of the Dispute Settlemen t Understanding that we 
are to adjudicate appeals and clarify existing provisions of the covered agreements without adding 
to or diminishing the rights and obligations provided in those agreements. We strive to adhere to 
that mandate when deciding complex issues that arise in a variety of circumstances, frequently on 
matters of first impression. Whether we have always succeeded is a subject we leave to the WTO 
Membership to discuss. We welcome the right of WTO Members to comment on our reports, as is 
forese en in Article 17.14 of the Dispute Settlement Understanding, and we are open to other 
informed and constructive comments.  
With regard to risks for the trust that WTO Members place in the independence and impartiality of 
Appellate Body member s, we are conce rned about the tying of an Appellate Body member 's 
reappointment to interpretations in specific cases, and even doing so publicly. The dispute 
settlement system depends upon WTO Members trusting the independence and impartiality of 
Appellate Body member s. Linking the reappointment of a m ember to specific cases could affect 
that trust.  
Finally, we wish to say that we have the highest respect for Mr Seung Wha Chang as a person and 
colleague of integrity, independence, and impartiality. He has worked hard toge ther with us to 
maintain the quality of our reports and to foster constructive improvement of our operations.  
We recognize that there is no right of reappointment. We understand that we do not have a role in 
decisions for reappointment. But we felt compell ed to make our views known for the reasons we 
have given.  
Yours sincerely,  
Thomas R. GRAHAM  
Chair 
Appellate Body  
Ujal Singh BHATIA  
Appellate Body member  
Shree Baboo Chekitan SERVANSING  
Appellate Body member  Ricardo RAMÍREZ HERNÁNDEZ  
Appellate Body member  
Peter VAN DEN BOSSCHE  
Appellate Body member  
Yuejiao ZHANG  
Appellate Body memberWT/AB/ 27 
 
- 103 - 
 
 COMMUNICA TION TO THE DISPUTE SETTLEMENT B ODY FROM FORMER APPELLATE  BODY  
MEMBERS  DATED 31 MAY 2016  
Dear Mr. Chairman:  
We write in the hope that we can be of some assistance to  the Members of the World Trade 
Organization. As the thirteen livi ng former m embers of the WTO Appellate Body, we have followed 
closely and with some concern the recent deliberations of the Members of the WTO on the pending 
candidacy for reappointment of o ne of our successors on the Appellate Body. We recognize that 
this is a political decision that is reserved exclusively for the Members of the WTO in their role as 
the WTO Dispute Settlement Body. We recognize, too, that, because it includes the possibi lity of 
the reappointment of a m ember of the Appellate Body to a second four -year term, the WTO 
Dispute Settlement Understanding contemplat es also the possibility that a m ember may not be 
reappointed.  
This acknowledged, we think it urgent nonetheless to voice  our consensus that this political 
decision by the Members of the WTO must never be made in such a way that could threaten to 
politicize WTO dispute settlement and imperil the i mpartial independence of every m ember of the 
Appellate Body that is required by  the WTO Rules of Conduct. The continued impartial 
independence of the WTO Appellate Body is essential to upholding the rule of law in international 
trade; moreover, we see it as a prerequisite to providing security and predictability for the 
rule-based mu ltilateral trading system for the benefit of all of the Members of the WTO.  
We emphasize that the concerns raised for us by the current reappointment process  are wholly 
institutional. One m ember of the Appellate Body has been singled out for criticism by o ne Member 
of the WTO by reference to rulings in certain appeals in  which he was a m ember of the Division 
concerned. The criticisms that have been directed toward that one Appellate Body member  in the 
current process could just as easily have been directed toward any of the six other Appellate Body 
member s. As the six oth er members of the Appellate Body have explained in a recent letter to the 
Members of the WTO, the rulings and the recommendations of the Appellate Body cannot be 
attributed solely to any one  Appellate Body member , because "our reports are reports of the 
Appellate Body. " 
Throughout the first twenty years of the WTO and the Appellate Body, this has always been so. In 
always ruling, recommend ing, and reporting as one, the m embers of the Appellat e Body have 
maintained and mutually reinforced the strength of their individual commitments to impartiality 
and independence. But if, now, the fact that a member of the Appellate Body joined in the 
consensus on the outcome on a particular legal issue or on  a particular dispute becomes for the 
first time a factor in a decision on that member 's reappointment, all of the accomplishments of the 
past generation in establishing the credibility of the WTO dispute settlement system can be put in 
jeopardy. This rais es the possibility of inappropriate pressures by participants in the WTO trading 
system. There must be no opening whatsoever to the prospect of political interference in what 
must remain impartial legal judgments in the WTO 's rule -based system of adjudicat ion. 
As our revered late colleague Julio Lacarte once said of any action that might call into question the 
impartiality and the independence of the Appellate Body, "This is a Rubicon that must not be 
crossed. " The unquestioned impart iality and independence  of the m embers of the Appellate Body 
has been central to the success of the WTO dispute settlement system, which has in turn been 
central to the overall success of the WTO. Undermining the impartial independence of the 
Appellate Body now would not only ca ll into question for the first time the integrity of the 
Appellate  Body; it would also put the very future of the entire WTO trading system at risk.  
From time to time, one or more of the Members of the WTO may differ with a decision reached by 
the Appellat e Body, but this does not necessarily mean that the Appellate Body has acted outside 
its mandate in reaching that decision. Such differences are unavoidable in a rule -based system 
that seeks to resolve international disputes between disputing parties that maintain conflicting 
views of the meaning of the rules. Indeed, such differences are intrinsic to the very process of 
legal interpretation – the core competency of the Appellate Body.  WT/AB/27  
 
- 104 - 
 
 A decision on the reappointment of a member of the Appellate Body should  not be made on the 
basis of the decisions in which that Member has participated as a part of the divisions in particular 
appeals, lest the impartiality, the independence, and the integrity of that one Member, and, by 
implication, of the entire Appellate B ody, be called into question. Nor should either appointment or 
reappointment to the Appellate Body be determined on the basis of doctrinal preference, lest the 
Appellate Body become a creature of political favo ur, and be reduced to a mere political 
instrum ent. Rather, as provided in Article 17.3 of the WTO Dispute Settlement Understanding, the 
standard for both appointment and reappointment should be whether the person in question is "of 
recognized authority, with demonstrated expertise in law, internationa l trade and the subject 
matter of the covered agreements generally. " 
Should WTO Members ever conclude that the Appellate Body has erred when clarifying a WTO 
obligation in WTO dispute settlement, the Marrakesh Agreement establishing the World Trade 
Organiz ation spells out the appropriate remedial act. Article IX:2 of the Marrakesh Agreement, on 
"Decision -Making, " provides, "The Ministerial Conference and the General Council shall have the 
exclusive authority to adopt interpretations of this Agreement and of  the Multilateral Trade 
Agreements " by a "three-fourths majority of the Members. " Any such legal interpretation would, of 
course, be binding in WTO dispute settlement. We observe that, to date, the Members of the WTO 
have not seen the need to take any such  action.  
Furthermore, and importantly, should WTO Members conclude now that they would like to do still 
more to help ensure the impartial independence of the Appellate Body, we suggest that  the current 
system of reappointment be abolished. Instead of one f our-year term, with the possibility of a 
second four -year term, we recommend a single, longer term f or all members of the 
Appellate  Body.  
Mr. Chairman, we respectfully request that you circulate this letter to all the Members of the WTO. 
We ask also that y ou assure them that we remain, as always, ea ger to serve them in any way 
we can. 
We thank you very much.  
Sincerely,  
 
Georges Abi -Saab 
Lilia R. Bautista  
Jennifer Hillman  
Shotaro OshimaJames Bacchus  
Claus -Dieter Ehlermann  
Merit E. Janow  
Giorgio Sacerdoti  
David UnterhalterLuiz Olavo Baptista  
AV Ganesan  
Mitsuo Matsushita  
Yasuhei TaniguchiWT/AB/ 27 
 
- 105 - 
 
 ANNEX 4  
FAREWELL SPEECHES OF  TWO APPELLATE  BODY  MEMBERS  
SPEECH ON 26 SEPTEMBER  2016  BY SEUNG WHA CHANG   
I would like to start by thanking all of the WTO Members, first for  agreeing, four years ago, to  
appoint me to serve this wonderful institution with the hono ur of being a member of the  
Appellate  Body and for enabling me to speak here today as I leave. For the last four years, I  have 
constantly felt that I was a junior Appellate Body member . But now, as I am leaving  earlier than 
my more senior colleagues, I feel like I am suddenly becoming senior to them.  This is a good 
feeling. What a day!  
I would like to address three aspects of WTO dispute settlement, and to follow that with a  
somewhat more personal reflection  regarding the past four years at the Appellate  Body. The first 
of these three aspects is what I see as one of the current challenges facing WTO  dispute 
settlement in general. The other two relate more specifically t o the Appellate  Body's mandate, as 
well as its independence and impartiality.  
Over the last twenty years, the WTO disputes have not only increased in number; they also  have 
become more legalistic, more complex, and more sophisticated. This reflects the  success of the 
WTO: national economies are more intertwined. It also reflects the increasing  role of 
lawyers/litigators in WTO dispute settlement. The problem is, however, that this  evolution appears 
not to have been contemplated in the DSU. For example: the 90-day time  limit for appellate 
proceedings and the part -time status of Appellate Body member s appear  to be incompatible with 
the increased size and complexity of appeals brought to the  Appellate  Body. 
Some may take the view that WTO panels and the Appella te Body were not designed to, and  thus 
should not, operate in the same way as traditional judicial bodies. But if the users of the  
WTO dispute settlement system present their cases and request various procedural rulings  with 
sophisticated advocacy skills a nd strategies as do litigants before such judicial bodies,  the WTO 
panels and the Appellate  Body will have no other way than to respond accordingly  to accommodate 
the ways in which the dispute settlement system is currently being used by  WTO Members. I 
believe the Appellate  Body has done its best to accomplish this mission,  while streamlining its case 
management practices accordingly. However, the Appellate  Body has done it under the structural 
constraints that flow from the over -twenty year -old framework p rovided by the DSU.  
So now the time has come for WTO Members to take action with regard to the legal  framework of 
the dispute settlement system, whether through a revision to the DSU, or an  adoption of 
supplementary rules or decisions by the DSB.  
Now I tur n to more specific issues. First, the Appellate  Body mandate.  
Of course, the scope of the Appellate  Body's mandate should be defined in accordance with  the 
DSU. Under the DSU, the Appellate  Body is required to "address" each of the issues  raised by the 
parties to a dispute during an appellate proceeding, and such issues are  limited to "issues of law 
covered in the panel report and legal interpretations developed by  the panel". Accordingly, once 
duly raised by the parties on appeal, the Appellate  Body is under its 'legal duty ' to address each of 
those issues.  
WTO Members may diverge on how the Appellate  Body should "address" each of the issues  raised 
by the parties. In my view, this depends largely on how the parties presented their  claims. But in 
the end it will be the Appellate  Body who will decide, on a case -by-case basis,  how to address each 
issue appealed, in light of the guiding principles, for example, the  aim of the dispute settlement 
system, which is the prompt resolution of disputes, and,  equally imp ortantly, due process 
concerns.  
Article  3.2 of the DSU provides that "[t]he disput e settlement system of the WTO  serves  to clarify 
the existing provisions of [the covered] agreements in accordance with  customary rules of WT/AB/27  
 
- 106 - 
 
 interpretation of public internatio nal law." As the Appellate  Body has said,  this mandate to "clarify " 
is not an invitation for "the Appellate  Body to 'make law' by clarifying  existing provisions of the 
WTO Agreement outside the context of resolving a particular  dispute." Thus, the Appellat e Body 
should be careful not to provide general interpretations of  the provisions of the covered 
agreements in an abstract or overly comprehensive manner  disconnected from the scope of the 
issues appealed in a particular dispute, and thereby take  the risk of foreclosing the interpretative 
window for future cases, in which a more pertinent  dispute may arise.  
At the same time, remember, the whole of the covered agreements of the WTO constitute a  
"single package " multilateral trading system, and each component  cannot be interpreted or  applied 
in isolation from other components. In interpreting certain provisions, panels and the  
Appellate  Body face the delicate task of striking a balance between maintaining coherence  among 
different but systemically connected WT O provisions, on the one hand, and  respecting contextual 
peculiarities of each of them, on the other hand. This is why the  Appellate  Body should carefully 
consider systemic implications of the legal interpretations of  any particular WTO provisions that 
may have an impact on other contextually relevant parts  of the covered agreements.  
This is a more difficult task than merely making an isolated and myopic decision of which  party's 
argumentation regarding a specific WTO provision prevails. It is not an academ ic exercise, but 
rather a proper and required adjudicatory function of the Appellate  Body. At the  same time, it is 
the very core responsibility of the Appellate  Body in clarifying the existing  WTO provisions and 
thereby "providing security and predictabili ty of the multilateral trading  system, " in which the 
whole WTO Members, including the third parties to a dispute, have a  systemic interest.  
Now I move on to the issue of independence and impartiality of the Appellate  Body. 
Undoubtedly, the independence and  impartiality of adjudicators under the dispute settlement  
mechanism is the most fundamental pillar for the adjudicatory institution. Appellate Body 
member s of course have the duty to maintain their independence and impartiality. Similarly,  WTO 
Members who  created this system also are obligated not to undermine the  independence and 
impartiality of Appellate Body member s. 
It is true that there is no right of automatic reappointment for Appellate Body member s. But, it  is 
equally true that WTO Members as a who le have a very strong interest in preserving the  
independence and impartiality of the Appellate  Body, and therefore they should be  discouraged 
from using their sovereign right in ways that undermine basic confidence in the  Appellate  Body. 
Therefore, I reco mmend that the WTO Members through the DSB lay out  some principles and 
procedural requirements that Members would be expected to observe  regarding reappointments.  
Each Appellate Body member 's reappointment should be secured unless there are  legitimate 
reasons for WTO Members to oppose it. Further, the scope of these legitimate  reasons should be 
very limited. For example, "incapacity, " including illness, and material  breaches of duties as 
required under the DSU and other relevant rules, such as the Code of  Conduct, would, in my view, 
constitute legitimate reasons to oppose reappointment. Such  violations of duties may include 
failure to maintain independence or impartiality, for example affiliation with any government; 
ex parte communications of the type prohi bited by the  current rules; breach of confidentiality; and 
failure to avoid conflict s of interests.  
Nevertheless, these reasons should become legitimate only when sufficient evidence has  been 
properly presented in a timely manner by a WTO Member who intend s to oppose  reappointment, 
and when the level of such breach is "material. " If a WTO Member seriously  considers opposing 
reappointment of an Appellate Body member , it should make best efforts  to raise this issue at the 
earliest practicable time, and suffic ient due process opportunities for  an Appellate Body member  to 
be heard should be guaranteed before her term expires.  Without such principles, not only may 
confidence in the independence and impartiality of  Appellate Body member s be eroded, but also 
unexpe cted vacancies in the composition of  the Appellate  Body may occur, which would be 
detrimental to the proper operation of the  Appellate  Body system.  
Most importantly, the outcome of cases must never be an acceptable reason for opposing  
reappointment. And si milarly, an Appellate Body member 's adjudicatory performance relating  to 
case-management, including her "judicial style, " should not be recognized as a legitimate  reason WT/AB/27  
 
- 107 - 
 
 for opposing reappointment. In particular, I believe that there should be only one  occasion for 
vetting "judicial style " – the lead -up to the initial appointment. The term "judicial  style" may 
capture various aspects of an adjudicator 's performance, which are normally kept  confidential and 
invisible to outsiders. If a WTO Member attempts to  define an Appellate Body member 's 'judicial 
style' on the basis of its mere observation of that member 's adjudicatory performance during the 
oral hearing, it would be something like drawing an  elephant after touching only its nose without 
looking at the w hole body.  
Throughout my professional career of more than twenty -five years as an adjudicator,  whether as a 
national judge, an international arbitrator, a WTO panelist, or an Appellate Body member , I have 
consistently applied one of my adjudicatory princip les, that is, "if you  cannot evenly please both 
parties with your questions in the hearing room, try to displease  them both with your questions, 
but always evenly. " In my recollection, for the last four years,  in the Appellate  Body hearings, my 
questioning  has failed to evenly please both parties, but  at every single one of them, I have tried 
my best to displease them in an even -handed  manner, whether they are claimants or respondents, 
or whether they are large advanced countries or small less  developed  countries. Yes, this is my 
"judicial style ". 
Please imagine what would be the consequences to the proper functioning of the Appellate  Body if 
individual Appellate Body member 's questioning and judicial styles observed in the  oral hearing 
room were to be asses sed unilaterally by WTO Members (in particular, the  parties to disputes) for 
their decision on whether to oppose her reappointment in the future?  Should that continue to 
happen, I would rather suggest to my Appellate  Body colleagues that  the Appellate  Body seriously 
consider eliminating oral hearings or replacing them with written  questionnaires. Otherwise, no 
single Appellate Body member  during her first term will be free  from the risk of non -reappointment 
unless she is a magician to evenly please all part ies all  the time. Under such circumstances, can 
you expect an Appellate Body member  to carry out  her adjudicative functions in an independent 
and impartial manner, and how many Appellate Body member s actually would like to consider 
seeking reappointment?  
For all these reasons, I am glad that the DSB has launched the Dedicated Sessions on the  issue of 
reappointment, including whether an amendment to the rules governing  reappointment is 
necessary. I would strongly support a proposal to change the newly  appoin ted Appellate Body 
member 's term to a non -renewable six - or seven -year extended  term. If this goal is too ambitious 
to achieve in the foreseeable future, then perhaps the DSB  might use the Dedicated Sessions as a 
valuable forum to rationalize the reappoint ment process in order to preserve the independence 
and impartiality of the Appellate  Body. I am  truly (and truly) hopeful that WTO Members will 
convert my unfortunate event of non -reappointment  into a valuable and positive opportunity to 
foster, rather tha n undermine, the  independence and impartiality of the Appellate  Body in the long 
run. 
Let me lastly turn to my personal reflection on the last four years in this institution. First of all,  it 
has been an enormous honour and privilege to work with so wise a nd dedicated six other  
colleagues. Recently, we have all marvelled, together, that, for the last few years, while  listening 
carefully to the system users ' voices and wishes, the Appellate  Body has made  meaningful 
progress to improve its case -handling pract ices so as to make them more  efficient and fair, and at 
the same time enhance our level of responsibility for the work  products of the Appellate  Body. I 
am proud of what I have done together with my colleagues  so far, and I hope and believe that 
such effor ts will continue after I leave.  
The Appellate  Body Secretariat lawyers, headed by the most dedicated Director, Werner, are  one 
of the best and talented intellectual groups I have worked with in my entire professional  life. 
Without them, under the short tim e limit and the part -time status of the Appellate Body member s, 
the appellate review system of the WTO would not be sustainable. Therefore, it is  essential that 
they should be provided with sufficient human resources and the working  environment so that 
they can thrive and be retained under sustainable working conditions.  
Eight years may be too a long period for one person to keep affection for another person  with the 
same high level of passion. Likewise, my love for the WTO might have withered or faded away  
eventually, had I served  two terms of four years. But, as I am leaving the WTO now after one term 
when my love for it  is still at the highest gear, I will continue to be in love with WTO, in particular 
the Appellate  Body, for the rest of my life.  WT/AB/27  
 
- 108 - 
 
 And on a  very final note, I recall, four years ago, I took an oath before all of you and my  family 
including the twin children, while reading out this sentence: "I do solemnly swear that I  shall 
perform my duties as a member of the Appellate  Body of the World Trad e Organization  
honourably, independently, impartially, conscientiously, and in accordance with the law of the  
World Trade Organization. I shall, at all times, avoid direct or indirect conflicts of interest in  the 
exercise of my functions and responsibiliti es, and shall respect the confidentiality of  proceedings of 
the Appellate  Body." Now, I can proudly confirm that I have strictly kept my  promise for the last 
four years.  
Thank you all and goodbye . 
SPEECH ON 26 OCTOBER  2016  BY YUEJIAO ZHANG  
Time flies very  fast. I have completed eight years of service as a member of the world -renowned 
Appellate  Body which is the highest adjudicative body of the WTO. These past eight years have 
been the most rewarding of my fifty years of professional life. Serving on the Appellate  Body has 
been a deep hono ur. I would like to thank all those who made it possible for me to be part of this 
unique institution.  
It has also been a privilege and true pleasure to have spent these eight years in the company of 
such intelligent, wise and collegial members of the Appellate  Body, both present and past, as well 
as the very dedicated staff of the AB Secretariat. While I say farewell, I express my gratitude to 
each of you.  
When I was appointed Appellate Body member , I considered it to be a glorious mission and heavy 
responsibility on my shoulders. I took an oath before all of you on 23 May 2008 and I committed 
myself to serve the rules -based multilateral trading system and to settle trade disputes according 
to WTO law independently, impartia lly, conscientiously, and to avoid any conflicts of interest in the 
exercise of my functions and responsibilities. Independence and impartiality are of upmost 
importance for adjudicators. That we are unaffiliated with any  Government and engage in no 
ex parte communication is a mandatory requirement for all panelists and AB members. This 
protects not only the authority and dignity of the AB, but also the integrity and credibility of 
adjudicators. Like my AB colleagues, I pledged my dedication and priority in  carrying out the work 
of the AB and ensuring the security and predictability of the multilateral trading system.  This was 
not mere lip -service, but a fulfilled promise on my part. I never forewent an AB assignment for a 
personal matter. In October 2008, m y father was hospitalized just before I was due to travel to 
Geneva for an appeal and I was reluctant to leave him. My father told me, "You should go to 
Geneva. Settling a world dispute of such dimension is more important than my health. I will 
recover." A t his insistence, I came to Geneva as scheduled. After the oral hearing, the Exchange of 
Views among seven AB members and the Division 's deliberation in the appeal process, I returned 
straight to the Beijing Hospital, but my father had passed away. My husb and told me that my 
father had said that he was proud of  me. These were his last words.  
I have been inspired not only by my father, but also by the founding fathers of the Appellate  Body. 
I count among these Ambassador Julio Lacarte, Judge Florentino Felic iano, as well as Professor 
John Jackson all of whom  passed away in the last year. I was very fortunate to have had meetings 
with them in Geneva, in Beijing and other cities, where they shared with me their vast experience 
of WTO law and practice. Their vis ion, professionalism and dedication l eft a l asting impression 
on me. 
I sincerely thank six AB colleagues for their dedication, profound knowledge on WTO law, 
collegiality, wisdom and long term experience on multilateral trade negotiations and dispute 
settlement, and for always making our deliberations wa rm, sharp, smooth and fruitful.  
As AB members, we work hard. Despite extensive long distance traveling, many of us start to 
informally comment on issues through email at about 4 o 'clock in the morning follow ed by intense 
meetings through the entire working day and into the evening and weekends. Since it is difficult to 
be recovered totally from the jetlag, almost all AB members have changed their regular sleeping 
time and become early birds!  WT/AB/27  
 
- 109 - 
 
 In my view, the p art time status of the AB members and 90 days ' time pressure for completion of 
AB report is not sustainable, particularly in times of heavy work load, and given the complexity of 
legal issues raised in appeals. Due to delays in the appoint ment process, the  AB had only 
six members for 9.5 months in 2013. At present it has only five members. The current two vacant 
ABM positions should be filled as soon as possible.  
I would also thank the AB Secretariat very capable lawyers and dedicated staff. They also work 
hard, including in the evening and on weekends, and often at the expense of personal and family 
commitments . 
The shortage of capable lawyers is a big challenge for the WTO dispute settlement mechanism. 
Stable and well trained and capable lawyers are very i mportant for the smooth appeal process and 
retaining institutional memory. Unfortunately I have seen seven  lawyers leave the ABS during the 
last eight years, roughly 40 % of them to law firms. There is an urgent need for the WTO to recruit 
very qualif ied lawyers and to retain them.  
My colleagues of the AB and ABS have treated me as family. During the last eight years, I spent 
four Chinese Spring Festivals at AB work in Geneva. Surprising m e, my ABM colleagues and the 
AB Secretariat staff organized parties t o celebrate my birthday. I was deeply moved to tears by 
the songs that they composed and the dancing for my farewell. I will never forget the warm 
hospitality and close friendship that they offered me.  
I am also grateful to the Chinese Government who nomi nated me to the AB after I had retired 
from the Asian Development Bank. The Chinese Government has never intervened in my work in 
the AB, even when I, together with other members of the Division, ruled that their measures failed 
to comply with some of the covered agreements. I am very impressed by their implementation of 
the WTO rulings.  
My gratitude also goes to other Members of the WTO. They have respected the AB's findings even 
when such rulings found fault with their measures. The mandatory nature and g ood enforcement 
of DSB -adopted rulings is key to the success of the WTO dispute settlement system. At the same 
time, the trust and confidence that WTO Members place on the adjudicators encourage the AB to 
make every effort to ensure prompt and posit ive sol ution of trade disputes.  
It is usually imprudent for adjudicators to speak on the issues they are asked to decide. Therefore, 
I was almost faceless and voiceless during my eight -year tenure at the WTO Appellate  Body. 
There are, however, a few occasions whe re AB members have been able to be more open, and 
frank, in expressing personal views. Following AB tradition, I would like to take this Farewell as an 
opportunity to offer a few modest personal observations about the WTO Dispute Settlement  
System and the Appellate  Body. 
The WTO Dispute Settlement System is highly regarded, and often referred to as "the jewel in the 
crown" of the WTO. Its establishment, including the creation of a permanent Appellate  Body, was a 
significant achievement. The fact that some r egional or bilateral trade and investment agreements 
will introduce a similar permanent court shows what a model the WTO Appellate  Body has become 
for trade and  investment dispute settlement.  
WTO law is part of public international law. Trade is the engine  of world economic development. 
More than 98% world trade is subject to WTO law, which provides security and predictability to the 
multilateral trading system. Consequently the harmonized and binding WTO law has contributed to 
the harmonization of public i nternational law and to reducing its fragmen tation. I believe that 
WTO law has also contributed to global economic governance, enhancing such important principles 
as the rule of law, accountability, transparency and inclusiveness.  
During the last eight yea rs I saw how much WTO law and dispute settlement contributes to the 
prevention of trade friction and reduction of trade protectionism under the world financial crisis 
and economic downturn. At the same time, I saw that 13 new Members joined WTO, committing  
themselves to rules -based multilateralism. The WTO has really become a "world " organization.  WT/AB/27  
 
- 110 - 
 
 Meanwhile, I saw the extreme difficulty that WTO Members have in reaching consensus on 
important issues through multilateral trade negotiations. The slow process of the decision making 
in the WTO needs reform.  
Overall, I believe that with its solid legal foundation, successful dispute settlement system as well 
as its sound negotiation and trade policy review mechanism and effective technical cooperation, 
the WTO pl ainly has the vigour not only to survive during difficult times, but to contribute to the 
peace and development of the world. The WTO will never die!  
In recent years, the WTO Dispute Settlement System has faced many challenges. For instance, the 
demand for  dispute settlement among Members is high, the number of cases being brought to the 
WTO is increasing, more issues and more complex issues are being raised, and submissions and 
reports are getting longer. All of this has created a heavier workload and enge ndered a shortage of 
experienced professional staff, but the budget is tight. How is the WTO to deal with these 
challenges?  
I would like to offer some very preliminary and personal thoughts and proposals:  
First, the WTO should explore the possibility of mo re use of the informal resolution of 
governmental trade disputes, for example, through consultation, me diation, and conciliation 
(also called alternative dispute resolution ADR). This would be an ideal choice. As ADR proceedings 
are faster than formal adju dication proceedings, the cost is lower to the parties; the proceedings 
are less formalistic, less legalistic, and less burdensome to the parties. Furthermore, ADR can 
reduce confrontation between parties and maintain long -term trading relationships among 
WTO Members. Parties' autonomy is the underlying principle. If the parties are willing to settle 
their trade disputes voluntarily and peacefully without prejudice to the interests and rights of a 
third party, they should be encouraged to do so. The DSU sho uld provide incentives to let 
Members settle their disputes through ADR. Some Members may be concerned about the 
enforceability of the outcome of ADR. Just as the DSB adopts panel and AB reports having legal 
effect, it too could adopt any ADR agreement amo ng parties.  
Second, if consultations fail, the next step in WTO dispute settlement proceedings is the panel 
stage, which is very important. Fact -finding and legal reasoning, as well as the quality of panel 
reports, are vital parts of this stage of the proc ess. Panelists act on an ad hoc basis. Selection and 
training of panelists is extremely important. To ensure a fair representation and participation of 
WTO membership in this process, selection and training of panelists from developing country 
Members shou ld be a top priority in the legal aid agenda of the WTO.  
Third, measures are needed to address the current shortage of qualified lawyers to support panel 
and appeal work. Internal mobility of qualified lawyers should be encouraged, and ongoing training 
in fact-finding and legal reasoning should be encouraged and made more available to Secretariat 
staff in the dispute settlement Divisions. Drafting consonant with WTO law, coherent, convincing, 
concise and reader -friendly reports should be a key objective of in house quality control.  
Fourth, the competent authorities and Committees of the WTO should clarify and interpret the 
WTO covered agreements in a timely manner. Through subsequent agreements, a set of 
secondar y rules can be adopted quickly.  
As the highest  decision making body of WTO, the Ministerial Conference decisions should be given 
more weight. All Members should implement adopted Ministerial decisions in good faith.  
Fifth, on the subject of remand, I would think the introduction of such a new system m ay not be 
effective, because once the parties know the outcome of the AB's decision, they may be reluctant 
to provide additional factual information that would confirm their violation of the covered 
agreements. In addition, organizing new panels is very ti me consuming, and may prolong the 
proceedings and impose more burdens on the parties. If a p anel undertakes a thorough 
fact-finding exercise and parties cooperate in providing all uncontested evidence and sign an 
agreed statement of facts, there should be little need for panels to exercise judicial economy. 
Then, at the appellate review stage, if the AB reverses some of the panels' interpretations and 
conclusions, the AB can complete the legal analysis based on the uncontested facts and other WT/AB/27  
 
- 111 - 
 
 factual inform ation and findings in the panel report. By completing the legal analysis, it can avoid 
mooting some of the panel decis ions and not leave issues open.  
Sixth, many panel meetings and oral hearings are now open to public viewing. Some Members are 
reluctant to  open the oral hearing to the public because they have few representatives in Geneva 
who can benefit from the hearing. Providing access through internet streaming would allow more 
Members and more people to benefit from such open proceedings. Making the WT O 
DS proceedings more transparent is beneficial to the dissemination of WTO law and training of 
people. Article  17 of the DSU should be amended accordingly.  
Seventh, a further improvement to WTO dispute settlement proceedings would be the issuance of 
more concise and convincing reports. Written submissions by the parties should be shorter with 
set page limits. The determinations of a reasonable period of time awarded through arbitration 
should be no more than 15 months, and there is no need for reports sett ing out such 
determinations to be lengthy. Article  21.5 compliance proceedings should focus on the measures 
taken to comply, and should not reopen the case.  
Eighth, the DSU stipulates that the AB shall provide its report within a maximum of 90 days. But 
the 90 days include weekends, holiday periods, and time needed to translate the report into the 
official WTO languages. So the actual working days are really only two months. This tight time 
requirement should be more flexible, based on the complexity and no velty of the legal issues in 
question. Quality and outcome should be the first consideration of dispute settlement proceedings. 
In my view, AB reports could be shorter and more concise if the AB was afforded the time 
necessary for deliberati on and drafting  of its reports.  
Ninth, to achieve the UN millennium goal on poverty reduction and enhancing the standard of 
living of people in the world, trade policies play a very important role. Several WTO covered 
agreements also ensure governments ' rights to regulat e according to law. Among those policies to 
protect public goods, I see environmental protection and appropriate subsidies.  
For instance, should Article  8 of SCM agreement on Non Actionable Subsidies be reactivated? I 
believe that assistance to research ac tivities, assistance to disadvantaged regions; assistance to 
promote adaptation of existing facilities to new environmental requirements imposed by law should 
be non -actionable.  
Tenth, while the multilateral trade negotiation is slow, the regional free tra de agreement 
negotiations develop rapidly. There are more than 400 Regional Free Trade Agreements. Should 
the WTO do more than merely receive the reports and information of the FTAs? Perhaps it could 
coordinate or provide best practices or samples to its M embers to enhance the weaker Members' 
bargaining position and help to avoid conflicts between FTAs and the covered agreements. There 
are new modalities to conduct cross border trade, such as import and export over the internet. 
Should the WTO take the lead  in the preparation of relevant rules to govern new ways of trading?  
For all the above tasks, we need highly qualified people, trade specialists, economists and 
WTO lawyers. Human resources development is the key, particularly the training of developing 
countries ' experts on WTO.  
In concluding my personal reflexions, I am very confident that WTO dispute settlement is sound 
and widely supported by 164 Members. More importantly, WTO dispute settlement is handled by 
very capable, highly professi onal and very k nowledgeable AB m embers, panelists, Secretariat staff 
and WTO Members. I thank you again from the bottom of my heart for your very hard work and 
effective contribution to the success of the WTO dispute settlement system. I am proud to have 
been a part of i t. I wish you all the very best!  WT/AB/ 27 
 
- 112 - 
 
 ANNEX 5 
SPEECH BY THOMAS GRA HAM ON 22 NOVEMBER 2 016 
SPEAKING UP: THE STA TE OF THE APPELLATE  BODY  
Yogi Berra, a great American baseball player of the 1950 's, remains famous today in part for what 
are called his "Yogisms " – a unique mangling of the English language in ways that often, perhaps 
unwittingly, showed clever insight:  
 "It ain 't over 'til it's over; " 
 "It's déjà vu all over again; " 
 "Half the game is 90%  mental. " 
Yogi once told an audience: "Thank you for making thi s occasion necessary. " 
I want to thank the World Trade Institute, the University of Geneva, the Graduate Institute, 
the WTO, and my colleagues on the Appellate  Body and AB staff, for helping to make this occasion 
possible. And I want to give special thanks  to the WTI for helping to make possi ble the reception 
this evening.  
And channelling  Yogi Berra, I want to cite developments throughout this challenging year for 
making this occasion necessary.  
It has been a difficult year. One Appellate  Body colleague com pleted her second term and rotated 
off, and another AB colleague was not reappointed to a second term, giving rise to a discussion in 
the Dispute Settlement Body dedicated to the subject of the independence and impartiality of the 
Appellate  Body in relatio n to the reappointment process, a discussion that we have followed and 
appreciate.  
As a consequence of the vacancies, we have been five instead of seven Appellate Body member s 
for half the year. We have managed to do all right with that, with some of us ov erlapping on cases 
and all of us working a little harder. So far this year we have issued six reports, and the business 
of the AB has continued to be done. We expect to welcome soon two new members. We are 
grateful for that and look forward to their joinin g us. 
But Yogi Berra also said: "The future ain 't what it used to be. " 
Looking ahead, things are not going to get easier. For one thing, many things are unforeseeable. 
And for another, the large increase  in cases that has long been predicted is now upon us . 
We have three appeals in process currently, including the enormous Airbus compliance appeal, and 
China 's appeal in US Antidumping and Countervailing Duty Methodologies. We have been told by 
the Directors of the Legal and Rules Divisions to expect about 2 6 panel reports to be issued 
during  2017 – twenty -six – including another enormous appeal, the Boeing Section 21.5 
compliance case, and an appeal of the large and complex Australia Plain Packaging panel decision. 
Since historically more than two -thirds of all panel reports are appealed, we can expect 17 or 18 
new appeals next year, along with the carry -over of Airbus, Methodologies, and Russia Pigs – the 
three appe als that are currently pending.  
In other words, we are expecting next year almost three times the number of appeals that we had 
in the busy year that we are now completing, and those 20 -plus appeals next year will, almost 
certainly, include cases that are unusually large and complex. This will cause a backlog that will 
build up and continue beyond 2017.  WT/AB/27  
 
- 113 - 
 
 Moreover, during 2017 we will lose two more veteran Appellate Body member s whose second 
terms will expire, so there will be two more vacancies to be filled. By the end of next year, four of 
the seven Appellate Body member s will not have served more t han one year. Currently we have 
only 16 lawyers to help us, a number that is flatly inadequate for the caseload we are facing. By 
comparison, more than 45 lawyers are working at the panel stage.  
So we have chosen to speak up, to break out of the "splendid isolation " that has enveloped the 
Appellate  Body during most of its first 20 years. We 've begun doing that already: starting with the 
workload paper that we issued in 2013, and continuing with our participating in several receptions, 
including one kindly h osted by the Canadian Ambassador. We continued our communication with 
Members through "listening sessions " that my predecessor as Chair, Peter van den Bossche, held 
with individual delegations and representatives of groups of delegations last year. We co -hosted 
and participated in conferences celebrating the 20th Anniversary of the WTO, which were held over 
the past 17 months in Florence, Beijing, Seoul, Cancun, and Cambridge, Massachusetts (and still 
another is to be held in Delhi). Currently I am holding a second round of "listening sessions " with 
delega tions and their representatives . 
We have learned a lot from listening to WTO Members. We have concluded that the benefits of 
communicating far outweigh any downsides. And, more than ever, we need to keep ta lking. I will 
return to that in a moment.  
The Appellate  Body has always struggled with – and succeeded despite – the fact that from the 
beginning we have been continuously adapting and making do with an organizational structure 
that was obsolete almost fro m the first day, because it was based on expectations that were very 
different from what in fact occurred.  
The Appellate  Body was an afterthought, created at the end of the Uruguay Round negotiations 
20 years ago. It was an amazing achievement – the Urugua y Round – the culmination of changes 
that had begun to stir many years earlier, when an earlier generation of negotiators – the 
generation of the grandfathers and grandmothers of some of you – began to tackle a category of 
subjects that were then called "non-tariff barriers " to trade.  
From those seeds the Uruguay Round negotiators, between 1986 an d 1995 – produced 
22 agreements setting forth new rules aimed at fostering open and fair trade competition over a 
wide range of subjects, many of which had not bee n the specific subject of trade rules before. And 
along with these new rules, the Uruguay Round negotiators created a new and la rger international 
institution – the WTO – to house, promote, and reconsider the WTO rules, and to settle disputes 
arising under  them.  
As most of you know, one of the bold innovations of the Uruguay Round was adoption of the 
"reverse consensus rule ": that a final dispute -settlement finding becomes a decision of the 
WTO Dispute Settlement Body, and therefore becomes subject to manda tory compliance backed 
by the possibility of trade retaliation, unless the decision is opposed by consensus of the 
DSB members. This created one of the most credibly enforceable dispute settlement system in th e 
history of international law.  
The virtually a utomatic adoption of panel reports, backed by the possibility of authorized trade 
retaliation, made some of the negotiators nervous. What if a dispute settlement panel got it 
wrong? And so, late in the Uruguay Round, the negotiators added a few lines to th e new 
Dispute  Settlement Understanding and thereby created a second level for the review of initial 
panel reports. They called it the Appellate  Body. 
As created, the Appellate  Body was a sort of a court, but not exactly a court, since its decisions 
were su bject to DSB approval albeit under the reverse consensus rule. Appellate Body member s 
were sort of judges, deciding cases and subject to strict Code of Conduct and ethical rules. But the 
AB members were unlike most other judges, since they were to be part -time, were not expected to 
live in Geneva, and were not prohibited from holding other jobs.  
Few expected the Appellate  Body to be very busy or to play a central role in WTO dispute 
settlement. One prominent scholar said many delegations saw the newly creat ed Appellate  Body 
"as a kind of Super -Panel to give a losing party another bite at the cherry, given that the losing WT/AB/27  
 
- 114 - 
 
 party could no longer  block adoption of the Panel ". Another called the Appellate  Body a safety 
measure against "bad" panel reports. The Cha irman of the WTO dispute settlement negotiations, 
the late, great Julio Lacarte, who also was the first Chairman of the Appellate  Body, said later that 
many governments believed panels would continue to be the "backbone " of WTO dispute 
settlement, and that  "the newly created Appellate  Body would be called upon infrequently. " 
At the time, on average there were about six cases a year, at the panel level. A small portion of 
these six were expected to be appealed. And so, for the Appellate  Body's beginning in 1 995, the 
WTO Dispute Settlement Body decided that, "a reasonable level of support in the initial stages of 
operation of the Appellate  Body would be one registrar, three professional assistants with legal 
training, and sufficient clerical staff. " 
Perhaps th ey had not seen an American film of about the same period, called Field of Dreams, 
which gave rise to a pithy aphorism that is still widely used: "If you build it, they will come. " 
As Lacarte later put it, "[i]t was WTO Members themselves who resorted to a ppealing almost every 
panel report from the very beginning. " In the early years, the appeal rate was nearly 100% . 
The appeal rate eve ntually settled down to about 70% of all panel reports. But the number of 
appeals, the number of issues appealed, and the n umber of arguments and pages, have all grown 
enormously, especially in recent years.  
In the Appellate  Body's first three years appeals averaged three per year. In the most recent three 
years there have been 24 appeals in total, an average of eight per year . And next year, as I said 
earlier, the Appellate  Body expects to be dealing with 20 or more appeals, between two and three 
times the annual average.  
And the cases have grown much larger. The length of WTO panel reports that have been appealed 
has more tha n doubled since the early years of WTO dispute settlement to an average of more 
than 350 pages. The average number of exhibits submitted by the parties to panels, and, thus, 
frequently on appeal to the Appellate  Body, has increased from around 60 per case in the early 
years, to over 500 currently. The factual and legal complexity of disputes has also grown over 
time, and the growing body of WTO jurisprudence further contributes to the length and complexity 
of submissions on appeal. This trend has intensifie d as we predicted in workload pa per that we 
circulated in 2013.  
Mega -cases, such as the Airbus and Boeing cases, have stretched our capacity and made delays 
and queues necessary, and will do so again.  
Outside lawyers now represent parties in most disputes,  and while their presence sharpens issues 
and makes additional expertise available, and is welcomed by us, it also may contribute to 
increasing the number of issues raised and arguments made. In fact, the average number of 
issues raised on appeal has more than doubled since the early cases. The number of claims 
brought under Article  11 of the DSU, requiring us to examine a panel 's assessment of the facts, 
has also increased, and so has the number of procedural requests made during an appeal.  
Remember that w e were an afterthought, that the Appellate  Body was designed to review a few 
cases a year and that the rules that define our structure have not changed in the 20 years since 
our founding.  
Appellate Body member ship is still of ficially a part -time job; many Appellate Body member s have 
had other professional commitments, an expectation that is reflected in the rules.  
Appellate Body member s are not expected to live in Geneva, and the incentive system, while 
improved, reflects the expectation that we will live i n our home countries, but be available at all 
times and on short notice for travel to Geneva. We spend a lot of time in jet lag.  
The original rules still call for us to complete the consideration of appeals and to release our final 
reports within 90 days o f the date an appeal is filed, a deadline that simply is not realistic in view 
of the size and complexity of appeals today, and especially considering that the first 21 days 
following the filing of an appeal are taken up with the filing of submissions, and  that we must give WT/AB/27  
 
- 115 - 
 
 the translators our final report two or three weeks before the report is to be issued, to allow 
adequate time for translation.  
We have to note, also, that whether we exceed 90 days or not, the appeal stage, during which we 
hear a case, a ccounts for only a small portion of the overall duration of WTO dispute settlement 
proceedings, which may take up one and a half or two years, or longer in exceptionally big cases. 
By way of comparison, the average duration of the proceedings before the In ternational Court of 
Justice is four years, and before the General Court and the Court of Justice of the European Union, 
more than three years. And the ICJ has 15 judges and 60 professional staff.  
From the beginning, the Appellate  Body has had to adapt to workloads and demands that were not 
expected, with an institutional structure that was not designed for such workloads and demands. 
So far, the Appellate  Body has b een able to adapt well enough.  
Quantitatively, the Appellate  Body has issued 142 reports, in cluding reports regarding parties ' 
compliance under Article  21.5 of the DSU. During the same period (1995 - 2016), the International 
Court of Justice rendered 65 judgments and five advisory opinions – less than half the 
Appellate  Body's number -- and the In ternational Tribunal for  the Law of the Sea rendered 
12 judgments and two advisory opinions.  
Whether there has been a "resolution of a dispute " is not always a precise concept, but we can say 
for certain that compliance with our rulings has not continued t o be an issue, under WTO auspices, 
at least, in all but a small handful of the dis putes that have come before us.  
Qualitatively, like judges everywhere, we work with less than perfect rules, rules that were the 
subject of negotiators ' compromises, rules th at are sometimes ambiguous, imprecise, incomplete, 
or contradictory, rules that sometimes are not fully up to date with rapidly changing globalized 
trade. We can 't read the minds of the negotiators who concluded the agreements, nor is it our job 
to do so. We work with the words on paper.  
But that is rarely as simple as it might sound. The Dispute Settlement Understanding states, in the 
most relevant part of Article  3.2, that the WTO dispute settlement system "…serves to preserve 
the rights and obligations o f Members under the covered agreements, and to clarify the existing 
provisions of those agreements in accordance with customary rules of interpretation of public 
international law ". It further states that findings of the dispute settlement system "cannot a dd to 
or diminish the rights and obligations provided in the covered agreements".  
But, in almost every appeal that comes before the Appellate  Body, the very heart of the question 
at issue is whether an interpretation advocated by one of the participants wo uld correctly reflect 
the balance struck in the treaty provisions, or would add to or detract from the rights and 
obligations of a WTO Member. Whether we have struck the balance correctly is often in the eye of 
the beholder.  
Maintaining the balance struck by the negotiators and written into the rules is, in fact, a 
nearly -constant theme in our deliberations. For example, a lot of our cases touch upon national 
laws and policies regarding subjects as sensitive as health and safety, protection of natural 
resou rces, and even protection of "public morals. " We are keenly aware of the balance that is 
struck between the rules on fair and open competitive trade opportunities, on one hand, and 
proper space for domestic regulation, on the other hand, as reflected, for example, in the 
exceptions such as those expressed in GATT Article  XX; in the prea mbles of several of the 
Uruguay  Round agreements; and in many of the rules themselves.  
We try hard to discern and give meaning to that balance as reflected in the treaty text  and to get 
our interpretations right. We can 't expect all Members always to agree with us. We don 't always 
agree even among ourselves. But we do bring to these discussions respect for one another and our 
honest best efforts, by our own lights. We read the  statements that parties to our appeals make in 
the DSB, and we are always open to constructive criticism.  
We also have tried to be more efficient in the way we handle cases, and more user -friendly in the 
way we write our reports. Last year we began, on a trial basis, annexing to our reports the 
participants ' and third participants ' executive summaries of their arguments, instead of WT/AB/27  
 
- 116 - 
 
 summarizing those arguments ourselves in the opening pages of our reports. We also have begun 
restating the reasoning behind o ur conclusions in the final pages of our reports, in the section 
listing the findings and conclusions. This is an effort to make it easier for those who turn quickly to 
the "Findings and Conclusions " section to understand the decisions and the reasoning. W e are 
always looking for ways to improve the interaction between ABMs and participants in oral hearings, 
and we have heard the suggestions that have been made in this respect.  
We are well aware that developing -country Members face considerable burdens for participation in 
the WTO dispute -settlement system, and that, so far, the system has been used only once by a 
least-developed -country Member. But we are happy that through the Advisory Centre on WTO Law 
– an institution unlike any other that we are aware o f in any other international court system – 
developing country Members are provided excellent legal services and training at low costs. 
Notably, LDC -Members of the WTO, or countries in the process of acceding, are entitled to the 
services of the Advisory C entre without having to become its members or to contribute to its fund.  
A speech on the state of the Appellate  Body would be incomplete without some mention of 
independence and impartiality. My colleagues and I welcome the discussion in the "Dedicated 
Session" that is taking place in the DSB. Needless to say, the independence and impartiality of 
adjudicators are vital to any adjudicative system, including the WTO dispute settlement system, 
and we need to safeguard it.  
We consider that independence can be c hallenged in various ways. Pressures regarding 
reappointment may be one way. Indirect pressures, for example, to limit resources or staffing may 
be another way of compromising our independence.  
I also would consider our "speaking up " to be incomplete witho ut a brief word about the unique 
position of the Appellate  Body and our Secretariat within the WTO structure. We are the only unit 
in the WTO framework that has its own senior management – the members of the Appellate  Body 
– and whose staff is directed by that senior management and largely independent from the 
WTO Secretariat. This, too, is an essential element of our independence. WTO Members recognized 
this in the very first Decision of the Dispute Settlement Body, of 10 February 1995, which says in 
part: "The Appellate  Body and its support staff should be independent from the Secretariat… ", and 
that the Appellate  Body staff "should be employed by the WTO, on conditions similar to those 
accorded secretariat staff of similar rank, but should otherwise be ad ministratively separate from it 
and answerable to the Appellate  Body…". 
Regarding the sufficiency of the Appellate  Body staff, the Dispute Settlement Understanding says 
in Article  17.7 that the Appellate  Body "shall be provided with appropriate administrat ive and legal 
support as it requires." The first DSB decision, regarding the Appellate  Body, adds that, 
"the number of support staff needed depends on the anticipated workload of the Appellate  Body." 
The number of the staff allocated to the Appellate  Body, and the timing of their appointments, is 
decided by the senior administration of the WTO, within the paramete rs set by the Budget 
Committee.  
In conclusion:  
The massive volume of appeals next year and beyond, some very large, will tie up a large part of 
the Appellate  Body staff, and will command much of the time and energy of Appellate Body 
member s, for long periods of time. And that, in turn, will reduce our capacity to staff and cons ider 
other appeals in parallel.  
We will do what we can, with the staff an d resources that we have, on a sustainable basis. We will 
not attempt to drive our staff beyond what is sustainable by them and permissible under the rules. 
Our staff members are very talented; they work for us by choice, but we can 't keep them unless 
they have reasonable working conditions, and reasonable opportunities for pr ofessional 
advancement.  
In striking the balance between quality, speed, sustainability, and capacity, we will give priority to 
quality within our capacity. This means that almost certa inly there will be delays and queues. We 
will work with the Members and case participants to handle these problems as well as possible.  WT/AB/27  
 
- 117 - 
 
 And that brings me to a request directed to the Members of the WTO:  
Our constituents are you, the Members of the WTO who  created the Appellate  Body, framed our 
mandate, bring your disputes to us, have the ultimate word on acceptance of our findings, and 
must comply with our findings after t hey are authorized by the DSB. Let us see if we can work 
together to maintain, nurtur e, and preserve the trust and credibility that has been built up over 
the years in this dispute settlement system, which is uniquely effective, but fragile, and whi ch 
cannot be taken for granted.  
Can we find a better way for WTO Members and the Appellate  Body to discuss long -standing 
structural problems? As it is, the best efforts on both sides have resulted in our talking past one 
another to some extent. Our interactions are mainly transactional: We issue decisions; you 
comment on them in the DSB. Our mana gement of this joint enterprise is mainly unilateral – on 
both sides: We say from time to time that we are understaffed, very busy and under strain. You 
make statements in existing WTO bodies or form groups to consider what might be done, but 
without our i nput or feedback. Might it be possible to close that gap, and find a way to interact 
about the structural problems of the dispute settlement system, and in particular of the 
Appellate  Body? 
The resolution of disputes, the measures of stability, clarity, an d predictability that the Dispute 
Settlement System has brought about have been achieved by our working together: you provide 
us with quality pleadings, and we try to respond with quality rulings. But maybe it is time to see if 
a common effort might put th is fragile enterprise, which started as an afterthought, onto a 
sounder footing, not only in the area of independence and impartiality but also in areas such as 
matching res ources to the growing demands. Maybe we should engage with one another more 
broadly , and more frequently, than merely meeting across the podium in the hearing room.  
In speaking up about the state of the Appellate  Body, I have tried to show how we think about this 
role to which we are all, in our ways, so committed. Maybe in doing so we l ose a little of the 
majesty of "splendid isolation. " Maybe in drawing back the figurative robes we expose our selves to 
additional criticism.  
But we chose to speak up, hoping that by trying to promote more understanding of how we see 
things we might contrib ute toward healing some of the scrapes and scratches of this challenging 
year, and maybe even begin a process that may result in adapting the Appellate  Body better to the 
challenges it faces today and will face more in the intense years of adjudication ahe ad. 
After all, by speaking up this way we are only following the advice of Yogi Berra, who said : 
"When  you come to a fork in the road, take it. " 
Thank you.  
 WT/AB/ 27 
 
- 118 - 
 
 ANNEX 6 
MEMBERS OF THE APPELLATE  BODY  
(1 JANUARY TO 31 DEC EMBER 201 6) 
BIOGRAPHICAL NOTES  
Ujal Sing h Bhatia  (India) (2011 –2019)  
Ujal Singh Bhatia was born in India on 15 April 1950. He was India 's Ambassador and Permanent 
Representative to the WTO from 2004 to 2010 and represented India in a number of dispute 
settlement cases. He also served as a WTO di spute settlement panelist in 2007 –2008.  
Mr Bhatia has served in senior positions in the Government of India as well as in Orissa State in 
various administrative assignments that involved development administration and policy -making. 
His legal and adjudicat ory experience spans over three decades, and has involved domestic and 
international legal/jurisprudence issues, as well as negotiation of bilateral, regional, and 
multilateral trade agreements.  
Mr Bhatia has often lectured on international trade issues an d has published numerous papers and 
articles on a range of trade and economic topics. He holds an MA in Economics from the University 
of Manchester and from Delhi University, as well as a BA (Hons ) in Economics, also from 
Delhi University.  
Seung Wha Chang  (Korea) (2012 –2016)  
Born in Korea on 1 March 1963, Seung Wha Chang is currently Professor of Law at Seoul National 
University where he teaches International Trade Law and International Arbitration.  
He has served on several WTO dispute settlement panels, in cluding US – FSC, Canada – Aircraft 
Credits and Guarantees , and EC – Trademarks and Geographical Indications . He has also served as 
Chairman or Co-arbitrator  of numerous  arbitral tribunals dealing with commercial matters. Until he 
joined the Appellate  Body in 2012,  he had served as a Membe r of the International Court 
of Arbitration.  
Professor Chang began his professional academic career at the Seoul National University School of 
Law in 1995 . He has taught international trade law and, in particular WTO dispu te settlement, at 
more than ten foreign law schools, including Harvard Law School, Yale Law School, Stanford Law 
School, New York University, Duke Law School, and Georgetown University. In 2007, Harvard Law 
School granted him an endowed visiting professori al chair title, the Nomura Visiting Professor of 
International Financial Systems.  
In addition, Professor Chang previously served as a Seoul District Court judge, handling many 
cases involving international trade. He also practised as a foreign attorney at a leading  law firm in 
Washington DC, handling international trade matters, including trade remedies and WTO -related 
disputes.  
Professor Chang has published many books and articles in the field of international trade law in 
internationally recognized journa ls. In addition, he serves as an Advisory Board Member of the 
Journal of International Economic Law  (Oxford University Press) and the Journal of International 
Dispute Settlement  (Oxford University Press).  
Professor Chang holds a n LLB and an LLM  from Seoul National University School of Law , and 
an LLM as well as a n SJD from Harvard Law School.  WT/AB/27  
 
- 119 - 
 
 Thomas R. Graham  (United States) (2011 –2019)  
Tom is the former head of the international trade practice at King & Spalding, and he was the 
founder of the international  trade practice at Skadden, Arps , Slate, Meagher & Flom . He was one 
of the first US lawyers to represent respondents in trade remedy cases in various countries around 
the world, and he was among the first to bring economists, accountants, and other non -lawyer 
professionals into the international trade practices of private law firms.  
Prior to entering private practice, Tom served as Deputy General Counsel in the Office of the 
US Trade Representative. Earl ier in his career, he was a Legal Officer of the Unit ed Nations, in 
Geneva; and a visiting professor of law and staff member of Ford Motor Company, in Caracas, 
Venezuela.  
Tom was the founding chairman of the American Society of International Law's Committee on 
International Economic Law . He served as chair o f the American Bar Association's Subcommittee 
on Exports.  He has been a visiting professor at the U niversity of North Carolina Law  School and an 
adjunct professor at the Georgetown Law Center.  He has edited books on international trade policy 
and internati onal trade and environment, and he has written many articles and monographs on 
international trade law and has been  a Guest Scholar at the Brookings Institution and a Senior 
Associate at the Carnegie Endowment for International Peace. He also is the co -author, with his 
daughter, of Getting Open: The Unknown Story of Bill Garrett and the Integratio n of College 
Basketball, (Simon  & Schuster, Atria Books, 2006; Indiana University, paperback, 2008).  
Tom received his undergraduate degree fro m Indiana University,  and his JD  from Harvard 
Law School.  
Ricardo Ramírez -Hernández  (Mexico) (2009 –2017)  
Born in Mexico on 17 October 1968, Ricardo Ramírez -Hernández holds the Chair of International 
Trade Law at the Mexican National University (UNAM) in Mexico City. He was Hea d of the 
International Trade Practice for Latin America of an international law firm in Mexico City. His 
practice focused on issues related to NAFTA and trade across Latin America, including international 
trade dispute resolution.  
Prior to practicing with a law firm, Mr  Ramírez -Hernández was Deputy General Counsel for Trade 
Negotiations of the Ministry of Economy in Mexico for more than a decade. In this capacity, he 
provided advice on trade and competition policy matters related to 11 free trade agreements  
signed by Mexico, as well as with respect to multilateral agreements, including those related to the 
WTO, the Free Trade Area of the Americas (FTAA), and the Latin American Integration 
Association  (ALADI).  
Mr Ramírez -Hernández also represented Mexico in c omplex international trade litigation and 
investment arbitration proceedings. He acted as lead counsel to the Mexican government in 
several WTO disputes. He has also served on NAFTA panels.  
Mr Ramírez -Hernández holds an LLM degree in International  Business  Law from the 
American  University Washington College of Law, and a law degre e from the Universidad 
Autónoma  Metropolitana.  WT/AB/27  
 
- 120 - 
 
 Hyun Chong Kim  (Korea) (2016 -2020)  
Mr Kim received his Degrees of Bachelor, Masters and Juris Doctor from Columbia University in 
New York. He served as Trade Minister for Korea from 2004 to 2007, during which time Korea 
negotiated free trade agreements with more than 40 countries, including Korea 's biggest trading 
partners. As minister, Mr Kim was appointed Facilitator for the services negotiations at the 
WTO's December 2005 Hong Kong Ministerial Conference and  helped Korea host the 
November  2005 Asia -Pacific Economic Cooperation (APEC) Leaders ' Summit in Busan. He served 
as Korea 's Ambassador to the United Nations from 2007 to 2008 and was e lected Vice President of 
the UN  Economic and Social Council in 2008, where he worked towards achievement of th e 
Millennium Development Goals.  
Between 1999 and 2003, Mr Kim was a senior lawyer in the WTO 's Appellate  Body Secretariat and 
Legal Affairs D ivision, where he worked on cases related to IPR, services, TRIMs, safeguards, and 
subsidies/countervailing measures, among others. More recently,  Mr Kim oversaw patent and 
anti-trust litigation with a major Korean corporation and is currently a professor at 
Hankuk  University of Foreign Studies in Seoul, where he focuses on trade law and trade policies.  
Shree Baboo Chekitan Servansing  (Mauritius) (2014 –2018)  
Born in Mauritius on 22 April 1955, Shree Baboo Chekitan Servansing enjoyed a long and 
distinguished  career with the Mauritian civil service. From 2004 to 2012, Mr Servansing was 
Mauritius' Ambassador and Permanent Representative to the United Nations Office and other 
International Organizations in Geneva, including the WTO. During his tenure as Permanen t 
Representative, he served on various Committees at the WTO, and chaired the Committees on 
Trade and Environment, and Trade and Development. He also chaired the Work Programme on 
Small Economies, the dedicated session on Aid -for-Trade, and the African Gro up, and was 
coordinator of the African Caribbean Pacific (ACP) Group.  
Mr Servansing previously worked, in various capacities, for the Mauritius Ministry of Foreign Affairs 
in Mauritius, India and Belgium. During his tenure at the Mauritius Embassy in Belgi um, he was 
intensively involved in the ACP -EU negotiations leading to the Cotonou Agreement and 
subsequently in the Economic Partnership Agreement (EPA) negotiations. Mr Servansing also 
served as the personal representative of the Prime Minister of Mauriti us on the Steering Committee 
of the New Partnership for Africa's Development (NEPAD). In this capacity he was engaged in the 
strategic formulation of Africa's flagship development framework.  
Upon retiring from civil service, Mr Servansing served as the hea d of the ACP -EU Programme on 
Technical Barriers to Trade in Brussels from 2012 to 2014. In this position, he was responsible for 
facilitating the building of capacity among ACP countries in order to enhance their export 
competitiveness, and improve their Q uality Infrastructure to comply with technical regulations.  
Mr Servansing's experience in trade policy, trade negotiations, and the multilateral trading system 
spans three decades. He has frequently spoken on international trade issues, and has published 
numerous papers and articles in Mauritian and foreign journals on a variety of trade -related issues.  
Mr Servansing holds an MA  from the University of Sussex, a Postgraduate Diploma in 
Foreign  Affairs and International Trade from Australia n National Universi ty, and a BA  (Hons) from 
the University of Mauritius.  WT/AB/27  
 
- 121 - 
 
 Peter Van den Bossche  (Belgium) (2009 –2017)  
Born in Belgium on 31 March 1959, Peter Van den Bossche is Professor of International Economic 
Law at Maastricht University, the Netherlands. Van den Bossche is also visiting professor at the 
College of Europe, Bruges (since 2010); the University of Barcelona (IELPO Programme) 
(since  2008); and the World Trade Institute, Berne (MILE Programme) (since 2002). He is member 
of the Advisory  Board of the  Journal of I nternational Economic Law,  the Journal of World 
Investment and Trade  and the  Revista Latinoamericana de Derecho Comercial International . He is 
also member of the Advisory Board of the WTO Chairs Programme (WCP).  
Mr Van den Bossche holds a Doctorate in Law from the European University Institute in Florence, 
an LLM from the University of Michigan Law School, and a Licence en Droit  magna  cum laude  from 
the University of Antwerp. From 1990 to 1992, he served as a r éférendaire of Advocate 
General  W. van Gerven a t the European Court of Justice in Luxembourg. From 1997 to 2001, 
Mr Van den Bossche was Counsellor and subsequently Acting Director of the WTO Appellate  Body 
Secretariat. In 2001, he returned to academia and from 2002 to 2009 frequently acted as a 
consult ant to international organisations and developing countries on issues of international 
economic law. He also served on the faculty of the Université libre de Bruxelles, Brussels, 
Belgium  (2002 –2009); the China -EU School of Law, China University of Politica l Science and 
Law, Beijing, China (2008 -2014); the Trade Policy Training Centre in Africa (trapca), Aru sha, 
Tanzania (2008 and 2013); the Foreign Trade University, Hanoi & Ho Chi Minh City, Vietnam 
(2009  and 2011); the Universidad San Francisco de Quito, E cuador (2013); and at the Law School 
of Koç University, Istanbul, Turkey  (2013).  
Mr Van den Bossche has published extensively in the field of international economic law. He is 
author of the book  The Law and Policy of the World Trade Organization , of which the third edition 
(with Werner Zdouc) was published by Cambridge University Press in 2013.  
Yuejiao Zhang  (China) (2008 –2016) 
Yuejiao Zhang is Professor of International Economic Law at Tsinghua University and at Shantou 
University in China. She is an arbit rator at the International Chamber of Commerce (ICC) and at 
China's International Trade and Economic Arbitration Commission (CIETAC). She served as 
Vice-President of China's International Economic Law Society. She is also a member of the 
Advisory Board of the International Development Law Organization (IDLO).  
Professor Zhang served as a Board Director to the West African Development Bank from 2005 to 
2007. Between 1998 and 2004, she held various senior position s at the Asian Development 
Bank (ADB), includin g as Assistant General Counsel, Co -Chair of the Appeal Committee, and 
Director -General. She was the head of the ADB experts group on international trade and the 
ADB contact point to the WTO. Prior to this, she held several positions in government and 
acade mia in China, including as Director -General of Law and Treaties at the Ministry of Foreign 
Trade and Economic Cooperation (1984 –1997). She participated in the preparation of China's first 
joint-venture law, general principles of civil law, contract law, an d foreign trade law. From 1987 to 
1996, she was one of China's chief negotiators on intellectual property and was involved in the 
preparation of China's patent law, trademark law, and copyright la w. She also served as the 
chief legal counsel for China's GA TT resumption. Between 1982 and 1985, she worked as legal 
counsel at the World Bank. She was a Member of the Governing Council of the International 
Institute for the Unification of Private Law (UNIDROIT) from 1987 to 1999 and a Board Member of 
IDLO from 19 88 to 1999. Professor Zhang was a member of the UNIDROIT and UNCITRAL drafting 
committees concerning several international trade and economic c onventions, such as the 
General  Principles of Commercial Contract and the International Financial Leasing Convent ion. 
Professor Zhang has authored several books and articles on international economic law and 
international dispute settlement. She has a BA from China High Education College, a BA from 
Rennes University, France, and an LLM from Georgetown University. Pro fessor Zhang also lectured 
at universities in France and in Hong Kong, Macau of China.  WT/AB/27  
 
- 122 - 
 
 Hong Zhao  (China) (2016 -2020)  
Ms Zhao received her Degrees of Bachelor, Masters and Ph. D in Law from the Law School of 
Peking University in China. She currently serves as Vice President of the Chinese Academy of 
International Trade and Economic Cooperation. Ms Zhao is also a guest Professor at several 
universities including the Universities of Peking, Fudan, and International Business and Economics. 
Previously she served  as Minister Counsellor in charge of legal affairs at China 's mission to the 
WTO, during which time she served as Chair of the WTO 's Committee on Trade -Related 
Investment Measures (TRIMs). Ms Zhao then served as Commissioner for Trade Negotiations at 
the C hinese Ministry of Commerce 's Department for WTO Affairs, where she participated in a 
number of important negotiations on international trade, including the Trade Facilitation 
Agreement negotiations, and negotiations on expansion of the Information Technol ogy Agreement.  
Domestically, Ms Zhao helped formulate many important Chinese legislative acts on economic and 
trade areas adopted since the 1990s and has experience in China 's judiciary system, serving as 
Juror at the Economic Tribunal of the Second Interm ediate Co urt of Beijing between 1999 
and 2004. She has also taught and supervised law students on international economic Law, 
WTO law and intellectual property rights (IPR) at various universities in China.  
* * * 
DIRECTOR OF THE APPELLATE  BODY  SECRETARIAT  
Werner Zdouc  
Director of the WTO Appellate  Body Secretariat since 2006, Werner Zdouc obtained a law degree 
from the University of Graz in Austria. He then went on to earn an LLM from Michigan Law School 
and a PhD from the University of St Gallen in Switzer land. Dr Zdouc joined the WTO Legal Affairs 
Division in 1995, advised many dispute settlement panels, and conducted technical cooperation 
missions in many developing countries. He became legal counsellor at the Appellate  Body 
Secretariat in 2001. In 2008 -2009 he chaired the WTO Joint Advisory Committee to the 
Director -General. He has been a lecturer and Visiting Professor for international trade law at 
Vienna Economic University, the Universities of St. Gallen, Zurich , Barcelona , Seoul, Shanghai,  and 
the Ge neva Graduate Institute. From 1987 to  1989, he worked for governmental and 
non-governmental development aid organizations in Austria and Latin America. Dr  Zdouc has 
authored various publications on international economic law and is a member of the Trade La w 
Committee of the International Law Association.  
 WT/AB/ 27 
 
- 123 - 
 
 ANNEX 7 
FORMER APPELLATE BOD Y MEMBERS AND CHAIRP ERSONS  
I. FORMER APPELLATE  BODY  MEMBERS  
Name  Nationality  Term(s) of office  
Said El -Naggar  Egypt   1995–2000 
Mitsuo Matsushita  Japan   1995–2000 
Christopher  Beeby  New Zealand  1995–1999 
1999–2000 
Claus -Dieter Ehlermann  Germany  1995–1997 
1997–2001 
Florentino Feliciano  Philippines  1995–1997 
1997–2001 
Julio Lacarte -Muró Uruguay  1995–1997 
1997–2001 
James Bacchus  United States  1995–1999 
1999–2003 
John Lockhart  Australia  2001–2005 
2005–2006 
Yasuhei Taniguchi  Japan  2000–2003 
2003–2007 
Merit E. Janow  United States  2003–2007 
Arumugamangalam 
Venkatachalam Ganesan  India 2000–2004 
2004–2008 
Georges Michel Abi -Saab Egypt  2000–2004 
2004–2008 
Luiz Olavo Baptista  Brazil 2001–2005 
2005–2009 
Giorgio Sacerdoti  Italy 2001–2005 
2005–2009 
Jennifer Hillman  United States  2007–2011 
Lilia Bautista  Philippines  2007–2011 
Shotaro Oshima  Japan  2008–2012 
David Unterhalter  South Africa  2006-2009 
2009-2013 
Yuejiao Zhang  China  2008-2012 
2012-2016 
Seung Wha Chang  Korea, Republic of  2012-2016 
 WT/AB/27  
 
- 124 - 
 
 II. FORMER CHAIRPERSONS OF THE APPELLATE  BODY  
Name  Nationality  Term(s) as Chairperson  
Julio Lacarte -Muró Uruguay  7 February 1996 – 
6 February 1997  
7 February 1997 – 
6 February 1998  
Christo pher Beeby  New Zealand  7 February 1998 – 
6 February 1999  
Said El -Naggar  Egypt  7 February 1999 – 
6 February 2000  
Florentino Feliciano  Philippines  7 February 2000 – 
6 February 2001  
Claus -Dieter Ehlermann  Germany  7 February 2001 – 
10 December 2001  
James B acchus  United States  15 December 2001 – 
14 December 2002  
15 December 2002 – 
10 December 2003  
Georges Abi -Saab Egypt  13 December 2003 – 
12 December 2004  
Yasuhei Taniguchi  Japan  17 December 20 04 – 
16 December 2005  
Arumugamangalam 
Venkatachalam Ganesan  India 17 December 2005 – 
16 December 2006  
Giorgio Sacerdoti  Italy 17 December 2006 – 
16 December 2007  
Luiz Olavo Baptista  Brazil  17 December 2007 – 
16 December 2008  
David Unterhalter  South Africa  18 December 2008 –
11 December 2009  
12 December 2009 – 
16 December 2010  
Lilia Bautista  Philippines  17 December 2010 – 
14 June 2011  
Jennifer Hillman  United States  15 June 2011 – 
10 December 2011  
Yuejiao Zhang  China  11 December 2011 – 
31 May 2012  
1 June 2012 – 
31 December 2012  
Ricardo Ramírez Hernández  Mexico  1 January 2013 – 
31 December 2013  
1 January 2014 – 
31 December 2014  
Peter Van den Bossche  Belgium  1 January 2015 – 
31 December 2015  
Thomas Graham  United States  1 January 2016 – 
31 December 2016  
 WT/AB/ 27 
 
- 125 - 
 
 ANNEX 8 
APPEALS FILED: 1995–20161 
TOTAL NUMBER OF APPEALS : 1995–2016 
 
 
 
APPEALS FILED: 1995–2016 
Year  Notices of  
Appeal filed  Notices of Appeal 
in original 
proceedings  Notices of Appeal 
in Article  21.5 
proceedings  
1995   0 0 0 
1996   4 4 0 
1997   6a 6 0 
1998   8 8 0 
1999   9b 9 0 
2000  13c 11 2 
2001   9d 5 4 
2002   7e 6 1 
2003   6f 5 1 
2004   5 5 0 
2005  13 11 2 
2006   5 3 2 
2007   4 2 2 
2008  11g 8 3 
                                               
1 No appeals were fi led and no Appellate Body reports were circulated in 1995, the year the Appellate 
Body was established.  WT/AB/27  
 
- 126 - 
 
 Year  Notices of  
Appeal filed  Notices of Appeal 
in original 
proceedings  Notices of Appeal 
in Article  21.5 
proceedings  
2009 3 1 2 
2010 3 3 0 
2011 9 9 0 
2012 5 5 0 
2013 2 2 0 
2014 13 11 2 
2015 8h 6 2 
2016 8 7 1 
Total  151 127 24 
a This number includes two Notices of Appeal that were filed at the same time in related matters, counted 
separately: EC – Hormones (Canada)  and EC – Hormones (US).  A single Appellate  Body report was 
circulated in relation to those appeals.  
b  This number exc ludes one Notice of Appeal that was withdrawn by the United States, which 
subsequently filed another Notice of Appeal in relation to the same panel report: US – FSC. 
c  This number includes two Notices of Appeal that were filed at the same time in related matters, counted 
separately: US – 1916 Act (EC)  and US – 1916 Act (Japan).  A single Appellate  Body report was 
circulated in relation to those appeals.  
d  This number excludes one Notice of Appeal that was withdrawn by the United States, which 
subsequently filed another Notice of Appeal in relation to the same panel report: US – Line Pipe . 
e  This number includes one Notice of Appeal that was subsequently withdrawn: India – Autos ; and 
excludes one Notice of Appeal that was withdrawn by the European Communiti es, which subsequently 
filed another Notice of Appeal in relation to the same panel report: EC – Sardines . 
f  This number excludes one Notice of Appeal that was withdrawn by the United States, which 
subsequently filed another Notice of Appeal in relation t o the same panel report: US – Softwood Lumber 
IV. 
g  This number includes two Notices of Appeal that were filed at the same time in related matters, counted 
separately: US – Shrimp (Thailand)  and US – Customs Bond Directive.   
h  This number includes two No tices of Appeal that were filed at the same time in related matters, counted 
separately: China – Measures Imposing Anti -Dumping Duties on High -Performance Stainless Steel 
Seamless Tubes ("HP -SSST") from Japan and China – Measures Impos ing Anti -Dumping Duti es on 
High-Performance Stainless Steel Seamless Tubes ("HP -SSST") from the European Union.  WT/AB/ 27 
 
- 127 - 
 
 ANNEX 9 
PERCENTAGE OF PANEL REPORTS APPEALED BY YEAR OF ADOPTIONa: 199 6 – 2016b 
 All panel reports  Panel reports other than  
Article  21.5 reportsc Article  21.5 
panel reports  
Year of  
adoption  Panel 
reports 
adoptedd Panel 
reports 
appealede Percentage 
appealedf Panel 
reports 
adopted  Panel 
reports 
appealed  Percentage 
appealed  Panel  
reports 
adopted  Panel  
reports 
appealed  Percentage 
appealed  
1996 2 2 100%  2 2 100%  0 0 – 
1997 5 5 100%  5 5 100%  0 0 – 
1998 12 9 75% 12 9 75% 0 0 – 
1999 10 7 70% 9 7 78% 1 0 0% 
2000 19 11 58% 15 9 60% 4 2 50% 
2001 17 12 71% 13 9 69% 4 3 75% 
2002 12 6 50% 11 5 45% 1 1 100%  
2003 10 7 70% 8 5 63% 2 2 100%  
2004 8 6 75% 8 6 75% 0 0 – 
2005 20 12 60% 17 11 65% 3 1 33% 
2006 7 6 86% 4 3 75% 3 3 100%  
2007 10 5 50% 6 3 50% 4 2 50% 
2008 11 9 82% 8 6 75% 3 3 100%  
2009 8 6 75% 6 4 67% 2 2 100%  
2010 5 2 40% 5 2 40% 0 0 – 
2011 8 5 63% 8 5 63% 0 0 – 
2012 18 11 61% 18 11 61% 0 0 – 
2013 4 2 50% 4 2 50% 0 0 – 
2014 15 13 87% 13 11 85% 2 2 100%  
2015 13 8 62% 11 6 55% 2 2 100%  
2016 8 7 88% 6 6 100%  2 1 50% 
Total  222 151 68%  189 127 67%  33 24 73%  
a  The figures in this table correspond to the year in which the panel report was adopted, even in cases 
when the panel reports were appealed in a different year.  
b  No panel reports were adopted in 1995.  
c  Under Article  21.5 of the DSU, a panel may be establi shed to hear 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 upon the adoption of a previous panel or Appellate  Body report.  
d  The panel reports in EC  – Bananas III (Ecuador), EC – Bananas III (Guatemala and Honduras),  
EC – Bananas III (Mexico), and EC – Bananas III (US) are counted as a single panel report. The panel 
reports in US  – Steel Safeguards, in EC – Export Subsidies on Sugar, and in EC  – Chicken Cuts, are also 
counted as single panel reports in each of those disputes.  
e  The number of panel reports appealed may differ from the number of Appellate  Body reports because 
some Appellate  Body reports address more than one panel report.  
f  Percentag es are rounded  to the nearest whole number.  
 WT/AB /5 
Page 127 
 WT/AB/ 27 
 
- 128 - 
 
  WT/AB/27  
 
- 128 - ANNEX 10 
WTO AGREEMENTS ADDRE SSED IN APPELLATE BO DY REPORTS CIRCULATE D: 1996 - 2016 
The c hart below shows the number of times specific WTO agreem ents have been addressed in 
the 144 Appellate  Body reports circul ated from 1996 to 2016. 
 
 
  
 
 WT/AB/27  
 
- 129 - WTO AGREEMENTS ADDRESSED IN APPELLATE  BODY  REPORTS CIRCULATED : 1996  - 2016 a 
Year of  
circulation  DSU WTO  
Agmt  GATT  
1994  Agri- 
culture  SPS ATC TBT TRIMs  Anti- 
Dumping  Import  
Licensing  SCM Safe-
guards  GATS  TRIPS  
1996  0 0 2 0 0 0 0 0 0 0 0 0 0 0 
1997  4 1 5 1 0 2 0 0 0 1 1 0 1 1 
1998  7 1 4 1 2 0 0 0 1 1 0 0 0 0 
1999  7 1 6 1 1 0 0 0 0 0 2 1 0 0 
2000  8 1 7 2 0 0 0 0 2 0 5 2 1 1 
2001  7 1 3 1 0 1 1 0 4 0 1 2 0 0 
2002  8 2 4 3 0 0 1 0 1 0 3 1 1 1 
2003  4 2 3 0 1 0 0 0 4 0 1 1 0 0 
2004  2 0 5 0 0 0 0 0 2 0 1 0 0 0 
2005  9 0 5 2 0 0 0 0 2 0 4 0 1 0 
2006  5 0 3 0 0 0 0 0 3 0 2 0 0 0 
2007  5 0 2 1 0 0 0 0 2 0 1 0 0 0 
2008  8 1 9 1 2 0 0 0 3 0 3 0 0 0 
2009  3 0 4 0 0 0 0 0 3 0 0 0 1 0 
2010  1 0 0 0 1 0 0 0 0 0 0 0 0 0 
2011  7 1 6 0 0 0 0 0 1 0 2 0 0 0 
2012  9 0 7 0 0 0 4 0 1 0 2 0 0 0 
2013  0 0 2 0 0 0 0 2 0 0 2 0 0 0 
2014  6 4 7 0 0 0 2 0 0 0 3 0 0 0 
2015  7 0 7 1 0 0 2 0 3 1 0 0 0 0 
2016  6 1 6 0 0 0 0 1 2 0 1 0 1 0 
Total  113 16 97 14 7 3 10 3 34 3 34 7 6 3 
a  No appeals were filed and no Appellate Body reports were  circulated in 1995, the year the Appellate Body was established.  
 WT/AB/ 27 
 
- 130 - 
 
 ANNEX 11 
PARTICIPANTS AND THI RD PARTICIPANTS IN A PPEALS: 199 6–2016 
The chart below  shows the ratio of developed country Members to developing country Members in 
terms of appearances made a s appellant, other appellant, appellee, and third participant in 
appeals for which an Appellate  Body report was circulated from 1996 t o 2016.1 
WTO MEMBER PARTICIPATION IN APPEALS 1996 –2016 
 
 
I. STATISTICAL SUMMARY  
WTO Member  Appellant  Other 
appellant  Appe llee Third 
participant  Total  
Antigua & 
Barbuda  0 1 1 0 2 
Argentina  3 5 8 20 36 
Australia  2 2 6 45 55 
Bahrain, Kingdom 
of 0 0 0 1 1 
Barbados  0 0 0 1 1 
Belize  0 0 0 4 4 
Benin  0 0 0 1 1 
Bolivia, 
Plurinational 
State of  0 0 0 1 1 
Brazil  5 7 12 37 61 
                                               
1 No appeals were filed and no Appellate  Body reports were circulated in 1995, the year the 
Appellate  Body was established.  WT/AB/2 7 
 
- 131 - 
 
 WTO Member  Appellant  Other 
appellant  Appe llee Third 
participant  Total  
Cameroon  0 0 0 3 3 
Canada  14 10 23 32 79 
Chad 0 0 0 2 2 
Chile 3 0 2 12 17 
China  15 5 11 50 81 
Colombia  1 0 0 23 24 
Costa Rica  1 0 0 3 4 
Côte d'Ivoire  0 0 0 4 4 
Cuba 0 0 0 4 4 
Dominica  0 0 0 4 4 
Dominican 
Republic  1 0 1 4 6 
Ecuador  0 2 2 19 23 
Egypt  0 0 0 2 2 
El Salvador  0 0 0 6 6 
European Union  22 20 48 72 162 
Fiji 0 0 0 1 1 
Ghana  0 0 0 2 2 
Grenada  0 0 0 1 1 
Guatemala  1 2 2 13 18 
Guyana  0 0 0 1 1 
Honduras  0 2 2 6 10 
Hong Kong, 
China  0 0 0 8 8 
Iceland  0 0 0 2 2 
India 9 2 8 45 64 
Indonesia  0 1 1 5 7 
Israel  0 0 0 2 2 
Jamaica  0 0 0 5 5 
Japan  7 6 15 66 94 
Kenya  0 0 0 1 1 
Korea  3 5 7 35 50 
Kuwait, the State 
of 0 0 0 1 1 
Madagascar  0 0 0 1 1 
Malaysia  1 0 1 1 3 
Malawi  0 0 0 1 1 
Mauritius  0 0 0 2 2 
Mexico  5 6 9 36 56 
Namibia  0 0 0 1 1 
New Zealand  0 3 6 14 23 
Nicaragua  0 0 0 4 4 
Nigeria  0 0 0 1 1 WT/AB/2 7 
 
- 132 - 
 
 WTO Member  Appellant  Other 
appellant  Appe llee Third 
participant  Total  
Norway  2 1 3 31 37 
Oman  0 0 0 4 4 
Pakistan  0 0 2 3 5 
Panama  1 0 2 3 6 
Paraguay  0 0 0 5 5 
Peru 1 1 1 7 10 
Philippines  3 0 3 2 8 
Poland  0 0 1 0 1 
Russian 
Federation  0 0 0 10 10 
Saint Lucia  0 0 0 4 4 
Saudi Arabia, 
Kingdom of  0 0 0 17 17 
Senegal  0 0 0 1 1 
Singapore  0 0 0 1 1 
St Kitts & Nevis  0 0 0 1 1 
St Vincent &  
the Grenadines  0 0 0 3 3 
Suriname  0 0 0 3 3 
Swaziland  0 0 0 1 1 
Switzerland  0 1 1 1 3 
Chinese Taipei  0 0 0 40 40 
Tanzania  0 0 0 1 1 
Thailand  3 2 5 23 33 
Trinidad 
& Tobago  0 0 0 1 1 
Turkey  1 0 0 19 20 
United States  37 24 82 42 185 
Venezuela, 
Bolivarian 
Republic of  0 0 1 6 7 
Viet Nam  1 0 0 8 9 
Total  142 108 266 842 1358  
 WT/AB/2 7 
 
- 133 - 
 
 II. DETAILS BY YEAR OF C IRCULATION  
1996  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
US – Gasoline  
WT/DS2/AB/R  United States  --- Brazil  
Venezuela  European 
Communities  
Norway  
Japan – Alcoholic Beverages II  
WT/DS8/AB/R,  
WT/DS10/AB/R , 
WT/DS11/AB/R  Japan  United States  Canada  
European 
Communities  
Japan  
United States  --- 
 
1997  
Case  Appellant  Othe r 
appellant(s)  Appellee(s)  Third 
participant(s)  
US – Underwear  
WT/DS24/AB/R  Costa Rica  --- United States  India 
Brazil – Desiccated Coconut  
WT/DS22/AB/R  Philippines  Brazil  Brazil  
Philippines  European 
Communities  
United States  
US – Wool Shirts and Blouses   
WT/DS33/AB/R and Corr.1  India --- United States  --- 
Canada – Periodicals  
WT/DS31/AB/R  Canada  United States  Canada  
United States  --- 
EC – Bananas III  
WT/DS27/AB/R  European 
Communities  Ecuador  
Guatemala  
Honduras  
Mexico  
United States  Ecuador  
European 
Comm unities  
Guatemala  
Honduras  
Mexico  
United States  Belize  
Cameroon  
Colombia  
Costa Rica  
Côte d'Ivoire  
Dominica  
Dominican 
Republic  
Ghana  
Grenada  
Jamaica  
Japan  
Nicaragua  
St Lucia  
St Vincent  
& the Grenadines  
Senegal  
Suriname  
Venezuela  
India – Patents (US)  
WT/DS5 0/AB/R  India --- United States  European 
Communities  WT/AB/2 7 
 
- 134 - 
 
 1998  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
EC – Hormones  
WT/DS26/AB/R,  
WT/DS48/AB/R  European 
Communities  Canada  
United States  Canada  
European 
Communities  
United States  Australia 
New Zealand  
Norway  
Argentina – Textiles and Apparel  
WT/DS56/AB/R and Corr.1  Argentina  --- United States  European 
Communities  
EC – Computer Equipment  
WT/DS62/AB/R,  
WT/DS67/AB/R , 
WT/DS68/AB/R  European 
Communities  --- United States  Japan  
EC – Poultry  
WT/DS69/AB/R  Brazil  European 
Communities  Brazil  
European 
Communities  Thailand  
United States  
US – Shrimp  
WT/DS58/AB/R  United States  --- India 
Malaysia  
Pakistan  
Thailand  Australia  
Ecuador  
European 
Communities  
Hong Kong, 
China  
Mexico  
Nigeria  
Australia  – Salmon  
WT/DS18/AB/R  Australia  Canada  Australia  
Canada  European 
Communities  
India 
Norway  
United States  
Guatemala – Cement  I 
WT/DS60/AB/R  Guatemala  --- Mexico  United States  
 WT/AB/2 7 
 
- 135 - 
 
 1999  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
Korea  – Alcoholic Beverages  
WT/DS75/AB/R,  
WT/DS84/AB/R  Korea  --- European 
Communities  
United States  Mexico  
Japan – Agricultural Products II  
WT/DS76/AB/R  Japan  United States  Japan  
United States  Brazil  
European 
Communities  
Brazil – Aircraft  
WT/DS46/AB/R  Brazil  Canada  Brazil  
Canada  European 
Communities  
United States  
Canada – Aircraft  
WT/DS70/AB/R  Canada  Brazil  Brazil  
Canada  European 
Communities  
United States  
India – Quantitative Restrictions  
WT/DS90/AB/R  India --- United States  --- 
Canada – Dairy  
WT/DS103/A B/R, WT/DS113/AB/R 
and Corr.1  Canada  --- New Zealand  
United States  --- 
Turkey –Textiles  
WT/DS34/AB/R  Turkey  --- India Hong Kong, 
China  
Japan  
Philippines  
Chile – Alcoholic Beverages  
WT/DS87/AB/R, WT/DS110/AB/R  Chile --- European 
Communities  Mexico  
United States  
Argentina – Footwear (EC)  
WT/DS121/AB/R  Argentina  European 
Communities  Argentina  
European 
Communities  Indonesia  
United States  
Korea – Dairy  
WT/DS98/AB/R  Korea  European 
Communities  Korea  
European 
Communities  United States  
 WT/AB/2 7 
 
- 136 - 
 
 2000  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
US – FSC  
WT/DS108/AB/R  United States  European 
Communities  European 
Communities  
United States  Canada  
Japan  
US – Lead and Bismuth  II 
WT/DS138/AB/R  United States  --- European 
Communities  Brazil  
Mexico  
Canada – Autos  
WT/DS139/AB/R  Canada  European 
Communities  
Japan  Canada  
European 
Communities  
Japan  Korea  
United States  
Brazil – Aircraft  
(Article  21.5 – Canada)  
WT/DS46/AB/RW  Brazil  --- Canada  European 
Communities  
United States  
Canada – Aircraft  
(Article  21.5 – Brazil)  
WT/DS70/AB/RW  Brazil  --- Canada  European 
Communities  
United States  
US – 1916 Act  
WT/DS136/AB/R, WT/DS162/AB/R  United States  European 
Communities  
Japan  European 
Communities  
Japan  
United States  European 
Communitiesa 
India 
Japanb 
Mexico  
Canada – Term of Patent 
Protection  
WT/DS170/AB/R  Canada  --- United States  --- 
Korea – Various Measures on Beef  
WT/DS161/AB/R, WT/DS169/AB/R  Korea  --- Australia  
United States  Canada  
New Zealand  
US – Certain EC Products  
WT/DS165/AB/R  European 
Communities  United St ates European 
Communities  
United States  Dominica  
Ecuador  
India 
Jamaica  
Japan  
St Lucia 
US – Wheat Gluten  
WT/DS166/AB/R  United States  European 
Communities  European 
Communities  
United States  Australia  
Canada  
New Zealand  
a In complaint brought by Japan.  
b  In complaint brought by the European Communities.  WT/AB/2 7 
 
- 137 - 
 
 2001  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
EC – Bed Linen  
WT/DS141/AB/R  European 
Communities  India European 
Communities  
India Egypt  
Japan  
United States  
EC – Asbestos  
WT/DS135 /AB/R  Canada  European 
Communities  Canada  
European 
Communities  Brazil  
United States  
Thailand – H-Beams  
WT/DS122/AB/R  Thailand  --- Poland  European 
Communities  
Japan  
United States  
US – Lamb  
WT/DS177/AB/R, WT/DS178/AB/R  United States  Australia  
New Zealand  Australia  
New Zealand  
United States  European 
Communities  
US – Hot-Rolled Steel  
WT/DS184/AB/R  United States  Japan  Japan  
United States  Brazil  
Canada  
Chile 
European 
Communities  
Korea  
US – Cotton Yarn  
WT/DS192/AB/R  United States  --- Pakistan  European 
Communit ies 
India 
US – Shrimp  
(Article  21.5 – Malaysia)  
WT/DS58/AB/RW  Malaysia  --- United States  Australia  
European 
Communities  
Hong Kong, 
China  
India 
Japan  
Mexico  
Thailand  
Mexico – Corn Syrup  
(Article  21.5 – US) 
WT/DS132/AB/RW  Mexico  --- United States  European 
Communities  
Canada – Dairy 
(Article  21.5 – New Zealand 
and US) 
WT/DS103/AB/RW, 
WT/DS113/AB/RW  Canada  --- New Zealand  
United States  European 
Communities  
 WT/AB/2 7 
 
- 138 - 
 
 2002  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
US – Section 211 
Appropriat ions Act  
WT/DS176/AB/R  European 
Communities  United States  European 
Communities  
United States  --- 
US – FSC ( Article  21.5 – EC) 
WT/DS108/AB/RW  United States  European 
Communities  European 
Communities  
United States  Australia  
Canada  
India 
Japan  
US – Line Pip e 
WT/DS202/AB/R  United States  Korea  Korea  
United States  Australia  
Canada  
European 
Communities  
Japan  
Mexico  
India – Autosc 
WT/DS146/AB/R, WT/DS175/AB/R  India --- European 
Communities  
United States  Korea  
Chile – Price Band System  
WT/DS207/AB/R and Corr.1  Chile --- Argentina  Australia  
Brazil  
Colombia  
Ecuador  
European 
Communities  
Paraguay  
United States  
Venezuela  
EC – Sardines  
WT/DS231/AB/R  European 
Communities  --- Peru Canada  
Chile 
Ecuador  
United States  
Venezuela  
US – Carbon Steel  
WT/DS213/AB/R and Corr.1  United States  European 
Communities  European 
Communities  
United States  Japan  
Norway  
US – Countervailing Measures on 
Certain EC Products  
WT/DS212/AB/R  United States  --- European 
Communities  Brazil  
India 
Mexico  
Canada – Dairy 
(Article  21.5 – New Zealand  
and US II) 
WT/DS103/AB/RW2, 
WT/DS113/AB/RW2  Canada  --- New Zealand  
United States  Argentina  
Australia  
European 
Communities  
c  India withdrew its appeal the day before the oral hearing was scheduled to proceed.  
 WT/AB/ 27 
 
- 139 - 
 
 2003  
Case  Appellant  Other 
appellant(s)  Appelle e(s) Third 
participant(s)  
US – Offset Act  
(Byrd Amendment ) 
WT/DS217/AB/R, WT/DS234/AB/R  United States  --- Australia  
Brazil  
Canada  
Chile 
European 
Communities  
India 
Indonesia  
Japan  
Korea  
Mexico  
Thailand  Argentina  
Costa Rica  
Hong Kong, 
China  
Israel  
Norway  
EC – Bed Linen  
(Article  21.5 – India ) 
WT/DS141/AB/RW  India --- European 
Communities  Japan  
Korea  
United States  
EC – Tube or Pipe Fittings  
WT/DS219/AB/R  Brazil  --- European 
Communities  Chile 
Japan  
Mexico  
United States  
US – Steel Safeguards  
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  United States  Brazil  
China  
European 
Communities  
Japan  
Korea  
New Zealand  
Norway  
Switzerland  Brazil  
China  
European 
Communities  
Japan  
Korea  
New Zealand  
Norway  
Switzerland  
United States  Canada  
Cuba 
Mexico  
Chinese Taipei  
Thailand  
Turkey  
Venezuela  
Japan – Apples  
WT/DS245/AB/R  Japan  United States  Japan  
United States  Australia  
Brazil  
European 
Communities  
New Zealand  
Chinese Taipei  
US – Corrosion -Resistant S teel 
Sunset Review  
WT/DS244/AB/R  Japan  --- United States  Brazil  
Chile 
European 
Communities  
India 
Korea  
Norway  
 WT/AB/2 7 
 
- 140 - 
 
 2004  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
US – Softwood Lumber  IV 
WT/DS257/AB/R  United States  Canada  Canada  
United States  European 
Communities  
India 
Japan  
EC – Tariff Preferences  
WT/DS246/AB/R  European 
Communities  --- India Bolivia  
Brazil  
Colombia  
Costa Rica  
Cuba 
Ecuador  
El Salvador  
Guatemala  
Honduras  
Mauritius  
Nicaragua  
Pakistan  
Panama  
Paraguay  
Peru 
United States  
Venezuela  
US – Softwood Lumber  V 
WT/DS264/AB/R  United States  Canada  Canada  
United States  European 
Communities  
India 
Japan  
Canada – Wheat Exports and Grain 
Imports  
WT/DS276/AB/R  United States  Canada  Canada  
United States  Australia  
China  
European 
Communitie s 
Mexico  
Chinese Taipei  
US – Oil Country Tubular Goods 
Sunset Reviews  
WT/DS268/AB/R  United States  Argentina  Argentina  
United States  European 
Communities  
Japan  
Korea  
Mexico  
Chinese Taipei  
 WT/AB/2 7 
 
- 141 - 
 
 2005  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
particip ant(s)  
US – Upland Cotton  
WT/DS267/AB/R  United States  Brazil  Brazil  
United States  Argentina  
Australia  
Benin  
Canada  
Chad 
China  
European  
Communities  
India 
New Zealand  
Pakistan  
Paraguay  
Chinese Taipei  
Venezuela  
US – Gambling  
WT/DS285/AB/R and Corr.1  United States  Antigua & 
Barbuda  Antigua & 
Barbuda  
United States  Canada  
European  
Communities  
Japan  
Mexico  
Chinese Taipei  
EC – Export Subsidies on Sugar  
WT/DS265/AB/R, WT/DS266/AB/R,  
WT/DS283/AB/R  European 
Communities  Australia  
Brazil  
Thailand  Australia  
Brazil  
European 
Communities  
Thailand  
 Barbados  
Belize  
Canada  
China  
Colombia  
Côte d'Ivoire  
Cuba 
Fiji 
Guyana  
India 
Jamaica  
Kenya  
Madagascar  
Malawi  
Mauritius  
New Zealand  
Paraguay  
St Kitts &  
Nevis  
Swaziland  
Tanzania  
Trinidad &  
Tobago  
United States  
 WT/AB/2 7 
 
- 142 - 
 
 2005 (CONT'D)  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
Dominican Republic – Import and 
Sale of Cigarettes  
WT/DS302/AB/R  Dominican  
Republic  Honduras  Dominican  
Republic  
Honduras  China  
El Salvador  
European  
Communities  
Guatemala  
United States  
US – Countervailing Duty 
Investigation on DRAMS  
WT/DS296/AB/R  United States  Korea  Korea  
United States  China  
European  
Communities  
Japan  
Chinese Taipei  
EC – Chicken Cuts  
WT/DS269/AB/R,  
WT/DS286/AB/R  and Corr.1  European  
Communities  Brazil  
Thailand  Brazil  
European  
Communities  
Thailand  China  
United States  
Mexico – Anti-Dumping Measures  
on Rice  
WT/DS295/AB/R  Mexico  --- United States  China  
European  
Communities  
US – Anti-Dumping Measures on 
Oil Country Tubular Goods  
WT/DS282/AB/R  Mexico  United States  Mexico  
United State s Argentina  
Canada  
China  
European  
Communities  
Japan  
Chinese Taipei  
US – Softwood Lumber  IV 
(Article  21.5 – Canada)  
WT/DS257/AB/RW  United States  Canada  Canada  
United States  China  
European 
Communities  
 WT/AB/2 7 
 
- 143 - 
 
 2006  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
US – FSC 
(Article  21.5 – EC II)  
WT/DS108/AB/RW2  United States  European 
Communities  European 
Communities  
United States  Australia  
Brazil  
China  
Mexico ‒ Taxes on Soft Drinks  
WT/DS308/AB/R  Mexico  --- United States  Canada  
China  
European 
Communities  
Guatemala  
Japan  
US – Softwood Lumber VI  
(Article  21.5 – Canada)  
WT/DS277/AB/RW and Corr.1  Canada  --- United States  China  
European 
Communities  
US – Zeroing (EC ) 
WT/DS294/AB/R and Corr.1  European 
Communities  United States  United States  
European 
Communities  Argentina  
Brazil  
China  
Hong Kong, 
China  
India 
Japan  
Korea  
Mexico  
Norway  
Chinese Taipei  
US – Softwood Lumber V  
(Article  21.5 – Canada)  
WT/DS264/AB/RW  Canada  --- United States  China  
European 
Communities  
India 
Japan  
New Zealand  
Thailand  
EC – Selected Customs Matters  
WT/DS315/AB/R  United States  European 
Communities  European 
Communities  
United States  Argentina  
Australia  
Brazil  
China  
Hong Kong, 
China  
India 
Japan  
Korea 
Chinese Taipei  
 WT/AB/2 7 
 
- 144 - 
 
 2007  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
US – Zeroing (Japan)  
WT/DS322/AB/R  Japan  United States  United States  
Japan  Argentina  
China  
European 
Communities  
Hong Kong, 
China  
India 
Korea  
Mexico  
New Zealand  
Norway 
Thailand  
US – Oil Country Tubular Goods 
Sunset Reviews  
(Article  21.5 ‒ Argentina)  
WT/DS268/AB/RW  United States  Argentina  Argentina  
United States  China  
European 
Communities  
Japan  
Korea  
Mexico  
Chile – Price Band System  
(Article  21.5 – Argentina)  
WT/DS207/AB/RW  Chile Argentina  Argentina  
Chile Australia  
Brazil  
Canada  
China  
Colombia  
European 
Communities  
Peru 
Thailand  
United States  
Japan – DRAMs (Korea)  
WT/DS336/AB/R and Corr.1  Japan  Korea  Korea  
Japan  European 
Communities  
United States  
Brazil – Retreaded Tyres  
WT/DS332/AB/R  European 
Communities  --- Brazil  Argentina  
Australia  
China 
Cuba 
Guatemala  
Japan  
Korea  
Mexico  
Paraguay  
Chinese Taipei  
Thailand  
United States  WT/AB/2 7 
 
- 145 - 
 
 2008  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
US – Stainless Steel (Mexico)  
WT/DS344/AB/R  Mexico  --- United States  Chile 
China  
European 
Commun ities 
Japan  
Thailand  
US – Upland Cotton  (Article  21.5 – 
Brazil)  
WT/DS267/AB/RW  United States  Brazil  Brazil  
United States  Argentina  
Australia  
Canada  
Chad 
China  
European 
Communities  
India 
Japan  
New Zealand  
Thailand  
US – Shrimp (Thailand)  
WT/DS343/AB/R  Thailand United States  United States  
Thailand  Brazil  
Chile 
China  
European 
Communities  
India 
Japan  
Korea  
Mexico  
Viet Nam  
US – Customs Bond Directive  
WT/DS345/AB/R  India United States  United States  
India Brazil  
China  
European 
Communities  
Japan  
Thailand  
US – Continued Suspension  
WT/DS320/AB/R  European 
Communities  United States  United States  
European 
Communities  Australia  
Brazil  
China  
India 
Mexico  
New Zealand  
Norway  
Chinese Taipei  
Canada – Continued Suspension  
WT/DS321/AB/R  European 
Communities  Canada  Canada  
European 
Communities  Australia  
Brazil  
China  
India 
Mexico  
New Zealand  
Norway  
Chinese Taipei  WT/AB/2 7 
 
- 146 - 
 
  
2008 (CONT'D)  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
India – Additional Import Duties  
WT/DS360/AB/R  United States  India India 
United Sta tes Australia  
Chile 
European 
Communities  
Japan  
Viet Nam  
EC – Bananas III  
(Article  21.5 ‒ Ecuador  II) 
WT/DS27/AB/RW2/ECU and  Corr.1  European 
Communities  Ecuador  Ecuador  
European 
Communities  Belize  
Brazil  
Cameroon  
Colombia  
Côte d'Ivoire  
Dominica  
Dominican 
Republic  
Ghana  
Jamaica  
Japan  
Nicaragua  
Panama  
St Lucia 
St Vincent & the 
Grenadines  
Suriname  
United States  
EC – Bananas III 
(Article  21.5 ‒ US) 
WT/DS27/AB/RW/USA and  Corr.1  European 
Communities  --- United States  Belize  
Brazil  
Cameroon  
Colombia  
Côte d'Ivoire  
Dominica  
Dominican 
Republic  
Ecuador  
Jamaica  
Japan  
Mexico  
Nicaragua  
Panama  
St Lucia 
St Vincent & 
the Grenadines  
Suriname  WT/AB/2 7 
 
- 147 - 
 
 2008 (CONT'D)  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
China – Auto Parts (EC)  
WT/DS339/AB/R  China  --- European 
Communities  Argentina  
Australia  
Brazil  
Japan  
Mexico  
Chinese Taipei  
Thailand  
China – Auto Parts (US)  
WT/DS340/AB/R  China  --- United States  Argentina  
Australia  
Brazil  
Japan  
Mexico  
Chinese Taipei  
Thailand  
China – Auto Parts (Canada)  
WT/DS342/AB/R  China --- Canada  Argentina  
Australia  
Brazil  
Japan  
Mexico  
Chinese Taipei  
Thailand  
 WT/AB/2 7 
 
- 148 - 
 
 2009  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
US – Continued Zeroing  
WT/DS350/AB/R  European 
Communities  United States  European 
Communities  
United States  Brazil  
China  
Egypt  
India 
Japan  
Korea  
Mexico  
Norway  
Chinese Taipei  
Thailand  
US – Zeroing (EC)  
(Article  21.5 ‒ EC) 
WT/DS294/AB/RW and Corr.1  European 
Communities  United States  European 
Communities  
United States  India 
Japan  
Korea  
Mexico  
Norway  
Chinese Taipei  
Thailand  
US – Zeroing (Japan) 
(Article  21.5 – Japan)  
WT/DS322/AB/RW  United States  --- Japan  China  
European  
Communities  
Hong Kong, 
China  
Korea  
Mexico  
Norway  
Chinese Taipei  
Thailand  
China – Publications and 
Audiovisual Products  
WT/DS363/AB/R  China  United States  China  
United States  Australia  
European 
Communities  
Japan  
Korea  
Chinese Taipei  
 
2010  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
Australia – Apples  
WT/DS367/AB/R  Australia  New Zealand  New Zealand  
Australia  Chile 
European Union  
Japan  
Pakistan  
Chinese Taipei  
United States  WT/AB/2 7 
 
- 149 - 
 
 2011  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
US – Anti-Dumping and 
Countervailing Duties (China)  
WT/DS379/AB/R  China  --- United States  Argentina  
Australia  
Bahrain  
Brazil  
Canada  
European Union  
India 
Japan  
Kuwait  
Mexico  
Norway  
Saudi Arabia  
Chinese Taipei  
Turkey  
EC and certain member States  – 
Large Civil Aircraft  
WT/DS316/AB/R  European Union  United States  United States  
European Union  Australia  
Brazil  
Canada  
China  
Japan  
Korea  
Thailand – Cigarettes (Philippines)  
WT/DS371/AB/R  Thailand  --- Philippines  Australia  
China  
European Union  
India 
Chine se Taipei  
United States  
EC – Fasteners (China)  
WT/DS397/AB/R  European Union  China  China  
European Union  Brazil  
Canada  
Chile 
Colombia  
India 
Japan  
Norway  
Chinese Taipei  
Thailand  
Turkey  
United States  
US – Tyres (China)  
WT/DS399/AB/R  China  --- United States  European Union  
Japan  
Chinese Taipei  
Turkey  
Viet Nam  
 WT/AB/2 7 
 
- 150 - 
 
 2011 (CONT'D)  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
Philippines – Distilled Spirits  
(European Union)  
WT/DS396/AB/R  Philippines  European Union  European Union  
Philippines  Australia  
China  
India 
Mexico  
Chinese Taipei  
Thailand  
Philippines – Distilled Spirits 
(United States)  
WT/DS403/AB/R  Philippines  --- United States  Australia  
China  
Colombia  
India 
Mexico  
Chinese Taipei  
Thailand  
 WT/AB/2 7 
 
- 151 - 
 
 2012  
Case  Appellant  Other 
appellant(s)  Appellee (s) Third 
participant(s)  
China – Raw Materials 
(United  States)  
WT/DS394/AB/R  China  United States  China  
United States  Argentina  
Brazil  
Canada  
Chile 
Colombia  
Ecuador  
India 
Japan  
Korea  
Norway  
Saudi Arabia  
Chinese Taipei  
Turkey  
China – Raw Materials 
(Europea n Union)  
WT/DS395/AB/R  China  European Union  China  
European Union  Argentina  
Brazil  
Canada  
Chile 
Colombia  
Ecuador  
India 
Japan  
Korea  
Norway  
Saudi Arabia  
Chinese Taipei  
Turkey  
China – Raw Materials  
(Mexico)  
WT/DS398/AB/R  China  Mexico  China  
Mexico  Argentina  
Brazil 
Canada  
Chile 
Colombia  
Ecuador  
India 
Japan  
Korea  
Norway  
Saudi Arabia  
Chinese Taipei  
Turkey  
 
 WT/AB/2 7 
 
- 152 - 
 
 2012 (CONT'D)  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
US – Large Civil Aircraft 
(2nd complaint)  
WT/DS353/AB/R  European Union  United States  United States  
European Union  Australia  
Brazil  
Canada  
China  
Japan  
Korea  
US – Clove Cigarettes  
WT/DS406/AB/R  United States  --- Indonesia  Brazil  
Colombia  
Dominican 
Republic  
European Union  
Guatemala  
Mexico  
Norway  
Turkey  
US – Tuna II (Mexico)  
WT/DS 381/AB/R  United States  Mexico  Mexico  
United States  Argentina  
Australia  
Brazil  
Canada  
China  
Ecuador  
Guatemala  
Japan  
Korea  
New Zealand  
Chinese Taipei  
Thailand  
Turkey  
Venezuela  
US – COOL (Canada)  
WT/DS384/AB/R  United States  Canada  Canada  
United States  
 Argentina  
Australia  
Brazil  
China  
Colombia  
European Union  
Guatemala  
India 
Japan  
Korea  
New Zealand  
Peru 
Chinese Taipei  
 WT/AB/2 7 
 
- 153 - 
 
 2012 (CONT'D)  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
US – COOL (Mexico)  
WT/DS386/AB/R  United States  Mexico  Mexico 
United States  Argentina  
Australia  
Brazil  
China  
Colombia  
European Union  
Guatemala  
India 
Japan  
Korea  
New Zealand  
Peru 
Chinese Taipei  
China – GOES  
WT/DS414/AB/R  China  --- United States  Argentina  
European Union  
Honduras  
India 
Japan  
Korea  
Saudi Arabia  
Viet Nam  
 WT/AB/2 7 
 
- 154 - 
 
 2013  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
Canada – Renewable Energy  
WT/DS412/AB/R  Canada  Japan  Japan  
Canada  Australia  
Brazil  
China  
El Salvador  
European Union  
Honduras  
India 
Korea  
Mexico  
Norway  
Saudi Arabia  
Chinese T aipei 
United States  
Canada – Feed-in Tariff Program  
WT/DS426/AB/R  Canada  European Union  European Union  
Canada  Australia  
Brazil  
China  
El Salvador  
India 
Japan  
Korea  
Mexico  
Norway  
Saudi Arabia  
Chinese Taipei  
Turkey  
United States  
 WT/AB/2 7 
 
- 155 - 
 
 2014  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
EC – Seal Products  (Canada)  
WT/DS400/AB/R  Canada  
 European Union  Canada  
European Union  Argentina  
China  
Colombia  
Ecuador  
Iceland  
Japan  
Mexico  
Russia  
United States  
EC – Seal Products  (Norway)  
WT/DS401/AB/R  Norway European Union  Norway  
European Union  Argentina  
China  
Colombia  
Ecuador  
Iceland  
Japan  
Mexico  
Namibia  
Russia  
United States  
US – Countervailing and 
Anti-Dumping Measures (China)  
WT/DS449/AB/R and Corr.1  China  United States  United States  
China  Australia  
Canada 
European Union  
India 
Japan  
Russia  
Turkey  
Viet Nam  
China – Rare Earths  (US)  
WT/DS431/AB/R  United States  China  United States  
China  Argentina  
Australia  
Brazil  
Canada  
Chinese Taipei  
Colombia  
European Union  
India 
Indonesia  
Korea  
Japan  
Norway  
Oman  
Peru 
Russia 
Saudi Arabia  
Turkey  
Viet Nam  
 WT/AB/2 7 
 
- 156 - 
 
 2014 (CONT'D)  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
China – Rare Earths  (EU) 
WT/DS432/AB/R  China  --- European Union  Argentina  
Australia  
Brazil  
Canada  
Chinese Taipei  
Colombia  
India 
Indonesia  
Japan  
Korea  
Norway  
Oman  
Peru 
Russia  
Saudi Arabia   
Turkey  
United States  
Viet Nam  
China – Rare Earths  (Japan)  
WT/DS433/AB/R  China  --- Japan  Argentina  
Australia  
Brazil  
Canada  
Chinese Taipei  
Colombia  
India 
Indonesia  
European Union  
Korea  
Norway  
Oman  
Peru 
Russia 
United States  
US – Carbon Steel (India)  
WT/DS436/AB/R  India United States  India  
United States  Australia  
Canada  
China  
European Union  
Saudi Arabia  
Turkey  WT/AB/2 7 
 
- 157 - 
 
 2014 (CONT'D)  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
US – Counterva iling Measures 
(China)  
WT/DS437/AB/R  China  United States  United States  
China  Australia  
Brazil  
Canada  
European Union  
India 
Japan  
Korea  
Norway  
Russia  
Saudi Arabia  
Turkey  
Viet Nam  
 WT/AB/2 7 
 
- 158 - 
 
 2015  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
Argentina – Import Measures (EU)  
WT/DS438/AB/R  Argentina  European Union  Argentina  
European Union  Australia  
Canada  
China  
Ecuador  
Guatemala  
India 
Israel  
Japan  
Korea  
Norway  
Saudi Arabia  
Chinese Taipei  
Thailand  
Turkey  
Switzerland  
United States  
Argentina – Import  Measures (US)  
WT/DS444/AB/R  Argentina   United States  Australia  
Canada  
China  
Ecuador  
European Union  
Guatemala  
India 
Israel  
Japan  
Korea  
Norway  
Saudi Arabia  
Chinese Taipei  
Thailand  
Turkey  
Switzerland  
Argentina – Import Measures 
(Japan)  
WT/DS445/AB/R  Argenti na Japan  Argentina  
Japan  Australia  
Canada  
China  
Ecuador  
European Union  
Guatemala  
India 
Israel  
Korea  
Norway  
Saudi Arabia  
Chinese Taipei  
Thailand  
Turkey  
Switzerland  
United States  
 WT/AB/2 7 
 
- 159 - 
 
 2015 (CONT'D)  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
US – COOL (Article  21.5 – Canada)  
WT/DS384/AB/RW  United States  Canada  Canada  
United States  Australia  
Brazil  
China  
Colombia  
European Union  
Guatemala  
India 
Japan  
Korea  
Mexico  
New Zealand  
US – COOL (Article  21.5 – Mexico)  
WT/DS386/AB/RW  United States  Mexico  Mexico  
United States  Australia  
Brazil  
Canada  
China  
Colombia  
European Union  
Guatemala  
India 
Japan  
Korea  
New Zealand  
US – Shrimp (Viet Nam)  
WT/DS429/AB/R  Viet Nam  --- United States  China  
Ecuador  
European Union  
Japan  
Norway  
Thailand  
India – Agricultural Products  
WT/DS430/AB/R  India --- United States  Argentina  
Brazil  
China  
Colombia  
Ecuador  
European Union  
Guatemala  
Japan  
Peru – Agricultural Products  
WT/DS457/AB/R  Peru Guatemala  Guatemala  
Peru Argentina  
Brazil  
China  
Colombia  
Ecuador  
El Salvador  
European Union  
Honduras  
India 
Korea  
United States  WT/AB/2 7 
 
- 160 - 
 
 2015 (CONT'D)  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
China – HP-SSST (Japan)  
WT/DS454/AB/R and Add. 1  Japan  China  China  
Japan  European Union  
India 
Korea  
Russia  
Saudi Ar abia 
Turkey  
United States  
China – HP-SSST (EU) 
WT/DS460/AB/R and Add. 1  China  European Union  China  
European Union  India 
Japan  
Korea  
Russia  
Saudi Arabia  
Turkey  
United States  
US – Tuna II (Mexico)  
(Article  21.5 – Mexico)  
WT/DS381/AB/RW  United States  Mexic o Mexico  
United States  Australia  
Canada  
China  
European Union  
Guatemala  
Japan  
Korea  
New Zealand  
Norway  
Thailand  
 WT/AB/2 7 
 
- 161 - 
 
 2016  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
EC – Fasteners 
(China)  
WT/DS397/AB/RW  European Union  China  China  
European Union  Japan  
United States  
Argentina – 
Financial Services  
WT/DS 453/AB/R  Panama  Argentina  Argentina  
Panama  Australia  
Brazil  
China  
Ecuador  
European Union  
Guatemala  
Honduras  
India 
Oman  
Saudi Arabia  
Singapore  
United States  
Colombia  –Textiles  
WT/DS461 /AB/R Colombia  --- Panama  China  
Ecuador  
El Salvador  
European Union  
Guatemala  
Honduras  
Philippines  
United States  
US – Washing 
Machines  
WT/DS464/AB/R  United States  Korea  Korea  
United States  Brazil  
Canada  
China  
European Union  
India 
Japan  
Norway  
Saudi Arabia  
Thailand 
Turkey  
Viet Nam  
 WT/AB/2 7 
 
- 162 - 
 
 2016 (CONT'D)  
Case  Appellant  Other 
appellant(s)  Appellee(s)  Third 
participant(s)  
India – Solar Cells  
WT/DS456/AB/R  India --- United States  Brazil  
Canada  
China  
Ecuador  
European Union  
Japan  
Korea  
Malaysia  
Norway  
Russia  
Saudi Arabia  
Chinese Taipei  
Turkey  
EU – Biodiesel 
(Argentina)  
WT/DS473/AB/R  European Union  Argentina  Argentina  
European Union  Australia  
China  
Colombia  
Indonesia  
Mexico  
Norway  
Russia  
Saudi Arabia  
Turkey  
United States  
 
 
__________