RESTRICTED  
  
WT/DSB/M/397  
 
18 August  2017 
(17-4437) Page: 1/30 
Dispute Settlement Body  
22 May 2017    
 
 MINUTES OF MEETING  
HELD IN THE CENTRE W ILLIAM RAPPARD  
ON 22 MAY 2017  
Chairman: Mr. Junichi I hara (Japan ) 
Prior to the adoption of the Agenda , the representative of the European  Union  noted that Agenda 
items  10 and 11 related to the same matter. In the EU's  view the proposal under Agenda item  11 
was more far -reaching than the proposal under Agenda item  10. The EU had raised this matter 
with the countries that had put forward the proposal currently under Agenda item  10 and they had 
agreed to reverse the order  of these two items. The EU considered that the proposal under item  11 
was most far -reaching than the proposal under item  10 and should therefore be considered first. 
The EU  noted that this was in line with the rules of procedure for meetings of the DSB.  
 
The Chairman  proposed that , in light of the EU's request , the proposed Agenda be modified and 
that i tem 11 be taken up before item  10. 
 
The Agenda was adopted  as amended.  
Table of Contents  
1   SURVE ILLANCE OF IMPLEMENT ATION OF RECOMMENDAT IONS 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  ................................ ................................ ..............  3 
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 ................................ ................................ ....... 3 
2   EUROPEAN  UNION – MEASURES AFFECTING T ARIFF CONCESSIONS ON  
CERTAIN POULTRY MEAT  PRODUC TS ................................ ................................ ...............  4 
A.  Implementation of the recommendations of the DSB  ................................ ..........................  4 
3   UNITED  STATES – CONTINUED DUMPING AN D SUBSIDY OFFSET ACT  
OF 2000 : IMPLEMENTATION OF THE RECOMMENDATIONS ADOPTED BY THE  DSB ...........  5 
A.  Statement by the European  Union  ................................ ................................ ....................  5 
4   UNITED  STATES – COUNTERVA ILING MEASURES ON CE RTAIN PIPE AND TUBE 
PRODUCTS FROM TURKEY  ................................ ................................ ................................  6 
A.  Request for the establishment of a panel by Turkey  ................................ ............................  6 
5   INDI A – MEASURES CONCERNING THE IMPORTATION OF C ERTAIN 
AGRICULTURAL PRODUCT S ................................ ................................ ..............................  6 
A.  Recourse to Article  21.5 of the DSU by India: Request for the establishment 
of a panel  ................................ ................................ ................................ ..........................  6 WT/DSB/M/397  
 
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  6   COLOMBIA – MEASURES RELATING TO  THE IMPORTATION OF T EXTILES, 
APPAREL AND FOOTWEAR  ................................ ................................ ..............................  10 
A.  Recourse to Article  21.5 of the DSU by Panama: Request for the establishment 
of a panel  ................................ ................................ ................................ ......................... 10 
7   UNITED  STATES – MEASURES CONCERNING THE IMPORTATION, MAR KETING 
AND SALE OF TUNA AND  TUNA PRODUCTS  ................................ ................................ ..... 12 
A.  Recourse to Article  22.7 of the DSU by Mexico  ................................ ................................ ..12 
8   CHINA – ANTI -DUMPING MEASURES ON IMPORTS OF CELLULOSE  PULP FROM 
CANADA  ................................ ................................ ................................ .........................  19 
A.  Report of the Panel ................................ ................................ ................................ ........ 19 
9   UNITED  STATES – CERTAIN METHODOLOGIE S AND THEIR APPLICAT ION TO 
ANTI -DUMPING PROCEEDINGS INVOLVING CHINA  ................................ .......................  21 
A.  Report of the Appellate Body and Report of the Panel  ................................ ........................ 21 
10   APPOINTMENT OF APPEL LATE BODY MEMBERS: P ROPOSAL BY THE 
EUROPEAN  UNION  ................................ ................................ ................................ .........  24 
11   PROPOSAL REGARDING T HE APPELLATE BODY SE LECTION PROCESS  .....................  25 
12   MECHANISM FOR DEVELO PING, DOCUMENTING AN D SHARING PRACTICES 
AND PROCEDURES IN TH E CONDUCT O F WTO DISPUTES  ................................ ...............  29 
A.  Statement by Canada  ................................ ................................ ................................ ....29 
13   RUSSIA – TARIFF TREATMENT OF CERTAIN AGRICULTURAL  AND 
MANUFACTURING PRODUC TS................................ ................................ .........................  29 
A.  Statement by the Russian  Federation  ................................ ................................ .............. 29 
14   DISPUTE SETTLEMENT W ORKLOAD  ................................ ................................ .........  30 
A.  Statement by the Chairman  ................................ ................................ ............................ 30 
 
 
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 
repor t by the United  States (WT/DS184/15/Add.172)  
 
B.  United  States – Section 110(5) of the US Copyright Act: Status report by the United  States 
(WT/DS160/24/Add.147)  
 
C.  European  Communities – Measures affecting the approval and marketing of biotech products : 
Status report by the European  Union (WT/DS291/37/Add.110)  
 
 
1.1.  The Chairman  noted that there were three sub -items under the Agenda item concerning 
status reports submitted by delegations pursuant to Article  21.6 of the DSU. He recalled that 
Article  21.6 req uired 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 re main on the DSB's 
Agenda until the issue is resolved". Under this Agenda item, the Chairman invited delegations to 
provide up -to-date information about compliance efforts and to focus on new developments, 
suggestions and ideas on progress towards the resol ution of disputes. He also reminded 
delegations that, as provided for in Rule  27 of the Rules of Procedure for DSB meetings: 
"Representatives should make every effort to avoid the repetition of a full debate at each meeting 
on any issue that has already be en fully debated in the past and on which there appears to have 
been no change in Members' positions already on record". He then turned to the first status report 
under this Agenda item.  WT/DSB/M/397  
 
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  A.  United  States – Anti-dumping measures on certain hot -rolled steel  products from 
Japan: Status report by the United  States (WT/DS184/15/Add.172)  
1.2.  The Chairman  drew attention to document WT/DS184/15/Add.172, which contained the 
status report by the United  States on progress in the implementation of the DSB's 
recommendation s in the case concerning US  anti-dumping measures on certain hot -rolled steel 
products from Japan.  
1.3.  The representative of the United  States  said that the United States had provided a status 
report in DS184 on 11  May 2017, in accordance with Article  21.6 of the DSU. The United  States 
had addressed the DSB's recommendations and rulings with respect to the calculation of 
anti-dumping margins in the hot -rolled steel anti -dumping duty investigation at issue. With respect 
to the recommendations and 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 resolve this matter.  
1.4.  The representative of Japan  said that his country thanked the United States for its state ment 
and its status report. Japan called on the United States to fully implement the DSB's 
recommendations and rulings in order to resolve this matter.  
1.5.  The DSB took note  of the statements and agreed  to revert to this matter at its next regular 
meeting.  
B.  United  States – Section 110(5) of the US Copyright Act: Status report by the 
United  States (WT/DS160/24/Add.147)  
1.6.  The Chairman  drew attention to document WT/DS160/24/Add.147 which contained the status 
report by the United  States on progress in the implemen tation of the DSB's recommendations in 
the case concerning Section  110(5) of the US Copyright Act.  
1.7.  The representative of the United  States  said that the United States had provided a status 
report in this dispute on 11  May 2017, in accordance with Article  21.6 of the DSU. The 
US Administration would continue to confer with the EU, and to work closely with the US  Congress, 
in order to reach a mutually satisfactory resolution of this matter.  
1.8.  The representative of the European  Union  said that his delegation tha nked the United  States 
for its status report and its statement. The EU referred to its previous statements made on this 
matter and said that it would wish to resolve this dispute as soon as possible.  
1.9.  The DSB took note  of the statements and agreed  to revert  to this matter at its next regular 
meeting.  
C.  European  Communities – Measures affecting the approval and marketing of biotech 
products: Status report by the European  Union (WT/DS291/37/Add.110)  
1.10.   The Chairman  drew attention to document WT/DS291/37/Add.110 , which contained the 
status report by the European  Union on progress in the implementation of the DSB's 
recommendations in the case concerning measures affecting the approval and marketing of 
biotech products.  
1.11.   The representative of the European  Union  said that the draft authorisation decision for one 
type of genetically modified maize1 (for food and feed uses) and the draft proposals for the 
authorisation of three types of  maize2 (for cultivation) had been submitted to the Appeal 
Committee for a vote on 27  March  2017, with a "no opinion" result. Furthermore, on 16  May 2017 
the draft authorisation decisions for one  type of genetically modified maize3 and one type of  
cotton4 (for food and feed use) had been submitted to the Appeal Committee for a vote, with a  
                                                
1 Maize Bt11 × 59122 × MIR604 × 1507 × GA21.  
2 Bt11, 1507 and MON810 (renewal).  
3 DAS-40278 -9. 
4 GHB119.  WT/DSB/M/397  
 
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  "no opinion" result. It was now for the Commission to decide on these authorisations. The EU said 
that it continued to be committed to acting in line with its WTO obligations. More generally, and as 
it had stated previously on many occasions, the EU recal led that the EU approval system was not 
covered by the DSB's recommendations and rulings.  
1.12.   The representative of the United  States  thanked the EU for its status report and its 
statement made at the present meeting. As the United States had noted repeatedly,  the EU 
measures affecting the approval and marketing of biotech products continued to result in lengthy, 
unpredictable, and unexplained delays in approvals. The delays and uncertainty in approvals 
caused adverse effects on trade. The failure to approve bi otech corn products was a source of 
particular concern to the United States. A number of corn products had received the approval of 
the EU's scientific authority, yet remained stalled at the level of the EU Appeals Committee or the 
EU Commission. The Unite d States encouraged the EU to make decisions on biotech approvals 
without unnecessary or further delays.  
1.13.   The DSB took note  of the statements and agreed  to revert to this matter at its next regular 
meeting.  
2  EUROPEAN  UNION – MEASURES AFFECTING T ARIFF CONCESS IONS ON CERTAIN 
POULTRY MEAT PRODUCT S 
A.  Implementation of the recommendations of the DSB  
2.1.  The Chairman  recalled that, in accordance with the DSU provisions, the DSB was required to 
keep under surveillance the implementation of recommendations and rulings of the DSB in order to 
ensure effective resolution of disputes to the benefit of all Members.  In this respect, Article  21.3 
of the DSU provided that the Member concerned should inform the DSB, within 30  days after the 
date of adoption of the panel or Appe llate Body report, of its intentions in respect of 
implementation of the recommendations and rulings of the DSB. The Chairman recalled that at its 
meeting on 19  April 2017, the DSB had adopted the Panel Report in the dispute on: 
"European  Union – Measures Affecting Tariff Concessions on Certain Poultry Meat Products". As 
Members were aware, the 30 -day time -period in this dispute had expired on 19  May 2017, and on 
16 May 2017 the EU had informed the DSB in writing of its intentions with respect to 
implementa tion of the recommendations and rulings of the DSB. The relevant communication was 
contained in document WT/DS492/5. The Chairman invited the representative of the EU to make a 
statement.  
2.2.  The representative of the European  Union  said that his delegation wi shed to confirm that the 
EU intended to implement the recommendations and rulings of the DSB in this dispute in a manner 
that respected its WTO obligations. The EU would need a reasonable period of time in which to do 
this. The EU stood ready to discuss th is matter with China, in due course, in accordance with 
Article  21.3(b) of the DSU.  
2.3.  The representative of China  said that her country thanked the EU for its statement at the 
present meeting informing the DSB of its intentions to implement the DSB's recomme ndations and 
rulings in this dispute. China noted that the EU would need a reasonable period of time for 
implementation, and said that it was ready to discuss this matter with the EU at the earliest 
convenience to both sides. China said that it hoped that the EU could fully implement the DSB 's 
recommendations and rulings in an expeditious manner.  
2.4.  The representative of Brazil  said that his country would like to comment on the 
implementation of the Panel's recommendations in this dispute. Brazil said that it was confident 
that, in implementing the recommendations of the Panel, the parties would ensure full compliance 
with Article  3.5 of the DSU, pursuant to which decisions within the WTO dispute settlement system 
"shall not nullify or impair benefits accruing to any Member under the covered agreements, nor 
impede the attainment of any objective of those agreements". In particular, Brazil said that it 
expected that its rights, obtained through negotiations under Article  XXVIII of the GATT  1994 with 
the EU, would  not be affected by the implementation of the Panel Report, both in terms of the 
overall size of the TRQ allocated to Brazil under those procedures and with regard to the 
administration regime of such quotas. Brazil emphasized the importance of the Panel's  reasoning 
with regard to the dynamic nature of quotas established under Article  XIII of the GATT  1994, WT/DSB/M/397  
 
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  stating that the Panel had, in different paragraphs of its report, acknowledged the impact of 
changes in market share following initial TRQ allocations as well as other "special factors" for the 
purposes of Article  XIII of the GATT  1994.  
2.5.  The representative of Thailand  thanked the EU for its statement and referred to the 
statement made at the 19  April 2017 DSB meeting. Thailand supported the statement made  Brazil.  
2.6.  The DSB took note  of the statements, and of the information provided by the European  Union 
regarding its intentions in respect of implementation of the DSB's recommendations.  
3  UNITED  STATES – CONTINUED DUMPING AN D SUBSIDY OFFSET ACT  OF 2000: 
IMPLEM ENTATION OF THE RECO MMENDATIONS ADOPTED BY THE  DSB 
A.  Statement by the European  Union  
3.1.  The Chairman  said that this item was on the Agenda of the present meeting at the request of 
the European Union and invited the representative of the European  Union to sp eak. 
3.2.  The representative of the European  Union  said that his delegation wished to inform the DSB 
that the authorized level of retaliation against the United  States had been adjusted starting on 
1 May 2017. The regulation containing the EU's measures had bee n published on 29  April 2017 
and had been circulated to all Members. The EU, once again, requested the United States to stop 
transferring anti -dumping and countervailing duties to the US industry. Every disbursement that 
still took place was clearly an act  of non -compliance with DSB's recommendations and rulings. The 
EU renewed its call on the United  States to abide by its clear obligation under Article  21.6 of the 
DSU to submit status reports on implementation in this dispute. The EU would continue to plac e 
this matter on the DSB Agenda as long as the United  States had not implemented the WTO ruling.  
3.3.  The representative of Brazil  said that her country thanked the EU for keeping this item on the 
Agenda of the DSB. As a party to the Byrd Amendment disputes, Br azil wished to refer to its 
previous statements made on this matter. In particular, Brazil wished to refer to its statements 
regarding the continuation of illegal disbursements, which should cease immediately. Brazil 
renewed its calls on the United States to fully comply with the DSB's recommendations and rulings 
in this dispute. Until then, the United States was under an obligation to submit status reports, 
pursuant to Article  21.6 of the DSU.  
3.4.  The representative of the United  States  said that, as the Unite d States had noted at previous 
DSB meetings, the Deficit Reduction Act – which included a provision repealing the Continued 
Dumping and Subsidy Offset Act of 2000 – had been enacted into law in February  2006. 
Accordingly, the United  States had taken all ac tions 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 entered after 1  October  2007, over nine years ago. With respect to the EU's 
request for status reports in this matter, as the United States had already explained at previous 
DSB meetings, there was no obligation under the DSU to provide further status reports once  a 
Member announced that it had implemented the DSB's recommendations and rulings, regardless 
of whether the complaining party disagreed about compliance. As the United  States had noted 
previously, the EU had demonstrated repeatedly it shared this understa nding, at least when it was 
the responding party in a dispute. Once again, the EU had not provided a status report at the 
present meeting for one or more disputes in which there was a disagreement between the parties 
on the EU's compliance. Finally, the Un ited States noted the EU's recent announcement to 
maintain its suspension of concessions on US goods. The United States said that it continued to 
review the action by the EU and would not accept any characterization of such continued 
countermeasures as con sistent with the DSB's authorization. As the EU was aware, the 
United  States had announced that it had implemented the DSB's recommendations and rulings. If 
the EU disagreed, there would appear to be a disagreement between the parties to the dispute 
about the situation of compliance.  WT/DSB/M/397  
 
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  3.5.  The representative of Canada  said that his country thanked the EU for having placed this 
item on the Agenda of the DSB. Canada shared the EU's standpoint, according to which: the 
Byrd Amendment had to be submitted to the monito ring of the DSB until it was no longer applied.  
3.6.  The DSB took note  of the statements.  
4  UNITED  STATES – COUNTERVAILING MEASU RES ON CERTAIN PIPE AND TUBE 
PRODUCTS FROM TURKEY  
A.  Request for the establishment of a panel by Turkey (WT/DS523/2)  
4.1.  The Chairman  drew attention to the communication from Turkey contained in document 
WT/DS523/2 and invited the representative of Turkey to speak.  
4.2.  The representative of Turkey  said that his country's panel request reflected its concerns with 
the US conduct of several counter vailing duty proceedings and the preliminary and final 
countervailing duty measures that had been imposed on certain Turkish steel pipe and tube 
products. As detailed in Turkey's panel request, the measures at issue appeared to be inconsistent 
with the pro visions of the GATT  1994 and SCM Agreement. Turkey raised concerns regarding 
certain US determinations during the countervailing duty proceedings at issue, but the 
United  States had not taken any actions to resolve Turkey's concerns. Turkey had then reques ted 
and held formal WTO consultations with the United  States on 28  April 2017. These efforts had 
also, unfortunately, failed to resolve the dispute. Accordingly, Turkey requested that the DSB 
establish a panel to examine the matter set forth in its panel r equest, with the standard terms of 
reference.  
4.3.  The representative of the United  States  said that the United States was disappointed that 
Turkey had sought the establishment of a panel in this matter. As the United States had explained 
to Turkey, the determi nations identified in Turkey's request for panel establishment were fully 
consistent with WTO rules. Furthermore, Turkey sought to challenge certain alleged "practices". 
These matters, however, were not measures and would not fall within the scope of a dis pute 
settlement proceeding. Further, the United States said that it failed to understand why Turkey was 
pursuing a challenge to a determination that had been vacated in the course of domestic litigation. 
The United  States regretted that Turkey would seek t o use WTO resources in this manner, 
particularly when WTO dispute settlement resources were overburdened. For these reasons, the 
United States did not agree to the establishment of a panel at the present meeting.  
4.4.  The DSB took note  of the statements and agreed to revert to this matter.  
5  INDIA – MEASURES CONCERNING THE IMPORTATION OF C ERTAIN AGRICULTURAL 
PRODUCTS  
A.  Recourse to Article  21.5 of the DSU by India: Request for the establishment of a 
panel (WT/DS430/21)  
5.1.  The Chairman  recalled that the DSB had consi dered this matter at its meeting on 
19 April 2017. He drew attention to the communication from India contained in document 
WT/DS430/21, and invited the representative of India to speak.  
5.2.  The representative of India said that his country had sought the estab lishment of a panel, 
pursuant to Article  21.5 of the DSU, in this dispute at the DSB meeting on 19  April 2017. India 
said that it strongly considered that it had complied with the DSB's recommendations and rulings 
by bringing its measures into conformity w ith its WTO -obligations and by addressing all the 
concerns raised by the United States during bilateral discussions. However, in spite of the efforts 
made by India to resolve the dispute bilaterally, by providing the relevant information and 
requested clar ifications to the United States, the United States had not yet agreed to resolve the 
dispute. Furthermore, the United States had not accepted India' s request to suspend the 
Article  22.6 proceeding in this dispute. The United States had not agreed to a sequ encing 
agreement, to first seek a compliance panel to determine whether there was compliance, before 
proceeding with the arbitration proceedings. As Brazil had rightly pointed out at the 19  April 2017 
DSB meeting, whenever there was disagreement about the existence or consistency of measures WT/DSB/M/397  
 
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  with the covered agreements, the logical procedural order could only be the one set out in the 
DSU. That order was to first have recourse to Article  21.5 of the DSU. In light of these facts, and 
in order to safeguard it s interests, India had no option but to proceed with the second request 
under Article  21.5 of the DSU to establish whether India had complied with its obligations under 
the covered agreements. Therefore, India requested that a Panel be established, pursuan t to 
Article  21.5 of the DSU, with standard terms of reference, as set forth in Article  7.1 of the DSU. 
Finally, India also requested that the DSB refer the matter to the original Panel, if possible. 
Nevertheless, India said that it was still open to discu ssion with the United States on their 
concerns, if any, on the extent of India' s compliance with its WTO obligations in these proceedings.  
5.3.  India also wished to highlight the existence of two parallel proceedings in this dispute – the 
compliance panel under  Article  21.5 and the arbitration proceedings under Article  22.6. At the 
19 April 2017 DSB meeting, Brazil had raised a number of pertinent questions with respect to the 
difficulty in proceeding with an Article  22.6 proceeding before the completion of the compliance 
proceeding. It had stated that Article  22.6 proceedings could not be transformed into a 
"mini-implementation dispute". This could risk curtailing the due process guarantees safeguarded 
by the procedure under Article  21.5, which was, in the DSU, the mechanism suitable to resolving 
divergences regarding implementation of adopted decisions. During the same DSB meeting, the EU 
had maintained that arbitration under Article  22.6 should be preceded by a multilateral 
determination of compliance in case t here was a disagreement on this question. India had also 
noted Canada' s point that the disputing parties ought to consider their procedural options with due 
regard both systemic considerations and their own interest in reciprocal treatment in future 
disput es. India noted that Australia had encouraged the parties to cooperate with a view to finding 
a pragmatic solution that both protected the rights of each party and took into account the 
systemic interests of all Members.  
5.4.  India said that the United States h ad, unfortunately, not agreed to enter into a sequencing 
agreement in this dispute. India still looked forward to such an agreement. It understood that the 
United  States' position was that it had reserved its rights to move forward on the pending 
arbitrati on under Article  22.6 on the level of nullification and impairment resulting from India's 
measure, but that the United States continued to seek to work cooperatively with India toward the 
goal of compliance. At the 19  April 2017 DSB meeting, the United Sta tes had also noted that the 
DSU did not require Members to enter into a sequencing agreement but that Members had found it 
appropriate to do so in many circumstances. India did not wish to engage in a legal analysis as to 
whether there was a requirement to  enter into a sequencing agreement under the DSU at this 
stage. India only wished to state that, as it had sought a compliance panel in this dispute, 
obviously on account of the reasons it had mentioned, it considered that it would be logical and 
more effi cient to determine compliance under Article  21.5, before proceeding with Article  22.6 
proceedings.  
5.5.  The representative of the United  States  said that, as the United States had noted at the 
19 April 2017 DSB meeting, India had no basis for asserting complian ce with the DSB's 
recommendations in this dispute. To recall, the DSB had found that India's measures blocking the 
importation of US poultry and other agricultural products were not based on science and breached 
several of India's obligations under the SPS  Agreement. The DSB had adopted these rulings in 
June 2015, nearly two years ago. Despite that, India continued to maintain a complete ban on US 
poultry and other agricultural products. The United States had made concrete proposals to India 
and had yet to receive a substantive reply from India to those proposals. It was regrettable that 
India remained focused on litigation instead of on actually achieving compliance in this dispute. 
Regarding India's comments about sequencing agreements, the United States f ound it puzzling 
that so much of India's panel request was dedicated to the issue of a sequencing agreement rather 
than explicating how India was ensuring its trading partners had access consistent with India's 
WTO obligations. In any event, the DSU did no t require Members to enter into a sequencing 
agreement. The fact was that India had taken no steps to address the DSB's recommendations as 
of the time when the United States had taken procedural action to preserve its rights under 
Article  22 of the DSU. Re garding India's comments that Article  21.5 proceedings should come 
before Article  22.6 proceedings, Members had often agreed, through sequencing agreements or 
otherwise, to conduct proceedings in such an order, but as Members were well aware, this was not 
required under the DSU. Regarding India's comments about the United States' request for 
authorization, under Article  22.6 of the DSU, the negative consensus rule applied within 30  days of 
the end of the period for compliance. By submitting the Article  22.2 request, the United States had 
preserved its negative consensus rights. Taking this step was neither surprising nor unusual. WT/DSB/M/397  
 
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  Similar actions had been taken in other disputes. The United States noted that as of the end of the 
reasonable period of time, and  indeed as of the time of the United States' request under 
Article  22.2 of the DSU, India was not even claiming that the measures that were the subject of 
the DSB's rulings and recommendations had been withdrawn or modified.  
5.6.  The representative of Japan  said that the request for the establishment of an Article  21.5 
panel had been made by India, the original respondent in this dispute. Japan did not disagree that 
an original respondent had the right to resort to compliance proceedings. As observed by the 
Appellate Body, "the text of Article  21.5 does not preclude an original respondent from initiating 
proceedings under [Article  21.5] to obtain confirmation of the consistency with the 
WTO-agreements of its implementing measure".5 The scope of compliance proceed ings under 
Article  21.5 was parties' "disagreement as to the existence or consistency with a covered 
agreement of measures taken to comply with the recommendations and rulings". And an 
Article  21.5 compliance panel was tasked with determining or confirming  whether the respondent 
had achieved substantive compliance by resolving this "disagreement".6 Japan questioned 
whether, in cases like the present one where an original respondent had initiated the compliance 
proceedings, the panel request which formed the  compliance panel's terms of reference would be 
both narrow enough and broad enough to identify precise "disagreement" and to enable a 
compliance panel to carry out its task of determining whether the respondent had come into 
substantive compliance. The pa nel request by an original respondent could be too broad in its 
scope. As had been observed by the Appellate Body, what the original respondent was required to 
do was to identify the measures it had taken to comply and make a claim that these measures had 
rectified the inconsistencies found in the DSB recommendations and rulings.7 The original 
complainant could then challenge the original respondent's claims of compliance before the panel.8 
At that stage, the scope of "disagreement" as to the respondent's c laims of compliance would 
become clear. Even then, the original respondent could seek the compliance panel's review of its 
claims, which the complainant had decided not to challenge, in order to obtain multilateral 
confirmation of compliance, even though t here was no genuine "disagreement" between the 
parties as to such particular claims. The respondent's panel request could be too narrow in its 
scope as well. As acknowledged by the Appellate Body, "the original respondent that has taken a 
measure to comply  cannot be expected to speculate as to the violations that could possibly be 
raised against its measure by other Members, and this is not what the original respondent is 
expected to do if it initiates Article  21.5 panel proceedings".9 Because of this possi ble deficiency, 
the Appellate Body had anticipated the possibility that "if … the original complainant considers that 
the implementing measure is inconsistent with provision of the WTO agreements not covered in 
the request for the establishment of a panel by the implementing Member, it may file its own 
request for the establishment of a panel".10 These observations revealed that the original 
complainant would play a pivotal role in identifying "disagreement" to be resolved by a compliance 
panel. Indeed, in J apan's view, an original complainant was in a far better position than an original 
respondent to identify "disagreement" that defined and delimited the scope of compliance 
proceedings, as Members' 20 -some -years of practices and operations of the dispute se ttlement 
system had amply demonstrated.  
5.7.  Japan said that it would now turn to the existence of active parallel proceedings. Once the 
DSB had established a compliance panel at the present meeting, there would be two parallel 
dispute settlement proceedings in  this dispute: the Article  22.6 arbitration and the Article  21.5 
compliance proceedings initiated by India. Japan recalled that in July  2016, the United  States had 
requested authorization from the DSB to suspend concessions or other obligations under 
Article 22.2 of the DSU and, upon objection by India, the matter had been referred to arbitration 
under Article  22.6 of the DSU. Japan said that it was not in a position to know how, and to what 
extent, the arbitration proceedings had progressed. Japan could no t speculate as to how the 
compliance Panel, the Arbitrator and the parties to this dispute envisaged these two parallel 
proceedings organizing, coordinating and/or harmonizing their respective works either.  
                                                
5 Appellate Body Reports, "US – Continued Suspension "/"Canada – Continued Suspension ", para.  348. 
6 Appellate Body Re ports, "US – Continued Suspension "/"Canada – Continued Suspension ", paras.  337, 
338. 
7 Appellate Body Reports, "US – Continued Suspension "/"Canada – Continued Suspension ", para . 353. 
8 Appellate Body Reports, "US – Continued Suspension "/"Canada – Continued  Suspension ", para . 354. 
9 Appellate Body Reports, "US – Continued Suspension "/"Canada – Continued Suspension ", para . 353. 
10 Appellate Body Reports, "US – Continued Suspension "/"Canada – Continued Suspension ", para . 354. WT/DSB/M/397  
 
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  5.8.  However, given the potential overlap between the mandates of these two proceedings, Japan 
observed that there appeared to be at least three possible scenarios from the Article  22.6 
Arbitrator's perspective: first, the Arbitrator could examine and decide the WTO -consistency of the 
compliance measures on i ts own and then decide the level of nullification or impairment. This could 
potentially lead to conflicting outcomes between the two proceedings, especially because an 
appellate review was only available in the compliance proceedings (and the Appellate Bod y could 
reverse the compliance Panel's findings). Second, the Arbitrator could determine the level of 
nullification or impairment based on the original measures found to be WTO -inconsistent in the 
original proceedings. Since, under Article  22.7 of the DSU,  the Arbitrator's decision had to be 
accepted as final, and there would be no second arbitration, the outcome of the compliance 
proceedings, whatever it was, would not be reflected in the arbitral award. Unless the outcome of 
the compliance proceeding conf irmed that India's compliance measures had achieved substantive 
compliance, the authorized level of suspension would be maintained regardless of the level of 
nullification or impairment caused by the compliance measures. Third, the arbitrator could wait fo r 
the completion of compliance proceedings before proceeding. This was the equivalent of a 
sequencing arrangement; but it could certainly delay and prolong the entire process. Japan hoped 
that the compliance Panel and the Arbitrator, in consultation with t he parties, would take a proper 
course of action that would serve the purpose of "prompt"11, "positive"12 and "effective"13 
resolution of this dispute, to the satisfaction of all parties involved in these two proceedings.  
5.9.  The representative of European  Union  said that his delegation wished to refer to its 
statement made at the special DSB meeting on 19  July 2016. The EU said that it hoped that India 
and the United States would ensure that the procedures of the DSU, with regard to compliance 
and suspension of o bligations in this dispute, could be conducted efficiently and in the correct 
sequence. In that regard, the EU noted India's request to establish a compliance panel pursuant to 
Article  21.5 of the DSU. These developments raised a number of systemic issues which the EU 
intended to closely follow in the upcoming proceedings. India restated its view that arbitration 
under Article  22.6 of the DSU should be preceded by a multilateral determination of compliance in 
case there was a disagreement on this question. The EU had participated as a third -party in the 
panel and appeal proceedings, and would request third -party rights in the compliance proceeding, 
pursuant to Articles  10.1 to 10.3 of the DSU, including with respect to any disagreement as to the 
existence or  consistency with a covered agreement of measures taken to comply with the 
recommendations and rulings of the DSB.  
5.10.   The representative of Canada  said that his country referred to its previous statement made 
in respect of this panel request at the 19  April 2017 DSB meeting. In particular, Canada noted that 
recent practice clearly demonstrated the relevance and appropriateness of the right of the 
responding party to initiate compliance proceedings under the DSU. Canada said that it presumed 
that the concerns o utlined by previous speakers had been borne in mind by the responding 
Members that had recently initiated compliance proceedings in the DS381, DS430, and DS461 
disputes.  
5.11.   The representative of Australia  said that her country wished to refer to its statement  made 
at the 19  April 2017 DSB meeting which had observed the potential systemic issues arising in 
relation to the sequencing of compliance and retaliation proceedings in the current dispute. 
Australia recalled that all Members shared a responsibility to s upport and improve the efficiency, 
effectiveness and operation of the WTO dispute settlement system. In that light, Australia 
continued to encourage the parties in this dispute to work together to reach an agreement which 
would address the systemic issues arising in this dispute.  
5.12.   The representative of Colombia  said that his country did not wish to take position on the 
substance of this dispute, and hoped that the United States and India would be able to settle their 
differences with respect to the implement ation of the rulings and recommendations of the DSB. 
However, Colombia wished to highlight the recent DSB practice, which would be adopted at the 
present meeting with regard to this dispute. This practice recognized that the responding party in 
a dispute, which had complied with the recommendations and rulings of a panel, had the right to 
recourse to Article  21.5 of the DSU before the DSB could proceed with the suspension of 
concessions process under Articles  22.2 and 22.6 of the DSU. In Colombia's view, th is practice 
                                                
11 DSU Article  3.3. 
12 DSU Article  3.7. 
13 DSU Article  21.1. WT/DSB/M/397  
 
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  clarified how the principle of sequencing functioned in the framework of the DSB. Finally, Colombia 
wished to refer to its statement made at the 19  April 2017 DSB meeting.  
5.13.   The representative of Brazil  said that his country wished to reiterate i ts statement made at 
the 19  April 2017 DSB meeting, in which it had emphasized the consequences of not taking into 
account the correct procedural order between Articles  21.5 and 22.6 of the DSU. Brazil asked 
whether the procedural precariousness in several  disputes regarding the issue of sequencing was 
the intention of the original drafters of the DSU. At the 19  April 2017 DSB meeting, Brazil had 
raised several questions to see whether the procedural confusion currently witnessed by the DSB 
was possibly wha t the DSU prescribed to Members. Brazil said that the answer was clearly no and 
hoped that Members could soon revert to the correct, logical and procedurally -sound sequence 
between Articles  21.5 and 22.6 of the DSU.  
5.14.   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/DS430/21. The 
Panel would have standard terms of reference.  
5.15.   The representatives of Australia , Brazil , China , the  European  Union, Guatemala , Japan , 
Kazakhstan , Korea , the Russian  Federation , Singapore  and Viet Nam reserved their third -party 
rights to participate in the Panel's proceedings.  
6  COLOMBIA – MEASURES RELATING TO  THE IMPORTATION OF T EXTILES, APPAREL 
AND FOOTWEAR  
A.  Reco urse to Article  21.5 of the DSU by Panama: Request for the establishment of a 
panel (WT/DS461/22)  
6.1.  The Chairman  drew attention to the communication from Panama contained in document 
WT/DS461/22 and invited the representative of Panama to speak.  
6.2.  The represen tative of Panama  said that on 9  March  2017, her country had requested 
consultations with Colombia under Article  21.5 and Article  4 of the DSU, Article  19 of the Customs 
Valuation Agreement, and Article  XXII of the GATT  1994 with respect to certain implemen ting 
measures resulting from the implementation of the DSB's rulings and recommendations in 
"Colombia – Measures Relating to the Importation of Textiles, Apparel and Footwear" (DS461). 
Those consultations had taken place in Geneva on 28  March  2017. Panama and Colombia had 
subsequently pursued their efforts in respective capitals in order to arrive at a solution. 
Unfortunately, these consultations had failed to resolve this dispute. Consequently, Panama asked 
the DSB to establish a panel under Article  21.5 o f the DSU.  
6.3.  The representative of Colombia  said that his country welcomed Panama's intention to settle 
this dispute in a manner that enabled first to examine the Colombian measures by the Article  21.5 
panel before proceeding with the request for suspension of concessions. Colombia recalled that, at 
the DSB meeting on 16  December  2016, it had informed the DSB of its compliance with the DSB's 
recommendations and rulings. Colombia had complied promptly and effectively, through 
Decree  1744 of  2016, which had rep laced the compound tariff with an ad valorem tariff that did 
not exceed Colombia's WTO bound -tariff rates for imports of the apparel and footwear covered by 
the Decree, which were subject of this dispute. Colombia noted that, since it had complied with the  
DSB's recommendations and rulings, there was no basis for the request to suspend concessions. 
Moreover, as the Arbitrator in "US – Tuna II (Mexico)" had explained, in order to have recourse to 
Article  22.2 of the DSU, there had to be adverse DSB's recomme ndations and rulings in respect of 
the measure taken to comply, which was not the case in this dispute. In the circumstances, 
Colombia had considered that the appropriate way to proceed would be for Panama to withdraw its 
request under Article  22.2 of the DSU which was the basis for Arbitration under Article  22.6 of 
the DSU. 
6.4.  Colombia noted that, with respect to the other apparel and footwear products covered by the 
measure, which was considered to be inconsistent with Colombia's obligations under Article  II of 
the GATT  1994 that under Decree  1744, they were subject to the national tariff, i.e. Colombia's 
MFN tariff which did not exceed the bound levels. Panama's complaints in this request for the 
establishment of an Article  21.5 panel concerned Decree  1745 o f 2016, which was a customs WT/DSB/M/397  
 
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  measure that was not inconsistent with any of Colombia's obligations under the Marrakesh 
Agreement, and which had nothing to do with the compound tariff measures that were the subject 
of the DSB's recommendations and rulings in DS461. By Decree  1745, Colombia had adopted 
measures to strengthen the customs risk management and control system in the face of possible 
situations involving customs fraud associated with the importation of certain goods, whatever their 
origin. In other w ords, the Decree was an effort to ensure that trade operations were governed 
strictly by the principles underlying legal and fair trade, and accordingly, it was in line with WTO 
rules. For Colombia, Panama's current request raised systemic concerns in that  it meant 
disregarding the limited nature of Article  21.5 procedures. This placed the responding Member at 
the considerable disadvantage of possibly being subjected to suspension of concessions without 
having had a reasonable period of time to bring itself  into conformity with the WTO rules. 
Colombia and Panama had been discussing their mutual concerns in this respect, and would deal 
with them through dialogue between the two governments. Consequently, Colombia said that it 
believed that the best thing to d o, for the moment, was to continue this dialogue. As such 
Colombia was not in a position to agree to the establishment of an Article  21.5 panel. In the 
meantime, Colombia looked forward to an agreement which the delegations of both countries had 
been worki ng so hard to achieve. Colombia noted that the position it had adopted at the present 
meeting would not stand in the way of a speedy and prompt resolution of the dispute: in view of 
the DSB's workload, the failure to establish a panel at the present meetin g would not have any 
influence on the process.  
6.5.  The representative of Panama  said that her country shared Colombia's concern regarding the 
sequencing issue. The complexity of this matter was apparent in other areas of the WTO's work, 
such as the DSU negotia tions where this important issue remained unresolved. Panama considered 
it essential that the proceedings in this case, which had been ongoing for a decade, were 
conducted in an orderly and expeditious manner so that the measures applied by Colombia did no t 
continue to nullify and impair the benefits accruing to Panama directly or indirectly under the 
GATT  1994. Panama had followed the provisions of the DSU and had complied with the existing 
time-frames in order to safeguard its rights. Panama had challenge d Colombia's measures 
concerning textile and footwear imports in two WTO proceedings, in which two Panels and the 
Appellate Body had confirmed that Colombia was in breach of its obligations under the WTO -rules. 
Nonetheless, Colombia still failed to impleme nt the DSB's recommendations and rulings and 
continued to impose restrictions on trade in these products from Panama.  
6.6.  Panama had been requesting, for over a decade of WTO proceedings, that Colombia regulate 
its imports of textiles and footwear without viol ating its obligations under the WTO  Agreements. It 
was therefore critically important for Panama, especially at this stage in the proceedings, that this 
case be concluded in an expeditious and orderly manner. Panama also pointed out that it had 
complied wi th all the relevant procedures in submitting this panel request under Article  21.5 of the 
DSU. The proceedings would be heard by the same panel or arbitration panel which comprised the 
members of the original panel and which Panama hoped would coordinate m atters in the most 
pertinent way.  
6.7.  The representative of the European  Union  said that, with regard to the panel request at the 
present meeting, his delegation considered that this situation fell under Article  9.1 of the DSU and 
hence both compliance proceed ings could be merged. In this regard, and taking into account the 
second sentence of Article  9.1 of the DSU, the EU considered that the matter should be referred to 
the compliance panel which had been established at the requested of Colombia since this wou ld 
appear to be feasible.  
6.8.  The representative of Brazil  said that, as her country had already pointed out on previous 
occasions, Brazil was concerned about the way Members used, or misused,  the procedures under 
Articles  21.5 and  22.2 of the DSU. In Brazil's  view, the correct interpretation of these provisions 
required that Members first obtain a multilateral decision concerning implementation before 
requesting authorization to suspend concessions and other obligations. This dispute was another 
example of the  procedural precariousness generated by disregarding the sound and reasonable 
procedural order of those provisions. Once the panel requested by Panama were established, there 
would be two compliance panels (requested by both Colombia and Panama) and one ar bitration 
proceeding running in parallel. Had the proper procedural order been respected from the 
beginning, a second compliance proceeding would not have been necessary, as Panama could have 
included the full spectrum of Colombian measures "taken to compl y" in the terms of reference of 
the Article  21.5 panel. The recurrence and multiplication of these procedural anomalies were WT/DSB/M/397  
 
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  noteworthy and pointed out to the fact that this was not what the original drafters had intended 
for the dispute settlement system.  Given the current situation, Brazil encouraged the parties to 
work constructively in order to harmonize all the proceedings.  
6.9.  The representative of Japan  said that his country wished to refer to the statement made 
under Agenda item  5. 
6.10.   The representative of  Australia  said that her country referred to its statement made at the 
DSB meeting on 6  March  2017 reflecting Australia's concerns regarding the systemic issues arising 
in these dispute proceedings, as well as its statement made under item  5 of the DSB Age nda. 
6.11.   The DSB took note  of the statements and agreed  to revert to this matter.  
7  UNITED  STATES – MEASURES CONCERNING THE IMPORTATION, MAR KETING AND 
SALE OF TUNA AND TUN A PRODUCTS  
A.  Recourse to Article  22.7 of the DSU by Mexico (WT/DS381/44)  
7.1.  The Chairman  drew attention to the communication from Mexico contained in document 
WT/DS381/44 and invited the representative of Mexico to speak.  
7.2.  The representative of Mexico  said that his country had initiated this dispute on 
24 October  2008. In July  2012, the DSB had de termined that the United  States had violated its 
trade commitments with the original tuna measure. In 2013, the United States had amended the 
measure, and in December 2015 the DSB had again determined that the Member concerned had 
failed to comply with its  international trade obligations. Under those circumstances, on 
10 March  2016 Mexico had filed a request for authorization to suspend concessions. In response, 
on 22  March  2016 the United  States had taken two actions: the first action was to challenge the 
level of suspension of concessions proposed by Mexico, and the second one was to amend the 
measure at issue for the third time. Mexico thanked the Arbitrator, the Secretariat staff that had 
assisted the Arbitrator and the translators for the Report issued on 25  April 2017. Regarding the 
Arbitrator's decision, Mexico said that it would take this opportunity to comment on some of the 
Arbitrator's reasoning and conclusions, which would serve to guide future arbitrators in 
proceedings in which the level of null ification or impairment was challenged.  
7.3.  Regarding procedural matters, the following points had emerged from the Arbitrator's 
Decision. At the United States' request, the Arbitrator had authorized a delayed closed circuit 
television broadcast of the US stat ements at the hearing, notwithstanding Mexico's objection. In 
"EU- Biodiesel", the Appellate Body had received a similar request from only one of the participant 
and therefore the request had been denied in the absence of mutual agreement.14 DSU provided 
that "the dispute settlement system of the WTO is a central element in providing security and 
predictability to the multilateral trading system". The fact that an arbitrator or panel departed from 
precedent and decided a matter differently from previous case s undermined the security and 
predictability of the system. The US request for delayed closed circuit television broadcasting had 
also placed a heavier burden on the WTO Secretariat and on the parties to the dispute, since it had 
entailed the recording, re view of the recording, a meeting with the parties to edit the video and 
the viewing of the video itself at the WTO. Even the Arbitrator had acknowledged that "[p]artially 
open meetings impose a greater burden on a WTO adjudicator".15 There had been more WTO  
Secretariat staff than members of the public at the hearing. To distract Secretariat staff with such 
forms of activity was disturbing in that it affected their workload, which was heavy enough.  
7.4.  The United States also stated that the Arbitrator should have  determined the level of 
nullification or impairment in the light of the amended 2016 tuna measure and not the amended 
2013 tuna measure. The Arbitrator had noted that Article  22.6 of the DSU "does not specify which 
measure should form the basis of the req uest for, or authorization of, suspension of 
concessions".16 The Arbitrator had thus considered that a full reading of Article  22 of the DSU 
showed that the level of nullification or impairment caused had to be construed to mean the 
original or compliance m easure that had been found to be inconsistent "at the time of expiry of the 
                                                
14 Appellate Body Report, "EU-Biodiesel ", (WT/DS473/AB/R/Add.1 ), paras. 6 and 7.  
15 Decision by the Arbitrator, "US-Tuna II (Mexico) ", (WT/DS381/ARB), para. 2.29.  
16 Ibid., para. 3.18.  WT/DSB/M/397  
 
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  RPT".17 In this case that had been the amended 2013 tuna measure. Mexico agreed with the 
Arbitrator's conclusion that "the present arbitration takes place in response to DSB 
recomme ndations and rulings that the 2013 tuna measure had failed to bring the United  States 
into compliance within the RPT"18 and that "[t]he adverse DSB recommendations and rulings 
covering the 2013 tuna measure therefore continue to provide a valid basis for th e suspension of 
concessions".19 The Arbitrator had also addressed Mexico's systemic concerns. In particular, that of 
whether interrupting the suspension of concessions proceedings by giving precedence to the 
compliance proceedings would render Article  22 of  the DSU ineffective, thus undesirably creating 
an endless loop that could indefinitely preclude the right to suspend concessions or other 
obligations. The Arbitrator had agreed with Mexico's systemic concern.20 This concern had in fact 
been shared by other  Members such as Guatemala, Canada, Japan, Korea, Australia, Norway and 
Chinese  Taipei at the DSB meetings held on 22  April 201621 and 9  May 2016.22 
7.5.  The Arbitrator had decided that it was "appropriate […] to undertake a prompt assessment of 
the level of null ification or impairment on the basis of the 2013 tuna measure and leave the 
analysis of the WTO consistency of the 2016 tuna measure to the two compliance panels 
established to undertake that precise task".23 
7.6.  Regarding the substance of this dispute the foll owing emerged from the Arbitrator's Decision. 
The Arbitrator had found that many – albeit not all – of the assumptions underpinning the Mexican 
model were reasonable. In this regard the Arbitrator had based its calculation on a re -specified 
version of Mexi co's model, since it "is a reasonable methodology to estimate the export losses 
caused by the Tuna Measure".24 By contrast, the Arbitrator had refrained from using the US model, 
based on Mexico's historical share in the US market prior to the adoption of th e tuna measure. In 
this regard, the Arbitrator had determined that the level of nullification or impairment was 
US$163.3  million per annum, between 19 and 7 times more than the amounts suggested by the 
United  States with its model, which had been US$8.5  million and US$21.9  million per annum. Both 
parties to the dispute had agreed that withdrawal of the Tuna Measure would constitute an 
appropriate counterfactual. The Arbitrator had concurred, and the value of Mexico's exports of 
canned yellowfin to the Unite d States had therefore been determined.  
7.7.  With regard to the time -frame, the parties had agreed – and the Arbitrator had shared their 
view – that a short -term assessment of the withdrawal of the measure would be appropriate. The 
Arbitrator had also shared Me xico's view in taking calendar -year 2014, which had been the year 
that had followed the expiry of the reasonable period of time for compliance and the year for which 
there had been the most data available as the period for assessing the short -term impact o f the 
withdrawal of the amended 2013 tuna measure. Mexico agreed with the Arbitrator's conclusion in 
the sense that "following the adoption of the original Tuna Measure, there was an important 
decline in the volume of US imports of yellowfin tuna from Mexi co and purchases of yellowfin by 
US canneries".25 
7.8.  The model proposed by Mexico had been based on: "(i) the demand for canned tuna in the 
United  States and Mexico, respectively; (ii) the supply of canned tuna in the United States and 
Mexico, respectively; an d (iii) the market equilibrium conditions in the US and Mexican markets for 
canned tuna".26 The Arbitrator had indicated that the Tuna Measure restricted the supply of canned 
yellowfin tuna from Mexico to the United States, which it had concluded was reason able according 
to Mexico's explanations. The Arbitrator had recognized that "yellowfin is a premium [or gourmet] 
product"27 and also that "US consumers have a preference for […] yellowfin tuna"28 and would 
                                                
17 Ibid., para. 3.21. See also para. 3.22.  
18 Ibid., para. 3.21. See also para. 3.34.  
19 Ibid., para. 3.21. See also paras . 3.42 and 3.66 and 3.67.  
20 Ibid., para. 3.21. See also para. 3.53.  
21 Minutes of DSB meeting, document WT/DSB/M/377, paras . 7.6-7.11, 7.13 and 7.17, and document 
WT/DSB/M/378, para. 1.5.  
22 Minutes of DSB meeting, document WT/DSB/M/378, para. 1.5.  
23 Decision by the Arbitrator, "US – Tuna II (Mexico) ", (WT/DS381/ARB), para. 3.21. See also 
para. 3.55. 
24 Ibid., para. 5.157.  
25 Ibid., para. 5.33.  
26 Ibid., para. 5.3.  
27 Ibid., para. 5.67.  
28 Ibid., para. 5.71.  WT/DSB/M/397  
 
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  therefore have been willing to pay a premium for it.  This was precisely the tuna produced by 
Mexico.  
7.9.  The Arbitrator had unfortunately not recognized that certain statements had been 
"manufactured". In Mexico's view, a simple reading of the letters obtained from the private sector 
showed them to have the sam e wording, which could not have been a coincidence unless the 
writers had received a format in which, or some indication as to how, to draft the letters. 
Nonetheless, the Arbitrator had found that US retailers, which accounted for 73.1% of total 
US consump tion of tuna products, would not have refused to sell tuna caught by setting on 
dolphins if the measure at issue had not existed. The Arbitrator had also determined that "Mexico 
does have a competitive advantage in the US market vis à vis other foreign can ned yellowfin 
producers".29 Given these circumstances, the Arbitrator had found that it could reasonably be 
expected that Mexico would increase its tuna exports to the United States following the withdrawal 
of the Tuna Measure.  
7.10.   Mexico said that it did not w ish to go into details in analysing the Decision. Suffice it to point 
out that the Arbitrator had considered the model proposed by Mexico to be reasonable. Lastly, the 
Arbitrator had concluded in the Decision of 25 April 2017 that Mexico "may request autho rization 
from the DSB to suspend concessions or other obligations as indicated in document WT/DS381/29 
at a level not exceeding US$163.23 million per annum".30 Therefore, in accordance with document 
WT/DS381/44, Mexico requested the DSB's authorization to s uspend concessions to the United 
States.  
7.11.   The representative of the United  States  said that the United States regretted the request for 
authorization put forward by Mexico at the present meeting. But as had been discussed at previous 
DSB meetings, in March  2016, the US National Oceanic and Atmospheric Administration ("NOAA") 
had issued a rule modifying the US dolphin safe labelling measure. That rule had directly 
addressed the DSB's findings and had brought the United  States into compliance with its WTO 
obligations. As a result, if the compliance panel confirmed that the current dolphin -safe labelling 
measure was no longer WTO -inconsistent, there would be no basis under WTO rules to apply any 
countermeasures. The United States did appreciate the hard work of the Arbitrator, and the 
Secretariat staff assisting it, in the Article  22.6 proceeding. Nonetheless, the United States had 
concerns with the Arbitrator's award. First, the Arbitrator had based its report on a measure that 
no longer existed. This choice was  inconsistent with the purpose and proper operation of an 
Article  22.6 proceeding, as was made clear by the text of the DSU. The level of suspension of 
concessions determined in any arbitration under Article  22.6 of the DSU had to be equivalent to 
the curr ent level of nullification and impairment. The text of DSU Article  22.4 was clear that the 
appropriate level of suspension of concessions may not exceed "the  level of nullification or 
impairment" currently caused by the measure found to be WTO -inconsistent . Article  22.7 also 
made it clear that the relevant inquiry was focused on the present level of nullification and 
impairment, and Article  22.8 of the DSU was explicit that there could be no suspension of 
concessions where there was compliance. Therefore, a s the US tuna measure had been brought 
into compliance, there was no basis for a suspension of concessions in this dispute.  
7.12.   With respect to the trade effects analysis in the Award, the United  States noted th at the 
Arbitrator's analysis  erroneously overesti mated the trade impact of this measure. Most 
importantly, the Arbitrator had used Mexico's model as a basis for calculation, even though the 
model had been based on three major assumptions that were unproven and, in fact, were contrary 
to the evidence on U S consumer preferences and the global supply of canned tuna. First, the 
Arbitrator had accepted Mexico's claim that the US measure restricted the supply of canned 
yellowfin to the US market, despite significant evidence to the contrary. The Arbitrator had claimed 
that the adoption of the US tuna measure in 1990 was "the main reason" for declining yellowfin 
imports and purchases by US canneries. But the Arbitrator had ignored the fact that all tuna 
purchases by US canneries declined in the 1990s. The Arbitra tor had also asserted that yellowfin 
prices had "generally increase[d]" after 1990. But the Arbitrator had relied on evidence related to 
fresh yellowfin for sale in the direct consumption/sashimi markets, not cannery -grade frozen 
yellowfin. They were two d ifferent markets – as any lover of sushi would appreciate – and could 
not be confused. Second, the Arbitrator had found that, on average, US  consumers preferred 
canned yellowfin over other types of canned tuna. But no evidence suggested more than a tiny 
                                                
29 Ibid., para. 5.104.  
30 Ibid., para. 7.1.  WT/DSB/M/397  
 
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  fraction of US consumers had such a preference. To the contrary, the evidence had established 
that US consumers had a strong preference for canned albacore and skipjack -based light meat 
tuna, as skipjack was the least expensive type of tuna and was low in me rcury. Multiple surveys 
had confirmed that only a tiny percentage of consumers buying canned tuna (2 -6%) looked for 
yellowfin. Additionally, US consumers, for decades, had been deeply concerned about the harmful 
effects of dolphin sets and had wanted to pu rchase tuna caught by other methods. In response to 
this concern, all major US retailers had, for decades, decided not to purchase canned tuna 
produced by setting on dolphins. The United States had presented statements by all of the largest 
US retailers sh owing that their purchasing policies regarding canned tuna would not be affected by 
removal of the tuna measure. Some of the retailers had declared explicitly that they would never 
purchase tuna caught by setting on dolphins, while others had explained tha t their purchasing 
decisions were not affected by the official label and would not be changed by its removal. The 
Arbitrator had ignored the evidence about US  consumer preferences and how they had shaped the 
decisions of all major US retailers. Instead, th e Arbitrator had assumed that any retailer in the 
United  States that had not explicitly vowed to never purchase tuna caught by setting nets on 
dolphins would start purchasing Mexican tuna if the measure were withdrawn. This included 
retailers that had conf irmed that removal of the measure would have no effect on their purchasing 
decisions. Third, the Arbitrator had agreed that Mexico would be the only supplier of canned 
yellowfin in the US  market. To repeat, no other WTO Member would successfully compete to  sell 
canned yellowfin tuna in the US market. This was unrealistic, and the assumption had been made 
without any evidence as to the cost structure of the Mexican tuna industry compared to other 
industries or any evidence of the Mexican industry's ability t o compete successfully in any market 
outside Mexico. In combination, these findings had resulted in a large overestimation of the trade 
effects from the previous version of the dolphin -safe labelling measure. But as the United States 
had noted at the outse t, the Arbitrator's analysis was of a measure that no longer existed. If the 
compliance panel confirmed that the current, 2016 dolphin -safe labelling measure was no longer 
WTO-inconsistent, there would be no basis under WTO -rules to apply any countermeasur es in 
relation to the award being discussed at the present meeting.  
7.13.   The representative of Canada  said that his country had carefully reviewed the Report of the 
Arbitrator and would like to comment briefly on the Arbitrator's findings in Section  3 of its Re port 
in view of Canada's systemic interest in the proper interpretation of Article  22 of the DSU. Canada 
commended the Arbitrator for its cogent analysis and for taking due account of the systemic 
considerations at issue. In particular, Canada welcomed and  supported the finding that, under 
Article  22.6 of the DSU, an Arbitrator was mandated "to assess the level of nullification or 
impairment caused by the WTO -inconsistent original measure (where no compliance measure was 
subsequently taken), or a subsequent  WTO-inconsistent compliance measure, that was in 
existence at the time of expiry of the RPT". Like the Arbitrator, Canada shared the concern 
expressed by Mexico regarding an interpretation of Article  22.6 of the DSU according to which a 
new assessment of compliance would be necessary before the DSB could authorize the suspension 
of concessions whenever: (i) a compliance measure subject to adverse DSB recommendations and 
rulings was further modified; (ii) the responding party claimed to have come into compl iance as a 
result of that modification; and (iii) an Article  22.6 arbitration was subsequently conducted. As the 
Arbitrator rightly noted, such an interpretation "could very substantially delay, and… effectively 
thwart, a complaining party's efforts toward s obtaining DSB authorization to suspend concessions". 
This was consistent with the view that Canada had expressed in this forum, most recently at the 
DSB meeting of 20  February  2017, that it would be appropriate for the complaining party to be 
able to exe rcise its rights under Article  22 of the DSU in all circumstances where the DSB had 
ruled that a measure taken to comply in fact did not comply. The adoption of successive 
modifications to a compliance measure could not undermine the ability of a complaini ng party to 
seek to suspend concessions, which was the remedy provided for in Article  22 of the DSU in cases 
of non -compliance. That remedy effectively contributed to preserving the rights and obligations of 
Members under the covered agreements. Canada, th erefore, congratulated the Arbitrator for this 
well-reasoned and important section of the decision.  
7.14.   The representative of Japan  said that, in this Arbitration, an interpretive issue of systemic 
importance had been raised, which should concern all WTO Membe rs. Specifically, the Arbitrator 
had been confronted with a difficult choice to make in determining the basis for its assessment of 
the level of nullification or impairment. This was the choice between the 2013 tuna measure, on 
the one hand, which had exis ted at the time of expiry of the RPT and had been found to be 
WTO-inconsistent as a result of the first compliance proceedings, and the 2016 tuna measure, on 
the other, which the United States had taken in response to the outcome of the first compliance WT/DSB/M/397  
 
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  proceedings and was currently subject to the ongoing 2nd  compliance proceedings. The Arbitrator 
had chosen the 2013 tuna measure as the proper basis for its assessment. Japan understood that 
the ultimate conclusion by the Arbitrator was specific to the factu al circumstances and procedural 
histories surrounding this dispute, as well as the particular claims and arguments that had been 
advanced by the parties before the Arbitrator. Thus, Japan said that it would not take any position 
on the propriety of the Arb itrator 's ultimate conclusion. However, given the systemic nature of the 
issue addressed by the Arbitrator, and because Japan had had no opportunity to express views on 
this systemic issue in the arbitration (which did not contemplate third -party participa tion) Japan 
said that it would like to offer some observations.  
7.15.   First, after examining the text and context of the relevant provisions of Article  22 of the 
DSU31, the Arbitrator had found that "the text of Article  22.6 of the DSU mandates an arbitrator to 
assess the level of nullification or impairment caused by the WTO -inconsistent original measure 
(where no compliance measure was subsequently taken), or a subsequent WTO -inconsistent 
compliance measure, that was in existence at the time of expiry of the RPT ".32 This was certainly a 
plausible reading of Article  22.6. However, the Arbitrator's emphasis on the existence of the 
measure at the time of expiry of the RPT begged the question: what if, as had often been the case, 
the implementing Member adopted the co mpliance measure subsequent to the expiry of the RPT? 
The Arbitrator could say, "well, in that case, depending on the timing of the adoption of such 
compliance measure, the parties would be most likely to agree that that compliance measure is 
the relevant measure to assess the level of nullification or impairment". In its discussion on the 
Arbitrator's decision in "US – Upland Cotton", specifically, its treatment of "Step  2 subsidy" which 
existed when the RPT expired but was subsequently withdrawn, the Arbi trator had stressed the 
importance of the parties' agreement.33 In essence, the Arbitrator appeared to observe the 
following: as the parties had agreed on the withdrawal of the Step  2 subsidy, there was no 
"disagreement" within the meaning of Article  21.5 a s to the compliance with respect to that 
subsidy. Since there was no genuine issue of compliance to resolve, the compliance panel had 
simply declined to rule on the WTO -consistency of that subsidy and hence there were no DSB 
recommendations and rulings. In  this particular context, the lack of the DSB recommendations and 
rulings would amount to the multilateral confirmation of the full compliance with respect to the 
Steps  2 subsidy; and further consideration of that subsidy in the assessment of the level of 
suspension would serve no purpose of inducing compliance. But, in Japan's view, the fact remained 
that the parties' agreement on the subsequent withdrawal of the measure would neither change 
the status of the expiry of the RPT as "the relevant point of ref erence"34, nor would otherwise 
extinguish the existence of the measure and its effect during the period between the expiry of the 
RPT and the time of withdrawal. Nevertheless, if the parties' agreement could justify the 
consideration of the withdrawals or a ny other compliance actions that occurred subsequent to the 
expiry of the RPT in assessing the level of nullification or impairment, then any other intervening 
events that could contribute to achieving substantive compliance would equally deserve serious 
considerations, especially, as noted by the Arbitrator, "given that the purpose of [the] suspension 
is precisely to induce compliance".35 
7.16.   Second, the Arbitrator had stated that "the existing adverse DSB recommendations and 
rulings remain in effect until such  time as there are new, overriding panel and/or Appellate Body 
findings that have been adopted by the DSB"36 and such "overriding panel and/or Appellate Body 
findings" could "affect[] the continued validity of the adverse DSB recommendations and ruling" 
previously made in the same dispute.37 Japan was not sure how the subsequent DSB 
recommendations and rulings could "override" or "affect the continued validity of" the previous 
DSB recommendations and rulings in the same dispute. As the Appellate Body had expl ained, the 
DSB's recommendations and rulings in the original proceedings, as well as in the subsequent 
compliance proceedings, "form part of a continuum of events relating to compliance with the 
recommendations and rulings of the DSB in the original procee dings"38 and "[t]he determination of 
whether 'measures taken to comply' challenged by the complaining party implement fully, or only 
in part, the DSB recommendations and rulings requires a panel to examine all of the previous DSB 
                                                
31 Decision by the Arbitrator, footnote 48.  
32 Decision by the Arbitrator, para.  3.24. 
33 Decision by the Arbitrator, paras.  3.40 – 3.41. 
34 Decision by the Arbitrator, para.  3.60. 
35 Decision by the Arbitra tor, para.  3.41. 
36 Decision by the Arbitrator, para.  3.35. 
37 Decision by the Arbitrator, para.  3.36. 
38 Appellate Body Report, "US – FSC" (Article 21.5 – EC II), para.  87. WT/DSB/M/397  
 
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  recommendations and rulings  and the entire range of measures covered by them".39 It could well 
have been that what the Arbitrator meant was that the DSB's findings that the implementing 
Member had achieved substantive compliance would confirm that all of the prior DSB 
recommendations  and rulings had been fully implemented. But, in Japan's view, the choice of 
words by the Arbitrator had been unfortunate.  
7.17.   Third, the Arbitrator had agreed with "the systemic concern"40 raised by Mexico about so -
called: "an endless loop that could indefinit ely preclude the right to suspend concessions or other 
obligations pursuant to Article  22".41 Given the prolonged and complicated procedural histories of 
this dispute, this concern could be understandable. However, the Arbitrator had described this 
concern in the following terms: "[i]f, in a situation such as ours where an Article  22.6 arbitration is 
conducted, new compliance panel proceedings under Article  21.5 needed to be undertaken every 
time a measure already found to be inconsistent at the expiry of th e RPT were modified and 
compliance was claimed, this could very substantially delay, and in theory effectively thwart, a 
complaining party's efforts towards obtaining DSB authorization to suspend concessions".42 In 
Japan's view, such scenario could be theor etically possible but was highly unlikely. Putting aside 
this remote possibility, this Arbitrator appeared to presuppose that compliance proceedings under 
Article  21.5 had to be conducted to determine the WTO -consistency of the new modified 
compliance meas ure, when it was introduced, before an Article  22.6 arbitration could proceed to 
examine the level of nullification or impairment. Japan said that it would return to this issue.  
7.18.   Fourth, the Arbitrator had found that Mexico was not seeking retroactive remed ies when it 
had proposed the suspension based on the nullification or impairment caused by the 2013 Tuna 
Measure.43 The Arbitrator reasoned that "the relevant point of reference is … the date of expiry of 
the RPT"44 and regardless of the delay in making its request for authorization, "Mexico is still only 
seeking to retaliate as from the date when the United States should have come into compliance".45 
Japan agreed that the relevant point of reference was the time when the RPT had expired and the 
mere passage o f time would not render the requested suspension "retroactive". However, Japan 
was still not certain what the Arbitrator meant by its statement that "Mexico is still only seeking to 
retaliate as from the date when the United States should have come into co mpliance". The 
Arbitrator could simply have wanted to suggest that Mexico sought to apply the suspension of 
concessions or other obligations prospectively after the authorization up to the level, each year, 
which was equivalent to the annual level of nulli fication or impairment caused by the 2013  tuna 
measures. Indeed, this was the approach the Arbitrator had taken in its determination of the 
arbitral award in this dispute. However, if (i) the Arbitrator had implied that any nullification or 
impairment caus ed historically by the 2013 tuna measure (as from the date of expiry of the RPT)  
could be counted towards the level of nullification or impairment; and (ii) that Mexico was entitled 
to take action to retaliate against all such nullification and impairment cause d in the past (albeit  
after the RPT expiry) , then such a remedy appeared to be retroactive.  
7.19.   Fifth, Japan observed that, implicit in the Arbitrator's finding on the issue of relevant 
measure to assess the level of nullification or impairment, was its r eluctance to assess and rule on 
the issue of compliance on its own, presumably given the existence of the adverse DSB's 
recommendations and rulings with respect to the 2013 tuna measure and the on -going parallel 
compliance proceedings reviewing the WTO -consistency of the 2016 tuna measure. Japan said that 
it agreed that "panel proceedings under Article  21.5 is the proper procedures for resolving the 
disagreement as to whether [a compliance measure] has achieved substantive compliance".46 And 
an Article  22.6 arbitrator could and should rely on the prior findings of the compliance panel in 
carrying out its duty to assess the level of nullification or impairment caused by the 
WTO-inconsistent measures at issue. After all, the Article  22.6 arbitration was "part o f a continuum 
of events"47 leading up to the final resolution of the dispute. However, as a matter of jurisdiction 
and adjudicative function, Japan did not consider that an Article  22.6 arbitrator was precluded 
from examining the issue of compliance where n ecessary, and if the circumstances so required. 
                                                
39 Appellate Body Report, "US – FSC" (Article 21.5 – EC II), para.  93. 
40 Decision by t he Arbitrator, para.  3.53. 
41 Decision by the Arbitrator, para.  3.49. 
42 Decision by the Arbitrator, para.  3.53. 
43 Decision by the Arbitrator, para.  3.58. 
44 Decision by the Arbitrator, para.  3.60. 
45 Decision by the Arbitrator, para.  3.58. 
46 Appellate Body Re ports, "US – Continued Suspension "/"Canada – Continued Suspension ", para.  338. 
47 Appellate Body Report, "US – FSC" (Article  21.5 – EC II), para.  87. WT/DSB/M/397  
 
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  Under Articles  22.6 and 22.7 of the DSU, an Article  22.6 arbitrator was given the mandate to 
"determine whether the level of [] suspension is equivalent to the level of nullification or 
impairment". Inherent in this mandate was the assessment of the WTO -consistency of a  
compliance measure. This was because, as the Arbitrator in "EC – Banana III" had explained, an 
arbitrator could not fulfil its task to assess the equivalence unless it had reached a view on the  
WTO-consistency of the compliance measure.48 This had been noted by this Arbitrator as well 
when it had described the Arbitrator's decision in "EC – Banana III" as follows: the Arbitrator, in 
that case, had considered that an analysis of the WTO -consistenc y of the measure taken to comply 
was a prerequisite to the assessment of the level of nullification or impairment, because if the 
measure taken to comply had in fact brought the European Communities into compliance within 
the RPT, there would, legally spea king, have been no nullification or impairment to assess.49 
Indeed, the Arbitrator had recognized as much the ability of an Article  22.6 arbitrator to review the 
issue of compliance, albeit, in the limited situation where "there have been no prior DSB 
recom mendations and rulings that the responding Member has failed to bring itself into compliance 
within the RPT" and there was no "logical way forward" other than doing so. Article  22 of the DSU 
regulated the critical phase of the dispute settlement process. Y et, the text of Article  22 was 
ambiguous and despite the best efforts by WTO adjudicators (including this Arbitrator) to make 
sense of this provision, such ambiguities had not been resolved. That was why WTO Members had 
overcome these ambiguities by conclu ding ad  hoc procedural arrangements. There was also a lack 
of certain procedural mechanisms which could improve the effective operation of Article  22. For 
example, as had been observed by the United  States in this arbitration, and noted by the 
Arbitrator, there was no mechanism to adjust the level of suspension authorized by the DSB.50 The 
outcome of this Arbitration testified that the proper interpretation and operation of the dispute 
settlement phase under Article  22 of the DSU was a live issue, which WTO Members may want to 
address.  
7.20.   The representative of the European  Union  recalled that Article  22.7 of the DSU provided that 
the DSB had to be informed promptly of the decision of the Arbitrator and had to, upon request, 
grant authorization to suspend concess ions or other obligations where the request was consistent 
with the decision of the Arbitrator, unless the DSB decided by consensus to reject the request. The 
EU also recalled that Article  22.8 of the DSU provided that the suspension of concessions or othe r 
obligations had to be temporary and could only be applied until such time as the measure, found 
to be inconsistent with a covered agreement, had been removed; or the Member that had to 
implement recommendations or rulings provided a solution to the nulli fication or impairment of 
benefits, or a mutually satisfactory solution was reached. If the conditions of this provision were 
fulfilled, the EU expected a complainant to not only stop any retaliation that had already been 
started, but also to refrain from commencing such retaliation in the first place, even if a DSB  
authorization had already been granted. Whether or not the conditions of this provision were 
fulfilled should be determined by following the guidance provided by the Appellate Body in DS320. 
In this respect, the EU said that it would expect all parties to act in good faith with a view to 
reaching agreement. If agreement was impossible, and in view of the ongoing second compliance 
procedures, the EU said that it would expect both parties to cooper ate in order to obtain a rapid 
adjudication, and to consider in good faith the impact of these ongoing procedures on retaliation.  
7.21.   The representative of Brazil  said that his delegation understood that the request made by 
Mexico at the present meeting was in  line with the principle that a request to suspend concessions 
could only be made after a multilateral decision of non -compliance was made. Brazil said that 
Mexico was requesting authorization to suspend concessions with regard to measures found to be 
inconsistent in the previous compliance panel and the request was based on an amount of 
retaliation that had been multilaterally determined in an arbitration proceeding. Therefore, Brazil 
understood that Mexico's request at the present meeting contributed to t he coherence and 
effectiveness of the dispute settlement system. Once the ongoing Article  21.5 Panel proceedings 
came to a conclusion, the parties would be able to reassess the situation regarding the suspension 
of concessions. If the current arbitration p roceedings had to be stalled, so as to wait for the 
second Article  21.5 panel proceedings, the effective functioning of the dispute settlement system 
would be undermined and "an endless loop of litigation" could also undermine the system and the 
objective of compliance. With regard to Japan's statement, Brazil did not agree that Article  22.6 of 
                                                
48 Decision by the Arbitrator, "EC – Banana III " (US) (Article 22.6 – EC), para . 4.8, quoted in Decision 
by the Arbitrator, para.  3.32. 
49 Decision by the Arbitrator, para.  3.32. 
50 Decision by the Arbitrator, paras.  3.61-3.62. WT/DSB/M/397  
 
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  the DSU could serve as a "mini -implementation" panel under the DSU. Brazil also commented on 
the Arbitrator's decision in this dispute, regarding the partial opening  of the hearing. Disclosure of 
written submissions and opening of hearings had been contentious issues in the dispute settlement 
mechanism for quite some time. Indeed these issues had been debated at length for years in the 
DSU negotiations. The Arbitrator , in the current dispute, stretched the interpretation of the 
relevant DSU provisions and did not take into account the objection of one of the parties to the 
dispute. In Brazil's view, a more sensible approach would have allowed for the opening of the 
hearing to the public only if both parties had given their explicit consent in that regard. Given that 
consensus on the issue was yet to emerge and no unequivocal interpretation had yet been 
established, the scope to be given to the opening of hearings should  correspond to degree of 
agreement obtained by the parties, and to the extent they are affected, also by third -parties.  
7.22.   The representative of Colombia  said that his country did not wish to take position on the 
substance of this dispute and hoped that the U nited States and Mexico would be able to settle their 
differences promptly, without affecting their trade. Colombia also hoped that this suspension would 
be temporary and that the Article  21.5 procedures that were in the process of being decided took 
into account the current status of compliance with the DSB's recommendations and rulings in this 
dispute. Colombia referred to its statements made on this matter under Agenda items  5 and  6 and 
pointed out that this dispute in fact raised a number of important i ssues regarding the sequencing 
of Articles  21.5, 22.2 and 26 of the DSU.  
7.23.   The representative of India said that he wished to comment briefly on the points raised by 
Mexico on the rather comparatively simple issue of the partially open hearing in this Arbitr ation. 
India noted that this was an extremely serious issue in the context of the rights and obligations of 
Members under the DSU. Mexico had stated that it had clearly objected to the partial open 
hearing, or the full open hearing, to the Arbitrator; but had been overruled in this dispute. India 
noted that Article  14 of the DSU clearly mandated that panel deliberations, which included 
Arbitration proceedings, had to be confidential. India also noted that, under Article  18 of the DSU, 
Members were free to d isclose their statements and own positions to the public. India said that it 
was also aware that the DSU negotiations had, for a long time, dealt with this issue and had failed 
to come to any conclusion. India noted that many Members had a great sensitivit y to panels, the 
Appellate Body or other dispute settlement mechanisms overstretching the limits of the DSU. In 
India's view this was a classic example of where the DSU was clear about panel proceedings being 
confidential and the Arbitrator had overstretch ed its limits and allowed for a partial open hearing, 
even after a Member had objected. India noted that in paragraph  2.33 of the Arbitrator's report, 
the circumstances that the Arbitrator had taken into account while coming to this conclusion were 
quite p uzzling. India quoted a paragraph, relating to the request for an open hearing, where the 
Arbitrator had stated: "in granting the United States request, we notably also took into account the 
following three circumstances: first, the present dispute concern s the protection of dolphins and 
thus is a conservation related measure. In this kind of dispute even a partially open meeting is apt 
to enhance understanding of, and confidence in, the WTO dispute settlement process." India said 
that it was unable to unde rstand this logic in the present circumstances. Did it mean to say that 
non-conservation related disputes were not sensitive enough to be open? Or was it the case that 
certain kinds of disputes related to the environment were more amenable to open hearings ? The 
Arbitrator had also stated that the parallel conduct of a second round of compliance panel 
proceedings had required the assembly of a substantial Secretariat support staff and that this was 
one of the factors for partial open hearing. India said that  it, again, failed to understand the logic 
of this condition for partial open hearing. India said that it hoped that this was an exception and it 
did not find a following in subsequent proceedings. India also registered its serious concern on this 
developm ent. 
7.24.   The DSB took note  of the statements and, pursuant to the request by Mexico under 
Article  22.7 of the DSU contained in document WT/DS381/44, agreed  to grant authorization to 
suspend the application to the United  States of tariff concessions or other ob ligations consistent 
with the Arbitrator's decision contained in document WT/DS381/ARB.  
8  CHINA – ANTI -DUMPING MEASURES ON IMPORTS OF CELLULOSE  PULP FROM CANADA  
A.  Report of the Panel (WT/DS483/R  and WT/DS483/R/ Add.1)  
8.1.  The Chairman  recalled that at its meeti ng on 10  March  2015, the DSB had established a 
Panel to examine the complaint by Canada pertaining to this dispute. The Report of the Panel, WT/DSB/M/397  
 
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  contained in document WT/DS483/R and WT/DS483/Add.1 had been circulated on 25  April 2017 
as an unrestricted documen t. The Panel Report was now before the DSB for adoption at the 
request of Canada. This adoption procedure was without prejudice to the rights of Members to 
express their views on the Panel Report.  
8.2.  The representative of Canada  said that his country wished t o thank the members of the Panel 
and the WTO Secretariat for their work in this dispute. Canada also thanked the third -parties in 
this dispute. Canada welcomed the findings and recommendations of the Panel that had confirmed 
that the imposition of the duti es at issue was inconsistent with China's obligations under the 
Anti-Dumping Agreement. The Panel had found that MOFCOM had failed to conduct a proper injury 
analysis. It had agreed that MOFCOM's injury analysis was inconsistent with Articles  3.1 and  3.2 of 
the Anti -Dumping Agreement because MOFCOM had failed to properly consider whether subject 
imports of cellulose pulp had depressed the prices of domestic Chinese cellulose pulp. The Panel 
had also agreed that MOFCOM's injury analysis was inconsistent with  Articles  3.1 and  3.5 of the 
Anti-Dumping Agreement. In this regard, it had found that MOFCOM had failed to demonstrate 
that subject imports caused injury to the domestic industry. It had also failed to ensure that the 
injuries caused by other known factor s, such as the prices of cotton and the downstream product – 
viscose fibre, were not attributed to the subject imports. However, Canada was disappointed that 
the Panel had not agreed that MOFCOM's analysis regarding both the volume of subject imports 
and t heir impact on the domestic industry was inconsistent with the WTO Anti -Dumping 
Agreement. Canada's approach in this dispute had been to focus on only the key issues. Canada's 
written submissions had both been under 75 pages long and Canada had only filed 36 exhibits. For 
its part, China's submissions had been similarly short and focused. The Panel itself had only taken 
three months to render its interim report of only 65  pages. Canada had focused its claims and 
arguments in hopes of engaging with China on only what was of most concern to Canada and in 
hopes of saving the time and resources of all involved. However, from the date of the Panel's 
composition in April  2015, these proceedings had taken two years to complete. Most concerning 
was the fact that the  Panel's 65 -page Report had taken four months to be translated. Canada 
suggested that the Secretariat examine all options to shorten translation times to ensure that 
future disputes did not face similar delays, particularly when the disputing parties had m ade 
efforts to focus the issues to the essence of the complaint. Throughout this period, Canadian 
cellulose pulp producers had faced additional costs and lost sales due to the imposition of 
anti-dumping duties. As a result, Canadian producers of cellulose pulp had seen a 79% decline in 
export value to China between 2013 and 2016. Canada said that it hoped that the prompt 
implementation of this ruling would lead to the recovery of its industry and would benefit Chinese 
consumers. Canada looked forward to con tinuing to work with China to agree to a reasonable 
period of time to implement the DSB's recommendations and rulings. In any event, Canada hoped 
that China would implement them as soon as possible.  
8.3.  The representative of China  said that her country wished to thank the Panel and the 
Secretariat for their time and for their efforts in assisting the parties to resolve this dispute. This 
dispute concerned an anti -dumping measure that had been taken by China in response to imports 
of cellulose pulp from Canada a t significantly dumped prices that had caused material injury to the 
Chinese domestic industry. Canada had not contested MOFCOM's determination of dumping. 
Instead, Canada had challenged MOFCOM's injury determination. While the Panel had found some 
deficie ncies in the final determination, the Panel had dismissed the majority of Canada's claims 
because MOFCOM's injury and causation analyses had complied with the requirements of the 
Anti-Dumping Agreement. The Panel had first found that MOFCOM had adequately considered 
whether there was a significant increase in the volume of dumped imports in both absolute and 
relative terms.51 The Panel had also found that there was "no basis to conclude that MOFCOM was 
required to specifically address arguments regarding the  context in which the acknowledged 
43.82% increase in dumped imports occurred in its consideration of whether that increase was 
significant in absolute terms under Article  3.2" of the Anti -Dumping Agreement.52 As regards the 
price effects analysis under the  second sentence of Article  3.2, the Panel had agreed with 
significant aspects of MOFCOM's analysis. The Panel had agreed with China that the fact that price 
trends crossed at one point during the POI did not undermine MOFCOM's conclusion that the prices 
of dumped imports and the domestic like product followed the same or parallel trends.53 The Panel 
had also agreed with China that the different rates of change in prices of the dumped imports and 
                                                
51 Panel Report, paras. 7.47 -7.48. 
52 Panel Report, para. 7.50.  
53 Panel Report, para. 7.75.  WT/DSB/M/397  
 
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  the domestic industry had not undermined the finding of the pa rallel trends in prices per se, given 
that the prices still moved in the same direction and quickly adjusted to the price decline in the 
market, showing the close competition between the domestic and imported dumped products.54 
Similarly, the Panel had acce pted China's position that price depression was not contingent on the 
existence of price undercutting.55 The Panel had further agreed that MOFCOM had adequately 
considered changes in the market share of dumped imports in its consideration of price effects.56 
Moreover, the Panel had found that it was proper for MOFCOM to have relied on certain pricing 
documents and had recognized that these documents corroborated MOFCOM's view that the 
domestic prices were depressed by the declining prices and increased volume  of the dumped 
imports.57 The Panel had nonetheless found that MOFCOM could have better explained certain 
aspects of its price effects analysis.  
8.4.  Canada's claim under Article  3.4 of the Anti -Dumping Agreement had been rejected by the 
Panel in its entirety. T he Panel had found instead that MOFCOM had properly: (i) evaluated the 
domestic industry's market share58; and (ii) examined the impact of the dumped imports on the 
state of the domestic industry.59 With respect to causation, the Panel had found that MOFCOM' s 
determination had relied on both the volume and price effects of dumped imports.60 Nevertheless, 
the Panel had found an inconsistency with Article  3.5 of the Anti -Dumping Agreement as a result of 
its earlier finding on price effects.61 Finally, Canada had challenged MOFCOM's analysis of certain 
non-attribution factors under Article  3.5 of the Anti -Dumping Agreement. The Panel had expressly 
acknowledged that it was unnecessary for it to address Canada's non -attribution claims, yet the 
Panel had gone ahead an d considered those claims because, in its view, this "may provide some 
useful guidance in the context of implementation of any DSB recommendation in this dispute".62 In 
any case, the Panel had again dismissed many of Canada's allegations concerning the 
non-attribution factors. The Panel had found that MOFCOM had reasonably concluded that the 
increase in manufacturing costs accounted for such a small proportion of total production costs 
that it could not have broken the causal link between the dumped imports and material injury.63 
The Panel had agreed that it was reasonable for MOFCOM to consider the data pertaining to 
changes in the production capacity of all domestic cellulose pulp producers, not merely that of the 
industry defined by MOFCOM.64 The Panel had a lso found that MOFCOM's overall conclusion that a 
shortage of cotton linter was not a cause of the domestic cellulose pulp industry's low capacity 
utilization rate was reasonable.65 In sum, the Panel had largely dismissed Canada's claims, finding 
instead th at, to a large degree, MOFCOM's final determination had complied with the requirements 
of the Anti -Dumping Agreement. While China disagreed with certain aspects of the Panel Report, it 
said that it had decided not to appeal the Report.  
8.5.  The DSB took note  of the statements and adopted  the Panel Report contained in 
WT/DS483/R and  Add.1.  
9  UNITED  STATES – CERTAIN METHODOLOGIE S AND THEIR APPLICAT ION TO 
ANTI -DUMPING PROCEEDINGS INVOLVING CHINA  
A.  Report of the Appellate Body (WT/DS471/AB/R  and WT/DS471/AB/R/ Add.1)  and 
Report of the Panel (WT/DS471/R and WT/DS471/R/Add.1)  
9.1.  The Chairman  draw attention to the communication from the Appellate Body contained in 
document WT/DS471/11 transmitting the Appellate Body Report in the dispute: "United  States – 
Certain Methodolog ies and their Application to Anti -Dumping Proceedings Involving China", which 
was circulated on 11  May 2017 in document WT/DS471/AB/R and Add.1. He reminded delegations 
that the Appellate Body Report and the Panel Report pertaining to this dispute had been  circulated 
                                                
54 Panel Report, para. 7.76.  
55 Panel Report, para . 7.86.  
56 Panel Report, para. 7.100.  
57 Panel Report, para. 7.105.  
58 Panel Report, para. 7.126.  
59 Panel Report, para. 7.138.  
60 Panel Report, para. 7.149.  
61 Panel Report, para. 7.147.  
62 Panel Report, para. 7.152.  
63 Panel Report, paras. 7.180 and 7.182.  
64 Panel Report, para. 7.177.  
65 Panel Report, paras. 7.198 -7.202.  WT/DSB/M/397  
 
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  as unrestricted documents. He recalled that Article  17.14 of the DSU required that: "An Appellate 
Body report shall be adopted by the DSB and unconditionally accepted by the parties to the 
dispute unless the DSB decides by consensus not to adop t the Appellate Body report within 
30 days following its circulation to Members. This adoption procedure is without prejudice to the 
right of Members to express their views on an Appellate Body report".  
9.2.  The representative of China  said that the DS471 case was a very significant dispute for his 
country. It had addressed methodologies that were systematically used by the US investigating 
authority in cases involving Chinese imports. The Reports that would be adopted at the present 
meeting concluded that the U nited States had applied, and maintained, certain methodologies that 
were not consistent with WTO rules. The Reports of the Panel and Appellate Body had also raised 
issues of systemic importance. Although the US violations had prejudiced a large number of 
Chinese exporters over a long period of time, most could be corrected through straightforward 
actions. China said that it, therefore, looked forward to prompt compliance by the United States.  
9.3.  According to the Panel, the manner in which the United States ha d resorted to and used the 
weighted average -to-transaction, or "W -to-T", comparison methodology was not permissible under 
WTO rules. In this respect, the findings of the Reports that would be adopted at the present 
meeting had to be read together with thos e in the parallel proceedings in "US – Washing 
Machines"  (DS464). Together, the findings in DS471 and DS464 confirmed that the second 
sentence of Article  2.4.2 only allowed recourse to the W -to-T methodology on an exceptional 
basis. Article  2.4.2 of the An ti-Dumping Agreement imposed real disciplines on an authority's 
identification of a relevant pricing pattern. Further, the need to resort to the exceptional W -to-T 
methodology to take account of so -called "targeted dumping" had to be fully explained. Even if it 
was justified in resorting to the W -to-T methodology, an investigating authority did not have carte 
blanche when applying it. The exceptional W -to-T methodology had to be limited to the sales that 
comprised the relevant pricing pattern. Further, Chin a appreciated the Panel's findings that an 
investigating authority could not disregard any of the transaction -specific comparison results 
generated by the W -to-T comparison methodology. In other words, the second sentence of 
Article  2.4.2 of the Anti -Dumpi ng Agreement could not be abused as a backdoor way to engage in 
WTO-inconsistent zeroing procedures. Finally, in respect of the "targeted dumping" findings, China 
also welcomed the Panel's confirmation that zeroing was never permissible in reviews under 
Article 9.3 of the Anti -Dumping Agreement.  
9.4.  In addition to the findings in relation to the United States' use of the W -to-T comparison 
methodology, China was also pleased by the findings of the Panel in relation to the United States' 
presumption that all prod ucers and exporters in China could be combined into a single "China -wide 
entity" and subjected to a single rate. This "single rate presumption" had been shown to be 
WTO-inconsistent. Contrary to the current US practice, Chinese exporters were entitled to b e 
individually investigated, and could not be lumped by the US authority into a fictional single entity. 
If exporters were not individually investigated, they were entitled to a rate that was consistent 
with Article  9.4 of the Anti -Dumping Agreement. The s ingle rate presumption was applied by the 
United  States alongside another norm that led its investigating authority to apply "adverse facts 
available", or "AFA", in a manner that could not be reconciled with Article  6.8 and Annex  II of the 
Anti-Dumping Agr eement. In this connection, China welcomed the Appellate Body's correction of 
the Panel's erroneous legal standard for determining that an unwritten "rule or norm" regarding 
AFA had "prospective" application. The Panel had misunderstood certain statements in the 
Appellate Body Report in "Argentina – Import Measures" as suggesting that, in order to show 
prospective application, a complaining Member had to show certainty that the challenged measure 
would be applied in the future. The Appellate Body had revers ed the Panel's finding. The Appellate 
Body had recognized that the AFA norm challenged by China – which had resulted in rates as high 
as 248% in the challenged determinations – "implement[s] an underlying policy".66 The US 
authority's approach reflected "st andard practice" and represented "more than mere repetition of 
conduct".67 This practice "create[d] expectations" and provided "administrative guidance".68 The 
Appellate Body had correctly found that these factors showed that the AFA norm had prospective 
application. It had also found that this norm had general application.  
                                                
66 Appellate Body Report, para. 5.159.  
67 Appellate Body Report, para. 5.160.  
68 Appellate Body Report, para. 5.160.  WT/DSB/M/397  
 
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  9.5.  China was, however, deeply disappointed that, after finding that the AFA norm was a rule or 
norm of general and prospective application, the Appellate Body had been unable to complete the 
analysis of China's claim against the norm. Responsibility for the inability of the Appellate Body to 
complete the analysis lay with the Panel. China had presented the Panel with a rich and complete 
record covering many determinations embodying the norm. I ndeed, China had specifically 
challenged 28 individual determinations in which the AFA norm had been applied. However, the 
Panel had failed to engage sufficiently with the extensive evidence before it. It had failed to make 
findings sufficient to enable th e Appellate Body to evaluate whether the US authority had violated 
Article  6.8 and Annex II of the Anti -Dumping Agreement.69 Thus, after more than four years of 
litigation, China was left without an immediate remedy in relation to the AFA norm. China 
noneth eless urged the United States to take note of the Appellate Body's clear description of the 
requirements for selecting "facts available", and to adhere closely to that standard in new 
determinations.  
9.6.  The Panel's failure to present the Appellate Body with a  set of factual findings sufficient to 
complete the analysis of China's "as such" claim in respect of the AFA norm had been closely 
related to the Panel's excessive exercise of judicial economy on most of China's "as applied" claims 
in relation to 30 chall enged determinations. In this regard, China wished to express its increasing 
concern at an apparent pattern in dispute settlement . Excessive exercise of judicial economy by 
panels was often coupled with an inability on the part of the Appellate Body to com plete the 
analysis. China had faced one or both of these issues in several trade remedy disputes against the 
United  States, namely, in DS379, DS437, DS449 and now in DS471. The DSU required Members 
to exercise their judgment as to whether recourse to dispu te settlement proceedings would be 
fruitful. This behoved all Members to exercise restraint, and to bring only those matters of 
importance to the DSB. However, once a Member had exercised its judgment and had decided to 
initiate a dispute, a panel had to m ake an objective assessment of the matter referred to it by the  
DSB. It was not appropriate for panels to find justifications for avoiding rulings, or to engage with 
the facts in a manner that was insufficient to allow completion of the analysis by the App ellate 
Body. Panels thereby supplanted the judgment of Members as to when recourse to dispute 
settlement was fruitful. China's concerns arose particularly where a panel asked many questions 
and called for extensive discussion of the relevant points. Partie s were expected to devote 
considerable resources to equipping panels to address claims that panels had then decided not to 
address, or address with insufficient attention to the facts. This failed to take into account that 
their decisions could be reversed  by the Appellate Body. This recent trend should be of concern to 
all Members who wished to ensure that dispute settlement in the WTO – one of its great successes 
– remained a viable, meaningful avenue for the resolution of trade disputes. Despite these 
concerns, China nonetheless welcomed the adoption of the Panel and Appellate Body Reports in 
DS471 at the present meeting. China thanked the Appellate Body, the Panel and the Secretariat 
teams assisting them for their efforts.  
9.7.  The representative of the United States  said that the United States thanked the Panel, the 
Appellate Body, and the Secretariat staff assisting them for their hard work in this dispute. The 
United  States welcomed the Appellate Body's rejection of virtually all of China's claims on appeal . 
Indeed, the United  States questioned whether China's decision to appeal comported with a 
judicious use of the WTO dispute settlement system. The Panel had found that the specific 
determinations at issue, as well as an alleged unwritten measure, were not consistent with 
obligations under the AD  Agreement. Despite this, China had sought more findings from the 
Appellate Body, essentially on derivative issues. Findings on those derivative issues would not 
have contributed to "secur[ing] a positive solution to  a dispute".70 Furthermore, China's appeal had 
lacked any legal merit. This was reflected in the Appellate Body's complete rejection of China's 
request for additional findings against the US measures at issue. In these circumstances, China's 
decision to bri ng this appeal raised systemic concerns. Given the stress on the dispute settlement 
system resulting from the large number of ongoing disputes, it was incumbent upon Members to 
act prudently when making decisions concerning the commencement of new disputes  and the 
taking of appeals. At the present meeting, the DSB was also adopting the Report of the Panel. A 
number of the Panel's findings were similar to or followed recent Appellate Body findings. In 
particular, these findings involved two important systemi c issues – targeted dumping, and the use 
of a single anti -dumping rate for those exporters controlled by the government of China. The 
                                                
69 Appellate Body Report, para. 5.177.  
70 See DSU, Art icle 3.7. WT/DSB/M/397  
 
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  United  States said that it had serious concerns with the Panel and underlying Appellate Body 
findings on both issues.71 
9.8.  First, with respect to targeted dumping, the Appellate Body in "US – Washing Machines" 
(DS464) had prescribed a particular methodological approach to the application of the 
AD Agreement that was not based on the text of the covered agreements, but rather was focused 
on the application of language from prior Appellate Body reports addressing different legal issues. 
The Appellate Body had essentially rewritten Article  2.4.2 of the AD  Agreement by prescribing a 
wholly new methodology for addressing "targeted dump ing". That methodology had never been 
contemplated at the time the AD  Agreement was negotiated and adopted. Nor, to the 
United  State s' knowledge, had the Appellate Body's methodology been used by any Member at any 
time in the more than 20  years since the W TO Agreement had entered into force. Indeed, no party 
in the dispute had advocated the methodology ultimately articulated by the Appellate Body. The 
Panel here had adopted the same approach. In rewriting the second sentence of Article  2.4.2, the 
Appellate Body had incorrectly found that the use of "zeroing" in connection with the application of 
the average -to-transaction comparison methodology to so -called "pattern transactions" was 
inconsistent with the AD  Agreement. As one Appellate Body member explained in dissent in "US – 
Washing Machines" (DS464), this finding could not be supported under the rules of interpretation 
provided for under the DSU. Regrettably, the Panel here had come to the same unsupportable 
conclusion. The Panel had also found that the us e of a rebuttable presumption that Chinese firms 
were under state control, and the consequent application of a single AD rate, was inconsistent with 
obligations under the AD Agreement. This finding to a large extent had been based on prior 
Appellate Body f indings in "EC – Fasteners" (DS397). As the United States had explained, the 
finding was not grounded in the AD Agreement, and failed to take account of the real -world 
difficulties that investigating authorities encountered when determining anti -dumping ma rgins for 
large numbers of government -controlled exporters. The United States thanked the DSB for its 
attention to the important issues covered in its statement on this item at the present meeting.  
9.9.  The DSB took note  of the statements and adopted  the Appell ate Body Report contained in 
document WT/DS471/AB/R and Add.1 and the Panel Report contained in document WT/DS471/R 
and Add.1, as modified by the Appellate Body Report.  
10  APPOINTMENT OF APPEL LATE BODY MEMBERS: P ROPOSAL BY THE 
EUROPEAN  UNION (WT/DSB/W/597)  
10.1.   The Chairman  said that this item was on the Agenda of the present meeting at the request 
of the European  Union. He drew attention to the communication contained in document 
WT/DSB/W/597 and he invited the representative of the European  Union to speak.  
10.2.   The re presentative of the European  Union  said that the EU's proposal spoke for itself and 
strictly followed the models of similar DSB decisions taken in the past. The EU's proposal was 
identical to the proposal made by Argentina, Brazil, Colombia, Chile, Guatema la, Mexico and Peru 
but, in addition, it also provided for the launching of the selection process to replace Professor Van 
den Bossche. The EU recalled that, based on past practice, it had expected the selection process, 
for the two vacancies arising in 20 17, to have been launched in February. The EU regretted that no 
consensus had so far been found on this issue. The EU had fully supported, and continued to 
support, the selection of new Appellate Body members without delay. The EU, therefore, 
encouraged al l Members to support its proposal, so that both selection processes could be 
launched at the present meeting.  
10.3.   The representative of the United  States  said that, given the ongoing transition in the United 
States' political leadership and the very recent con firmation of a new US Trade Representative, the 
United  States was not in a position to support the proposed decision to launch a process to fill a 
position on the Appellate Body that would only become vacant in December 2017. Nevertheless, 
the United State s was willing to join a consensus for the DSB to take the decision proposed by 
Argentina, Brazil, Colombia, Chile, Guatemala, Mexico, and Peru. That decision was focused on a 
process to fill a position that would become vacant in just over one month's time . As the 
                                                
71 See Dispute Settle ment Body, Minutes of Meeting, 26 September  2017, WT/DSB/M/385, paras. 8.8  – 
8.22 (Appellate Body findings on targeted dumping); Dispute Settlement Body, Minutes of Meeting, 
28 July 2011, WT/DSB/M/301, para. 8 (Appellate Body 's findings on rates for govern ment-controlled 
exporters).  WT/DSB/M/397  
 
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  United  States had conveyed to several Members, despite the ongoing transition, it had received 
guidance that it would be acceptable to launch a process given the expiry of Mr.  Ramirez's second 
term on 30  June 2017.  
10.4.   The representative of the Europe an Union  said that his delegation did not see any reason 
why both selection processes should not be launched at the present meeting. It had already been 
stated in the past few months that this was the most efficient way of managing the selection 
processes for both vacancies. The EU did not see why one should be singled out. In any event both 
the EU's proposal and the proposal which had been tabled under the next Agenda item indicated 
that a decision on the appointment of two new members of the Appellate Bod y could be taken at 
the DSB meeting to be held on 24 October 2017. Given that Professor Van den Bossche's term 
would expire on 11  December  2017, the EU believed that there was urgency for the selection 
process to be launched without delay.  
10.5.   The DSB took no te of the statements.  
11  PROPOSAL REGARDING T HE APPELLATE BODY SE LECTION PROCESS 
(WT/DSB/W/596)  
11.1.   The Chairman  said that this item was on the Agenda of the present meeting at the request 
of Argentina, Brazil, Colombia, Chile, Guatemala, Mexico and Peru. He drew  attention to the 
communication contained in document WT/DSB/W/596 and invited the respective delegations to 
speak.  
11.2.   The representative of Mexico , speaking on behalf of Argentina, Brazil, Colombia, Chile, 
Guatemala, Mexico and Peru, recalled that, at the 19  April 2017 DSB meeting, the countries in 
question had expressed the intention of the Latin American proponents to submit a draft decision 
in order to start a new selection process to fill the vacancy that would arise by the endo of 
June 2017. He recalled that on 8 May  2017, the Latin American proponents had accordingly tabled 
a proposal concerning the Appellate Body selection process, which had been circulated in 
document WT/DSB/W/596. The proposal was based on past DSB decisions that comprised the 
followi ng four elements: (i) to launch a selection process to replace Mr  Ricardo 
Ramírez -Hernández, whose second term of office would expire on 30  June 2017; (ii) to establish a 
Selection Committee; (iii) to set a deadline of 30  June 2017 for submitting nominatio ns of 
candidates; and (iv) to request the Selection Committee to issue its recommendation by 
24 October  2017 at the latest. He noted that this process should have started earlier, but this had 
not been possible. Given that the vacancy would arise after 30  June 2107, and that it had now 
become urgent to launch this process, the Latin American proponents urged Members not to delay 
this process any further and to agree that the selection process should begin and be agreed by the 
DSB at the present meeting.  
11.3.   The representative of the European  Union  said that, as it had previously stated, the EU fully 
supported the launching of the selection processes for new Appellate Body members as quickly as 
possible. In fact, the EU proposal entirely incorporated the proposal  made by Argentina, Brazil, 
Colombia, Chile, Guatemala, Mexico and Peru. Both proposals were identical regarding the 
selection process for the replacement of Mr. Ramirez. The EU said that it regretted that the 
Membership had not endorsed the EU's proposal.  The EU failed to see any valid reasons, given 
past practice, why one selection process should be singled out at this point. The EU encouraged 
the Chairman to continue his consultations with Members so that both processes could be launched 
as quickly as po ssible.  
11.4.   The representative of China  said that his country was making this statement in relation to 
items  10 and 11 of the Agenda of the present meeting.  China said that it had systemic concerns 
about the delay of the new AB selection process. China took n ote of the proposals made at the 
present meeting by relevant Members and referred to its previous statements. To ensure the 
smooth operation of the Appellate Body and the WTO dispute settlement system, China called 
upon Members to be more flexible and cons tructive in order to initiate the select ion process as 
soon as possible.  WT/DSB/M/397  
 
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  11.5.   The representative of India thanked both proponents for their proposals regarding the 
Appellate Body selection process. As it had mentioned at the 19  April 2017 DSB meeting, India 
had stated that it was unable to understand the underlying rationale of not coming to an 
agreement. India took note of the EU's proposal and its preference for one selection process for 
both vacancies in terms of the time -frame. India also noted that one Memb er had stated that it 
would not be able to join a consensus with respect to that process. But, having looked at both 
proposals, India noted that they were not mutually exclusive. India said that it was still uncertain 
about where the impasse was because bo th the proposals were identical in terms of launching of 
the process for the vacancy of Mr. Ricardo Ramírez. India asked whether there was also a lack of 
consensus on initiating the first selection process. If that was the case it had to be stated clearly 
for Members' understanding because Members did not really understand the reasons for the 
impasse in the present situation.  
11.6.   The representative of Japan  said that his country thanked the EU for its proposal. Japan also 
thanked Argentina, Brazil, Columbia, Ch ile, Guatemala, Mexico and Peru for their joint proposal. 
Given that the expiry of Mr. Ramirez's second term was fast approaching and that an extended 
period of vacancy was highly undesirable, Japan agreed with the general thrust of the proposals 
that the DSB should act expeditiously and launch the selection process or processes without 
further delay. Japan had no problem with either of the proposals and was ready to join a 
consensus to support either of the proposals. Japan had repeatedly stated in the pas t, and 
stressed again, that a member of the Appellate Body had to be a person of the highest calibre. To 
achieve this goal, the selection had to be made based on the candidate's own merit. The work of 
the Appellate Body was too important to be entrusted to  someone who did not meet the required 
standards of quality, qualification, authority, expertise, integrity, impartiality and independence. 
While the balance and diversity of expertise, professional backgrounds and experience in the 
overall composition of the Appellate Body did matter and had to be duly taken into account, in 
Japan's view, there was no requirement of regional or Member -specific representations on the 
Appellate Body. To achieve the goal of selecting person(s) of the highest calibre, the sele ction 
process had to be competitive and WTO Members should be allowed to make the best choice 
available from as broad a pool of highly -qualified individuals as possible. In this respect, Japan 
understood that the EU had proposed the launching of two simult aneous but separate processes. 
Japan said that it could accept this approach. But, should the DSB agree to launch the process for 
two vacancies, for the purpose of making the process more competitive and further broadening a 
pool of candidates, one could c ombine the two processes into a single one and choose the two new 
members from a common pool of candidates based on his or her own merit.  
11.7.   The representative of Australia  said that her country welcomed the initiative of the 
delegations which had put forward  possible processes to commence selection processes to fill the 
upcoming vacancies on the Appellate Body. As Australia had stated at a number of DSB meetings 
during 2017, Australia regretted that the DSB was now in the position that, even if the DSB was 
able to agree on launching a selection process at the present meeting, it could not avoid a vacancy 
on the Appellate Body, following the expiry of the term of current Appellate Body member 
Mr. Ricardo Ramírez -Hernández. Such a vacancy looked likely to extend  for at -least several 
months. Australia said that it was particularly concerned that the DSB had found itself in this 
position for a second year in a row. Australia reiterated its view that the proper functioning of the 
Appellate Body was best served by th e appointment of new members to fill vacancies as they 
arose, in accordance with Article  17.2 of the DSU. With this core principle in mind, Australia 
confirmed that it could have supported a consensus decision to, at a minimum, commence a single 
process at  the present DSB meeting to determine the replacement for Mr. Ricardo 
Ramírez -Hernández, as proposed by delegations of Argentina, Brazil, Colombia, Chile, Guatemala, 
Mexico and Peru. For clarity, Australia could also have supported a decision to commence a  second 
process to determine the replacement for Mr. Peter Van den Bossche, whose term was due to 
expire in December, as proposed by the EU. Australia called on all Members to demonstrate similar 
pragmatism and flexibility to reach agreement as soon as pos sible on a process or processes to 
ensure the timely appointment of members to the Appellate Body.  
11.8.   The representative of New Zealand  said that this statement was in regards to both items  10 
and 11 of the Agenda of the present meeting. New Zealand thanked t he Chairman for his progress 
report and his efforts to find consensus on this important matter. New Zealand also thanked the 
EU, and separately, Argentina, Brazil, Colombia, Chile, Guatemala, Mexico and Peru for their 
proposals to launch a process for the selection of Appellate Body members. New Zealand recalled 
its statements from the previous DSB meetings and continued to express its disappointment that WT/DSB/M/397  
 
- 27 - 
 
  the DSB had been unable to launch either process. Again, New Zealand urged Members to reach a 
consensus  on the process for the 2017 appointments and to be pragmatic and constructive so that 
candidates could be appointed as soon as possible to fill the vacant positions. Regrettably, 
whatever proposal was accepted, the DSB was now in the position where a vaca ncy would 
inevitably arise in the Appellate Body. Even with the full bench, the Appellate Body had workload 
and resource constraints and a queue of disputes to be heard. Members had to do their utmost to 
avoid exacerbating this situation.  
11.9.   The representativ e of Norway  thanked the proponents for their proposals.  Norway believed 
that the process of appointing Appellate Body members should not be further delayed. It was with 
disappointment that Norway registered that there would be no agreement on any of the p roposals 
at the present meeting. For the sake of clarity, Norway had a preference for the EU's proposal as it 
had perceived this to be the most efficient way to ensure that the Appellate Body was fully 
equipped. This being said, Norway would also have been  in a position at the present meeting to 
join consensus on the proposal from the group of Latin American countries in case Members were 
not in a position to agree on the EU's proposal. Norway said that it believed that Members' 
priorities should be to equi p the Appellate Body with the necessary resources to ensure its proper 
functioning and Norway urged all Members to show flexibility on this matter.  
11.10.   The representative of Hong Kong, China  said that her delegation was making its statement 
under items  10 and 11 of the Agenda of the present meeting. Hong  Kong, China welcomed the two 
proposals regarding the Appellate Body selection process. Hong Kong, China's preference was the 
EU's proposal which endorsed the launching of two selection processes in one go. But Hong Kong, 
China could also go along with the consensus if Members wished to adopt the proposal from a 
group of Latin American Members, in order to fill the imminent vacancy which would arise at the 
end of June. Hong  Kong, China said that it was disappoint ed with the delay in the Appellate Body 
selection process and encouraged Members to come up with an agreement as soon as possible.  
11.11.   The representative of Korea  said that his country thanked the two proponents. Korea did 
not have any problem to support the E U's proposal , however, it was evident that there was no 
consensus on the EU's approach. This had been the case for the past five months. The EU's 
proposal should not be a reason to prevent the launch of the more urgent process. Korea urged 
Members to allow  the DSB to launch the selection process for the post whose term would expire in 
June 2017 without any further undue delay. The later the DSB made a decision the longer the 
unnecessary vacancy would be. Members could not afford such a situation. Korea call ed for 
Members' flexibility and pragmatism.  
11.12.   The representative of Switzerland  said that his country thanked the Chairman for his 
efforts regarding this matter and the proponents for their proposals. Switzerland noted that the 
current circumstances seemed u nlikely to bring about consensus to move forward with the 
selection processes for the two upcoming vacancies in the Appellate Body. Switzerland regretted 
this situation and shared the concerns expressed by other delegations regarding possible impacts 
on th e proper functioning of the WTO dispute settlement mechanism and on the integrity of the 
multilateral trading system. These consequences were likely to widen as time passed. Switzerland 
expressed its appreciation to all potential candidates, and to the Mem bers who would nominate 
them. Many of those Members had already come forward unofficially with their candidates in spite 
of the uncertain situation, thereby showing their commitment to the system. With respect to the 
two proposals on the table, Switzerland 's clear preference would be for the simultaneous launch 
and conclusion of the two selection processes, primarily for the simple reason that the possibility 
of any Appellate Body position not being filled should be avoided or at least minimized. Finally, 
Switzerland said that it understood that under Article 17.3 of the DSU there was no entitlement of 
any particular Member or geographical region to a seat on the Appellate Body, even if certain 
practices in this regard had been followed in the past. The crit erion of "broadly representative of 
Membership" could not, in Switzerland's view, preclude highly -qualified candidates from any 
Member to stand for, and potentially be selected to, the Appellate Body.  
11.13.   The representative of Canada  said that his country was making its statement in respect of 
both items 10 and 11 of the Agenda of the present meeting.  Canada thanked the proponents of 
both proposals and reiterated its statement made at the DSB meeting held on 19  April 2017. Like 
Japan and Australia, Canada said  that it could support either proposal. Canada hoped that a 
selection process would be launched at the regular DSB meeting held in June, at the latest. WT/DSB/M/397  
 
- 28 - 
 
  However, Canada would be pleased to participate in a special DSB meeting before that meeting if 
a soluti on were to arise.  
11.14.   The representative of Chinese  Taipei  said that his delegation's comment was in relation to 
both items  10 and 11 of the DSB Agenda. Like several Members that had spoken previously, 
Chinese  Taipei was ready to join a consensus for either of  the proposals, or both of them, at the 
present meeting. And, like India, Chinese Taipei was puzzled about the reason why there was still 
no agreement on this issue after the consultations over the past five months. Chinese  Taipei hoped 
that the DSB could achieve a positive solution on this issue soon.  
11.15.   The representative of Ecuador  said that his country wished to make a statement with 
regard to both proposals. Ecuador had reviewed the proposals in detail and felt that, given the lack 
of consensus to approve  the launch of a joint selection process, the DSB should at least move 
forward with the proposal made by Argentina, Brazil, Colombia, Chile, Guatemala, Mexico and Peru 
at the present meeting. Ecuador said that it did not feel that that process should be de layed 
further and that the process, set out in document WT/DSB/W/596, should be approved at the 
present meeting.  
11.16.   The representative of Singapore  said that his country was addressing both DSB Agenda 
items  10 and 11. Singapore thanked the proponents for thei r proposals and said that it could go 
along with the EU's proposal or the proposal made by the group of Latin American countries. 
Singapore was disappointed that there was no consensus on either proposal and expressed its 
systemic concern about the delay i n the launching of the selection process. Singapore encouraged 
Members to be flexible and to come to an agreement as soon as possible.  
11.17.   The representative of Viet Nam said that her country echoed the comments made and 
views expressed by other Members. Viet Nam welcomed the two proposals made by the EU and 
the group of Latin American countries. Viet Nam supported launching of the process as soon as 
possible. In case that the DSB could not reach a consensus on the process proposed by the EU, 
Viet Nam recommend ed launching the process to select the Appellate Body member to replace 
Mr. Ramírez, as proposed by the group of Latin American countries.  
11.18.   The representative of the Russian  Federation  said that her country would like to thank the 
proponents of both proposa ls and would certainly welcome a solution based on either of the 
proposals that could pave the way to the launching of the AB selection process. Given the current 
workload of the Appellate Body and the fact that it would continue to increase in 2017, the 
Membership could hardly afford leaving vacancies unfilled for considerable periods of time. 
Registering its serious concern about the delay, the Russian Federation took note of the Member's 
positions and statements made at the present meeting and urged Memb ers to find a solution to 
this current situation so that the selection process could be launched as soon as possible.  
11.19.   The representative of Mexico , speaking on behalf of Argentina, Brazil, Colombia, Chile, 
Guatemala, Mexico and Peru, expressed their disapp ointment about the lack of consensus, 
especially in view of its impact on the dispute settlement system and the Appellate Body in 
particular. Under these circumstances, the Latin American proponents reiterated their willingness 
to work with the DSB Chairma n and to intensify consultations to resolve this matter.  
11.20.   The representative of Mexico , speaking on behalf of Mexico only , noted that many 
Members expressed their flexibility with regard to launching a selection process to fill the vacancy 
to be soon left b y Mr.  Ricardo Ramírez. In light of this, Mexico wished to ask the EU whether it 
could reconsider the option of moving ahead with the two processes, and instead agree to start the 
process for Mr.  Ricardo Ramírez's replacement at the present meeting. Mexico wished to know 
whether the EU had the flexibility to do so at the present meeting.  
11.21.   The Chairman  thanked Members for their statements and views expressed at the present 
meeting. He regretted that Members were not in a position to reach a consensus on this m atter at 
the present meeting. He noted that, in his statement to be made under "Other Business", he would 
refer to the fact that the Appellate Body was currently dealing with five appeals and that up to two 
additional appeals could be filed within the next  two months. He said that, in view of this situation, 
it was urgent for the DSB to agree to start the AB selection process, or processes, as soon as 
possible. He said that he would continue to consult with delegations on this matter and would be WT/DSB/M/397  
 
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  ready to d o whatever was necessary to find a solution that was agreeable to all delegations. He 
also invited delegations with any views or proposals on these issues  to contact him directly. He 
thanked delegations for their support and understanding regarding this ma tter. 
11.22.   The DSB took note  of the statements.  
12  MECHANISM FOR DEVELO PING, DOCUMENTING AN D SHARING PRACTICES AND 
PROCEDURES IN THE CO NDUCT OF WTO DISPUTE S  
A.  Statement by Canada  
12.1.   The representative of Canada , speaking under "Other Business", said that, in 2016,  a broad 
cross-section of 17 WTO Members had endorsed the establishment of a Mechanism for Developing, 
Documenting and Sharing Practices and Procedures in the Conduct of WTO Disputes. These 
Members had considered that this Mechanism would: (i)  provide a fr amework within which 
practices and procedures could evolve so as to facilitate the resolution of disputes; (ii) reduce the 
scope for procedural disagreements and delays; and (iii)  generate practical experience with 
procedural innovations. Some of these Mem bers had endorsed practice documents related to 
written notifications, transparency, third -party rights, and procedures to streamline disputes. 
These practice documents and the Mechanism were still open to endorsements and Canada 
encouraged all Members wit h interest and questions to raise them with Canada. Participation in the 
Mechanism was fully compatible with active participation in the DSU negotiations and it was 
Canada's intention to continue to actively participate in these negotiations. The endorsing  
Members had recently begun discussing four additional practice documents related to panel 
composition, electronic filing, responses to third -party requests to join consultations, and the 
publication of working procedures, timetables and working schedules.  Canada had copies of these 
four documents at the present meeting. Canada encouraged interested Members to collect them 
and to contact Canada with any questions about these specific documents or the Mechanism itself. 
Finally, Canada renewed its invitation to all Members to endorse the Mechanism and the practices 
documents. In particular, Canada considered that endorsing the Practices Mechanism would send a 
positive signal that WTO Members valued the Organization’s dispute settlement function and were 
commit ted to both tending to and improving it.  
12.2.   The representative of Australia  said that her country thanked Canada for its statement at 
the present meeting regarding the next steps in the utilization of the "Mechanism for Developing, 
Documenting and Sharing Pra ctices and Procedures in the Conduct of WTO Disputes". As Australia 
had said in previous DSB meetings, in its view, the information sharing mechanism promoted 
transparency in the dispute settlement system and supported the ongoing efforts of the WTO 
Secret ariat and Members to streamline and improve the dispute settlement processes and reduce 
delays. There was no doubt that such initiatives were increasingly important in light of the current 
pressures facing the dispute settlement system. Australia said that  it was pleased to endorse the 
statement which had established the mechanism in 2016 and looked forward to working with 
Canada and other Members in continuing the work on this initiative. In that light, Australia was 
also taking steps towards endorsing the  four practice documents, which had been circulated 
in 2016 under the mechanism and endorsed by a number of other Members concerning: written 
notifications, transparency of dispute proceedings, participation of third -parties in dispute 
proceedings, and imp roving and streamlining dispute proceedings. Australia encouraged all 
Members to consider the positive contribution of this mechanism and the practice documents to 
the effective and efficient functioning of the dispute settlement system and to consider mak ing 
similar steps to endorse these and future documents.  
12.3.   The DSB took note  of the statements.  
13  RUSSIA – TARIFF TREATMENT OF CERTAIN AGRICULTURAL  AND MANUFACTURING 
PRODUCTS  
A.  Statement by the Russian  Federation  
13.1.   The representative of the Russian Federation , speaking under "Other Business", said that 
her country wished to report on implementation of the DSB's recommendations and rulings in the 
dispute "Russia – Tariff Treatment of Certain Agricultural and Manufacturing Products" (DS485). WT/DSB/M/397  
 
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  Russia recalled that the Panel Report on this matter had been adopted by the DSB on 
26 September  2016. On 10  November  2016, Russia and the EU had informed the DSB that they 
had agreed on the reasonable period of time to implement the DSB's recommendations and 
rulings, which ha d expired on 11  May 2017. Russia had successfully met that deadline and had 
fully implemented the DSB's recommendations and rulings. In fact for certain measures: palm oil, 
certain types of paper (measures 6, 7 and 8) and refrigerators (measures 10 and 11 challenged in 
this dispute), the Russian Federation had amended its applied rates prior to, or in the course of, 
these proceedings. As of 1  September  2016 the duty applied by Russia in relation to the 9th 
measure at issue in this dispute had also been brou ght into conformity with Russia's WTO tariff 
commitments. Further, with respect to duties on paper and paperboard products (measures 1 – 5) 
the Common Customs Union Tariff had been amended in accordance with the recommendations of 
the Panel with the Decisi on of the Board of the Eurasian Economic Union adopted on 
31 January  2017. This Decision had come into force on 3  March  2017. Therefore, Russia had fully 
implemented DSB's recommendations and rulings in this dispute, prior to the expiration of the 
reasonab le period of time.  
13.2.   The representative of the European  Union  said that his delegation thanked Russia for its 
statement made at the present meeting.  However, the EU was surprised that Russia had not 
placed this matter on the regular Agenda of the present DSB  meeting, but instead it had chosen to 
make a statement under "Other Business". The EU noted that the period of six months referred to 
in Article  21.6 of the DSU had expired on 10  May 2017 and the EU had therefore expected that 
Russia would place the issue  of implementation on the DSB Agenda to provide a status report at 
least 10  days prior to the present meeting. The EU pointed out that, pursuant to Article  21.6 of the 
DSU, Russia had to provide a status report irrespective of whether it considered that it  had already 
complied or whether progress in implementation still needed to be made. The EU hoped that 
Russia would take this into consideration in preparation for the next regular DSB meeting. At this 
stage, the EU did not take a position on whether or no t Russia had fully complied in this dispute.  
13.3.   The DSB took note  of the statements.  
14  DISPUTE SETTLEMENT W ORKLOAD  
A.  Statement by the Chairman  
14.1.   The Chairman , speaking under "Other Business", said that he wished to make a report to 
provide the DSB with informat ion about the Appellate Body's workload, the number of disputes 
before panels and at the panel composition stage, and the ability of the Secretariat to meet 
expected demand over the coming period. This information reflected the status of disputes up until 
the DSB meeting on 22  May 2016. Other developments in the course of the present meeting would 
be reflected in the information posted on the Members' website. The Chairman added that rather 
than providing a detailed report at each DSB meeting on the DS work load in the future he instead 
planned to do so only in the event of significant developments or changes since the preceding 
report. He  nevertheless intended to provide a full update at the July DSB meeting so that Members 
had a good picture of the workload  situation before the summer break. Regarding panels, currently 
there were 15 active panels (including four panels under Article  21.5 of the DSU) that had not yet 
issued a final report to the parties. Multiple disputes that were being considered simultaneo usly by 
the same panel were being counted as one. As of the present meeting, all composed panels had 
been assigned staff to assist them and were either active or in the process of commencing 
proceedings. There were a further ten panels at the composition s tage. This did not count panels 
for which there had been no composition activity in the past 12  months. In addition, six final panel 
reports that had been issued to the parties were currently being translated. Regarding appeals, the 
Appellate Body was curr ently dealing with five appeals, including the extremely complex 
compliance proceedings in "EC and Certain Member States – Large Civil Aircraft (Airbus)". Two of 
these appeals could not be staffed at the present time. Up to two additional appeals could be filed 
within the next two months, including an appeal in the extremely complex compliance proceedings 
in "US – Large Civil Aircraft (Boeing)". Regarding arbitrations, two matters had been referred to 
arbitration under Article  22.6 of the DSU.  
14.2.   The DSB took note of the statement.  
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