RESTRICTED  
  
WT/DSB/M/412  
 
1 August  2018 
(18-4575) Page: 1/23 
Dispute Settlement Body  
27 April 2018    
 
MINUTES OF MEETING  
HELD IN THE CENTRE W ILLIAM RAPPARD  
ON 27  APRIL  2018 
Chairperson : Ms. Sunanta Kangvalkulkij  (Thailand)  
Prior to the adoption of the Agenda , the item concerning the adoption of the Panel Report in the 
dispute: " United States – Countervailing Duty Measures on Certain Products from China: Recourse 
to Article  21.5 of the DSU by China " (DS437) was removed from the proposed Agenda following 
the US decision to appeal the Report.  
 
 
Table of Contents  
1   SURVEILLANCE OF IMPL EMENTATION OF RECOMM ENDATIONS ADOPTED BY  
THE DSB  ................................ ................................ ................................ ...........................  2 
A.  United  States – Anti-dumping measures on certain hot -rolled steel products from 
Japan: Status report by the United  States  ................................ ................................ ..............  2 
B.  United  States – Section 110(5) of the US Copyright Act: Status report by the 
United  States  ................................ ................................ ................................ .....................  3 
C.  European  Communities – Measures affecting the approval and marketing of biotech 
products: Status report by the European  Union ................................ ................................ ....... 4 
D.  United  States – Anti-dumping and countervailing measures on large residential 
washers from Korea: Status report by the United  States  ................................ ..........................  4 
E.  China – Anti-dumping measures on imports of cellulose pulp from Canada: Status 
report by China  ................................ ................................ ................................ ...................  5 
2   RUSSIA – ANTI -DUMPING DUTIES ON LI GHT COMMERCIAL VEHIC LES FROM 
GERMANY AND ITALY  ................................ ................................ ................................ ....... 6 
A.  Implementation of the recommendations of the DSB  ................................ ..........................  6 
3   UNITED  STATES – CONTINUED DUMPING AN D SUBSIDY OFFSET ACT  
OF 2000: IMPLEMENTATION  OF THE RECOMMENDATIO NS ADOPTED BY THE DS B ...........  6 
A.  Statement by the European  Union  ................................ ................................ ....................  6 
4   STATEMENT BY COLOMBI A REGARDING THE MEAS URES ADOPTED BY 
PANAMA VIS -À-VIS SOME WTO MEMBERS  ................................ ................................ ....... 7 
5   UNITED  STATES ACTIONS UNDER  SECTION  301 OF THE TRADE ACT  OF 1974  .............  9 
A  Statement by China  ................................ ................................ ................................ .........  9 
6   AUSTRALIA – ANTI -DUMPING MEASURES ON A4 COPY PAPER  ................................ .. 14 
A.  Request for the establishment of a panel by Indonesia ................................ ....................... 14 WT/DSB/M/412  
 
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  7   UNITED  STATES – ANTI -DUMPING AND COUNTERV AILING DUTIES ON 
CERTAIN PRODUCTS AND  THE USE OF FACTS AVA ILABLE  ................................ ..............  14 
A.  Request for the establishment of a panel by the Republic of Korea  ................................ ......14 
8   UNITED  STATES – COUNTERVAILING MEASU RES ON CERTAIN HOT -ROLLED 
CARBON STEEL FLAT PR ODUCTS FROM INDIA  ................................ ...............................  15 
A.  Recourse to Article  21.5 of the DSU by India: Request for the establishment 
of a panel  ................................ ................................ ................................ ......................... 15 
9   APPELLATE BODY MATTE RS ................................ ................................ ......................  16 
A.  Appellate Body Appointments: Proposal by Argentina; Australia; Plurinational State of 
Bolivia; Brazil; Canada; Chile; China; Colombia; Costa  Rica; Dominican  Republic; 
Ecuador; El  Salvador; the European  Union; Guatemala; Honduras; Hong  Kong, China; 
India; Indonesia; Israel; Kazakhstan;  Korea; Mexico; New  Zealand; Nicaragua; Norway; 
Pakistan; Panama; Paraguay; Peru; the Russian  Federation; Singapore; Switzerland; the 
Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu; Turkey; Ukraine; 
Uruguay and Viet  Nam ................................ ................................ ................................ ........ 16 
 
 
1  SURVEILLANCE OF IMPL EMENTATION OF RECOMM ENDATIONS ADOPTED BY  THE DSB 
A.  United  States – Anti-dumping measures on certain hot -rolled steel products from Japan: Status 
report by the United  States (WT/DS184/15/Add.182)  
B.  United  States – Section 110(5) of the US Copyright Act: Status report by the United  States 
(WT/DS160/24/Add.157)  
C.  European  Communities – Measures affecting the approval and marketing of biotech products: 
Status report by the European  Union (WT/DS291/37/Add.120)  
D.  United  States – Anti-dumping and countervailing measures on large residential washers from 
Korea: Status report by the United  States (WT/DS464/17/Add.4)  
E.  China – Anti-dumping measures on import s of cellulose pulp from Canada: Status report by 
China (WT/DS483/7/Add.3)  
1.1.  The Chairperson  noted that there were five sub -items under this Agenda item concerning 
status reports submitted by delegations pursuant to Article  21.6 of the DSU. She recalled that  
Article  21.6 required that: "Unless the DSB decides otherwise, the issue of implementation of the 
recommendations or rulings shall be placed on the Agenda of the DSB meeting after six months 
following the date of establishment of the reasonable period of time and shall remain on the DSB's  
Agenda until the issue is resolved". Under this Agenda item, she invited delegations to provide 
up-to-date information about compliance efforts and to focus on new developments, suggestions 
and ideas on progress towards t he resolution of disputes. She also reminded delegations that, as 
provided for in Rule  27 of the Rules of Procedure for DSB meetings: "[r]epresentatives should 
make every effort to avoid the repetition of a full debate at each meeting on any issue that has  
already been fully debated in the past and on which there appears to have been no change in 
Members' positions already on record".  
A.  United  States – Anti-dumping measures on certain hot -rolled steel products from 
Japan: Status report by the United  States (WT/DS184/15/Add.182)  
1.2.  The Chairperson  drew attention to document WT/DS184/15/Add.182, which contained the 
status report by the United States on progress in the implementation of the DSB's  
recommendations in the case "US – Hot-Rolled Steel".  
1.3.  The United  States  had provided a status report in this dispute on 16  April 2018, in 
accordance with Article  21.6 of the DSU. The United  States had addressed the DSB's  
recommendations and rulings with respect to the calculation of anti -dumping margins in the 
hot-rolled steel anti -dumping duty investigation at issue. With respect to the recommendations WT/DSB/M/412  
 
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  and rulings of the DSB that had  yet to be addressed, the US  Administration would work with the 
US Congress with respect to appropriate statutory measures that would resol ve this matter.  
1.4.  The representative of Japan  said that his country thanked the United  States for the latest 
status report and the statement made at the present meeting. Japan, once again, called on the 
United  States to fully implement the DSB's recommendati ons and rulings so as to resolve this 
matter.  
1.5.  The DSB took note  of the statements and agreed  to revert to this matter at its next regular 
meeting.  
B.  United  States – Section 110(5) of the US Copyright Act: Status report by the 
United  States (WT/DS160/24/A dd.157)  
1.6.  The Chairperson  drew attention to document WT/DS160/24/Add.157, which contained the 
status report by the United  States on progress in the implementation of the DSB's  
recommendations in the case "US – Section 110(5) Copyright Act".  
1.7.  The representativ e of the United  States  said that the United States  had provided a status 
report in this dispute on 16  April 2018, in accordance with Article  21.6 of the DSU. The 
US Administration would continue to confer with the European  Union, and work closely with the 
US Congress, in order to reach a mutually satisfactory resolution of this matter.  
1.8.  The European  Union  said that his delegation thanked the United  States for its status report 
and its statement made at the present meeting. The EU referred to its previous sta tements and 
reiterated that it would like to resolve this dispute as soon as possible.  
1.9.  The representative of China  said that the United  States had, once again, failed to report on 
any progress in this 158th status report with regard to the DSB's  recommendations and rulings. 
The United  States was the only WTO Member who failed to comply with the DSB's 
recommendations with regard to the TRIPS Agreement, long after the expiry of the reasonable 
period of time. Section 110(5) of the United States Copy right Act, which had been found to be 
inconsistent with the requirements of the Berne Convention and the TRIPS Agreement, was still in 
effect. China reiterated its serious concerns about the fact that intellectual property right holders 
were still denied t heir legitimate rights and that the United States failed to provide minimum 
standards of protection as required by the TRIPS Agreement. China reiterated that the 
United  States should consider specifying, in its next status report, the precise action, which  it had 
taken thus far to comply with the DSB's  recommendations. China urged the United  States, once 
again, to implement the DSB's  recommendations by amending or withdrawing the law at issue.  
1.10.   The representative of the United  States  said that, by intervenin g under this Agenda item, 
China attempted to give the appearance of concern for intellectual property rights. At the present 
meeting, the United States would discuss the significant and trade distorting shortcomings in 
China's treatment of intellectual pro perty under Agenda item  5. Under th is item, the United States 
could say that as  the companies and innovators of China and other Members well knew, the 
intellectual property protection that the United  States provided within its own territory equalled or 
surpassed that of any other Member. Indeed, a s China also well knew, none of the damaging 
technology transfer practices of China that  were at issue under Agenda  item 5 were practices that 
Chinese compani es or innovators faced in the United  States.  
1.11.   The representative of China  said that, with respect to the second intervention by the 
United  States, his country reminded the United  States that, under this Agenda item, the issue was 
whether the United  States h ad implemented the DSB's recommendations and rulings. China had 
legitimate economic and systemic interests on this matter, and, thus, looked forward to an 
explanation by the United  States with regard to the reasons  for its continued non -compliance.  
1.12.   The DSB  took note  of the statements and agreed  to revert to this matter at its next regular 
meeting.  WT/DSB/M/412  
 
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  C.  European  Communities – Measures affecting the approval and marketing of biotech 
products: Status report by the European  Union (WT/DS291/37/Add.120)  
1.13.   The Chairp erson  drew attention to document WT/DS291/37/Add.120, which contained the 
status report by the European  Union on progress in the implementation of the DSB's 
recommendations in the case "EC – Approval and Marketing of Biotech Products".  
1.14.   The representative o f the European  Union  said that his delegation continued its progress 
with regard to authorizations where the European Food Safety Authority had finalized its scientific 
opinion and concluded that there were no safety concerns. On 19  March  2018, the draft 
authorization for the renewal of one GM sugar beet1 for food and feed was submitted for vote by 
the member States committee, resulting in "no opinion". This measure had been submitted for a 
vote to the Appeal Committee on 25  April 2018, with a "no -opinion" outcome. It was now for the 
European Commission to decide on that authorization. On 23  April 2018, two draft authorizations 
had been presented for vote to the member States committee, i.e. one for a renewal of GM maize2 
and one new authorization for GM mai ze.3 As the votes had resulted in "no opinion", the draft 
measures would be submitted for a vote to the Appeal Committee in May  2018. The EU continued 
to be committed to act in adherence with its WTO obligations. As had been stated at previous DSB 
meetings , the EU recalled that the EU approval system was not covered by the DSB's  
recommendations and rulings.  
1.15.   The representative of the United  States  said that the United States  thanked the EU for its 
status report and its statement made at the present meeting. The United  States once again noted 
its ongoing concerns that the EU measures affecting the approval of biotech products continued to 
involve prolonged, unpredictable and unexplained delays at every stage of the approval process. 
These delays had affected t he products  that had been previously approved by the EU and 
continued to affect the dozens of applications that had been awaiting approval for months. Even 
when the EU finally approved a biotech product, the EU had facilitated the ability of individual EU 
member States to impose bans on the supposedly approved product. As the United States had 
noted at previous DSB meetings, the EU had adopted legislation that permitted EU member states 
to "opt out" of certain approvals, even where the European Food Safety Authority had concluded 
that the product was safe. The United States again urged the EU to ensure that all of its measures 
affecting the approval of biotech products, including measures adopted by individual EU member 
States, were supported by scientific e vidence, and that decisions were taken without undue delay.  
1.16.   The representative of the European  Union  said that the United States had referred in its 
intervention to the EU's opt -out legislation. The EU's opt -out legislation was not covered by the 
DSB's rec ommendations and rulings. The EU further noted that, as of the present day, no EU 
member State had imposed any ban.  
1.17.   The DSB took note  of the statements and agreed  to revert to this matter at its next regular 
meeting.  
D.  United  States – Anti-dumping and co untervailing measures on large residential 
washers from Korea: Status report by the United  States (WT/DS464/17/Add.4)  
1.18.   The Chairperson  drew attention to document WT/DS464/17/Add.4, which contained the 
status report by the United States on progress in the im plementation of the 
DSB's  recommendations in the case "US – Washing Machines".  
1.19.   The representative of the United  States  said that the United States  had provided a status 
report in this dispute on 16  April 2018, in accordance with Article  21.6 of the DSU. On  
15 December  2017, the US Trade Representative had requested the US Department of Commerce 
to make a determination under Section  129 of the Uruguay Round Agreements Act to address the 
DSB's recommendations relating to the Department's countervailing duty i nvestigation of washers 
from Korea. On 18  December  2017, the US Department of Commerce had initiated a proceeding to 
make such determination. Since that time, the Department had issued initial and supplemental 
questionnaires seeking additional information necessary to conduct the Section  129 proceeding. 
                                                
1 Sugar beet H7 -1. 
2 Maize GA21.  
3 Maize 1507 × 59122 × MON 810 × NK603.  WT/DSB/M/412  
 
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  The United  States continued to consult with interested parties on options to address the 
recommendations of the DSB relating to anti -dumping measures challenged in this dispute.  
1.20.   The representative of Korea  said that his country thanked the United  States for its latest 
status report and the statement made at the present meeting. More than 19  months had passed 
since the adoption of the Panel and Appellate Body Reports in this dispute, nevertheless, there was 
barely any implementation progress, especially relating to the anti -dumping measures at issue. In 
this regard, Korea, once again, urged the United  States to faithfully implement the DSB's  
recommendations and rulings in this dispute to fully comply with its o bligations under the covered 
agreements.  
1.21.   The representative of Canada  said that his country was concerned that the United  States 
had not implemented the DSB's recommendations and rulings in this dispute. In particular, Canada 
was deeply disappointed that, despite the expiry of the reasonable period of time, the 
United  States continued to collect cash deposits from Canadian exporters based on a methodology 
that had been found to be "as such" inconsistent with WTO obligations in this dispute.  
1.22.   The DSB took not e of the statements and agreed  to revert to this matter at its next regular 
meeting.  
E.  China – Anti-dumping measures on imports of cellulose pulp from Canada: Status 
report by China (WT/DS483/7/Add.3)  
1.23.   The Chairperson  drew attention to document WT/DS483/7 /Add.3, which contained the 
status report by China on progress in the implementation of the DSB's recommendations in the 
case "China – Cellulose Pulp".  
1.24.   The representative of China  said that his country had provided a status report in this 
dispute on 16  April 2018, in accordance with Article  21.6 of the DSU. As had been agreed with 
Canada, the reasonable period of time in this dispute had expired on 22 April 2018. China was 
pleased to report that it had fully implemented the DSB's recommendations and rulings  in this 
dispute prior to the expiry of the reasonable period of time. On 25 August 2017, China's Ministry of 
Commerce had published a notice (Notice No.  43 of 2017) and had launched a re -investigation. On 
20 April 2018, China's Ministry of Commerce had published a notice (Notice No. 37 of 2018) and 
had issued the determination of the re -investigation. The issuance of the determination of the 
re-investigation brought China into compliance with the DSB's recommendations and rulings in this 
dispute.  
1.25.   The rep resentative of Canada  said that, on 20  April 2018, China had concluded its 
reinvestigation on Canadian imports of cellulose pulp into China. The purpose of this 
reinvestigation had been to implement the DSB's ruling that MOFCOM's anti -dumping investigation  
on Canadian imports of cellulose pulp had been inconsistent with the WTO Anti -Dumping 
Agreement. In its reinvestigation, MOFCOM had found that imports of cellulose pulp from Canada 
had caused material injury to China's domestic industry. As a result, MOFC OM had decided to 
continue to impose anti -dumping duties on Canadian dissolving pulp. Needless to say that Canada 
was very disappointed by this outcome. As mentioned at the last DSB meeting, substantial 
evidence on MOFCOM's record demonstrated that subject ed imports had not been responsible for 
any price depression suffered by the Chinese domestic industry. Similarly, incontrovertible 
evidence on MOFCOM's record had also shown that any material injury, suffered by the Chinese 
domestic industry, had been the  result of non -dumping factors. As a result, the only means to 
properly implement the DSB's recommendations and rulings had been to rescind these duties. 
Canada would continue to review China's reinvestigation report carefully and, if necessary, would 
ensure that its rights under the DSU were protected.  
1.26.   The DSB took note  of the statements.  WT/DSB/M/412  
 
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  2  RUSSIA – ANTI -DUMPING DUTIES ON LI GHT COMMERCIAL VEHIC LES FROM GERMANY 
AND ITALY  
A.  Implementation of the recommendations of the DSB  
2.1.  The Chairperson  recalled that in acc ordance with the DSU provisions, the DSB was required 
to keep the implementation of recommendations and rulings of the DSB under surveillance in order 
to ensure effective resolution of disputes to the benefit of all Members. In this respect, Article  21.3 
of the DSU provided that the Member concerned shall inform the DSB, within 30  days after the 
date of adoption of the panel or Appellate Body report, of its intentions in respect of 
implementation of the DSB's recommendations and rulings. She further recalle d that, at the 
9 April 2018 DSB meeting, the DSB had adopted the Appellate Body Report and the Panel Report, 
as had been modified by the Appellate Body Report, pertaining to the dispute on: " Russia – 
Commercial Vehicles" (DS479). She then invited the repre sentative of the Russian  Federation to 
inform the DSB of its intentions in respect of implementation of the DSB's recommendations.  
2.2.  The representative of the Russian  Federation  said that her country intended to implement the 
DSB's recommendations and ruling s in this dispute in a manner that respected its WTO obligations. 
She said that the Russian Federation would need a reasonable period of time to do so.  
2.3.  The representative of the European  Union  said that his delegation thanked the 
Russian  Federation for sta ting its intention to comply and looked forward to discussing with Russia 
the appropriate reasonable period of time for Russia's compliance.  
2.4.  The DSB took note of the statements and of the information provided by the 
Russian  Federation regarding its intentions in respect of implementation of the DSB's 
recommendations.  
3  UNITED  STATES – CONTINUED DUMPING AN D SUBSIDY OFFSET ACT  OF 2000: 
IMPLEMENTATION OF TH E RECOMMENDATIONS AD OPTED BY THE  DSB 
A.  Statement by the European  Union  
3.1.  The Chairperson  said that this item was on the Agenda of the present meeting at the request 
of the EU. She then invited the representative of the EU to speak.  
3.2.  The representative of the European  Union  said that his delegation reiterated its request to 
the U nited States to stop transferring anti -dumping and countervailing duties to the US industry. 
Every disbursement that still took place was an act of non -compliance with the DSB's  
recommendations and rulings. The EU renewed its call on the United States to a bide by its clear 
obligation under Article 21.6 of the DSU to submit status reports in this dispute. The EU  would 
continue requesting this Agenda item, for as long as the United States had not implemented the 
DSB's ruling.  
3.3.  The representative of Canada  said that his country thanked the EU for placing this item on 
the Agenda. Canada supported the EU's position that this item shall remain on the Agenda until 
the United  States complied with the DSB's recommendations and rulings.  
3.4.  The representative of Brazil  said that her country, once again, thanked the EU for keeping 
this item on the DSB Agenda. As an original party to the Byrd Amendment dispute, Brazil recalled 
that illegal disbursements continued to this day, more than 10  years after the adoption of the 
Repea l Act. Brazil, thus, called on the United  States to fully comply with the DSB's  
recommendations and rulings in this dispute.  
3.5.  The representative of the United  States  said that, as the United States had noted at previous 
DSB meetings, the Deficit Reduction A ct, which included a provision repealing the Continued 
Dumping and Subsidy Offset Act of 2000, had been enacted into law in February  2006. 
Accordingly, the United  States had taken all actions necessary to implement the DSB's 
recommendations and rulings in these disputes. The United  States recalled, furthermore, that the 
EU had acknowledged that the Deficit Reduction Act did not permit the distribution of duties 
collected on goods  that had entered after 1  October  2007, more than 10  years ago. With respect WT/DSB/M/412  
 
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  to the EU's request for status reports in this matter, as the United  States had already explained at 
previous DSB meetings, there was no obligation under the DSU to provide further status reports 
once a Member announced that it had implemented the DSB recomm endations and rulings, 
regardless of whether the complaining party disagreed about compliance. As the United  States had 
noted many times previously, the EU had demonstrated repeatedly that it shared this 
understanding, at least when it was the responding p arty in a dispute. Once again, this month the 
EU had provided no status report for long -standing disputes in which there was a disagreement 
between the parties on the EU's compliance.  
3.6.  The representative of the European  Union  said that his delegation referr ed to the last point 
made in the United  States' statement with regard to the delivery of status reports by the EU. In 
this regard, the EU noted that it had provided status reports on all cases that had involved the EU. 
At the present meeting, this was only  one dispute, namely: "EC  – Approval and Marketing of 
Biotech Products" (DS291).  
3.7.  The DSB took note  of the statements.  
4  STATEMENT BY COLOMBI A REGARDING THE MEAS URES ADOPTED BY PANA MA 
VIS-À-VIS SOME WTO MEMBERS  
4.1.  The Chairperson  said that this item was on the A genda of the present meeting at the request 
of Colombia. She then invited the representative of Colombia to speak.  
4.2.  The representative of Colombia  said that his country wished to refer to a series of measures, 
which had been adopted by Panama. These measures adversely affected Colombian exports, and 
were taken prior to the completion of the ongoing Article  21.5 proceedings in the dispute: 
"Colombia  – Textiles"  (DS461). These proceedings had started  on 18  June 2013 with a request for 
consultations by Panama. Although Panama had not been authorized by the DSB to suspend 
concessions, it had adopted measures that adversely affected Colombia's trade interests. Panam a 
had stated that such measures were of a "retaliatory" nature. Pursuant to Decree No.  28 of 
2 August  2016, Panama had raised the tariffs of thirteen sub -headings affecting certain Colombian 
products, including roses, carnations, gladioli, paper towels and  cement clinker. Following the 
adoption of the Panel and Appellate Body Reports by the DSB in 20164, two  requests for 
consultations had been made on 27  February  2017 and 9  March  2017, respectively.5 Colombia and 
Panama had made the respective requests with  regard to the measures taken by Colombia to 
comply with the DSB's  recommendations and rulings. Subsequently, the respective Panel requests 
had been submitted to the DSB. In the first request, Colombia, as the complainant6, had sought 
confirmation of its c ompliance with the recommendations, as set out in the Appellate Body Report 
in the initial proceeding. In the second request, Panama had claimed that Colombia had not 
complied with the recommendations of the Appellate Body Report.7 Currently, proceedings w ere 
ongoing, addressing both requests in parallel. According to Articles  21 and  22 of the DSU, the 
suspension of concessions could only be authorized by the DSB and could not be determined 
unilaterally by any Member. The Decree, as had been adopted by Pana ma, however, was a 
unilateral act without any basis in the dispute initiated under the DSU.  
4.3.  On 10  January  2018, pursuant to Decree  01 of 2018, Panama had decided to increase the 
tariffs of 32  sub-headings, including flowers, cement and bituminous coal. For  all of these 
products, Colombia was either the largest or the second largest exporter to the Panamanian 
market. At least one of these tariffs exceeded the bound import tariff rate, as contained in 
Panama's Schedule of Concessions. The Decree also establis hed a list of WTO Members. Panama's 
decision to target a list of WTO Members was also inconsistent with the MFN principle, as provided 
for in Article  I of the GATT  1994 and Article  II of the GATS. Furthermore, on 8  March  2018, 
Panama's Minister of Foreign Affairs, Economy and Finance and the Minister of Trade and Industry 
had signed Resolution No.  001-2018, pursuant to Law 48 of 26  October  2016, which "establishes 
retaliatory measures in the event of foreign discriminatory restrictions against the Republic of 
Panama". In Resolution No.  001-2018, Panama listed Brazil, Colombia, Chile, Ecuador, France and 
Peru, among other WTO Members, and declared that "these jurisdictions include Panama in 
                                                
4 Appellate Body Report of 7  June 2016 – WT/DS461/AB/R.  
5 WT/DS461/19 and WT/DS461/21 . 
6 WT/DS461/17 . 
7 WT/DS461/22 . WT/DSB/M/412  
 
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  discriminatory lists". Concerning Colombia specifically, the Resoluti on implied that Colombia 
belonged to a group of WTO Members that had discriminatory lists. Colombia noted, however, that 
this was untrue. The Resolution also stated that the legislation, which provided for the alleged 
discrimination, was Decree  No. 074 of 2013 concerning the importation of certain textiles, apparel 
and footwear. The said legislation was not in force and subject to an ongoing dispute. The DSB had 
not authorized the suspension of concessions. Colombia was, thus, concerned about Panama's 
decision to resort to unilateral action, which was a clear breach of WTO rules. Law  48 granted 
Panama to draw up lists of WTO Members that applied discriminatory measures vis-à-vis Panama, 
granting retaliatory action against them. Resolution No.  001-2018 contai ned such a list and 
included Colombia as a discriminating country. Pursuant to Article 23 of the DSU, Members had no 
right to undertake unilateral discrimination determinations, and even less so, implement 
retaliatory measures, including unauthorized suspe nsions of concessions. The prohibition of 
unilateral compliance determinations, as well as of unilateral trade retaliation, had been one of the 
key achievements of the DSU. Panama's measures were clearly inconsistent with Article  23 of the 
DSU, especially in light of the ongoing dispute settlement proceedings. Colombia drew attention to 
this issue given that such conduct was contrary to the very principles of the WTO dispute 
settlement system. Colombia called on Panama to cease its actions immediately . 
4.4.  The representative of Panama  said that her country took note of the statement made by 
Colombia at the present meeting, and explained that the list at issue, to which Colombia referred, 
only represented a step taken by Panama in response to discriminatory measu res imposed by 
certain WTO Members vis-à-vis Panama. These measures included monetary sanctions and 
burdensome procedural requirements, which affected transactions made by persons domiciled in 
Panama. The list of WTO Members that discriminated against Pana ma had been produced in a 
transparent manner, following diplomatic exchanges and bilateral consultations with these WTO 
Members. However, despite of the exchanges, Panama and the WTO Members at issue had not 
been in a position to agree on a satisfactory so lution to eliminate the discriminatory measures at 
issue. Panama noted that the mere existence of a list did not imply that measures or sanctions had 
been applied or would be applied to the WTO Members in question. Instead, drawing up the list 
simply marke d the beginning of a period of renewed bilateral consultations and exchanges. 
Panama emphasized that all bilateral channels for discussion, with the Members concerned 
remained open so as to provide the opportunity of being removed from the mentioned list. In this 
regard, Panama had invited Colombia, as well as the other listed WTO Members, to engage in 
renewed consultations. Panama further noted that, even when these consultations were over, no 
sanctions or measures would necessarily be applied. However, if  ever, any measures were to be 
applied, this would only be done, following due consideration by Panama, so as to assess what 
reaction would be needed in light of the situation at hand. Panama recalled that this was a right 
accorded to every WTO Member. If,  ultimately, measures should be applied, Panama would, as 
always, respect its international obligations, and in particular its WTO commitments and, any 
measures undertaken would be carefully evaluated and applied on a case -by-case basis.  
4.5.  Colombia had been included on this list because of the repeated measures that it had taken 
vis-à-vis Panama, which damaged Panama's economic interests significantly. The illegitimacy of 
Colombia's measures was well -known to anyone who had followed the decade -long disputes 
between the two WTO Members, and was confirmed by the associated findings. The DSU accorded 
particular importance to mutual agreements, which were reached through dialogue among WTO  
Members, and the DSU promoted such dialogue even for ongoing cases. Panama had, thus, invited 
Colombia to reengage in a dialogue with a view to settling the existing trade disputes. After a 
decade of WTO dispute settlement proceedings, Panama's claims, which had all been upheld by 
the DSB's recommendations and rulings, were yet t o be settled in a satisfactory manner. Instead, 
Colombia had imposed further discriminatory measures vis-à-vis Panama. As a WTO Member, 
Panama reserved its right to resort to means that were consistent with its international obligations 
to ensure that Colo mbia complies with its own international obligations.  
4.6.  The representative of Ecuador  said that his country intervened under this Agenda item to 
express its concern about having been listed, together with other WTO Members, by Panama, as a 
result of a Minist erial Resolution. According to Panama, the said list comprised WTO Members, 
which applied discriminatory or restrictive measures vis-à-vis Panama. Panama claimed that these 
measures adversely affected its economic and trade interests. The Ministerial Resol ution provided 
for the implementation of Law No.  48 of 26 October 2016, which, in turn, provided for retaliatory 
measures in response to discriminatory restrictions. Ecuador was concerned about this unilateral 
determination by Panama, as the law provided t hat Panama could decide unilaterally whether or WT/DSB/M/412  
 
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  not a measure adopted by another WTO Member was discriminatory without conducting 
consultations for such a determination. Ecuador encouraged the review of Law No.  48 of 
26 October  2016 and recalled that WTO r ules should be fully respected.  
4.7.  The representative of Brazil  said that her country thanked Colombia for including this item on 
the DSB Agenda. Brazil expressed its concern about its inclusion in a list of WTO Members, which 
had allegedly maintained discrim inatory measures against Panama. The list had been created 
under Resolution No.  001-2018, which had been issued by the Government of Panama on 
8 March  2018. Brazil understood that this list had been created to enable Panama to take action, 
pursuant to Arti cle 8 of Law  48-2016, vis-à-vis the listed WTO Members. Such action could take 
the form of tariff increases, for example, affecting the products, which were being sold by 
nationals of the WTO  Members that had been included on the said list. Brazil was of the view that 
its inclusion in a  list of WTO Members that had allegedly maintained discriminatory measures 
vis-à-vis Panama was unwarranted. Brazil stood ready to discuss the matter with Panama and 
hoped that Panama would be mindful of its obligations under the WTO Agreement.  
4.8.  The represe ntative of the Russian  Federation  said that her country shared the concerns 
raised by Brazil, Colombia and Ecuador. The Russian Federation underscored that if Panama was of 
the view that its rights, under the covered agreements, had been in any way undermi ned, Panama 
could take recourse to available WTO instruments. In doing so, Panama could address any such 
issue in a legitimate way, namely, by raising the matter in a relevant WTO body, including the 
DSB, and resolve it through a dispute settlement procedu re. Without a DSB ruling, unilateral 
retaliatory action was unacceptable. The Russian Federation called on Panama to refrain from 
violating its WTO obligations.  
4.9.  The representative of the European  Union  said that his delegation had listened to the 
concerns expressed by Colombia and other WTO Members on this matter. The EU understood that 
Panama had enacted legislation, which contained a list of WTO Members, vis-à-vis which, Panama 
could adopt a variety of retaliatory measures. The EU recalled that unilateral  retaliation, which was 
not based on WTO rules and procedures, undermined WTO  multilateralism and was, thus, 
unacceptable.  
4.10.   The representative of Panama  said that her country wished to reiterate its previous 
statement. The list, which Panama had drawn up, w as a response to similar lists that other 
Members had drawn up previously, and on which they had included Panama. Panama also 
reiterated that no sanctions or measures had been applied vis-à-vis any WTO Member on 
Panama's list. The diplomatic channels were open, including to all those WTO Members that had 
made statements under this Agenda item at the present meeting. Panama's Ministry of Foreign 
Affairs had approached all of the listed WTO  Members. Ecuador had responded to the request for 
bilateral consultat ions. Panama urged all other WTO Members on the said list to be in contact with 
their capitals so that consultations could be initiated.  
4.11.   The DSB took note  of the statements.  
5  UNITED  STATES ACTIONS UNDER  SECTION  301 OF THE TRADE ACT  OF 1974  
A.  Statement by China  
5.1.  The Chairperson  said that this item was on the Agenda of the present meeting at the request 
of China. She then invited the representative of China to speak.  
5.2.  The representative of China  said that on 18  August  2017, the United States had initiated a 
Section 301 investigation into China's intellectual property policy. The United States had claimed 
that the purpose of this investigation had been to address China's alleged "unfair economic 
practices" with the objective of "re -balancing the China -US trade r elationship", namely to lower the 
US trade deficit with China. On 22 March 2018, the United States had announced the plan to take 
a range of actions vis-à-vis China, as a result of the Section 301 investigation, including additional 
tariffs that the United  States intended to apply to US$50 billion worth of goods from China.  
5.3.  China noted that what had happened during the last eight months was not new; instead, 
many WTO Members were quite familiar with these types of actions. A large number of WTO  WT/DSB/M/412  
 
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  Members had been subject to Section  301 investigations, and as a result of these investigations, 
some of these Members had either been forced to open their markets to US  companies or had 
become the target of retaliatory action. Since its enactment in 1974, the United States had 
initiated 125  investigations under Section  301 of the Trade Act of 1974 and had taken 
17 retaliatory actions. There was a long list of WTO Members, which had been subject to 
Section  301 investigations. Between 1974 and 2018, the United States had initiated 
27 investigations against the EU, 16 investigations against Japan, 14 investigations against 
Canada, 11 investigations against Korea, 8 investigations against Brazil, 6 investigations against 
Argentina, 6 investigations against Chinese  Taipei , 5 investigations against India, 3 investigations 
against Thailand, 2 investigations against Belgium, France, Indonesia, Italy, Portugal, Spain, 
Sweden, Switzerland, the United  Kingdom, Ukraine respectively, and 1 investigation against 
Australia, Austria,  Colombia, Costa  Rica, Denmark, Germany, Guatemala, Honduras, Ireland, 
Mexico, Norway, Pakistan, Paraguay, the Netherland s, Turkey and the Soviet  Union, respectively.  
5.4.  The Section  301 investigation, which had been concluded most recently, was the 
125th  investigation, and there could be more. Prior to the establishment of the WTO, Section  301 
investigations, and associated retaliatory actions, were a nightmare for countries or regions, which 
did not possess as much negotiating leverage as the United States, a nd whose export industries 
relied heavily on the US market. Notably, the threshold to launch Section 301 investigations was 
relatively low, and approximately one third of all Section 301 investigations had been self -initiated 
by the United States, without a specific request by any domestic US industry. Twenty -three years 
after the establishment of the WTO, Section 301 of the Trade Act of 1974 continued to serve as a 
tool for the United States to take unilateral actions against fellow WTO  Members. In  2000, t he 
Panel in  "US – Section  301 Trade Act"  (DS152) had found that Section  301 was not inconsistent 
with Article  23 of the DSU, only when the US honoured its commitments. The US commitments 
were that it would base a Section 301 decision or action only on adop ted DSB's  recommendations 
and rulings. Contrary to these commitments, none of the decisions or actions taken by the 
United  States in the most recent Section 301 investigation, and subsequent actions, had been 
based on any adopted rulings and recommendation s of the DSB. The United  States had defended 
the most recent Section 301 investigation, and subsequent action, by asserting that the 
United  States had made no findings in the Section 301 investigation that China had breached its 
WTO obligations. The United  States, hence, argued that it was entitled to take retaliatory trade 
measures vis-à-vis China were legitimate, irrespective of whether or not the United  States' 
retaliatory measures were WTO -consistent. This was a fundamental misinterpretation of WTO 
Memb ers' obligations. The language in Article I and Article II of the GATT  1994 was clear. Under 
Article  I of the GATT  1994, Members had the unconditional obligation to provide MFN treatment to 
all WTO  Members, and under Article II  of the  GATT 1994, each Member "shall accord to the 
commerce of the other [Members] treatment no less favourable than that provided for in [its 
schedules of concessions]". The precondition suggested by the United States was simply no and 
unjustified. De facto, the unilateral nature of Section 301 had been revived and was now 
challenging the foundation of the rules -based multilateral trading system. China was, thus, of the 
view that the time had come for all WTO  Members to stand up against the unilateralism and 
protectionism manifested in the recent actions taken by the United States, so that what had 
happened time after time in the past, would not be repeated in the future.  
5.5.  The representative of the United  States  said that the United States  thanked China for placin g 
this item on the Agenda as it gave WTO Members the opportunity to discuss the seriously trade 
distorting policies  adopted by China  that were the subject of the ongoing Section  301 investigation 
that had been mentioned in China's statement. To be clear, i t was these policies, and not 
responses by the United States or other WTO Members to address these trade distorting policies, 
that were a threat to the international trading system. As WTO Members were aware, the United 
States had issued a detailed factual  report regarding the results of the US  investigation under 
Section 301, which was available on the USTR website. The report contained extensive evidence 
that China engaged in the following four types of practices involving technology transfer.  
5.6.  First, China used foreign ownership restrictions, such as joint venture requirements and 
foreign equity limitations, and various administrative review and licensing processes, to require or 
pressure technology transfer from foreign companies. These foreign  ownership restrictions 
prohibited foreign investors from operating in certain industries unless they partnered with a 
Chinese company, and in some cases, unless the Chinese partner was the controlling shareholder. 
These requirements precluded foreign comp anies from entering the market on their own terms, 
and laid the foundation for China to require or pressure the transfer of technology. China also used WT/DSB/M/412  
 
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  its administrative licensing and approval s processes to force technology transfer in exchange for 
the nu merous approvals needed to establish and operate a business in China. Vague provisions 
and uncertainty about the applicable rules provided Chinese authorities with wide discretion to use 
administrative processes to pressure technology transfer or otherwise  act in furtherance of China's 
trade -distorting industrial policy objectives.  
5.7.  Second, China's regime of technology regulations forced US companies seeking to license 
technologies to Chinese entities to do so on non -market -based terms that favoured Chinese  
recipients. China imposed a different set of rules for imported technology transfers originating 
from outside China, such as from foreign entities attempting to do business in China. These rules 
did not apply to technology transfers occurring between two domestic Chinese companies. China's 
mandatory requirements for importation of foreign technology were discriminatory and clearly 
more burdensome than the requirements applicable to domestic Chinese companies. Specifically, 
China mandated that all indemnity  risks were borne by the foreign technology transferor. Parties 
could not negotiate the allocation of this risk, even if the transferee would be willing to bear the 
risk under the contract. China also mandated that all improvements belong to the party maki ng 
the improvement and that a foreign licensor could not stop the Chinese licensee from making 
improvements to the technology. China further required that joint ventures, mandated under 
Chinese law, may continue to use transferred technology after the conc lusion of any licensing 
contract. These restrictions tipped the technology transfer regime in favour of Chinese entities 
before a foreign company even attempted to enter the market in China.  
5.8.  Third, China directed and unfairly facilitated the systematic inv estment in, and acquisition of, 
foreign companies and assets by Chinese companies to obtain cutting -edge technologies and 
intellectual property and to generat e the transfer of technology to Chinese companies. The role of 
the state in directing and supporti ng this outbound investment strategy was pervasive and evident 
at multiple levels of government – central, regional, and local. China had devoted massive 
amounts of financing to encourage and facilitate outbound investment in areas it deemed 
strategic. To implement these policies, China employed tools such as investment approval 
mechanisms and a system of "encouraged" sectors to channel and support outbound investment. 
These investments and acquisitions aligned with state objectives and policies, and were o ften 
undertaken by State -owned enterprises that were, by definition, owned and controlled by the 
government. Even when undertaken by companies, in which the government did not own an 
observable controlling stake, these transactions were frequently guided a nd directed by the State. 
In addition, many of these transactions were funded by State -owned entities or banks, often in 
situations where comparable commercial financing would have been unavailable.  
5.9.  Fourth, China conducted and supported unauthorized intrus ions into, and theft from, the 
computer networks of foreign companies to access their sensitive commercial information and 
trade secrets. For over a decade, China had conducted and supported cyber intrusions into US 
commercial networks, targeting confident ial business information held by US firms. Through these 
cyber intrusions, China had gained unauthorized access to a wide range of commercially -valuable 
business information, including trade secrets, technical data, negotiating positions, and sensitive 
and proprietary internal communications. China had used cyber -enabled theft and cyber intrusions 
to serve its strategic economic objectives. Documented incidents of China's cyber intrusions 
against US commercial entities aligned closely with China's industria l policy objectives.  
5.10.   These four technology transfer policies harmed every WTO Member, and every industry in 
every WTO Member, that relied on technology for maintaining competitiveness in world markets 
and increasing its people's standard of living. Instead  of addressing its damaging and 
discriminatory policies, China accused the United States of "unilateralism". This criticism had 
absolutely no validity. From the outset of the investigation, the United States had been clear that 
where an act, policy, or pra ctice appeared to involve WTO rules, the United States would pursue 
the matter through WTO dispute settlement. In fact, one of the areas of investigation, involving 
technology licensing, appeared to be amenable to WTO dispute settlement. In particular, cer tain 
technology licensing measures adopted by China appeared to deny patent rights to foreign IP 
holders and to discriminate  against foreign IP holders. Thus, China's measures appeared to be 
inconsistent with China's obligations under the TRIPS Agreement. Accordingly, on 23  March  2018, 
the United States had initiated a WTO dispute on this issue.8 The consultation request had been 
circulated, and WTO Members may review the request to see the TRIPS  Agreement issues 
                                                
8 "China – Certain Measures Concerning the Protection of Intellectual Property Rights " (DS542).  WT/DSB/M/412  
 
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  involved. T o be absolutely clear, t he United  States had made no findings in the Section  301 
investigation that the licensing measures at issue were inconsistent with China's TRIPS  Agreement 
obligations. Rather, as for any WTO dispute, the matter would be resolved by the parties or 
findings may be so ught through WTO dispute settlement. In contrast, the three other categories of 
measures covered in the US  investigation did not appear to implicate specific WTO obligations. In a 
previous DSB meeting, the United States had noted that, if China wished to t ell the DSB that the 
three other sets of acts, policies, and practices covered in the Section  301 investigation did 
amount to breaches of WTO  rules, it could do so. China now had another golden opportunity.  
5.11.   Accordingly, China's argument that the United Sta tes had somehow acted inconsistently 
with Article  23 of the DSU was completely lacking in foundation. Indeed, by asserting that the 
United States had breached the DSU, it was China itself that was acting inconsistently with 
Article  23. More broadly, the WT O system was not threatened, as China claimed, where a Member 
took steps to address harmful, trade distorting policies not directly covered by WTO rules. To the 
contrary, what did threaten the WTO was that China was asserting that the mere existence of the  
WTO prevented any action by any WTO Member to address its unfair, trade -distorting practices 
and policies, unless those policies were currently subject to WTO dispute settlement. If the WTO 
was seen as a shield protecting  those  WTO Members that chose to a dopt policies that could be 
shown to undermine the fairness and balance of the international trading system, then the WTO 
and the international trading system would lose all credibility and support among citizens.  
5.12.   The representative of Pakistan  said that h is country, a developing country, was a supporter 
of the multilateral trading system and was of the view that systemic concerns needed to be 
addressed if they were raised at any level. As had been raised by China, Pakistan also expressed 
its systemic conce rns with regard to the measures taken by the United States under Section  301 
of the US  Trade Act of  1974. Pakistan was of the view that such measures could have a significant 
impact on the global trading environment, in particular from a developing country  perspective. 
This action had the potential to spur a global protectionist backlash from other WTO Members. This 
would not only lead to serious consequences for developing countries but would, more importantly, 
weaken the basis of the multilateral trading system. As had been mentioned previously, the WTO  
Membership was already facing many challenges. Pakistan, thus, urged all WTO Members to 
continue to work towards trade multilateralism and openness as this would be the only way for all, 
especially smaller economies, to develop through the means of trade.  
5.13.   The representative of the Russian  Federation  said that her country had serious concerns 
with regard to the unilateral actions taken by the United States under Section  301 of the Trade Act 
of 1974. The Russian Federation recalled that the unilateral application of measures without the 
DSB decision was unacceptable.  
5.14.   The representative of Hong Kong, China  said that as a firm supporter of the rules -based 
multilateral trading system her delegation was opposed to any restrictive trade measures that 
were WTO -inconsistent. The entire WTO Membership would benefit by vigilant watch over 
unilateralism and protectionism. Her delegation appealed to China and the United States, the 
two largest economies in t he world, to resolve their disputes within the rules -based multilateral 
trading system. It was high time that the WTO demonstrated to the world what value predictable 
trade rules had on global trade.  
5.15.   The representative of Japan  that his country referred to  its previous statement made at the 
DSB meeting held on  27 March  2018, wh en the same issues had been raised.  
5.16.   The representative of Chinese  Taipei  said that her delegation shared the US  concerns with 
regard to intellectual property matters and forced techno logy transfers. Chinese  Taipei took note 
that, although certain measures, which had been mentioned by the United  States, would not 
involve specific WTO obligations, these measures could impact the fairness and balance of the 
world market. Chinese Taipei wa s of the view that such measures should be properly addressed 
before they became unamenable to any remedies. Chinese Taipei called on all WTO Members to 
work together and actively engage in relevant discussions so as to promote a fair and balanced 
multilat eral trading system.  
5.17.   The representative of the European  Union  said that his delegation wished to make two 
points. First, the EU shared the US concerns with regard to the protection of intellectual property WT/DSB/M/412  
 
- 13 - 
 
  rights and discriminatory conditions applying to f oreign licensors of intellectual property rights in 
China. These were well -known issues and long -standing concerns that the EU had raised over the 
years both in political dialogues with China and at the multilateral level, such as in TRIPS Council 
transiti onal reviews. Second, the EU was of the view that the only way to find solutions to these 
issues was through the multilateral trading system. Therefore, the EU would not support any 
measure, which were contrary to the WTO and, thus, called on WTO Members t o ensure 
compliance of their trade actions with WTO rules.  
5.18.   The representative of India said that her country was of the view that the multilateral 
trading system, embodied in the WTO, had served WTO Members well in ensuring fair and open 
trade, and in util izing trade as an engine for growth. The adoption of unilateral measures by WTO 
Members would erode the valued principles of predictability and non -discrimination and could lead 
to a full -blown trade war. As a firm supporter of the rules -based multilateral  trading system, India 
believed that gaps, imperfections and unfair elements in trade rules needed to be discussed and 
reformed at the WTO. Unilateral measures, on the other hand, could stop the fragile global 
economic recovery, with consequences for jobs,  GDP growth and development that would harm 
the entire WTO Membership. India, thus, urged all WTO Members to work together to safeguard 
the spirit of multilateralism and international cooperation,  and to refrain from any action that could 
weaken the WTO.  
5.19.   The representative of Brazil  said that his country had been following closely the recent 
actions taken under Section  301 of the Trade Act of 1974. While WTO Members were entitled to 
implement their trade policies according to their national legislation, inc luding by promoting 
investigations into alleged unlawful practices, any actions to remedy such practices should be fully 
consistent with their international obligations. Brazil encouraged the entire WTO Membership to 
abide by WTO rules, which had been deve loped collectively and which served the interests of all 
WTO Members. In particular, Brazil recalled that Article 23 of the DSU stated that redress of 
violations of obligations under the covered agreements should be made through recourse to the 
WTO dispute  settlement system.  
5.20.   The representative of Norway  said that her country shared the general concern raised by 
other WTO Members over what appeared to be a re -emergence of the use of unilateral trade 
measures, as a reaction to what was conceived to be WTO -inconsistent measures by other WTO 
Members. It was for the WTO, through the DSU process, and not an individual WTO Member, to 
determine that a measure was inconsistent with other WTO Members' obligations. This was one of 
the basic principles of the multilater al trading system and one that Norway was very keen to 
uphold. Having said that, Norway also shared the view that protection of intellectual property 
rights was important, and Norway had noted with interest that the United States had requested 
DSU consulta tions on that matter, in  "China  – Certain Measures Concerning the Protection of 
Intellectual Property Rights" (DS542). Norway looked forward to follow the case, as it developed.  
5.21.   The representative of China  said that his country took note of the US statement made at the 
present meeting. In the previous and present DSB meetings, the United States had listed policies 
that allegedly harmed the interests of other WTO Members as an excuse for resorting to 
unilate ralism. In this regard, China wished to make a few clarifications. First, the findings of the 
US Section  301 investigation were wilful distortions of facts and full of selective assertions and 
allegations, disregarding the actual progress China had made wi th regard to market -oriented 
reforms, in particular, concerning IP protection. With regard to the alleged policies, which forced 
foreign enterprises to transfer their technology and to agree to non -market based technology 
licensing terms that favoured Chin ese recipients, China reiterated that this assertion was entirely 
unfounded. China would defend its legitimate interests in " China – Certain Measures Concerning 
the Protection of Intellectual Property Rights" (DS542). In the meanwhile, China underlined the  
fact that contracts between Chinese companies and US companies were mutually beneficial 
arrangements agreed upon by the companies. Contrary to the presumption of the United States, 
no US company would ever enter into a contract if the terms of the contrac t were not favourable 
to its interests. Most US companies considered doing business in China as one of the most 
profitable business locations in the world. If the United States questioned China's joint venture 
requirements or foreign equity limitations, th is would be a market access issue. China had fully 
complied with its WTO market access commitments. Furthermore, China continued to eliminate the 
requirements for joint ventures and foreign equity limitations in some industries through reforming  
measures a nd bilateral investment agreement negotiations. This was an endeavor that took time 
but China would continue to open up its market, and these policy reforms were made by China at WT/DSB/M/412  
 
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  its own initiative and voluntarily. Second, the United States also claimed  that China directed or 
facilitated investment in, and acquisition of, US companies, or conducted and supported 
unauthorized intrusion into US company computer networks, China fundamentally objected to 
these allegations and failed to see any concrete evidence  with regard to this claim, in the 
200-page Section  301 report. Third, China emphasized that unilateral actions by the United  States 
had gravely undermined the foundations of the WTO, putting the Organization in an 
unprecedented danger. China reiterated it s call on the entire WTO Membership to work together 
and stand up firmly to the protectionist actions taken by the United States.  
5.22.   The DSB took note  of the statements.  
6  AUSTRALIA – ANTI -DUMPING MEASURES ON A4 COPY PAPER  
A.  Request for the establishment of a  panel by Indonesia (WT/DS529/6)  
6.1.  The Chairperson  recalled that the DSB had considered this matter at its meeting on 
27 March  2018 and had agreed to revert to it. She then drew attention to the communication from 
Indonesia, contained in document WT/DS529/6,  and invited the representative of Indonesia to 
speak.  
6.2.  The representative of Indonesia  said that, on 1  September  2017, her country had requested 
consultations with Australia with regard to Australia's anti -dumping duties on A4 copy paper from 
Indonesia. As  had been noted in Indonesia's request for consultations, Australia's anti -dumping 
determination appeared to be inconsistent with Australia's obligations under the GATT  1994 and 
the Anti -Dumping Agreement. Indonesia and Australia had held consultations on 31 October  2017, 
which unfortunately did not resolve the dispute. Indonesia had, thus, requested the establishment 
of a panel at the 27  March  2018 DSB meeting. However, Australia had objected to Indonesia's first 
request, hence, the second request at the p resent meeting. As had been set out in Indonesia's  
request for panel establishment, a number of substantive deficiencies existed in Australia's  
anti-dumping determination, which appeared to be inconsistent with its obligations under the 
GATT  1994 and the A nti-Dumping Agreement. Indonesia, therefore, requested that the DSB  
establish a panel to examine the matter as set out in Indonesia's panel request, with standard 
terms of reference.  
6.3.  The representative of Australia  said that her country considered it unfor tunate that Indonesia 
had proceeded with its second request for a WTO panel on this matter. As Australia had stated at 
the 27  March  2018 meeting of the DSB, Australia considered the investigation into alleged 
dumping of A4  copy paper from Indonesia, and th e subsequent imposition of dumping duties on 
certain Indonesian exporters, had been entirely consistent with the Anti -Dumping Agreement. 
Australia was of the view that the ability to take remedial action against dumped imports that were 
causing, or threate ned to cause, material injury to a domestic industry formed part of the critical 
balance of WTO Members' rights and obligations provided under WTO rules. While Australia stood 
ready to defend this matter before a WTO panel, it remained open to engage in a bilateral 
discussion with Indonesia to resolve this matter through a mutually agreeable solution. In this 
regard, Australia also reminded Indonesia that it had not yet exhausted the domestic review 
options available to it.  
6.4.  The DSB took note  of the statemen ts and agreed  to establish a panel in accordance with the 
provisions of Article  6 of the DSU with standard terms of reference.  
6.5.  The representatives of Canada , China , the European Union , India, Israel , Japan , the Russian 
Federation , Singapore , Thailand , Ukraine , the United  States  and Viet Nam reserved their 
third-party rights to participate in the Panel's proceedings.  
7  UNITED  STATES – ANTI -DUMPING AND COUNTERV AILING DUTIES ON CER TAIN 
PRODUCTS AND THE USE  OF FACTS AVAILABLE  
A.  Request for the establishment  of a panel by the Republic of Korea (WT/DS539/6)  
7.1.  The Chairperson  drew attention to the communication from Korea, contained in document 
WT/DS539/6, and invited the representative of Korea to speak.  WT/DSB/M/412  
 
- 15 - 
 
  7.2.  The representative of Korea  said that, as had been explained in the panel request dated 
16 April 2018, his country had serious concerns about the use of facts available by the authorities 
of the United  States in its anti -dumping and countervailing duty proceedings vis-à-vis certain 
products from Korea. More specifically, Korea was concerned that the use of adverse facts 
available, "as applied" in the challenged anti -dumping and countervailing duty proceedings, was 
inconsistent with US obligations under the Anti -Dumping Agreement and the SCM Agreement. In 
addition, it appeared that certain provisions of US law on the use of adverse facts available, such 
as Section  776 of the Tariff Act of  1930, as had been amended by Section  502 of the Trade 
Preferences Extension Act of  2015, as well a s US practice of resorting to the use of adverse facts 
available as a form of "ongoing conduct" or a rule or norm of general and prospective application, 
were also "as such" inconsistent with United States' obligations under the said Agreements. In 
additio n to a number of related procedural due process violations, as had been identified in the 
panel request, the undue use of adverse facts available had consequences, among others, on the 
determination of the margin of dumping or the amount of subsidization; on the determination of 
the impact of the allegedly dumped or subsidized imports on the domestic industry; on the 
imposition and maintenance of the duties; on the level of the duties imposed; and on the 
determination of the likelihood of dumping or subsidi zation and, thus, the extension of measures 
beyond the original period of application.  
7.3.  Korea had already provided a detailed explanation on how the use of adverse facts available 
by the United  States violated the covered agreements. Korea chose not to repe at these 
explanations at the present meeting. Korea and the United States had held consultations on 
22 March  2018. While the consultations had been helpful in understanding each other's positions 
on this matter, they had not led to a mutually satisfactory resolution of the dispute. The US 
measures continued to nullify or impair the benefits accruing to Korea, directly or indirectly, under 
the said Agreements. Korea, thus, requested the establishment of a panel to examine the matter 
set out in Korea's panel request, with standard terms of reference.  
7.4.  The representative of the United  States  said that the United States  regretted that Korea had 
sought the establishment of a panel in this matter. As the United  States had explained to Korea, 
the determinations ide ntified in Korea's request for panel establishment were fully consistent with 
WTO rules. Furthermore, Korea sought to challenge certain items that were not measures and 
would not fall within the scope of a dispute settlement proceeding. For these reasons, the 
United  States did not agree to the establishment of a panel at the present meeting.  
7.5.  The DSB took note  of the statements and agreed  to revert to this matter.  
8  UNITED  STATES – COUNTERVAILING MEASU RES ON CERTAIN HOT -ROLLED CARBON 
STEEL FLAT PRODUCTS FROM INDIA  
A.  Recourse to Article  21.5 of the DSU by India: Request for the establishment of a 
panel (WT/DS436/18)  
8.1.  The Chairperson  drew attention to the communication from India, contained in document 
WT/DS436/18, and invited the representative of India to spe ak. 
8.2.  The representative of India said that, on 19  December  2014, the DSB had adopted the 
Reports of the Appellate Body and the Panel in "US  – Carbon Steel (India)" (DS436). The Reports 
had found that the United  States had imposed countervailing duties on In dian exports of certain 
hot-rolled carbon steel flat products, in a manner that breached the US obligations under the SCM 
Agreement. The DSB had, thus, recommended that the United  States should bring its measures 
into conformity with its obligations under the SCM Agreement. The reasonable period of time to 
implement the DSB's recommendations and rulings had expired on 18  April 2016. On 6 May 2016, 
India and the United  States had concluded a sequencing agreement that would apply between the 
two parties, for the purpose of DS436 . India considered that the United States had failed to 
implement the DSB's  recommendations and rulings in DS436. Therefore, on 5 June 2017, India 
had requested consultations with the United States under Article  21.5 of the DSU, as well  as, 
under paragraph  1 of the sequencing agreement , which had been  concluded by the parties.  India 
and the United  States had held consultations on 13 July 2017 and 4  October  2017, respectively. 
The consultations had, unfortunately, not resolved the matter at issue, namely, India's concerns 
with regard to the US failure to implement the DSB's recommendations and rulings in this dispute.  WT/DSB/M/412  
 
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  8.3.  Paragraph  1 of the sequencing agreement  clearly provided that "[t]he parties to the dispute 
agree that after the end of suc h period for consultations, India may, at any time, request the 
establishment of a panel pursuant to Article  21.5 of the DSU". India had, thus, requested the 
establishment of a compliance panel under Article 21.5 of the DSU in its communication, dated 
29 March 2018 (WT/DS436/18). Paragraph 2 of the sequencing agreement  provided that the 
United  States should accept the establishment of an Article 21.5 panel at the first DSB meeting, at 
which India's compliance panel request appeared on the Agenda. India was disappointed that the 
United States had not complied with the DSB's recommendations and rulings in DS436, despite the 
fact that the reasonable period of time had expired more than two years ago. Among other issues, 
it appeared that the United Sta tes had made no effort to repeal or amend Section  1677(7)(G)(iii) 
of its domestic law to ensure conformity with Articles 15.1, 15.2, 15.3 and  15.5 of the 
SCM Agreement. India was of the view that the sheer indifference by the United  States on this 
matter w as a cause of concern for the integrity and effectiveness of the WTO dispute settlement 
system.  India, thus, requested the establishment of a panel under Article 21.5 of the DSU, with 
standard terms of reference, pursuant to Article 7.1 of the DSU. India a lso requested that, if 
possible, the matter should  be referred to the original Panel.  
8.4.  The representative of the United  States  said that, as the United States had stated at the 
November  2016 DSB meeting, and at prior DSB meetings, the United States had comp leted 
implementation with respect to the DSB recommendations in this dispute. Contrary to India's view, 
there was no basis for suggesting that US compliance had been inadequate. The United  States 
maintained that the measures identified in India's panel req uest were fully WTO -consistent. 
Nevertheless, the procedures set forth in the sequencing agreement between India and the United 
States provided that the United States shall accept the establishment of a panel at the first DSB 
meeting in which India's reque st appeared on the Agenda. The United States was prepared to 
engage in these proceedings and to explain to the panel why India had no legal basis for its 
claims. This statement was without prejudice to whether each of the items cited in India's panel 
reque st constituted a measure taken to comply for purposes of Article  21.5 of the DSU, and 
therefore was subject to examination by the panel.  
8.5.  The DSB took note of the statements and agreed , pursuant to Article  21.5 of the DSU, to 
refer to the original Panel, if  possible, the matter raised by India in document WT/DS436/18. It 
was agreed that t he Panel would have standard terms of reference.  
8.6.  The representatives of China , the European Union , Japan  and the Russian  Federation  
reserved their third -party rights to participate in the Panel's proceedings.  
9  APPELLATE BODY MATTE RS 
A.  Appellate Body Appointments: Proposal by Argentina; Australia; Plurinational State 
of Bolivia; Brazil; Canada; Chile; China; Colombia; Costa  Rica; Dominican  Republic; 
Ecuador; El  Salvador; the European  Union; Guatemala; Honduras; Hong  Kong, China; 
India; Indonesia; Israel; Kazakhstan; Korea; Mexico; New  Zealand; Nicaragua; Norway; 
Pakistan; Panama; Paraguay; Peru; the Russian  Federation; Singapore; Switzerland; the 
Separate Customs Territory  of Taiwan, Penghu, Kinmen and Matsu; Turkey; Ukraine; 
Uruguay and Viet  Nam (WT/DSB/W/609/Rev.3)  
9.1.  The Chairperson  said that this item was placed on the Agenda of the present meeting, at the 
request of Mexico on behalf of several delegations. In this regard,  she drew attention to the 
proposal, contained in document WT/DSB/W/609/Rev.3, and invited the representative of Mexico 
to speak.  
9.2.  The representative of Mexico  said that the following delegations: Argentina; Australia; 
Plurinational State of Bolivia; Brazil ; Canada; Chile; China; Colombia; Costa  Rica; 
Dominican  Republic; Ecuador; El  Salvador; the European  Union; Guatemala; Honduras; 
Hong Kong, China; India; Indonesia; Israel; Kazakhstan; Korea; Mexico; New  Zealand; Nicaragua; 
Norway; Pakistan; Panama; Paragu ay; Peru; the Russian  Federation; Singapore; Switzerland; the 
Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu; Turkey; Ukraine; Uruguay and 
Viet Nam, had agreed to submit a joint proposal to launch the selection processes for the 
vacancies i n the Appellate Body. Mexico, speaking on behalf of the 65  Members, as well as 
Iceland, wished to state the following. The considerable number of Members submitting this joint WT/DSB/M/412  
 
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  proposal reflected the common concern about the current situation in the Appella te Body, which 
was seriously affecting the WTO's work and the overall functioning of the dispute settlement 
system and was against the best interest of WTO Members. The WTO Members had a responsibility 
to safeguard and preserve the Appellate Body, the disp ute settlement system and the multilateral 
trading system. Thus, it was Members' duty to launch the selection processes for new Appellate 
Body members, as set out in the proposal submitted to the DSB at the present meeting. This 
proposal sought to, first, start the three selection processes, namely, one to replace Mr.  Ricardo 
Ramírez -Hernández, whose second term of office expired on 30 June 2017; a second process to fill 
the vacancy that had arisen following the resignation of Mr. Hyun Chong Kim with effect  from 
1 August  2017; and a third process to replace Mr. Peter Van den Bossche, whose second term 
expired on 11  December  2017. Second, to establish a Selection Committee. Third, to set a 30 -day 
deadline for the submission of candidacies. Fourth, to request that the Selection Committee 
circulate its recommendation within 60 days after the deadline for the nomination of candidates. 
While the proponents were flexible with regard to the deadlines for the selection processes, these 
should, however, reflect the ur gency of the situation. The co -sponsors of the proposal reiterated 
their call on all WTO Members to support the joint proposal in the interest of the dispute 
settlement system and the multilateral trading system as a whole.  
9.3.  The representative of the United  States  said that the United States  thanked the Chairperson 
for the continued work on these issues. As the United States had explained in prior DSB meetings, 
the United  States was not in a position to support the proposed decision. For at least the past 
eight months, the United States had been raising and explaining the systemic concerns that arose 
from the Appellate Body's decisions that purport to "deem" as an Appellate Body member someone 
whose term of office had expired and, thus, was no longer an Appel late Body member, pursuant to 
its Working Procedures for Appellate Review (Rule  15). During that period of time, the DSB had 
adopted by positive consensus two reports signed by someone no longer an Appellate Body 
member, and currently, there remained five ongoing appeals where the term of one or more of the 
persons appointed to the division had expired. In one instance, the person's term had expired 
almost ten months ago. However, the DSB had not yet addressed the problem of persons 
continuing to hear appea ls well after their terms had expired. Under the DSU, it was the DSB that 
had the authority to appoint Appellate Body members and to decide when their term in office 
would expire9, and so it was up to the DSB to decide whether a person who was no longer an  
Appellate Body member could continue to serve on an appeal. The United States appreciated the 
recognition by WTO Members at the last DSB meeting of the fact that addressing this issue was a 
joint responsibility of all WTO Members, and the United States ap preciated the willingness these 
WTO Members had expressed to engage on this issue.  The United States remained resolute in its 
view that WTO Members needed to resolve that issue as a priority. The United  States, therefore, 
would continue its efforts and its  discussions with WTO Members and with the Chairperson to seek 
a solution on this important issue.  
9.4.  The representative of Colombia , speaking on behalf of the GRULAC, said that the WTO was 
undergoing a delicate period due to the blockage to the Appellate Bod y selection processes. At the 
outset, Colombia wished to thank the Chairperson for her efforts to seek a solution for the current 
problem. Colombia reiterated its deep concern about the present situation, which affected the 
functioning of a key WTO body. I f this problem prevailed without resolution, it would bring about 
the paralysis of the Appellate Body in the near future. This would, in turn, put the entire dispute 
settlement system at risk. With the continued delay in launching the selection processes, the 
current number of vacancies had risen to three, and the WTO Membership was failing to comply 
with an existing mandate, and thus, breached its legal obligations under a covered agreement. 
This had serious systemic consequences and set a bad precedent fo r the WTO. This situation 
caused damage and affected the image and credibility of the WTO, in particular, given the complex 
international environment that was adversely affecting the multilateral trading system. Concerns 
had been raised regarding the funct ioning of the dispute settlement system and some specific 
issues regarding the decision -making process. Colombia disagreed that such concerns should be 
linked to the Appellate Body selection processes, and thus hinder WTO Members from fulfilling 
their lega l obligations under the DSU.  The proper functioning of the system should not be 
undermined because the concerns of some Members had not been addressed. Colombia called on 
the WTO Membership to understand the gravity of a continued blockage. The selection p rocesses 
should be delinked from unrelated concerns and should be addressed on the basis of their own 
                                                
9 Understanding on Rules and Procedures Governing the Settlement of Disputes , Articles 17.1, 17.2 
("DSU" ). WT/DSB/M/412  
 
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  merit. In this regard, Colombia urged WTO Members to find a solution that would allow the WTO 
Members to meet their legal obligations. Colombia supported the efforts of the Chairperson to 
continue to seek a solution to this matter.  
9.5.  The representative of Canada  said that his country deeply regretted that the DSB had been 
unable to fulfil its legal obligation under Article 17.2 of the DSU to appoint Appellate  Body 
members as vacancies arose. Canada agreed that it was time to start a process or, if necessary, 
several processes to select new Appellate Body members for the three current vacancies. Canada 
was pleased to join the proposal submitted by more than 30  delegations and urged the DSB to 
adopt it without further delay. Like other WTO Members, Canada was disappointed that the 
United  States had linked the start of the Appellate Body selection processes to the resolution of 
certain procedural concerns it had s hared with the WTO Membership. Canada invited the 
United  States to engage in discussions with interested Members with a view to expeditiously 
developing a solution to the concerns that it had raised.  Canada remained committed to working 
with other interest ed WTO Members, including the United States, with a view to finding a way to 
address those concerns, so as to allow the Appellate Body selection processes to start and be 
completed as soon as possible.  
9.6.  The representative of Pakistan  said that his country b elieved in achieving development 
through trade. Pakistan greatly valued the WTO dispute settlement mechanism and considered its 
worth, including the element of enforceability, as one of the major differentials from the GATT -era. 
Pakistan, once again, urged  WTO Members not to link Appellate Body appointments to systemic 
concerns regarding the working of the Appellate Body. Pakistan supported the position that 
Appellate Body vacancies should be filled urgently. Presently, there were three Appellate Body 
vacan cies. Unless these vacancies were filled soon, the WTO Membership was arriving at a 
situation where the current number of vacancies would rise to four before the end of  2018. 
Pakistan, once again, urged all WTO Members to discuss this matter with an open m ind and show 
the utmost flexibility in order to ensure that the WTO Membership could ensure the continuity of 
the dispute settlement system. As a co -sponsor, Pakistan supported the joint proposal, which had 
been submitted by Mexico, and expressed its hope that a positive outcome could be achieved 
through this proposal.  
9.7.  The representative of Hong Kong, China  said that her delegation was pleased to co -sponsor 
the proposal on Appellate Body selection processes, and encouraged all WTO Members that had 
not yet j oined the proposal to support it. As Hong  Kong, China had repeatedly expressed at 
previous DSB meetings, her delegation was deeply concerned with the prolonged impasse over the 
Appellate Body selection processes. This impasse was threatening the effective functioning of the 
WTO dispute settlement system. Vacancies on the Appellate Body should be filled as quickly as 
possible, without any delay. While Hong  Kong, China took note that some procedural concerns had 
been raised, and was ready to discuss these to find a possible way forward, Hong  Kong, China did 
not see a linkage between the selection processes and these procedural concerns. Hong  Kong, 
China, thus, urged all WTO Members to exercise maximum flexibility to reach an agreeable 
solution to end the curre nt impasse, so as to minimize the adverse effects on the WTO dispute 
settlement system.  
9.8.  The representative of the Russian  Federation  said that her country was deeply concerned 
about the continued US blockage with regard to the Appellate Body selection proc esses, and the 
fact that the United  States had linked a launch of the selection processes with the resolution of 
"the problem". For the past six  months, the United States had neither put forward what the actual 
problem was, nor provided any possible ways o f resolving any such problem. As a result, WTO  
Members were not able to engage in a meaningful discussion and could not move towards a 
resolution of the matter at issue. Unilateral actions, such as these, have the potential to destroy 
the trust in the mult ilateral process and contribute to chaos with regard to multilateral rules, 
irrespective of whether or not the unilateral actions were taken under the pretence of complying 
with WTO rules. There was always room for improvement. Such improvement, however, s hould 
not run counter to the effective functioning of the WTO dispute settlement mechanism and the 
WTO as a whole. The Russian Federation, thus, called on the United  States to provide a clear 
picture of the problem at issue, and propose potential solutions  or stop the blockage.  
9.9.  The representative of the Bolivarian Republic of Venezuela  said that his country supported 
the statement made by Colombia, on behalf of the GRULAC. Venezuela reiterated its deep concern 
about the unfortunate delay, caused by the lack  of consensus, to appoint new Appellate Body WT/DSB/M/412  
 
- 19 - 
 
  members. Like other WTO Members, Venezuela reiterated the importance of the Appellate Body, 
and its contribution to the multilateral trading system. Venezuela hoped that the WTO Member in 
question that was oppos ing the current appointment of new Appellate Body members would also 
come to understand the importance of the Appellate Body and take action in order to unblock the 
selection processes of new Appellate Body members, as set out in the joint proposal. This a ction 
would strengthen the confidence of WTO Members in the WTO dispute settlement system.  
9.10.   The representative of Switzerland  said that, like many other WTO Members, his country was 
disappointed that the overdue launch of the processes to fill the three vac ancies on the Appellate 
Body continued to elude the DSB. Switzerland had strong systemic concerns regarding the threat 
this situation posed to the WTO's key role in the settlement of trade disputes between  Members. 
Switzerland, once again, invited all WTO Members, and in particular the major ones, to 
constructively engage in substantive discussions aimed at strengthening trust and overcoming the 
present stalemate with a sense of urgency.  
9.11.   The representative of Thailand  said that her country supported the pos ition of other WTO  
Members that the Appellate Body selection processes should be launched as soon as possible. 
Thailand thanked all WTO Members, which had jointly submitted the proposal to this end, and 
agreed that ensuring a standing Appellate Body was a duty, which had been entrusted to the DSB. 
In this regard, all WTO Members shared a responsibility to promptly resolve the present issue. 
Thailand regretted that, thus far, the DSB had been unable to resolve this matter. Thailand had 
followed closely the c oncerns, which had been raised in recent DSB meetings, and encouraged the 
United  States to share its view as to how the DSB should address "the problem of persons 
continuing to serve on appeals well after their terms have expired". If this problem was an i ssue 
that should be resolved before WTO Members could agree to initiate the selection processes, 
Thailand was of the view that a concrete proposal was essential to facilitate Member's discussions 
towards possible solutions on this matter. Without prejudice  to Thailand's position as to whether or 
not there should be a linkage between the start of the Appellate Body selection processes and the 
resolution of the systemic concerns, Thailand was open to consider any suggestions that could 
enable the DSB to break  the deadlock and move forward. Thailand reiterated its willingness to 
work with the United States and all interested WTO Members in this regard.  
9.12.   The representative of Chinese  Taipei  said that her delegation shared the concerns expressed 
by other WTO Membe rs at the present meeting. Linking Appellate Body appointment matters to 
other concerns was inappropriate, given the present circumstance of a prolonged delay in 
launching the Appellate Body selection processes. The deadlock had already had a serious impac t 
on the overall effectiveness of the WTO dispute settlement system. Chinese Taipei, hence, 
reiterated its concerns and urged WTO Members to consider these issues in a well -balanced 
manner. Chinese Taipei stood ready to work with other WTO Members to find a way forward, 
which was in the best interest of the entire WTO Membership.  
9.13.   The representative of Singapore  reiterated his country's serious systemic concerns about 
the lengthy delays in launching the Appellate Body selection processes. Singapore had 
co-sponsored the joint proposal to launch the selection processes, since its introduction at the 
November  2017 DSB meeting. The growing number of co -sponsors since then indicated the 
increasing concern that WTO Members had over this impasse. Presently, four out  of seven 
Appellate Body positions were filled and the term of yet another Appellate Body member was set 
to expire in September  2018. Against this background, and if the vacancies were not filled, the 
WTO Membership would face an imminent paralysis. Given its heavy workload and significance, a 
fully-staffed Appellate Body was crucial to the proper functioning of the WTO dispute settlement 
mechanism, which, in turn, was an integral part of the rules -based multilateral trading system. 
The continued impasse ad versely affected the credibility and functioning of the WTO, and it was 
essential that all current and future Appellate Body vacancies would be filled without any further 
delays. Systemic issues, which had been raised, could be discussed in a separate proc ess. 
Singapore stood ready to engage constructively and to work with other WTO Members, as well as 
the Chairperson, to resolve this impasse.  
9.14.   The representative of Norway  said that, as stated by her country at previous DSB meetings, 
a well -functioned dispute settlement system was Norway's primary interest. All WTO Members had 
to work together and show flexibility and commitment to find solutions to surpass the present 
deadlock. Norway, thus, encouraged all WTO Members to support the proposal, which had  been 
co-sponsored by over 60 WTO Members. Norway believed that the process of filling Appellate Body WT/DSB/M/412  
 
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  vacancies should not be dependent on finding solutions to procedural issues, related to the work of 
the Appellate Body. Nevertheless, Norway reiterated its openness and willingness to listen 
seriously and engage constructively with all and any WTO Member on any existing grievances with 
the dispute settlement system.  
9.15.   The representative of Australia  said that her country referred to its previous statements 
made on this matter and reiterated its serious concerns with regard to the long -standing impasse, 
which had prevented the appointment of new Appellate Body members. Australia had joined over 
60 WTO Members in co -sponsoring the proposal for the DSB to comme nce immediately a process 
to make appointments to the Appellate Body. As had been repeated in the DSB over many 
months, this proposal gave effect to the DSB's responsibility under Article  17.2 of the DSU, 
requiring vacancies on the Appellate Body to be fil led as they arose. Australia joined Mexico in 
inviting other WTO  Members to support the proposal and join the long list of co -sponsoring WTO 
Members. While Australia was disappointed that, once again, the WTO Membership was unable to 
reach consensus on the  launch of Appellate Body selection processes, Australia continued to 
believe that, in the WTO, there was a group of Members with the will and commitment to find a 
way forward. Australia, like many other WTO Members that had spoken at the present meeting, 
remained willing to explore options for addressing the concerns that had been identified by one 
WTO Member regarding transitional arrangement for outgoing Appellate Body members, in 
anticipation that doing so, would unlock the current impasse in the Appell ate Body selection 
processes. It was time for the WTO Membership to put words into action and commit to efforts to 
find positive, long -term solutions to the matters before the DSB, and to ensure the ongoing 
functioning and effectiveness of the WTO dispute settlement system.  
9.16.   The representative of Brazil  said that her country endorsed the joint proposal, which had 
been submitted once again by 65  WTO Members for consideration at the present DSB meeting. 
More than 16  months had passed, since the DSB had first s tarted discussions on the process to fill 
Appellate Body vacancies, and unfortunately, no progress had been achieved. Brazil remained 
extremely concerned with the current impasse and its effects on the proper functioning of the WTO 
dispute settlement syste m and, more generally, of the WTO and the multilateral trading system. In 
fact, the underlying question was whether a rules -based multilateral trading system could survive 
without the guarantor of the multilateral rules. Brazil had taken note of recent doc uments, which 
contained concerns with regard to the multilateral trading system. There were certainly issues that 
could be improved in the WTO in general and in its dispute settlement system in particular. For 
this, WTO Members would need to be mindful of the significant achievements of the current 
system, and at the same time, demonstrate good will to identify and improve specific issues of 
concern. In this regard, Brazil stood ready to engage in conversations with interested WTO 
Members and encouraged the  prompt submission of concrete ideas and proposals to overcome this 
unfortunate impasse.  
9.17.   The representative of Ecuador  said that his country had expressed its views on this issue at 
previous DSB meetings. Ecuador recalled that WTO Members' compliance with WTO rules was one 
of the fundamental principles governing the multilateral trading system. By failing to initiate the 
selection processes to fill the Appellate Body vacancies, the WTO Membership had failed to comply 
with WTO rules. For this reason, Ecuador  supported the statement made by Colombia, on behalf of 
the GRULAC, and by Mexico, on behalf of the 66 proponents of the joint proposal. Ecuador was of 
the view that the linkage of procedural concerns with the appointment of new Appellate Body 
members was undermining the WTO dispute settlement system. These were two different issues, 
and should, thus, not be linked. Ecuador understood that Article 17.2 of the DSU to require that 
vacancies should be filled as quickly as possible, and it was, thus, the prerog ative of the 
Chairperson to take the decision to initiate the selection processes as soon as possible to settle 
this matter in the interest of the WTO dispute settlement system and the WTO as a whole. Ecuador 
also recalled that the WTO Membership was const antly reminded of the need to respect another 
key principle of the WTO, namely, transparency. Ecuador, thus, invited WTO Members to reflect on 
whether it was sensible to speak about transparency given the current situation, in which the WTO 
Membership was barred from proceeding with the appointments of new Appellate Body members, 
given the importance of the Appellate Body.  
9.18.   The representative of Turkey  said that his country wished to be associated with the 
statement made by Mexico, on behalf of the co -sponso rs. Turkey regretted that the DSB had, once 
again, failed to launch the selection processes for the three vacant positions in the Appellate Body. 
Like many other WTO  Members, Turkey was concerned about the workload of the Appellate Body, WT/DSB/M/412  
 
- 21 - 
 
  as well as the ove rall dispute settlement system. Turkey was of the view that the concerns, which 
had been raised by the United States about the Appellate Body's working procedures, should be 
dealt with separately, and should not block the immediate start of the selection p rocesses. Turkey, 
therefore, reiterated its call on all WTO Members to join the proposal soon.  
9.19.   The representative of India said that her country supported the proposal to launch the 
Appellate Body selection processes as a matter of priority. India recogniz ed that the WTO dispute 
settlement system was the central pillar that provided security and predictability in the multilateral 
trading system. The wide use of the WTO dispute settlement system in the 23  years of its 
existence was a testament to Member's tr ust in the impartiality and effectiveness of the WTO 
dispute settlement system. It would be a severe blow to the rules -based multilateral trading 
system, if one of its central pillars were to become ineffective. India deeply regretted that the DSB 
had been  unable to fulfil its legal obligation under Article 17.2 of the DSU to appoint Appellate 
Body members as new vacancies arose. This was a serious and urgent concern for the multilateral 
trading system and threatened to undermine the rights and obligations of WTO Members. India, 
therefore, urged all WTO Members to engage constructively to resolve this matter as soon as 
possible. India remained committed to work with other interested WTO Members to find a way to 
launch the Appellate Body selection processes a s soon as possible.  
9.20.   The representative of Panama  said that her country supported the statement made by 
Mexico, on behalf of the co -sponsors, as well as the statement made by Colombia, on behalf of the 
GRULAC. Panama shared the systemic concerns expressed b y other delegations with regard to the 
current deadlock in launching the Appellate Body selection processes. The inability to initiate or 
complete what should be a routine task seriously undermined and jeopardized the functioning and 
the credibility of the  WTO dispute settlement system and WTO rules, which, without the WTO 
dispute settlement system, would lose their effectiveness and would be less respected. This would, 
in turn, jeopardize the trade interests of WTO Members and result in major economic loss es. 
Panama was of the view that there was no justification to continue the delay in launching the three 
selection processes to fill each of the three vacancies. Nevertheless, Panama noted the statements 
made by the WTO Member, which had raised concerns abo ut the functioning of the Appellate Body 
and the rules governing the selection of new Appellate Body members. Panama invited the WTO 
Member, which had raised the mentioned concerns, to provide the WTO Membership with options 
and solutions vis-à-vis the con cerns it had raised. Panama believed that flexibility and pragmatism 
were needed in order to overcome the current impasse.  
9.21.   The representative of Honduras  said that her country considered the WTO dispute 
settlement system as one of the key pillars of the W TO. As an active Member of the system, 
Honduras reiterated its systemic concern with the current situation, which jeopardized the 
functioning of this pillar, and would, consequently, jeopardize the functioning of the entire 
multilateral trading system. Hon duras, thus, urged all WTO Members to show flexibility and 
willingness to overcome this impasse as soon as possible, as this would be to the benefit of all 
WTO Members. Honduras supported the statement made by Mexico, on behalf of the proponents of 
the joi nt proposal, as well as the statement made by Colombia, on behalf of the GRULAC.  
9.22.   The representative of Korea  said that his country referred to its previous statement made at 
DSB meetings under this Agenda item. Korea noted that, with the current impasse re garding the 
Appellate Body selection processes, it was not only the Appellate Body but the entire multilateral 
trading system would be undermined. Korea, thus, stood ready to engage in discussions and show 
flexibilities to resolve the problem.  
9.23.   The represen tative of New Zealand  said that her country was  seriously concerned about the 
ongoing impasse and considered that Appellate Body selection processes should be a routine 
matter. Delays in appointing Appellate Body members could have a bearing on the efficie nt and 
effective functioning of the WTO dispute settlement system, and had the potential to undermine 
the broader rules -based multilateral trading system. Despite its failure to agree on the proposal, 
which had been introduced by Mexico at the present meet ing, New Zealand continued to strongly 
support the proposal to launch the Appellate Body selection processes as soon as possible. 
New Zealand invited all WTO Members to join the co -sponsors efforts to launch the selection 
processes. While New Zealand did not agree with the linkages that had been drawn, it once again 
confirmed its willingness to engage constructively with all WTO Members to find solutions to 
address the concerns, which had been raised, with regard to the WTO dispute settlement system, 
so that the DSB could ensure that it continued to fulfil its essential role in the WTO.  WT/DSB/M/412  
 
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  9.24.   The representative of Japan  said that his country th anked the WTO Members that had 
placed the joint proposal on the Agenda of the present meeting. Japan would not repeat its 
position, which it had stated at previous DSB meetings under the same Agenda item. Instead, 
Japan simply emphasized that it was the re sponsibility of the entire WTO Membership, acting as 
the DSB, to ensure the proper functioning of the WTO dispute settlement system, in a manner 
consistent with the DSU. Japan welcomed the readiness expressed by many WTO Members to 
engage, and looked forwa rd to work with other interested WTO Members on this common 
endeavour.  
9.25.   The representative of China  said that WTO Members had been unable to launch the 
Appellate Body member selection processes for over a year. No progress had been made. The 
reason for this  impasse was widely known, both inside and outside the WTO. The WTO Member 
that had blocked the process, in the name of systemic concerns, had shared some of its reasoning 
at the previous DSB meetings. In the past two DSB regular meetings, the United  State s had 
asserted that China's interpretation of the word "rotation" "exhibits [a] fundamental 
misunderstanding of the DSU". However, China's reading of Article 17 of the DSU suggested 
otherwise. Specifically, Article 17 of the DSU set out the basic rules for  the Appellate Body, while 
paragraph  1 thereof contained general provisions, paragraphs 2 to 14 focused on specific aspects 
of the appellate review. Article 17.1 served as the introductory paragraph with general rules and 
as a basis for subsequent paragrap hs. The fourth sentence of Article 17.1 contained the rotation 
requirement, and thus, Appellate Body members' terms were not open -ended and they could not, 
necessarily, serve on one case throughout their terms. The specific provisions on rotation were 
provided under Article 17.2 of the DSU. If these provisions were interpreted as had been 
suggested by the United States, then the definition of "rotation" would be limited to the rotation of 
Appellate Body members only among different divisions, which would re sult an incomplete reading 
of Article  17.1 of the DSU. The United States had also claimed at previous DSB meetings that, 
unlike similar rules of many other international adjudicative bodies, the transitional rules under 
Rule 15 of the Working Procedures fo r Appellate Review had not been based on the WTO dispute 
settlement system's "constitutional text", namely, the DSU. The United States, thus, appeared to 
believe that the Appellate Body had made an improper analogy of Rule  15 to rules of other 
internationa l tribunals and had reiterated this in previous DSB regular meetings. China had 
undertaken a brief survey of transitional rules of other international adjudicative bodies and had 
found that, for instance, in the case of the African Court on Human and Peopl e's Rights, a rule 
similar to Rule  15 was included in Article 2.2 of the Rules of the Court. The said rules had been 
adopted by the court.  
9.26.   The question as to whether or not Rule  15 had been included in the DSB's "constitutional 
text" should not prevent WTO  Members from implementing such rule, or including such rule in the 
DSU, as an amendment after negotiations. The DSU itself was the result of negotiations of the 
Uruguay Round, and to recall, the WTO had not existed prior to 1995. The entire multilateral 
trading system was the result of tough negotiations. The United States had stated that "[t]he 
United  States remains resolute in its view that Members need to resolve that issue first before 
moving on to the issue of replacing such a person. We therefore wil l continue our efforts and our 
discussions with Members and with the Chair[person] to seek a solution on this important issue". 
China, however, did not see any efforts, on the part of the United States, to seek resolution or to 
engage constructively in a m eaningful discussion. Without the United States' constructive 
engagement, discussions on this matter would not be productive. There were currently three 
Appellate Body vacancies, and China reiterated its concerns that the unreasonable blockage by the 
Unite d States would undermine the functioning of the WTO dispute settlement system and the 
credibility of the multilateral trading system. This could eventually result in a complete paralysis of 
the WTO. Without the WTO, and its enforceable WTO dispute settleme nt mechanism, trade rules 
would be trampled upon. Unilateral and protectionist actions such as Section  301 or Section  232 
investigations, and associated measures, would become the norm, and all of this, would give rise 
to trade tensions among WTO Members o r, eventually, even trade wars if the present situation 
was not handled with care. Such scenario should be avoided.  
9.27.   The representative of Uruguay  said that her country referred to its previous statements 
made at the DSB, under this Agenda item. Uruguay sup ported the proposal, which had been 
submitted by Mexico, on behalf of several delegations, and endorsed the statement made by 
Colombia, on behalf of the GRULAC.  WT/DSB/M/412  
 
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  9.28.   The representative of the Philippines  said that her country placed great importance on the 
WTO dispute settlement system, including the Appellate Body, which played a crucial role in 
providing security and predictability to the rules -based multilateral trading system. In this regard, 
the Philippines noted its systemic concern with the delay in launc hing the Appellate Body selection 
processes. There were currently three vacancies, and a fourth vacancy would arise later this year. 
The effective functioning of the dispute settlement system was hinged on a fully composed 
Appellate Body; hence, the presen t vacancies had to be filled expeditiously. WTO Members would 
need to show flexibility so that a consensus could be reached for a DSB decision to launch the 
Appellate Body selection processes as soon as possible. The Philippines stood ready to engage 
const ructively with WTO Members, in any configuration, in order to resolve the present deadlock.  
9.29.   The representative of Mexico , speaking on behalf of the 66  co-sponsors of the proposal, said 
that the proponents regretted that, for the eleventh time, WTO Members had not achieved 
consensus to start the selection processes for the Appellate Body vacancies and had, thus, failed 
to fulfil their duties as WTO  Members. No discussion should prevent the Appellate Body from 
continuing to function fully, and WTO  Members sho uld comply with their obligation under the DSU, 
to fill the vacancies as they arose. By failing to act at the present meeting, the WTO Membership 
would maintain the current situation, which was seriously affecting the work of the Appellate Body 
and was aga inst the best interest of WTO Members.  
9.30.   The representative of Guatemala  said that his country understood and shared the 
disappointment and concerns expressed by other WTO Members. Guatemala had listened carefully 
to the statements made by the United  States during the past eight months. Guatemala believed 
that a period of eight months had been sufficient to understand the concerns at issue. Particularly, 
when such concerns referred to procedural issues that did not involve a high degree of 
sophistication. Fur thermore, Guatemala's perception was that a great majority of WTO Members 
would be willing to engage with the United  States with a view to finding a solution to the concerns, 
which had been raised. However, Guatemala had not heard in the DSB whether the Un ited States 
would be willing to appoint new Appellate Body members, if and when the DSB were to find a 
solution to the concerns the United States had raised at the DSB. Guatemala would appreciate if 
the United  States could provide clarification as to whether or not a solution on the procedural 
issues, as had been identified by the United  States in the DSB, would lead to the United  States' 
agreement to appoint new Appellate Body members.  
9.31.   The representative of the  European  Union  said that his delegation noted that everything had 
already been said, practically by everyone, at the present meeting. There was, however, one issue 
that had not yet been addressed. The United States had mentioned that, in recent months, tw o 
Appellate Body Reports had been adopted with "positive consensus". The EU was not aware of any 
Appellate Body Report that had ever been adopted by positive consensus. As in the past, Appellate 
Body Reports, which had been adopted thus far in 2018, had be en adopted pursuant to 
Article  17.14 of the DSU.  
9.32.   The Chairperson  thanked all delegations for their statements. She regretted that the DSB 
was, once again, not in a position to agree to launch the selection processes to fill the three 
Appellate Body vacanc ies. She noted  that this matter required political engagement on the part of 
all WTO Members. She said that she was in the hands of WTO Members and that her door was 
open to any delegation wishing to share ideas or views on how to proceed with this  issue. She 
further stated that it was her  intention to consult informally with some delegations in line with the 
process carried out by the former DSB Chair , Ambassador Ihara . She also invited any delegations 
that had views on this matter to contact her directly.  
9.33.   The DSB took note of the statements.  
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