WT/DS476/6  
 
25 September 2018  
(18-5937) Page: 1/3 
  Original: English  
 
EUROPEAN UNION AND I TS MEMBER STATES – CERTAIN MEASURES RELA TING  
TO THE ENERGY SECTOR  
NOTIFICATION OF AN A PPEAL BY THE EUROPEAN UNION UNDER  
ARTICLE 16.4 AND ART ICLE 17 OF THE UNDER STANDING ON RULES  
AND PROCEDURES GOVER NING THE SETTLEMENT OF DISPUTES ( DSU),  
AND UNDER RULE 20(1)  OF THE WORKING PROC EDURES FOR APPELLATE  REVIEW  
The following communication, dated 21 September  2018, from the delegation of the European Union , 
is being circulated to Members.  
 
_______________  
 
 
1. Pursuant to Article 16.4 and Arti cle 17.1 of the DSU, the European Union hereby notifies to 
the Dispute Settlement Body its decision to appeal to the Appellate Body certain issues of law and 
legal interpretations covered in the report of the Panel in European Union and its Member States – 
Certain Measures relating to the Energy Sector  (WT/DS476/R) concerning the third -country 
certification measure, the infrastructure exemption measure and the TEN –E measure. Pursuant to 
Rule 23(1) of the Working Procedures for Appellate Review , the European  Union simultaneously files 
this Notice of Appeal with the Appellate Body Secretariat.  
2. For the reasons to be further elaborated in its submissions to t he Appellate Body, the 
European  Union appeals, and requests the Appellate Body to reverse or declare moot  and of no legal 
effect the findings and conclusions of the Panel with respect to the errors of law and legal 
interpretations contained in the Panel Report described below, and where indicated to complete the 
analysis on the basis of the Panel's findings a nd uncontested facts on the record.1 
I. THE THIRD -COUNTRY CE RTIFICATION MEASURE  
3. The European Union appeals the Panel's conclusion2 and related findings3 that the 
third-country certification measure, as implemented in the national laws of Croatia, Hungary a nd 
Lithuania, is inconsistent with Article XVII of the GATS and is not justified under the general 
exception in Article XIV(a) of the GATS.   
4. This conclusion is based on the Panel's erroneous finding that the third -country certification 
measure, as implemen ted in the provisions of the laws of the three EU Member States cited above, 
is not applied consistently with the chapeau  of Article XIV of the GATS4.  
5. In making this finding the Panel erred in the interpretation and application of the chapeau  of 
Article X IV of the GATS. More precisely, the Panel erred by holding that the lack of an 
                                                
1 Pursuant to Rule 2 0(2)(d)(iii) of the Working Procedures for Appellate Review  this Notice of  Appeal 
includes an indicative list of the paragraphs of the Panel Report containing the alleged errors, without prejudice 
to the ability of the European Union to refer to other paragraphs of the Panel Report in the context of its 
appeal.  
2 Panel report, para. 8.1.f.ii  
3 Including the finding in Panel report, para. 7.1254 and the supporting re asoning in paras. 7.1241 -
7.1253.  
4 Panel report, para. 7.1254.  WT/DS476/6  
 
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  ex-ante mechanism for assessing the threats to the security of gas supply posed by TSOs controlled 
by persons of an EU Member constitutes a means of "arbitrary or unjustifiable discrimination".5  
6. The European Union requests the Appellate Body to reverse the appealed conclusion and 
related findings concerning the third -country certification measure and to find that the third -country 
certification measure is justified under Article XIV (a) of the GAT S.  
II. THE INFRASTRUCTURE E XEMPTION MEASURE  
7. The European Union appeals the Panel's findings and conclusion that the two challenged 
OPAL conditions within the 2009 OPAL exemption decision are inconsistent with Article XI:1 of the 
GATT 1994.6 The Panel erre d in finding that "the two challenged OPAL conditions restrict market 
access for EU imports of natural gas from Russia and limit competitive opportunities for importation 
of Russian natural gas into the European Union ".7 
8. The Panel's findings that the condi tions relating to the 50% capacity cap and the 3 bcm/yr 
gas release programme have a limiting effect on the importation of natural gas from Russia8 are 
erroneous because the two conditions were examined in isolation from the generally applicable 
provisions  of EU law that provide their context. The effects of those conditions, which concern access 
to the OPAL pipeline 's capacities, must be assessed in the context of Directive 's rules that require 
third-party access to the gas transmission and distribution sy stem (Article 32) and allow partial 
exemptions to be granted to major new infrastructure (Article 36).  
9. The Panel erred in failing to examine the two challenged OPAL conditions in their regulatory 
context and in mischaracterizing them as a measure on the im portation of goods within the meaning 
of Article XI:1 of the GATT 1994.  
10. In the alternative, the European Union argues that, in any event, the Panel erred in finding 
that those conditions have a limiting effect on the importation of natural gas from Russia.9 
11. The European Union requests the Appellate Body to reverse the Panel 's findings and conclusion 
that the challenged OPAL conditions (that is, the 50% capacity cap and 3 bcm/yr gas release 
programme) are inconsistent with Article XI:1 of the GATT 1994.10 
III. THE TEN -E MEASURE  
12. The European Union appeals the Panel's conclusion11 and related findings12 that the 
TEN-E measure is inconsistent with Article III: 4 of the GATT 1994. This conclusion is based on the 
Panel's erroneous finding that the TEN –E measure accor ds "less f avourable treatment" to 
Russian  natural gas than to like natural gas of EU origin13.  
13. The European Union also appeals the Panel's conclusion14 and related findings15 that the 
TEN-E measure  is inconsistent with Article I:1 of the GATT 1994. This conc lusion is based on the 
Panel's erroneous finding that the TEN –E measure accords an "advantage" to imports of natural gas 
originating in countries other than Russia16. 
                                                
5 Panel report, paras. 7.1252 -7.1253.  
6 Panel report, para s. 7.980 -7.1003 and 8.1.d.iii . 
7 Panel report, para. 7.1002.  
8 Panel report, paras. 7.1000 -7.1002.   
9 Panel report, para. 7.1001.  
10 Panel report,  paras. 7.980 -7.1003 and 8.1.d.iii.   
11 Panel report, para. 8.1.g.  
12 Including Panel report, paras. 7.1285, 7.1299 -7.1301 and supporting reasoning in paras. 7.1267 -
7.1286 and 7.1314 -7.1324.  
13 Panel report, para. 7.1300.  
14 Panel report, para. 8. 1.g. 
15 Including Panel report, paras. 7.1285, 7.1311 -7.1313 and supporting reasoning in paras. 7.1267 -
7.1286 and 7.1314 -7.1324.  
16 Panel report, para. 7.1312.  WT/DS476/6  
 
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  14. In making these two findings the Panel erred in law in the following two ways:  
• first, by relying on an erroneous legal standard for establishing the existence of "less 
favourable treatment", for the purposes of Article III:4 of the GATT 1994, and of an 
"advantage", for the purposes of Article I:1 of the GATT 1994; and  
• second, by excl uding a priori  from its analysis the legal relevance of the existing 
infrastructures for transporting natural gas.  
15. In addition, when developing its analysis under both Article III:4 and I:1 of the GATT 1994 
the Panel acted inconsistently with Article 11 o f the DSU by failing to conduct an objective 
assessment of the facts of the case:  
• first, the Panel failed to consider the detailed evidence and arguments submitted by the 
European Union with regard to the actual implementation of the TEN –E measure and, as  
a result, failed to undertake a "holistic assessment " of "all the relevant elements " in order 
to ascertain the meaning and expected operation of the TEN –E measure;  
• second, the Panel 's analysis relied on the import statistics provided by the European  Union  
as Exhibit EU - 190. Yet the Panel misunderstood those statistics and drew conclusions 
that are not properly based on that evidence.  
16. Should the Appellate Body reverse the Panel's findings that the TEN –E measure is inconsistent 
with Article III:4 of the G ATT 1994 and Article I:1 of the GATT 1994, the European Union further 
requests the Appellate Body to declare moot and of no legal effect the Panel 's conclusion that the 
TEN–E measure is not justified under Article XX (j) of the GATT 199417. 
17. In the event that the Appellate Body upheld the Panel's findings that the TEN –E measure is 
inconsistent with Article III:4 of the GATT 1994 and/or with Article I:1 of the GATT 1994, the 
European Union appeals the Panel's conclusion that the TEN –E measure  is not justifi ed under 
Article  XX (j) of the GATT 199418. This conclusion stems from an erroneous legal interpretation of 
the terms "in short supply" in Article XX (j) of the GATT 1994, according to which the terms 
"'products in general or local short supply' do not cove r products at risk of being in short supply" 
and only products that are "currently" in short supply can be considered to be "in short supply".  
18. Should the Appellate Body reverse the Panel's erroneous legal interpretation of the terms "in 
short supply", the  European Union further requests the Appellate Body to complete the analysis of 
the TEN –E measure in the light of remaining elements of the legal standard under Article XX (j) of 
the GATT 1994 and to find that the TEN –E measure is justified under that prov ision.  
 
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17 Panel report, paras. 8.1.g, 7.1350 -7.1353 and supporting reasoning in paras. 7.1328 -7.1349.  
18 Panel report, paras. 8.1.g, 7.1350 -7.1353 and supporting reasoning in paras. 7.1328 -7.1349.