WORLD TRADE  
ORGANIZATION  RESTRICTED 
WT/DSB/M/320 
28 September 2012 
 (12-5212) 
Dispute Settlement Body 
23 July 2012  
 
 
 
MINUTES OF MEETING 
 
Held in the Centre William Rappard 
on 23 July 2012 
 
Chairman:  Mr. Shahid Bashir (Pakistan) 
 
  Prior to the adoption of the Agenda, the item concerning the Panel Report in the case on:  
"China – Countervailing and Anti-Dumping Duties on Grain Oriented Flat-Rolled Electrical Steel 
from the United States" (DS414) was removed from th e proposed Agenda following China's decision 
to appeal the Report.     Subjects discussed: Page 
 
1.  Surveillance of implementation of recommendations adopted by the DSB ......................... 2  
(a)  United States – Section 211 Omnibus Appropr iations Act of 1998:  Status report by 
the United States ............................................................................................................. ............ 3 
(b)  United States – Anti-dumping measures on certain hot-rolled steel products from 
Japan:  Status report by the Unite d States ................................................................................... 6 
(c)  United States – Section 110(5) of the US Copyright Act:  Status report by 
the United States ............................................................................................................. ............ 7 
(d)  European Communities – Measures affecting the approval and marketing of biotech 
products:  Status report by the European Union ......................................................................... 7  
(e)  United States – Anti-dumping administrative reviews and other measures related to 
imports of certain orange juice from Brazil:  Status report by the United States ....................... 8  
(f)  United States – Definitive anti-dumping and countervailing duties on certain products 
from China:  Status report by the United States .......................................................................... 9  
(g)  Thailand – Customs and fiscal measures on cigarettes from the Philippines:  Status 
report by Thailand ............................................................................................................ ........... 9 
(h)  United States – Anti-dumping measures on certain shrimp from Viet Nam:  Status 
report by the United States ................................................................................................... ..... 10 
(i)  European Communities – Definitive anti-dum ping measures on certain iron or steel 
fasteners from China:  Status re port by the European Union .................................................... 11  
2.  United States – Continued Dumping and Subsidy Offset Act of 2000:  
Implementation of the recommenda tions adopted by the DSB .......................................... 11  
(a)  Statements by the European Union and Japan .......................................................................... 11  WT/DSB/M/320 
Page 2  
 
  3.  China – Measures related to the exportation of rare earths, tungsten and 
molybdenum .................................................................................................................... ........ 13 
(a)  Request for the establishment of a panel by the United States ................................................. 13  
(b)  Request for the establishment of a panel by the European Union ............................................ 13  
(c)  Request for the establishment of a panel by  Japan ................................................................... 13  
4.  United States – Countervailing measures on certain hot-rolled carbon steel flat 
products from India ........................................................................................................... ..... 14 
(a)  Request for the establishment of a panel by  India .................................................................... 14  
5.  United States – Anti-dumping measures on certain shrimp and diamond 
sawblades from China .......................................................................................................... .. 15 
(a)  Report of the Panel............................................................................................................ ........ 15 
6.  United States – Certain country of or igin labelling (COOL) requirements ...................... 16  
(a)  Report of the Appellate Body and Report of the Panel ............................................................. 16  
(b)  Report of the Appellate Body and Report of the Panel ............................................................. 16  
 
 
1. Surveillance of implementation of recommendations adopted by the DSB 
(a) United States – Section 211 Omnibus Appr opriations Act of 1998:  Status report by 
the United States (WT/DS176/11/Add.116) 
 (b) United States – Anti-dumping measures on certain hot-rolled steel products from Japan:  
Status report by the United States (WT/DS184/15/Add.116) 
 (c) United States – Section 110(5) of the US Copyright Act:  Status report by the United States 
(WT/DS160/24/Add.91) 
 
(d) European Communities – Measures affecting the approval and marketing of  biotech products:  
Status report by the European Union (WT/DS291/37/Add.54) 
 (e) United States – Anti-dumping administrative revi ews and other measures related to imports of 
certain orange juice from Brazil:  Status report by the United States (WT/DS382/10/Add.7) 
 
(f) United States – Definitive anti-dumping a nd countervailing duties on certain products from 
China:  Status report by the United States (WT/DS379/12/Add.6) 
 (g) Thailand – Customs and fiscal measures on ciga rettes from the Philippines:  Status report by 
Thailand (WT/DS371/15/Add.3) 
 
(h) United States – Anti-dumping measures on certain shrimp from Viet Nam:  Status report by 
the United States (WT/DS404/11/Add.2) 
 (i) European Communities – Definitive anti-dumpi ng measures on certain iron or steel fasteners 
from China:  Status report by the European Union (WT/DS397/15) 
 
 1. The Chairman recalled that Article 21.6 of the DSU required that unless the DSB decided 
otherwise, the issue of implementation of the re commendations or rulings shall be placed on the 
Agenda of the DSB meeting after six months follo wing the date of establis hment of the reasonable  WT/DSB/M/320 
 Page 3 
 
 
  period of time and shall remain on the DSB's Agenda  until the issue was resolved.  He proposed that 
the nine sub-items under Agenda ite m 1 be considered separately.  
(a) United States – Section 211 Omnibus Appropr iations Act of 1998:  Status report by 
the United States (WT/DS176/11/Add.116) 
2. The Chairman drew attention to document  WT/DS176/11/Add.116, which contained the 
status report by the United States on progress in th e implementation of the DSB's recommendations in 
the case concerning US Section 211 Om nibus Appropriations Act of 1998. 
3. The representative of the United States said that  his country had provided a status report in 
this dispute on 12 July 2012, in  accordance with Article 21.6 of the DSU.  Legislative proposals had 
been introduced in the current 112th Congress to im plement the recommendations and rulings of the 
DSB.  The US Administration would continue to work on solutions to implement the DSB's 
recommendations and rulings. 
4. The representative of the European Union said that the EU thanked the United States for its 
most recent status report, and hoped that the US  authorities would very soon take steps towards 
implementing the DSB's ruling and resolve this matter. 
5. The representative of Cuba said that her country noted that after ten years of non-compliance 
there was a risk that the United States would assume  that its obligations had been diminished over 
time.  Cuba recalled that, on 1 February 2002, the DSB had adopted a ruling to request the 
United States to bring Section 211 into confor mity with the TRIPS Agreement and the Paris 
Convention.  Subsequently, no other decision ha d been taken to change it.  Therefore, the 
United States must respect its commitments and the only way to do so was by repealing Section 211.  
It was unacceptable for the United States to clai m, each month, that the legislative proposals 
introduced in Congress constituted the US commitment to the dispute settlement system.  Those proposals were, in practice, merely cosmetic, as nothing had happened for the past ten years.  None of 
the proposals had been discussed in the bodies in wh ich they had been introduced.  Therefore, Cuba 
wondered about the US commitment and its political  will towards implementation.  As Cuba had 
mentioned on previous occasions, not only Section 211 remained in effect but, since its entry into 
force, the Cuban company Cubaexport had been deni ed the right to renew the Havana Club trademark 
and thus retained ownership of a trademark that it ha d held since 1976.  Cuba wished to underline that 
this trademark had been abandoned by the origin al owners.  The violations in this case were 
significant, since the US legislation was in breach  of the US obligations.  The US trademark law, 
known as the Lanham Act, gave particular importan ce to the abandonment of trademarks by their 
original owners and enabled third parties to regist er an abandoned trademark if it had not been used 
for two years, or if there was no intention of  it being used, as in the case of the Havana Club 
trademark.  Section 211, however,  superseded th e Lanham Act so as to prevent the US courts from 
taking into consideration rights to trademarks c onfiscated in Cuba, regardless of whether such 
trademarks had been abandoned or not.  This had al so given rise to the so-called "zombie trademarks" 
after the death of a trademark's original owner or a successor's indefinite refusal to allow third parties 
to use a trademark.   
6. A large number of Members, including Cuba, believed that the US failure to comply 
undermined the credibility and effectiveness of the di spute settlement system and their concerns were 
not unfounded.  Cuba noted that according to th e DSB Annual Report circulated in November 2011 
by the WTO Secretariat, the United States had ende d 2011 without complying w ith its obligations in 
six disputes.  Cuba drew attention to the Agenda  of the present meeting, which showed that the 
number of cases of non-compliance continued to exist in 2012.  Cuba would c ontinue to condemn the 
US blatant violation of Cuban intellectual property rights by allowing the Bacardi company to engage 
in the fraudulent and unlawful sale of products that had not been produced in Cuba, using the Havana WT/DSB/M/320 
Page 4  
 
  Club trademark, which indicated Cuban origin.  Section 211 undermined the legitimate rights of 
Cuban trademark holders.  Cuba ur ged the United States to comply with the DSB's rulings without 
further delay.  Cuba believed that there was no lega l or ethical basis for the US excuses not to comply 
with the DSB's recommendations and rulings.  The United States, the world's leading economy, had 
no right to be exempt from compliance with the WTO obligations.  
7. The representative of the Bolivarian Republic of  Venezuela said that her country supported 
Cuba's statement.  Venezuela wished to point ou t that ten years had passed since the DSB had ruled 
on the inconsistency of Section 211 with Article 42 of the TRIPS Agreement, the principles of 
national treatment and most-favoured-nation treatment  and the Paris Convention.  Venezuela noted 
that the most recent status report submitted by th e United States contained the same information as the 
previous reports.  The only changes made were the date and document symbol.  The report stated that:  
"the US Administration will continue to work on a solution that would resolve this matter".  In 
Venezuela's view, this amounted to "action without results".  Venezuela noted that Section 211 remained in force, despite having been found to be  inconsistent with the TRIPS Agreement.  This 
undermined the dispute settlement system, which was considered to be one of the main achievements 
of the Uruguay Round.  Venezuela was, therefore, concerned about the US failure to implement the 
Appellate Body's ruling.  As it had already done on numerous occasions, Venezuela urged the 
United States to end its policy of economic, commerc ial and financial blockade  against Cuba and to 
comply with the DSB's recommendations. 
8. The representative of Zimbabwe said that his c ountry thanked the United States for its report, 
but was disappointed that the United States continued to disregard the DSB's rulings and 
recommendations in this dispute, thereby undermini ng the international trading system.  This was in 
spite of the numerous calls made in the DSB fo r the United States to respect its international 
obligations in this area.  Therefore, Zimbabwe, on ce again, supported Cuba and the other delegations 
who had urged the United States to comply with the DSB's recommendations and rulings. 
9. The representative of Uruguay said that his country thanked the United States for its status 
report.  Once again, Uruguay called on the parties to this dispute to bring an end to this long-standing 
situation of non-compliance with the DSB's reco mmendations and rulings.  Uruguay also called on 
the United States to rectify its status reports, wh ich did not provide any information on progress in 
implementation.  Uruguay noted that Section 211was not in line with the US commitments under the 
WTO. 
10. The representative of Brazil said that her count ry thanked the United States for its status 
report but noted that, once again, the United Stat es reported lack of progress.  Brazil remained 
concerned about this situation of non-complianc e with the DSB's recommendations and urged the 
United States to bring its measures into conformity with WTO rules. 
11. The representative of China said that her country  thanked the United States for its status 
report and statement made at the present meeting.  The prolonged situation of non-compliance in this 
dispute was highly incompatible with the prompt  and effective implementation required under the 
DSU provisions, in particular since the interests of a developing-country Member were affected.  
Thus, China urged the United States to implemen t the DSB's rulings and recommendations without 
further delay.   
12. The representative of Nicaragua said that her c ountry thanked the United States for its status 
report which, apart from the date of circulation, was identical to previous reports submitted by the 
United States over the past ten years.  The United St ates had, for ten years, been telling delegations 
that it was working on the implementation of the DS B's recommendations in this dispute.  Nicaragua 
was concerned that this had become a routine and permanent feature of DSB meetings.  The 
United States failed to comply with its obligations  in many disputes.  The US failure to comply  WT/DSB/M/320 
 Page 5 
 
 
  undermined the credibility of the DSB and the multila teral trading system and could set a negative 
precedent for other Members, in particular de veloping countries.  Nicaragua supported Cuba's 
statement and urged the United States to bring its le gislation into conformity with the DSB's rulings 
and recommendations and to repeal Section 211, wh ich was inconsistent with the TRIPS Agreement 
and violated the legitimate rights of Cuban trademark holders. 
13. The representative of the Dominican Republic said that her country thanked the United States 
for its most recent status report.  The Dominican  Republic, once again, urged the United States to 
implement the DSB's recommendations and to bring Section 211 into conformity with those recommendations with a view to strengthening and enhancing the role of the multilateral trading 
system and the dispute settlement system. 
14. The representative of Angola said that her count ry thanked the United States for its status 
report but regretted that no concrete  effort had been made in the implementation of the DSB's decision 
and the Appellate Body's conclusi on of 12 February 2002 on Section 211.  As Members were aware, 
the delay in the implementation of the DSB's decisi on affected the security and the predictability of 
the multilateral trading system and set a negative pr ecedent for other cases.  Thus, Angola hoped that 
concrete actions would be undertaken  to bring this measure into conformity with WTO rules without 
any further delay. 
15. The representative of Argentina said that his c ountry thanked the United States for its status 
report and its statement made at the present mee ting.  However, Argentina regretted that the 
United States had, once again, reported non-complian ce.  This prolonged situation of non-compliance 
for ten years was highly incompatible with the pr inciple of prompt and effective implementation 
stipulated in the DSU provisions, in particular since the interests of a developing-country Member 
were affected.  In that regard, and as it had done  on other occasions, Argentina drew attention to the 
fact that when Members with relatively greater economic weight failed to comply with the DSB's 
rulings, to the detriment of the interests of deve loping-country Members, this undermined the stability 
of the multilateral trading system and jeopardized its  viability with an impact that affected not just 
commercial interests.  Argentina, therefore, suppor ted Cuba and joined previous speakers in urging 
both parties to the dispute, in particular the Unite d States, to take all necessary measures to finally 
remove this item from the DSB's Agenda. 
16. The representative of Viet Nam said that his co untry thanked the United States for its status 
report and statement made at the present meeting.  Once again, Viet Nam was concerned about the US 
lack of progress in the implementation of the DSB's recommendations and rulings on this case.  
Viet Nam urged the United States to implement the DSB's recommendations without further delay.   
17. The representative of Ecuador said that his c ountry supported the statement made by Cuba.  
Ecuador stressed, once again, that Article 21 of the DSU referred to prompt compliance with the 
DSB's recommendations and rulings, in particular si nce the interests of a developing-country Member 
were affected.  Ecuador hoped that the United States would step up its efforts in order to immediately 
comply with the DSB's rulings and recommendations by repealing Section 211.  Ecuador noted that 
this case, which involved prolonged non-compliance, had been on the DSB's Agenda for more than 
ten years.  This highlighted some of the wea knesses of the dispute settlement system regarding 
effective compliance, which had an impact on the in terests of developing countries and countries with 
small economies. 
18. The representative of the United States said that his country would like to respond briefly to 
some of the comments made in the preceding inte rventions.  In response to the comments about 
"systemic" concerns about the dispute settlement system, as the United States had noted on previous occasions, the facts simply did not support Members' assertions or justify such systemic concerns.  
The record was clear:  the United States had come into compliance, fully and promptly, in the vast WT/DSB/M/320 
Page 6  
 
  majority of its disputes.  As for the remaining few instances where US efforts to do so had not yet 
been entirely successful, the United States had been working actively towards compliance, such as in 
this dispute.  The United States said that it would note that several Member s speaking under this item 
had brought disputes against the United States ev en over the past year, which reflected their 
confidence that the United States would comply with any resulting DSB recommendations and 
rulings.  Finally, the United States said that it wo uld like to recall that Section 211 addressed the 
uncompensated expropriation of assets or businesses.  As had been explained previously, the DSB held that when a WTO Member chose not to recogni ze intellectual property rights in its own territory 
relating to a confiscation of rights in another terr itory, its measures must comport with the national 
treatment and most-favoured nation (MFN) obligations of the TRIPS Agreement.   The United States 
continued to make efforts to address these inconsis tencies.  The United States had not been made 
aware of another situation in which intellectual prope rty rights had been expropriated or confiscated 
in another Member's territory without compensation, but if Members were aware of such a situation, 
the United States would appreciate receiving that information, which could be quite useful for discussions.    
19. The representative of Cuba said that, once again,  her country disagreed with what had just 
been stated by the United States.  For the past ten years, the United States had failed to comply with 
its obligations, and Cuba believed th at this situation of non-compliance must end.  The US statements 
made in the DSB meetings lacked substan ce regarding uncompensated expropriation under 
Section 211.  Paragraph 111 of the Appellate Body Report pertaining to  this dispute stated that the 
United States contended that Section 211 was an expression of the long-standing US doctrine that 
those whose claim to ownership of a trademark was based on an uncompensated confiscation of assets 
could not claim rights of ownership in the United States, absent the consent of the owners whose 
assets had been confiscated.  The fact that the US po sition was reflected in the Report did not give the 
United States any right to claim legal superiority of that view.  Looking back at Cuba's nationalization 
process, the representative of Cuba said that the Unite d States had deprived its citizens of the right to 
compensation, which Cuba had sought to offer.  Cuba did not agree with the view on uncompensated 
expropriation.  The Appellate Body acknowledged tha t:  "this ruling is not a judgment on confiscation 
as that term is defined in Section 211.  The validit y of the expropriation of intellectual or any other 
property rights without compensation by a WTO Member  within its own territory is not before us.  
Nor do we express any view, nor are we required to  express any view in this appeal, on whether a 
Member of the WTO should, or should not, recognize in its own territory trademarks, trade names, or 
any other rights relating to any intellectual or othe r property rights that may have been expropriated or 
otherwise confiscated in other territories". 1  Cuba wished to indicate that in the case of Havana Club 
trademark, the assets associated with it that  had been nationalized in Cuba belonged to 
José Arechabala who was not a US national.  Cu ba found it unacceptable for the United States to 
defend an entity or legal person that was not a US na tional.  In Cuba's view, the accepted principle of 
a compensation agreement signed by Cuba was that the right holders had to be nationals of the 
claimant's country at the time when they were  affected by the expropriation of the right.   
20. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
(b) United States – Anti-dumping measures on certain hot-rolled steel products from Japan:  
Status report by the United States (WT/DS184/15/Add.116) 
21. The Chairman drew attention to document  WT/DS184/15/Add.116, which contained the 
status report by the United States on progress in th e implementation of the DSB's recommendations in 
the case concerning US anti-dumping measures on certain hot-rolled steel products from Japan. 
                                                      
1 WT/DS176/AB/R, para. 362.  WT/DSB/M/320 
 Page 7 
 
 
  22. The representative of the United States said that  his country had provided a status report in 
this dispute on 12 July 2012, in accordance with Ar ticle 21.6 of the DSU.  As of November 2002, the 
US authorities had addressed the DSB's recommendations  and rulings with resp ect to the calculation 
of anti-dumping margins in the hot-rolled steel anti-dumping duty investigation at issue in this dispute.  With respect to the recommendations an d rulings of the DSB that had not already been 
addressed by the US authorities, the US Administ ration would work with the US Congress with 
respect to appropriate statutory measures that would resolve this matter.  
23. The representative of Japan said that his country  thanked the United States for, and took note 
of, its statement and status report.  Once again, Japan called on the United States to fully implement 
the DSB's recommendations in this long-s tanding dispute without further delay. 
24. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
(c) United States – Section 110(5) of the US Copyright Act:  Status report by the United States 
(WT/DS160/24/Add.91) 
25. The Chairman drew attention to document WT/D S160/24/Add.91, which contained the status 
report by the United States on progress in the impl ementation of the DSB's recommendations in the 
case concerning Section 110(5) of the US Copyright Act. 
26. The representative of the United States said that  his country had provided a status report in 
this dispute on 12 July 2012, in accordance with Article 21.6 of the DSU.  The US Administration 
would continue to confer with the European Uni on, and to work closely with the US Congress, in 
order to reach a mutually satisfactory resolution of this matter.  
27. The representative of the European Union said that the EU noted and thanked the 
United States for its status report.  As it had stated  many times in the past, the EU wished to resolve 
this case as soon as possible. 
28. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
(d) European Communities – Measures affecting the approval and marketing of biotech products:  
Status report by the European Union (WT/DS291/37/Add.54) 
29. The Chairman drew attention to document WT/D S291/37/Add.54, which contained the status 
report by the European Union on progress in the implementation of the DSB's recommendations in 
the case concerning its measures affecting the approval and marketing of biotech products. 
30. The representative of the European Union said th at the EU, once again, wished to express its 
hope that it would continue on the constructive pa th of dialogue with the United States.  Three 
technical meetings had taken place since 2011.  T hose meetings had offere d a good opportunity to 
discuss directly issues of concern to both sides an d to follow up closely on developments in the 
biotech field.  In 2012, the European Commission had already authorized four more GMOs2 and had 
renewed the authorization of a fifth one.3  Three of those decisions4 had been adopted only six months 
after the relevant EFSA opinions ha d been published.  In addition,  EFSA had adopted an opinion on 
maize MIR 162, which had been published on 21 J une 2012.  EFSA had presented the opinion to 
                                                      
2 A5547-127 soybean, 356043 soybean, MON87701 soybean, MON 87701 X MON 89788 soybean. 
3 40-3-2 soybean. 
4 Authorization decision for 356043 and MON87701 soybeans, MON 87701 X MON 89788 soybean. WT/DSB/M/320 
Page 8  
 
  member States on 16 July 2012.  It was foreseen that a draft decision would be presented to the 
regulatory Committee on 10 September 2012.  Regardi ng the concerns expressed by the United States 
on the back-log of approvals, the EU, once again, recalled that the EU approval system was not 
covered by the DSB's recommendati ons and rulings.  The EU underlined that the GMO regulatory 
regime was working normally as evidenced by th e approval decisions just mentioned.  The 
functioning of the GMO regime should not be rigidly assessed purely quantitatively and in the 
abstract, in terms of the number of authorizations  per year, since this was dependent on various 
product and case-specific elements and in particular on the quality of applications and on the time 
needed by applicants to answer requests from EFSA on additional scientific information. 
31. The representative of the United States said that  his country thanked the EU for its status 
report and for the information in its statement made  at the present meeting.  As it had explained at 
past meetings of the DSB, the United States rema ined greatly concerned about the effects of EU 
delays on US exports of agricultural commodities and food products.  At the end of June 2012, the EU 
had approved a new variety of biotech soybean.  That approval was welcomed, but the United States 
noted that this approval had been delayed due to  the failure of the EU's Standing Committee on the 
Food Chain and Animal Health to act following th e issuance of a positive risk assessment issued by 
the EU's own scientific authority, the European Food  Safety Authority.  These delays were the rule, 
not the exception.  In fact, not once in the past ten years had the EU's regulatory committee approved 
a biotech product.  Instead, products had only b een approved through the invocation of additional 
steps in the EU process.  In the present month, the European Food Safety Authority had issued a 
favourable opinion on an insect resistant variety of  maize.  In accordance with that opinion, the 
United States hoped that the EU would be able to a pprove this application without further delays.  The 
United States further noted that drought conditions  in the United States and other growing areas were 
affecting worldwide supplies of maize and other feed  products.  As a result, it should be particularly 
important to the EU's own interests that the approval of this variety of maize not be subject to delay. 
32. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
(e) United States – Anti-dumping administrative review s and other measures related to imports of 
certain orange juice from Brazil:  Status report by the United States (WT/DS382/10/Add.7) 
33. The Chairman drew attention to document WT /DS382/10/Add.7, which contained the status 
report by the United States on progress in the impl ementation of the DSB's recommendations in the 
case concerning US anti-dumping administrative reviews and other measures related to imports of 
certain orange juice from Brazil. 
34. The representative of the United States said that  his country had provided a status report in 
this dispute on 12 July 2012.  Pursuant to th e sequencing agreement between Brazil and the 
United States5, the United States was ready to engage with  Brazil should it have any further questions 
regarding this matter.  
35. The representative of Brazil said that her count ry thanked the United States for its status 
report.  Brazil was following attentively the implem entation of the final rule published by the US 
Department of Commerce, which had modified the ca lculation of dumping margins in reviews.  Brazil 
would consult with the United States with a vi ew to achieving a solution to this dispute.  
36. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
                                                      
5 WT/DS382/11.  WT/DSB/M/320 
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  (f) United States – Definitive anti-dumping and countervailing duties on certain products from 
China:  Status report by the United States (WT/DS379/12/Add.6) 
37. The Chairman drew attention to document WT /DS379/12/Add.6, which contained the status 
report by the United States on progress in the impl ementation of the DSB's recommendations in the 
case concerning US definitive anti-dumping and count ervailing duties on certain products from China. 
38. The representative of the United States said that  his country had provided a status report in 
this dispute on 12 July 2012, in accordance with Arti cle 21.6 of the DSU.  As had been noted at prior 
meetings of the DSB, in April and May 2012,  the US Department of Commerce had issued 
preliminary determinations with respect to issues in  this dispute.  The Department of Commerce had 
provided an opportunity for interested parties to provide comments on those preliminary 
determinations, and to provide rebuttal comments on any comments submitted by other interested 
parties.  The Department of Commerce was taki ng those comments into account as it worked on 
preparing the final determinations. 
39. The representative of China said that her country  thanked the United States for its status 
report and statement made at the present meeting.  China noted that this would be another case in 
which the United States had failed to comply with  the DSB's recommendations and rulings.  Although 
16 months had elapsed since the adoption of the A ppellate Body and Panel Re ports and the reasonable 
period of time as agreed by the parties had expired on 25 April 2012, the United States had not yet completed its implementation process and the process was quite delayed.  Regarding the US preliminary determinations, as had been mentioned in its most recent status report, especially with respect to the determination of public bodies a nd "double remedy", China still had strong concerns 
and deep doubts that they were not fully consistent  with the DSB's recommendations and rulings.  On 
the contrary, it seemed that the United States went even further in the wrong direction, which was 
inconsistent with its WTO obligations.  China urge d the United States to expedite its work and fully 
implement the DSB's rulings and recommendations wit hout any further delay.  China would carefully 
study the preliminary determinations, pay close attention to the US implementation progress and 
reserved its right to take further action in accordance with the DSU provisions.   
40. The representative of the United States said that  his country was aware that the reasonable 
period of time agreed by China and the United States had expired.  The United States had discussed 
this matter with China bilaterally.  As a result of those discussions, the United States and China had 
reached an agreement on procedures under Articles 21 and 22 of the DSU.  The United States was 
working to bring the relevant measures into confor mity with the recommendations and rulings of the 
DSB as quickly as possible.  However, the United States assumed that China had appreciated the 
opportunity to provide full comments on the prelim inary determinations and the opportunity to fully 
defend its interests in the Section 129 proceeding.  
41. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
(g) Thailand – Customs and fiscal measures on cigare ttes from the Philippines:  Status report by 
Thailand (WT/DS371/15/Add.3) 
42. The Chairman drew attention to document WT /DS371/15/Add.3, which contained the status 
report by Thailand on progress in the implementati on of the DSB's recommendations in the case 
concerning Thailand's customs and fiscal m easures on cigarettes from the Philippines. 
43. The representative of Thailand said that her country had provided a status report in this 
dispute on 13 July 2012.  Thailand wished to note th at it had recently held informal consultations in 
Bangkok with the Philippines regarding Thailand's implementation.  Thailand appreciated the WT/DSB/M/320 
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  Philippines' participation in those informal excha nges, which Thailand considered to be a valuable 
means of clarifying Thailand's intentions with r espect to implementation in this dispute and of 
enabling useful discussions of some of the more te chnical aspects of the regulations being adopted by 
Thailand as part of its implementation in this dis pute.  Thailand looked forward to continuing these 
exchanges with the Philippines. 
44. The representative of the Philippines said that hi s country thanked Thailand for its fourth 
status report and statement made at the present meet ing.  The Philippines c ontinued to be concerned 
that Thailand had not fully complied with the DSB's recommendations and rulings regarding the 
measures subject to the reasonable period of time that had expired on 15 May 2012, more than two 
months ago.  The Philippines was working with Th ailand to resolve the outstanding issues as quickly 
as possible, and was also evaluating all of its options under the DSU provisions.   
45. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
(h) United States – Anti-dumping measures on certain shrimp from Viet Nam:  Status report by 
the United States (WT/DS404/11/Add.2) 
46. The Chairman drew attention to document WT /DS404/11/Add.2, which contained the status 
report by the United States on progress in the impl ementation of the DSB's recommendations in the 
case concerning US anti-dumping measures on certain shrimp from Viet Nam. 
47. The representative of the United States said that  his country had provided a status report in 
this dispute on 12 July 2012, in accordance with Article 21.6 of the DSU.  In October 2011, the 
United States and Viet Nam had jointly notified the DSB of their agreement that the reasonable period 
of time for the United States to implement the r ecommendations and rulings of the DSB would end on 
2 July 2012.6  In February 2012, the US Department of  Commerce had published a modification to its 
procedures in order to implement the DSB's re commendations and rulings regarding the use of 
zeroing in anti-dumping reviews.  That modification addressed certain findings in this dispute.  On 
28 June 2012, the US Trade Representative had requested, pursuant to Section 129 of the Uruguay 
Round Agreements Act, that the Department of Commerce take action necessary to implement the 
DSB's recommendations and rulings in this dispute.  The United States would continue to consult with 
interested parties as it worked to address th e recommendations and rulings of the DSB.  
48. The representative of Viet Nam said that his co untry thanked the United States for its status 
report.  Viet Nam was concerned that a pro ceeding under Section 129 of the Uruguay Round 
Agreement had recently been initiated by USTR on 28 June 2012, only four days before the expiry of 
the reasonable period of time on 2 Ju ly 2012, as agreed by the parti es.  This process had delayed the 
US full compliance with the DSB's recommendations and rulings.  Viet Nam reiterated that Article 21 
of the DSU stipulated that prompt compliance with the DSB's recommendations or rulings was essential in order to ensure effective resolution of di sputes to the benefit of all Members.  Viet Nam 
would consult with the United States with a view to  achieving an appropriate solution to this matter. 
49. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
                                                      
6 WT/DS404/10.  WT/DSB/M/320 
 Page 11 
 
 
  (i) European Communities – Definitive anti-dumping measures on certain iron or steel fasteners 
from China:  Status report by the European Union (WT/DS397/15) 
50. The Chairman drew attention to document WT /DS397/15, which contained the status report 
by the European Union on progress in the implem entation of the DSB's recommendations in the case 
concerning EU anti-dumping measures on certain iron or steel fasteners from China. 
51. The representative of the European Uni on said that the EU was working on the 
implementation of the DSB's recommendations and rulings  in this dispute and was making an effort to 
complete the implementation before the expiry  of the agreed reasonable period of time on 
12 October 2012.  First, the provision of the EU Basic Anti-Dumping Regulation that had been found 
to be "as such" incompatible with the Anti-Dump ing Agreement was being amended in a manner that 
fully respected the EU's WTO obligations.  The legi slative procedure was expected to be concluded 
with the publication of the amendment in the Official Journal of the EU in early September 2012.  Second, a review had been initiated in order to  implement the DSB's recommendations and rulings 
related to the specific EU anti-dumping measures on certain iron or steel fasteners originating in China.  The relevant procedures were ongoing and were  expected to be finalized in the near future.  
Finally, the EU wished to note that, regardless of the clear limits of the EU's implementation 
obligations arising from this dispute, the EU ha d also offered exporting producers in non-market 
economy countries, including China, the possibility to request a review of other anti-dumping measures currently in force with respect to any a pplication of Article 9(5) of the EU basic Anti-
Dumping Regulation in those measures allegedly in  contradiction with the reasoning set out in the 
Appellate Body Report.  The EU hoped that this  initiative would inspire other WTO Members in 
similar circumstances. 
52. The representative of China said that her country thanked the EU for its status report and 
statement made at the present meeting.  On 28 July 2012, the DSB had adopted the Appellate Body 
Report and the Panel Report in this dispute.  The Appellate Body and the Pane l had concluded that the 
individual treatment regime laid down in Article 9(5) of the Eur opean Union's Basic Anti-Dumping 
Regulation was, both "as such" and "as applied" in th e fasteners investigation, inconsistent with WTO 
law.  According to the agreement between both par ties, the reasonable period of time for the EU to 
implement the DSB's recommendations and rulin gs would expire on 12 October 2012.  China 
welcomed the progress the EU had made to implement the DSB's recommendations and rulings.  In particular, China welcomed the fact that the EU anticipated the amendment to the Basic Anti-
Dumping Regulation of 30 November 2009 to be  published and come into effect in early 
September 2012.  China hoped that the EU would fu lly implement the DSB's rulings in relation to 
both the Basic Anti-Dumping Regulation "as such" and "as applied" in the fasteners investigation as 
soon as possible before the end of the reasonable period of time.  With respect to the draft amendment to the Basic Anti-Dumping Regulation and the revi ew of the anti-dumping investigation at issue, 
China would evaluate and monitor its development. 
53. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
2. United States – Continued Dumping and Subsid y Offset Act of 2000:  Implementation of 
the recommendations adopted by the DSB 
(a) Statements by the European Union and Japan 
54. The Chairman said that this item was on the Age nda of the present meeting at the request of 
the European Union and Japan.  He then i nvited the respective representatives to speak. WT/DSB/M/320 
Page 12  
 
  55. The representative of the European Union said th at, as it had done many times before, the EU 
requested the United States to stop transferri ng anti-dumping and countervailing duties to the US 
industry.  Every disbursement that still took place was clearly an act of non-compliance with the DSB's recommendations and rulings.  Once again, the EU renewed its call on the United States to 
abide by its clear obligation under Article 21.6 of th e DSU to submit status reports pertaining to this 
dispute. 
56. The representative of Japan said that the CD SOA continued to be operational as FY 2012 
Preliminary CDSOA Amounts Available7 announced last month by US Customs and Border 
Protection showed.  Japan urged the United States to  stop the illegal distributions and repeal the 
CDSOA, not just in form but in substance, so as to  resolve this dispute.  According to Article 21.6 of 
the DSU, the United States was under obligation to provide the DSB with a status report pertaining to 
this dispute.  
57. The representative of Brazil said that her country  thanked the EU and Japan for keeping this 
item on the DSB's Agenda.  As it had expressed in previous meetings, Brazil was of the view that the 
United States was under obligation to submit status re ports in this dispute until such time as no more 
disbursements were made pursuant to the Byrd Amen dment.  Only then woul d the issue be "resolved" 
within the meaning of the DSU.   
58. The representative of India said that his count ry thanked Japan and the EU for regularly 
keeping this item on the DSB's Agenda.  India agreed  with the previous speakers that this issue should 
continue to remain under the surveillance of th e DSB until such time full compliance was achieved. 
59. The representative of Canada said that his country  wished to refer to its statements made 
previously under this Agenda item.  Canada 's position did not change on this matter.  
60. The representative of Thailand said that his country supported the statements made by 
previous speakers and continued to urge the Un ited States to cease the disbursements and fully 
implement the DSB's rulings and recommendations on this matter. 
61. The representative of the United States said that, as his country had already explained at some 
previous DSB meetings, the President had signed the Deficit Reduction Act into law on 
8 February 2006.  That Act included a provisi on repealing the Continued Dumping and Subsidy 
Offset Act of 2000.  Thus, the United States had ta ken all actions necessary to implement the DSB's 
recommendations and rulings in these disputes.  The United States recalled, furthermore, that 
Members, including the EU and Japan, had acknowl edged during previous DSB meetings that the 
2006 Deficit Reduction Act did not permit the distribu tion of duties collected on goods entered after 
1 October 2007.  The United States, therefore, di d not understand the purpose for which the EU and 
Japan had inscribed this item on the Agenda of the present meeting.  With respect to comments 
regarding further status reports in this matter, the United States failed to see what purpose would be 
served by further submission of status reports rep eating, again, that the United States had taken all 
actions necessary to implement the DSB's reco mmendations and rulings in these disputes.  
62. The DSB took note of the statements. 
                                                      
7 http://www.cbp.gov/xp/cgov/trade/pr iority_trade/add_cvd/cont_dump/   WT/DSB/M/320 
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  3. China – Measures related to the exportation of rare earths, tungsten and molybdenum 
(a) Request for the establishment of a panel by the United States (WT/DS431/6) 
(b) Request for the establishment of a panel by the European Union (WT/DS432/6) 
(c) Request for the establishment of a panel by Japan (WT/DS433/6) 
63. The Chairman proposed that the three sub-items to which he had just referred be considered 
together.  He recalled that the DSB had consider ed these matters at its meeting on 10 July 2012 and 
had agreed to revert to them.  He then drew attention to the communication from the United States 
contained in document WT/DS431/6 and invited th e representative of the United States to speak. 
64. The representative of the United States said that, as explained at the 10 July 2012 DSB 
meeting, the United States continued to be concer ned with Chinese export restraints on certain raw 
materials – i.e., rare earths, tungsten and molybde num – that were critical to manufacturing industries 
in the United States and in other Members.  The export restraints at issue included export quotas, export duties, various restrictions on the right to  export, as well as administrative requirements that 
limited exports of these materials from China by in creasing the burdens and costs for exporting.  As 
the United States had explained at the 10 July 2012  DSB meeting, China's export restraints were 
similar to the policies that the United States, the EU and Mexico had successfully challenged in the 
"China - Raw Materials" dispute as inconsistent  with China's obligation under the GATT 1994 and 
China's Protocol of Accession.  Therefore, the United States requested that the DSB establish a panel 
to examine the matter set out in the US panel request with standard terms of reference.  As the panel 
requests of the co-complainants, the EU and Japan , related to the same matter, the United States 
requested pursuant to DSU Article 9.1 that a single panel be established to examine these complaints.  
65. The Chairman drew attention to the communication from the European Union contained in 
document WT/DS432/6 and invited the representative of the European Union to speak. 
66. The representative of the European Union said th at the EU regretted that it had no choice but 
to make a second request for the establishment of a pa nel in this dispute.  As had been noted during 
the previous DSB meeting, the consultations, wh ile helpful in clarifying the Chinese measures and 
their application, had provided no basis for a ne gotiated solution to the dispute.  As had also 
previously been noted, the export restrictions impos ed by China on raw materials were by no means a 
recent phenomenon.  They had been a problem when  China acceded to the WTO and they continued 
to be so at the present time.  The EU regretted th at China had not signalled any intentions to remove 
those export restrictions, despite the clear ruling issu ed by a panel and the Appellate Body earlier this 
year on a similar set of measures.  The EU believed th at the export restrictions at issue in this dispute 
constituted a violation of China's WTO comm itments undertaken under the GATT as well as 
commitments undertaken in its Accession Protocol, speci fically aiming at these types of restrictions.  
The export restrictions at issue significantly distor ted the market and created  competitive advantages 
in favour of the Chinese manufacturing industry  to the detriment of foreign competitors.  
Furthermore, these policies put pressure on fore ign producers to move their operations and 
technologies to China, as companies outside China were either cut off fro m supplies or had access 
only at much higher prices than Chinese companies.  The EU wished to reiterate again that it 
supported and encouraged the promotion of a cleaner  and sustainable production of raw materials.  
Environmental protection and sustainable resource management were legitima te aims, recognized and 
fully achievable under WTO rules.  However, the EU  strongly believed that export restrictions were 
not the appropriate tools to promote these aims and welcomed the clear findings of the Panel in the 
first raw materials dispute to that effect.  Fina lly, in light of the panel requests made by the 
United States and Japan in DS431 and DS433, the EU requested that a single panel be established in 
accordance with Article 9.1 of the DSU. WT/DSB/M/320 
Page 14  
 
  67. The Chairman drew attention to the comm unication from Japan contained in document 
WT/DS433/6 and invited the representative of Japan to speak. 
68. The representative of Japan said that his country would not repeat its position and claims in 
this dispute at the present meeting, as they were expl ained in detail in the panel request and in Japan's 
statement made at the previous DSB meeting of 10 July 2012.  This case concerned China's export 
restrictions on various forms of rare earths, t ungsten and molybdenum th rough export duties, export 
quotas and their administration.  Japan considered th at China's export restrictions were inconsistent 
with China's various obligations under the WTO Agre ement.  This panel request had appeared as an 
item on the Agenda of the previous DSB meeting of  10 July 2012.  Following that meeting, Japan 
once again requested, pursuant to Article 6 of the DSU, that a panel be established to examine the 
matter set out in its panel request with standard te rms of reference in accordance with Article 7.1 of 
the DSU.  Japan further requested that, pursuant to Article 9.1 of the DSU, a single panel be 
established to examine the complaints of Japan, the United States and the European Union which 
related to the same matter. 
69. The representative of China said that her country wished to reiterate that after the 
complaining parties had requested consultations  in these disputes, China had held sincere 
consultations with them and had po sitively responded to their relevant  questions.  China regretted that 
the complaining parties requested the DSB to estab lish a panel in these disputes for a second time.  As 
it had reiterated on many occasions, China's policies c oncerning the products at issue were aimed at 
protecting natural resources and achieving sustaina ble economic development.  Once again, China 
noted that it had no intention to protect its domestic  industry through means that would distort trade.  
According to the statistics, China supplied over 90 per cent of rare earths on the global market with 
just 23 per cent of the world's total reserves, and had made great contributions to the world economic 
developments.  At the same time, it had to be recognized that over-exploitation of resources also resulted in the outstanding problems, such as ecol ogical destruction, which in turn had seriously 
hampered the sustainable development of the rare  earths.  Therefore, China was puzzled by the 
complainants' intention of initiating the panel pr ocess.  China understood that a panel would be 
established at the present meeting and, although not obligated, in the spirit of collaboration, China 
agreed to the establishment of a single panel to examine the three disputes. 
70. The DSB took note of the statements and agreed to establish a single panel pursuant to 
Article 9.1 of the DSU, with standard terms of reference to examine the complaint by the 
United States contained in WT/DS431/6, the co mplaint by the European Union contained in 
WT/DS432/6 and the complaint by Japan contained in WT/DS433/6. 
71. The representatives of Brazil, Canada, Colombia, the European Union, India, Japan, Korea, 
Norway, Oman, Saudi Arabia, Chinese Taipei, the United States and Viet Nam reserved their third-
party rights to participate in the Panel's proceedings. 
4. United States – Countervailing measures on certai n hot-rolled carbon steel flat products 
from India 
(a) Request for the establishment of a panel by India (WT/DS436/3) 
72. The Chairman drew attention to the communication from India contained in document 
WT/DS436/3, and invited the representative of India to speak. 
73. The representative of India said that the Un ited States had conducte d a countervailing duty 
investigation and had levied c ountervailing duties on certain hot-rolled carbon steel products from 
India.  The provisional measures had been imposed  with effect from 20 April 2001 and the final 
measures had been imposed with effect from 3 December 2001.  The United States had concluded a  WT/DSB/M/320 
 Page 15 
 
 
  sunset review in 2007 and had continued the duti es for a further period of five years.  The 
United States had also conducted several Admini strative Reviews to determine the countervailing 
duty rates to be applied on the imports made duri ng the relevant period.  The measures continued to 
be in force and India considered that these measu res were inconsistent with US obligations under 
several provisions of the SCM Agreement and the GATT 1994.  On 24 April 2012, India had 
requested consultations with the United States,  pursuant to Articles 1 and 4 of the DSU, 
Article XXII:1 of the GATT 1994 and Article 30 of the SCM Agreement.  Consultations had been 
held on 31 May and 1 June 2012.  Unfortunately, the consultations were unsuccessful in resolving the 
dispute and, therefore, pursuant to Articles 4.7 and 6 of the DSU and Article 30 of the SCM 
Agreement, India respectfully requ ested that the DSB establish a pane l to examine this matter, with 
standard terms of reference.  
74. The representative of the United States said that his country was disappointed that India had 
requested the establishment of a panel on this matter.   Members had the right to levy a countervailing 
duty in order to offset subsidies bestowed by another Member on the manufacture, production or 
export of goods in or from that other Member's jurisdiction.  India, at both the national and state 
levels, provided subsidies that be nefitted domestic manufacturers of certain hot-rolled carbon steel flat 
products and that caused material injury to the in dustry of other Members.  In that regard, the 
United States noted that it was not the only WTO Me mber to have found that India's domestic steel 
industry received subsidies from national and stat e governmental entities and that these subsidies 
caused injury.  With respect to the countervailing duty order at issue in this dispute, the United States 
had conducted the initial i nvestigation and subsequent reviews transparently and with all necessary 
procedural safeguards.  The United States consider ed that US procedures compared very favourably 
to those of certain other Members subject to multiple  WTO challenges to their investigations recently.  
Nevertheless, many of the very issues that India now  raised in its panel request arose from the failure 
of the Government of India and the relevant Indian  companies to avail themselves of the opportunity 
to fully participate in those pro ceedings.  The United States also had a number of concerns with the 
way in which India had framed its panel request.  For example, the request appeared to include 
provisions of US law about which c onsultations had neither been requested nor held.  For all of these 
reasons, the United States was not in a position to ag ree to the establishment of a panel at the present 
meeting.   
75. The DSB took note of the statements and agreed to revert to this matter. 
5. United States – Anti-dumping measures on certain shrimp and diamond sawblades from 
China 
(a) Report of the Panel (WT/DS422/R and Add.1) 
76. The Chairman recalled that, at its meeti ng on 25 October 2011, the DSB had established a 
panel to examine the complaint by China pertaini ng to this dispute.  The Report of the Panel 
contained in document WT/DS422/R and Add.1 had been circulated on 8 June 2012 as an unrestricted 
document.  The Report of the Panel was before the DSB for adoption at the re quest of China.  The 
adoption procedure was without prejudice to the right of Members to express their views on the 
Report. 
77. The representative of China said that her country thanked the Panel and the Secretariat for 
their work in this dispute.  China welcomed the fact that the Panel had upheld China's claim 
concerning the USDOC's use of zeroing in the calculation of dumping margins for individually-
examined exporters and producers.  The Panel had found that the "zeroing" methodology used by the 
USDOC in calculating the margins of dumping in the three anti-dumping investigations at issue was inconsistent with Article 2.4.2 of the Anti-Dumpi ng Agreement, and therefore had concluded that the 
United States had acted inconsiste ntly with its obligations under WTO rules.  According to the WT/DSB/M/320 
Page 16  
 
  Agreement on Procedures between China and the United States in this dispute (WT/DS422/4), the 
parties had agreed that the reasonable period of tim e for the United States to bring each measure into 
conformity with the Anti-Dumping Agreement would be eight months.  China hoped that the United States would fully implement the DSB's recommendations and rulings as soon as possible. 
78. The representative of the United States said that his country would like to also thank the 
members of the Panel and the Secretariat for their work  on this dispute.  With  regard to the specific 
methodology challenged by China in this dispute – i. e. zeroing in the context of average-to-average 
comparisons in anti-dumping duty investigations – the US Department of Commerce had announced 
years ago that it would discontinue zeroing in this context as a result of earlier DSB recommendations and rulings.  Accordingly, in the present dis pute, the United States and China had reached a 
procedural agreement that provided an efficient means of addressing China's claims with reduced 
burdens on the resources of the parties and the disput e settlement system.  As had been agreed with 
China and consistent with the procedural agreement,  the United States said that it would like to state 
that it intended to implement the recommendations and rulings of the DSB in this dispute in a manner 
that respected US WTO obligations.  The United St ates would need a reasonable period of time in 
which to do so, and China and the United States had agreed that the reasonable period of time in this 
dispute would be eight months.  
79. The representative of China said that her country  thanked the United States for its statement 
regarding the US intentions to implement the DS B's recommendations and rulings.  China noted that, 
pursuant to Article 21.3 of the DSU, the United St ates had an obligation to inform the DSB of its 
intentions in respect of implementation in this disp ute within the next 30 days.  However, the parties 
had reached a procedural agreement in this regard.  Therefore, China appreciated the US statement of 
intentions made at the present meeting.  
80. The DSB took note of the statements and adop ted the Panel Report contained in documents 
WT/DS422/R and WT/DS422/R/Add.1. 
6. United States – Certain country of origin labelling (COOL) requirements 
(a) Report of the Appellate Body (WT/DS384/AB /R) and Report of the Panel (WT/DS384/R) 
(b) Report of the Appellate Body (WT/DS386/AB /R) and Report of the Panel (WT/DS386/R) 
81. The Chairman drew attention to the communi cation from the Appellate Body contained in 
document WT/DS384/16 – WT/DS386/15 transm itting the Appellate Body Reports on:  
"United States – Certain Country of Origin Labelling (COOL) Requirements", which had been 
circulated on 29 June 2012 in document WT/D S384/AB/R – WT/DS386/AB/R.  He reminded 
delegations that the Appellate B ody Reports and the Panel Reports pertaining to these disputes had 
been circulated as unrestricted documents.  As Members were aware, Article 17.14 of the DSU required that:  "An Appellate Body report sha ll be adopted by the DSB and unconditionally accepted 
by the parties to the dispute unless the DSB decid es by consensus not to adopt 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".  
82. The representative of Canada said that his count ry thanked the Panel, the Appellate Body and 
their respective Secretariats for their work on this  dispute.  Canada also wished to acknowledge the 
valuable cooperation with Mexico, which had laun ched its own challenge of the same measure, the 
Report for which would also be adopted at the presen t meeting.  Canada welcomed the Panel and the 
Appellate Body's findings and recommendations, wh ich confirmed that the measure taken by the 
United States relating to requirements for Country of Origin Labelling (COOL) was inconsistent with 
its WTO obligations.  When the United States had fi rst implemented the COOL requirements in 2008,  WT/DSB/M/320 
 Page 17 
 
 
  the impact on Canadian industry was immediate and si gnificant.  Within a year of the adoption of the 
measure, exports to the United States of Canadian f eeder cattle and slaughter hogs were cut in half.  
Virtually overnight, the COOL measure had led to the disintegration of the North American supply 
chain, created unpredictability in the market a nd imposed additional costs on producers on both sides 
of the border.  In the lead-up to the adoption of th e measure and beyond, Canada had repeatedly raised 
with the United States its strong concerns about th e consequences of COOL, but to no avail.  Canada 
was left with no choice but to initiate dispute settle ment proceedings.  The Appellate Body and Panel 
Reports being adopted at the presen t meeting had confirmed Canada and Mexico's concerns on the 
most significant issues.  At the present meeting, Canada wished to comment briefly on three issues 
that had been raised in this dispute.  First, th e Appellate Body had confir med that the COOL measure 
negatively affected the conditions of competition of Canadian cattle and hogs in the US market.  It 
had further confirmed that the segregation costs im posed disproportionately on Canadian cattle and 
hogs, together with an excessive administrative and r ecordkeeping burden, were not even-handed.  As 
a result, the Appellate Body had agreed that the C OOL measure was inconsistent with Article 2.1 of 
the TBT Agreement by discriminati ng against Canadian cattle and hogs. 
83. Second, while Canada regretted that the Appe llate Body had been unable to complete its 
analysis under Article 2.2 of the TBT Agreement,  Canada nonetheless welcomed the clear guidance 
that the Appellate Body had provided for the app lication of Article 2.2 of the TBT Agreement in 
future cases.  The recent trilogy of disputes involving  Article 2.2 of the TBT Agreement claims had, 
in a very short period of time, enriched the collec tive understanding of the nature of the obligations 
this provision imposed on Members governments.  In particular, in this dispute, Canada appreciated 
the Appellate Body's consideration of the a lternative measures proposed by Canada.  That 
consideration suggested that those alternative me asures, such as voluntary labelling or substantial 
transformation, were potentially viable less trade- restrictive alternatives to the COOL measure.  
However, the outcome of Canada's claims under Article 2.2 of the TBT Agreement was also a 
reminder of the importance of finalizing the review  of the operation of the DSU.  The Appellate 
Body's inability to complete the analysis under Ar ticle 2.2 of the TBT Agreement in this dispute 
highlighted, once again, that the absence of a remand procedure exposed all complaining parties to the 
risk that they may go through an entire proceeding, only to see a final resolution of the claim concerned frustrated due to th is procedural lacuna.   
84. Third, Canada noted that the Appellate Body ha d reiterated that the test under Article III:4 of 
the GATT 1994 was not the same as under Article 2.1 of the TBT Agreement.  While the Appellate 
Body had not found it necessary to make a findi ng, it was clear nonetheless that the finding of 
negative effects on the conditions of  competition related to Article 2. 1 of the TBT would also ground 
a GATT Article III:4 violation, if that had been necessary.  As a result of the recommendations and 
rulings that the DSB would adopt at the present meet ing, Canada trusted that the United States would 
act promptly to remove the discriminatory elements of the COOL measure, by amending the statute 
concerned to end the violation of national treatmen t that had been found by the Panel and confirmed 
by the Appellate Body.   
85. Finally, Canada wished to conclude with a comment about the length of time it had taken to 
arrive at that point in the resolution of the dispute.  Almost 33 months had passed since the 
establishment of the Panel in November 2009, far in excess of the 12 months foreseen in Article 20 of 
the DSU.  Canada acknowledged that a good amount of  the additional time taken had been with the 
consent of, and sometimes at the be hest of, the disputing parties.  But other delays had been imposed 
upon those parties through the domino effect of system ic delays that had been affecting disputes in 
recent years.  Canada's understanding was that many of the conditions that had led to recent delays 
had passed, but Members should not be naïve in believ ing that they would not return.  It was in the 
interest of Members and potential disputing parties, and the responsibility of DSB delegates, to take 
immediate steps to ensure that the system was prepar ed to deal with such conditions should, or when, 
those conditions returned. WT/DSB/M/320 
Page 18  
 
  86. The representative of Mexico said that his c ountry welcomed the opportunity to express its 
views on this matter.  First, Mexico wished to  thank the Appellate Body members and the AB 
Secretariat, in particular the division that had ex amined the case.  Mexico also thanked the Panel and 
the Secretariat that had assisted in their work in th is dispute.  Mexico also welcomed the participation 
of third parties at the panel stage and third partic ipants in the appeal.  Their interesting views had 
helped to enhance the quality of the discussion at both stages of the proceedings.  The TBT 
Agreement recognized Members' right to establish technical regulations, which constituted obstacles 
to trade, when they were needed to fulfil or pr otect a legitimate objective, such as the protection of 
human or animal life or health or the prevention of deceptive practices.  However, such technical 
regulations, regardless of their legitimate objective,  remained subject to TBT Agreement obligations, 
most notably the requirement that they shall not be discriminatory or more trade restrictive than 
necessary to fulfil their legitimate objective.  Mexico  recognized that providing consumer information 
could be an important legitimate objective.  Howeve r, in the case brought by Mexico before a panel 
and the Appellate Body, the intention had not been  to question this objective in general, but the 
specific features of the country of origin labelling (COOL) requirements of the United States.   
87. In Mexico's view, the COOL requirements had not been created for the real and legitimate 
purpose of providing consumer information, but with  a view to US livestock producers recovering the 
market share that livestock born in Mexico and Canada had legitimately held for decades.  The 
method that had been used to try to recover this shar e of the market was to requi re that all participants 
in the meat production chain provide informati on on the place where the livestock concerned was 
born, raised and processed, even if it had gained most of its weight and its meat had been produced in 
the United States, as in the case of Mexican feeder  cattle.  As the information provided to consumers 
had served only a protectionist and not genuine purpose, the charges for livestock born in the United States had been minimized, and all costs ha d been transferred to production chain operators 
that had decided to use livestock of different orig ins.  The result was a discriminatory measure, the 
ultimate aim of which was protectionist, and whic h, instead of fulfilling its objective to inform 
consumers, created confusion.  In short, while th e COOL requirements had been totally ineffective in 
fulfilling the objective of providing consumer info rmation, especially when the meat concerned 
derived from livestock of different origins, they had been very effective in fulfilling their protectionist 
purpose.  The Panel and the Appellate Body had co nfirmed that the COOL requirements created an 
incentive to use only livestock born in the United States and a disincentive to use livestock born in 
another country. 
88. At the present meeting, Mexico also wish ed to make some specific comments on the 
Appellate Body's analysis by first looking at Article  2.1 of the TBT Agreement and then Article 2.2 of 
the TBT Agreement.  Mexico welcomed the Pane l and Appellate Body's findings that the COOL 
measure was inconsistent with the national treatme nt and non-discrimination obligation set out in 
Article 2.1 of the TBT Agreement.
8  Mexico considered the Appellate Body's interpretation, as 
previously developed in the reports on "US - Clove Cigarettes" and "US - Tuna II (Mexico)", to be 
appropriate, in that the correct way to analyse wh ether a technical regulati on was inconsistent with 
Article 2.1 of the TBT Agreement was to determin e whether it modified the conditions of competition 
in the relevant market to the detrim ent of the group of imported products vis-à-vis  the group of like 
domestic products.  Furthermore, recognizing that  technical regulations simply by establishing 
product characteristics may have a de trimental impact, the Appellate B ody had clarified that in order 
to determine whether this provision had been vi olated, it was necessary to  analyse whether the 
existence of the detrimental impact reflected the exis tence of discrimination, and that it was, therefore, 
necessary to analyse in detail whether the detrimen tal impact on imports stemmed exclusively from a 
legitimate regulatory distinction.  For this, it was necessary to analyse whether the measure was 
even-handed.9  On the basis of that interpretation, the Appellate Body had recognized in this specific 
                                                      
8 Appellate Body Report, para. 496(a)(iv). 
9 Appellate Body Report, paras. 266-272.  WT/DSB/M/320 
 Page 19 
 
 
  case that the COOL requirements modified the cond itions of competition in the US market to the 
detriment of livestock born in Mexico.  In that r espect, Mexico noted that the Appellate Body had 
recognized that its "examination of the COOL measure under Article 2.1 reveals that its 
recordkeeping and verification requirements impose a disproportionate burden on upstream producers 
and processors ..."10 and that "it is these same recordkeeping and verification requirements that 
'necessitate' segregation, meaning that their associ ated compliance costs are higher for entities that 
process livestock of different origins.  Given that  the least costly way of complying with these 
requirements is to rely exclusively on domestic livestock, the COOL measure  creates an incentive for 
US producers to use exclusively domestic livestoc k and thus has a detrimental impact on the 
competitive opportunities of imported livestock."11  As to whether the detrimental impact reflected the 
existence of discrimination or, in other words,  whether it stemmed exclusively from a legitimate 
regulatory distinction, Mexico noted that the Appe llate Body had concluded that "the recordkeeping 
and verification requirements imposed on upstream producers and processors cannot be explained by 
the need to convey to consumers information re garding the countries wher e livestock were born, 
raised, and slaughtered, because the detailed inform ation required to be tracked and transmitted by 
those producers is not necessarily conveyed to consumers through the labels prescribed under the 
COOL measure.  This is either because the pr escribed labels do not e xpressly identify specific 
production steps and, in particular for Labels B and C, contain confusing or inaccurate origin 
information, or because the meat or meat pr oducts are exempt from the labelling requirements 
altogether.  Therefore, the detrimental impact caused by the same recordkeeping and verification 
requirements under the COOL measure can also not be explained by the need to provide origin 
information to consumers.  Based on these findings, we consider that the regulatory distinctions 
imposed by the COOL measure amount to arbitrar y and unjustifiable discrimination against imported 
livestock, such that they cannot be said to  be applied in an even-handed manner."12   
89. In light of the foregoing, the Appellate Body  had found that "the detrimental impact on 
imported livestock did not stem exclusively from a legitimate regulatory distinction but, instead, 
reflected discrimination in violation of  Article 2.1 of the TBT Agreement".13  Mexico agreed with the 
factual findings and the interpretation of the Panel, as upheld by the Appellate Body but for different 
reasons, which had led both to conc lude that the COOL requirements were inconsistent with the 
national treatment and non-discrimination obligatio n under Article 2.1 of the TBT Agreement.  
Mexico welcomed the Appellate Body's recommenda tion to the DSB to request the United States to 
bring its COOL requirements into conformity  with Article 2.1 of the TBT Agreement.14 
90. With regard to Article 2 of the TBT Agreemen t, in Mexico's view, the Panel had correctly 
concluded that the COOL measure wa s inconsistent with Article 2.2 of the TBT Agreement, as it did 
not fulfil the objective of providing consumer inform ation on origin with respect to meat products.  
Mexico regretted the Appellate Body 's reversal of that conclusion.  In Mexico's view, the Appellate 
Body, based on the guidance given in its recent report in "US - Tuna II", had correctly determined that 
"to make an objective and independent assessment of the objective that a Member seeks to achieve, 
the panel must take account of all the evidence put before it in this regard, including 'the texts of 
statutes, legislative history, and other evidence rega rding the structure and operation' of the technical 
regulation at issue".15  Mexico also agreed with the Appellate Body's view that if the objective did not 
fall among those specifically listed, a panel must make a determination of legitimacy.16  M e x i c o  
regretted, however, that the Panel had not give n due consideration to the evidence submitted by 
                                                      
10 Appellate Body Report, para. 349. 
11 Appellate Body Report, para. 349 
12 Appellate Body Report, para. 349 
13 Appellate Body Report, para. 349 
14 Appellate Body Report, para. 497. 
15 Appellate Body Report, para. 371. 
16 Appellate Body Report, para. 372. WT/DSB/M/320 
Page 20  
 
  Mexico and Canada, which showed that the objectiv e of the COOL measure was protectionist and, 
therefore, illegitimate, or to the Appellate Body's finding that, in identifying the objective, the Panel had not acted inconsistently with its obligation under Article 11 of the DSU to make an objective 
assessment of the facts.   
91. With regard to the term "fulfil", the Appellate Body recalled that in "US - Tuna II (Mexico)", 
it had found that, while read in isolation, the word "fulfil" could be understood to signify the complete 
achievement of something, this term was concerned with the degree of contribution that the technical 
regulation made towards the achievement of the le gitimate objective, and that a panel must seek to 
ascertain, from the design, structure, and operation of the technical regulation, as well as from evidence relating to its application, to what degree, if at all, the challenged technical regulation, as 
written and applied, actually contributed to the achieve ment of the legitimate objective pursued by the 
Member.
17  The Appellate Body had subsequently not ed that "because the Panel seems to have 
considered it necessary for the COOL  measure to have fulfilled the objective completely, or satisfied 
some minimum level of fulfilment to be consistent with Article 2.2, it erred in its interpretation of 
Article 2.2".18  Mexico was concerned that a measure not fulfilling its objective but contributing 
minimally to that objective may be considered consis tent with Article 2.2 of the TBT Agreement.  A 
measure that contributed minimally or insignifican tly to the fulfilment of its supposed objective 
created an unnecessary barrier to trade.  In Mexico 's view, the Appellate B ody should have followed 
the Panel's approach in that if a measure did not fulfil its objective, or contributed minimally or insignificantly, it was not necessar y to continue the analysis. 
92. When reversing the Panel's finding that the COOL requirements were inconsistent with 
Article 2.2 of the TBT Agreement, the Appellate Body  had found that due to the absence of relevant 
factual findings by the Panel, and of sufficient undisputed facts on the record, it was unable to complete the legal analysis and determine whether the COOL measure was more trade restrictive than 
necessary to fulfil its legitimate objective.
19  Mexico deeply regretted th is situation and wished to 
emphasize that Article 3.4 of the DSU provided that recommendations or rulings made by the DSB 
shall be aimed at achieving a satisfactory settlement of  the matter, and that, pursuant to Article 2.1 of 
the DSU, the DSB relied on panels and the Appellate  Body to achieve this.  In the present case, the 
Appellate Body had not been in a pos ition to complete its analysis in respect of Article 2.2 of the TBT 
Agreement, as the Panel had made no factual find ings regarding the less restrictive alternatives 
proposed by Mexico.  Therefore, in this particular case, the Panel could not fully complete its task.  
Mexico noted that in the context of the ongoing ne gotiations on clarificati ons and improvements to 
the DSU, there were two proposals on remand which, in light of this case, could be viable for ensuring 
that the Appellate Body completed its analysis in fu ture disputes.  In that respect, Mexico called upon 
Members to consider this case as proof of the need to  find solutions to this problem and to analyse in 
greater detail and more seriously the proposals on remand that some Members had put forward for 
consideration.  In light of the Panel and Appe llate Body's findings and recommendations, Mexico 
hoped that the United States would promptly comply with the DSB's recommendations and that the 
measures taken to comply would be  consistent with the covered ag reements and would lead to the 
satisfactory settlement of this dispute. 
93. The representative of the United States said that  his country would like to thank the members 
of the Panel, the Appellate Body, and the Secretaria t assisting them for their work on this dispute.  
This dispute involved US country of origin labelling (COOL) require ments for beef and pork products 
sold at the retail level.  These requirements a pplied equally to produc ts, whether imported or 
domestic.  As was the case with country of orig in labelling provisions in many Members, they 
allowed consumers to make more informed purch asing decisions about the food they bought.  The 
                                                      
17 Appellate Body Report, para. 373. 
18 Appellate Body Report, para. 468. 
19 Appellate Body Report, para. 491.  WT/DSB/M/320 
 Page 21 
 
 
  United States was pleased that the Panel and the Appe llate Body had both agreed that the objective of 
the COOL measure was to provide consumers info rmation on origin and that they had further 
confirmed that the provision of consumer informati on on the origin of food products was a legitimate 
objective.  The United States was also pleased that the Appellate Body had reversed the Panel's finding that the COOL measure was "more trade rest rictive than necessary" under Article 2.2 of the 
TBT Agreement.  In so doing, the Appellate Bo dy had appropriately concluded that whether a 
measure was "more trade restrictive than necessary" in this case required a comparison of the measure 
at issue with another measure that a complaining party asserted would fulfil the Member's objective at the level the Member considered appropriate, but in a less trade restrictive manner.    
94. With respect to the appeal under Article 2.1 of  the TBT Agreement, concerning whether the 
COOL measure treated imports less favourably th an domestic products, th e Panel and Appellate 
Body's findings and approach raised a number of si gnificant concerns.  The Pa nel and Appellate Body 
had found that the COOL measure had modified th e conditions of competition to the detriment of 
imported products without ever identifying any different treatment under the COOL measure of 
imported livestock from domestic livestock in either a de jure  or de facto  sense.  Instead, the Panel 
and Appellate Body, unlike in any prior GATT or  WTO dispute relating to national treatment, had 
taken an approach where a difference in market im pact was sufficient to establish a breach of national 
treatment obligations.
20  In other words, the identical treatment of like imported and domestic 
products under a measure could no netheless be found to discriminate against imported products if 
there was a different market impact.    
95. The Panel and Appellate Body had not, in their Reports, identified the textual or other basis 
for this novel approach, its implications, or how th is approach would account for the fact that there 
often, if not always, would be different market  impacts on products from different entities from any 
measure.  Further, and as third parties had poi nted out during the appellate proceedings, it was 
inappropriate to fashion a national treatment anal ysis that determined whether a measure was WTO 
inconsistent solely based on the market in whic h it was enacted, for example, whether the Member 
taking the measures had a big or small market or was a big or small producer.  The Appellate Body 
also did not acknowledge that this was a novel an d unprecedented approach.  The previous reports 
cited by the Appellate Body to support its approach21 – such as "Korea - Beef" and "China - Auto 
Parts" – all involved measures that explicitly treat ed imported and domestic products differently on 
their face.  In those prior reports, only after this  different treatment had been established did the 
Appellate Body turn to the question of market impact.22  By contrast, the Appellate Body in this 
dispute had jumped immediately to market impact  without finding any different treatment.  This 
approach would shift the analysis from whether a measure differentiated between products in a 
manner adverse to imports to whether a measure th at did not differentiate between products had the 
same market impact on imports compared to dom estic products.  The national treatment inquiry 
would then become a trade effects test that coul d open to challenge any number of origin-neutral 
measures.  As a result, legislators and regulators w ould not only need to c onsider whether a measure 
treated imports differently and less favourably, but they may also need to conduct a market impact 
analysis of the measures on imports.  That would be a new, significant obligation nowhere agreed to by WTO Members.  The Appellate Body added an additional step to the Panel's analysis and had 
ultimately concluded that the US measure was inc onsistent with Article 2.1 of the TBT Agreement 
because the amount of information the labels conve yed was out of proportion to the administrative 
requirements imposed on upstream producers.  It appear ed to the United States that this issue was far 
attenuated from a national treatment analysis u nder Article 2.1 of the TBT Agreement.   
                                                      
20 Panel Report, para. 7.372. 
21 Appellate Body Report, paras. 286-294. 
22 Korea - Beef (AB), paras. 130-151;  US - FSC (Article 21.5 - EC) (AB), para. 217;  China - Auto 
Parts (AB), paras. 192-197. WT/DSB/M/320 
Page 22  
 
  96. In particular, whether or not the COOL measure's administrative requirements were 
commensurate with the level of information ultimat ely provided to consumers, it was unclear what 
this had to do with the question the Panel and A ppellate Body had been called to examine – whether 
the measure reflected discrimination.  Rather, the United States was greatly concerned that the 
Appellate Body's approach to Article 2.1 of th e TBT Agreement asked adjudicators to review the 
calibration of a measure to risk, cost, and benefit, even if in the end the difference in treatment was 
not related to origin.  Article 2.1 of the TBT Agreement did not create the need or the authority to conduct such an analysis.  Instead, it could set up pa nels and the Appellate Body to be the ultimate 
arbiters of a range of important re gulatory questions, a role that Memb ers had not agreed to provide to 
them under the WTO.  Further, the United States understood that panels and the Appellate Body were 
not equipped to conduct such an inquiry and to second-guess the myriad regulatory issues involved in 
many technical regulations.  A far preferable appr oach to reviewing national treatment claims under 
Article 2.1 of the TBT Agreement would be a retu rn to determining whether a measure at issue 
accorded less favourable treatment that was re lated to the origin of the product.    
97. Finally, in relation to the circulation of these reports beyond the 90-day time-limit set out in 
Article 17.5 of the DSU, the United States said that it would like to recall for Members the 
communications that had been circulated by Canada , Mexico, and the United States in which they had 
confirmed that they, like the Appellate Body
23, each considered the Appella te Body Report in their 
respective dispute to be an Appellate Body Repor t circulated pursuant to Article 17.5 of the DSU.24  
In those communications, the three parties had jointly  stated as follows:  "The parties note that the 
Division hearing this appeal did not consult with them on its need to exceed the 90-day time-limit.  
We consider that, consistent with the practice of Members and the Appellate Body until 2011, the 
Appellate Body should consult with  the parties and obtain their agreement to receive reports that are 
to be circulated after the deadline provided for in the DSU.  We particularly regret the lack of 
consultation with the Division hearing this appeal given that the parties would have been willing to 
positively consider a communication from the Division of its need for additional time.  While we note 
our understanding that further delays will not be re quired in upcoming disputes given the anticipated 
workload of the Appellate Body in  the immediate future, should delays in the circulation of reports 
beyond the 90-day deadline be again considered necessary, we would e xpect a return to the Appellate 
Body's pre-2011 practice".25  Members would recall that at the DSB meeting on 10 July 2012, 
Canada, Mexico, and the United States had expressed th eir concerns relating to the situation in these 
appeals, including only being inform ed towards the end of the appeal period that the Reports would be 
delayed beyond 90 days, and had put forward some  ideas on how Members could begin to address the 
issues raised.  The United States looked forward to  continuing its discussions with any interested 
delegations on how to find solutions to the problem s raised by the recent practice in appeals.  The 
United States thanked the DSB for its attention. 
98. The representative of Costa Rica said that his country had not participated as a third party in 
these disputes and, therefore, it would not comment on the substance of the Reports.  However, 
Costa Rica wished to be associated  with the statements made by the parties to the disputes regarding 
the circulation of the Appellate Body Reports outs ide the 90-day time-limit.  In that regard, 
Costa Rica underlined that Article 17.5 of the DSU clearly stated that in no case shall appeal 
proceedings exceed 90 days.  Costa Rica valued the quality of the Appellate Body reports and understood that, in some cases, the Appellate B ody may face exceptional circumstances that would 
prevent it from meeting the 90-day deadline.  In such  cases, Costa Rica believed that the Appellate 
                                                      
23 WT/DS384/16 (3 July 2012);  WT/DS384/15 (3 July 2012). 
24 Joint communication from Canada and the United St ates, United States – Cert ain Country of Origin 
Labelling (COOL) Requirements, WT/DS384/17 (3 July 2012);  Joint communication from Mexico and the 
United States, United States – Certain Country of  Origin Labelling (COOL) Requirements, WT/DS386/16 
(3 July 2012). 
25 WT/DS384/17;  WT/DS386/16 (footnotes omitted).  WT/DSB/M/320 
 Page 23 
 
 
  Body should seek consent from the parties to the dispute and in form the DSB of the reasons for the 
delay.  This would ensure the legal certainty of  the reports and transparency for all Members.  
Therefore, Costa Rica supported the proposal to continue discussions on this matter with a view to finding a solution to this situation. 
99. The representative of the European Union said that  the EU had participated as a third party in 
these disputes due to the systemic issues raised and the interpretation of the relevant obligations set 
out in Articles 2.1 and 2.2 of the TBT Agreement, as well as Articles X:3(a) and XXIII:1(b) of the GATT 1994.  The EU was satisfied with the Appellate  Body's consistency in the three recent TBT 
cases including the "US - Clove Cigarettes" and "US - Tuna II (Mexico)" cases.  In particular, the Appellate Body had confirmed that, for a finding of  less favourable treatment under Article 2.1 of the 
TBT Agreement, it was not sufficient that a technical regulation had a detrimental impact on imported 
products, but also that this detrimental impact di d not stem exclusively from a legitimate regulatory 
distinction.  In the circumstances of these disputes,  the Appellate Body had correctly concluded that, 
when a measure arbitrarily and unjustifiably di scriminated against imported products, such 
detrimental impact was not even-handed and, acco rdingly, must not be considered as stemming 
exclusively from a legitimate regulatory distinction.   
100. With regard to Article 2.2 of the TBT Agreem ent, the EU welcomed the Appellate Body's 
clarifications on the interpretation of key normative elements in that provision, in particular the 
notion:  "to fulfil a legitimate objective" as the degr ee the measure at issue actually contributed to the 
achievement of a legitimate objective.  Likewise, the Appellate Body had co rrectly interpreted the 
notion of "necessity" in that provision as involving a comparison of the trade-restrictiveness and the 
degree of achievement of the measure at issue, with  that of a possible alternative measure.  The EU 
was also satisfied with the interpretation of "l egitimate objective" as including the provision of 
information to the consumer on the origin of a product.    
101. The United States and Costa Rica had just mentioned how important it was to respect 
Article 17.5 of the DSU regarding the 90-day deadline and the need to ensure appropriate 
transparency.  The EU also consid ered that deadlines set out in the DSU relating to the time-limits for 
Panel and the Appellate Body repor ts were important a nd should be respected as far as objectively 
possible.  That being said, it was also true that  there were circumstances where the Appellate Body 
was simply objectively unable to meet the 90-day de adline, if it was to perform its obligations under 
Article 17.12 of the DSU to "address each of the issues raised" and, as set out in Article 3.2 of the DSU, to "preserve the rights and obligations of Members".  Concretely, the EU was thinking about 
situations such as the simultaneous filing of more  appeals than the Appellate Body was objectively 
able to handle, or filing of individual appeals th at were so voluminous and complex that even the 
entire devotion of the Appellate Body's resources woul d be insufficient to fulf il its tasks within the 
90-day deadline.  Exceeding the 90-day deadline s hould not and could not call into question the 
"rules-based multilateral trading system" or, for that matter, Article 17.14 of the DSU, as 
demonstrated by the adoption of the Appellate Body reports at the present meeting.  In fact, the EU 
considered that a high-quality Appellate Body report , albeit slightly late, contributed more to the 
rules-based trading system than a poor-quality repor t issued within 90 days.  In those cases where the 
Appellate Body needed to exceed the 90 days, the EU  trusted that the Appellate Body would deal with 
the issue in fairness and would provide the necessary tr ansparency.  In that regard, the EU noted that 
all WTO Members had already been fully inform ed about the timing of this Report in the 
communication from the Appellate Body of 23 May 2012
26, which was publicly available on the 
WTO website.  Finally, with regard to the cons tructive proposal from Canada to examine how to 
address delays in the system as a whole in the futu re, the EU stood ready to participate actively and 
positively in such discussions. 
                                                      
26 WT/DS384/14 and WT/DS386/13. WT/DSB/M/320 
Page 24  
 
  102. The representative of Japan said that his country  thanked the Panel, the Appellate Body and 
their respective Secretariats for their hard work on the Reports.  Japan had participated in these 
dispute settlement proceedings as an interested th ird party.  Although Japan was still analysing the 
Appellate Body's findings, it wished to make two preliminary observations.  First, Japan observed 
that, following its previous findings in "US - Cl ove Cigarettes" and "US - Tuna II (Mexico)", the 
Appellate Body continued to emphasize the need to inquire the measure's "even-handedness" in the 
analysis of no less favourable treatment requi rement under Article 2.1of the TBT Agreement.27  The 
Appellate Body further clarified, in the present Re ports, that the complainant could demonstrate the 
measure's lack of "even-handedn ess" by showing "for example"28 that the measure "is designed or 
applied in a manner that constitutes a means of arbitrary or unjustifiable discrimination"29, and upon 
such showing the regulatory distinction under th e measure "cannot be considered 'legitimate'".30  
Therefore, "even-handedness" appeared to primarily  relate to, and be for discerning, the "legitimacy" 
of regulatory distinction.  However, it was still not clear as to what the precise content or scope of the notion of "even-handedness" would be in the analys is of "less favourable treatment" under Article 2.1 
of the TBT Agreement.  The notion of "even- handedness", which was not treaty language, would 
appear to be rather an analytical tool, albeit useful , to determine a violation of Article 2.1 of the TBT 
Agreement, specifically whether the detrimental impacts stemmed exclusively from the legitimate 
regulatory distinction.  
103. Second, with respect to the issue relating to Article 17.5 of the DSU which previous speakers 
had just referred to, Japan appreciated that the h eavy workload and complexities of appeals had been 
posing a difficult challenge that may require additiona l time for the Appellate Body to produce a high-
quality report.  Japan valued the high quality of  the Appellate Body reports, and commended the 
tireless efforts to seek excellence of th eir work by the Appellate Body and its Secretariat.  However, it 
should also be recalled that Article 3.3 of the DSU set out the general principle of the "prompt 
settlement" of disputes in WTO dispute settlement, a nd the time-limits in the process provided for in 
the DSU provisions, including the time-period in Ar ticle 17.5 of the DSU, were specific expressions 
of this general principle of "prompt settlement".  Parties' interests in "prompt settlement" of disputes 
reflected in the DSU were also recognized by the Appellate Body as a legitimate due process 
interest.
31  Furthermore, the 90-day time-limit imposed on the Appellate Body and also on parties to 
the dispute was written in categorical terms.  Beca use of this categorical language and the general 
principle of "prompt settlement", and the adjudicatory function assumed by the Appellate Body to decide the consistency or inconsistency of WTO Members' measures with a covered agreement, any 
departure from the clear text of the DSU must be of temporal or emergenc y nature and should be 
limited to address exceptional circumstances.  Japan al so noted that the parties had voluntarily agreed 
amongst themselves to deem the Reports to be consis tent with Article 17.5 of the DSU.  However, 
Japan believed that, in the interest of legal cer tainty on the DSB's adoption process for Appellate 
Body reports, it was important and, even essential, that the Appellate Body would seek to secure the 
agreement of the parties to deem the reports to be  issued within 90 days, as had been the customary 
practice of the Appellate Body before 2011.  Fi nally, since the 90-day issue concerned systemic 
interests that all Members should and did share, the underlying problems, including those identified 
by the parties at the previous DSB meeting, must be discussed by Members so as to find a solution to 
this issue.  Japan stood ready to engage in such discussions.  
104. The representative of Australia said that, like previous speakers, his country thanked the 
Panel, Appellate Body and the Secretariat for thei r work in finalizing these Reports.  Australia had 
participated as a third party in these disputes and welcomed the findings in these disputes as well as 
                                                      
27 Appellate Body Report, e.g. paras. 271, 272, 341 and 349.  
28 Appellate Body Report, e.g. paras. 271, 272 and 341. 
29 Appellate Body Report, para. 271. 
30 Appellate Body Report, para. 271. 
31 Appellate Body Report, Thailand - Cigarettes, para. 150.  WT/DSB/M/320 
 Page 25 
 
 
  the guidance that had been provided by the Appellate  Body over the recent trilogy of cases in relation 
to the interpretation of Article 2 of the TBT Agre ement.  As had been done on a number of occasions, 
Australia wished to, once again, express its appreciati on for the excellent work of the Appellate Body.  
However, Australia also noted that the Appellate  Body had on some occasions not been able to 
circulate its reports within the 90-day time-frame set out in Article 17.5 of the DSU, in particular in 
times of heavy workloads, and this again was the cas e in the COOL disputes.  The higher than usual 
workload had been compounded by the increasing le gal and factual complexity of recent cases.  
While, in Australia's view, ensuring that Appellate Body reports were of the highest possible quality 
remained critical, Australia continued to hope that  the Appellate Body would do all it could to meet 
the 90-day time-frame.  Given that the Appellate  Body was currently moving into a period of 
relatively reduced workload, Australia hoped that th is would be achievable in the near future.  
Australia also wished to encourage the Appellate  Body, as soon as it was apparent that it may be 
difficult to meet the 90-day time-frame, to consult as soon as possible with the parties to the dispute 
about the status and likely timing of the circulation of the Appellate Body report.  In addition, the 
DSB should be kept apprised of the outcome of such consultations.  This  practice would provide 
important transparency to Appellate Body pro cesses.  Australia remained willing to continue 
discussions with other Members with a view to expl oring ways to ensure that the dispute settlement 
system was best able to meet the fundamental objective of the prompt settlement of disputes. 
105. The representative of Guatemala said that his c ountry thanked the Panel, the Appellate Body 
and the Secretariat for the Reports, which would be  adopted at the present meeting.  Guatemala had 
participated as a third party in these disputes, wh ich concerned Article 2 of the TBT Agreement, and 
noted the findings in this regard.  Like other delegations, Guatemala wished to express its concern 
regarding the way the 90-day time-period, provided for in Article 17.5 of the DSU, had been extended.  As indicated on various occasions, it was clear that Article 17.5 of the DSU did not allow for any exceptions.  It was a mandatory provision that had to be complied with.  Guatemala was, 
however, aware of the fact that, under certain circ umstances, the Appellate Body may require more 
time to produce its reports.  Guatemala was not sure why past practice in this regard, which worked 
well, had been changed.  The practice was not perfect, but provided certainty and ensured transparency for Members.  In Guatemala's view, the need to consult with the parties to a dispute did 
not mean that the Appellate Body had to obtain th e parties' agreement in order to extend the 90-day 
deadline.  It was clear that the AB reports would be adopted by the DSB and accepted without condition by the parties to the dispute unless the DS B decided by consensus not to adopt them.  
Therefore, the absence of the parties' agreement rega rding the extension of the 90-day period provided 
for in Article 17.5 of the DSU would not affect or  prevent the adoption of the reports unless the DSB 
decided by consensus not to adopt such reports. 
106. The representative of Brazil said that her country  wished to be associated with the statement 
made by the EU regarding the 90-day deadline.  Br azil believed that the need to comply with the 90-
day time-period should not affect the high-quality of  the Appellate Body reports.  Since delays 
occurred, and Brazil noted that there had been 18 cases in the total history of the WTO, Members 
should try to address the reasons for such delays.  In  particular, Members needed to recognize the fact 
that the increasing complexity of the cases had made  the deadline under Article 17.5 of the DSU not 
realistic in some cases.  Brazil believed that the d eadline should either be extended or more flexibility 
should be allowed.  Another possibility would be to provide the Appellate Body with the necessary 
resources to enable it to complete its task in a timely manner, while ensuring that the reports were of 
the same high quality.  Brazil believed that the current procedures by which the Appellate Body 
informed the parties of the delays were appropriate and should be sufficient.  There was no need to 
seek the parties' agreement.  Brazil also believed that there was no relationship between the deadline 
in Article 17.5 of the DSU and the negative consensus rule in Article 17.14 of the DSU. 
107. The representative of China said that her country  would not comment on the substance of the 
Panel and Appellate Body Reports, but wished to express systemic  concerns about the understanding WT/DSB/M/320 
Page 26  
 
  of Article 17.5 of the DSU.  China recognized the categorical nature of Article 17.5 of the DSU and 
said that perhaps the negotiators in the Uruguay Rou nd wished to set a strict deadline for circulation 
of Appellate Body reports to ensure that the Appellate Body's work was conducted in a timely 
manner.  This was important and th e Appellate Body had respected that time-frame.  The efficiency of 
the Appellate Body's work had been highly recogni zed by Members and other international dispute 
settlement forums.  It was commendable to recognize  the AB achievements accomplished within the 
short time-frame to resolve complicated disputes among Members.  However, Members needed to 
recognize that currently it was not possible to resolv e all disputes within 90 days.  The two large Civil 
Aircraft cases were good examples that this ti me-frame, which had been negotiated during the 
Uruguay Round, was not compatible with the curr ent practices and the complexity of the cases 
appealed before the Appellate Body.  Thus, the i ssue was how to reconcile the time-frame stipulated 
in the DSU and the current difficulties in practice.   
108. With respect to the due process issue that had been identified by some Members, China noted 
that the Appellate Body had notified Members, ei ther in person or by letter to the DSB Chair 
regarding delays.  While, it was desirable for the pa rties to meet with the Appellate Body Secretariat 
to discuss such matters, China did not agree with some delegations who claimed that the Appellate 
Body was under obligation to hold consultations in orde r to seek the parties' consent regarding delays.  
China believed that sometimes it was impossible fo r the parties to find agreement on this.  As 
indicated by the EU, the rigidity of the time-frame under Article 17.5 of the DSU and the requirement 
for the Appellate Body to review each and every issue appealed, according to Article 17.12 of the 
DSU, was an issue which could be considered by the DSB.  China agreed with Brazil that Members 
should examine whether the resources of the Appellate Body to address the case lo ad were sufficient.  
China would always prefer high-quality reports to be  circulated by the Appellate Body.  China agreed 
with Brazil that there was no linkage between Ar ticle 17.5 of the DSU and the negative consensus 
rule when adopting the report under Article 17.14 of the DSU.  China would work constructively with 
Members on this issue. 
109. The representative of Turkey said that, with regard to the 90-day time-limit, no Member 
questioned the quality of the Appellate Body reports or  the quality of the work of the Appellate Body.  
All Members appreciated the work of the Appellate Bo dy and the quality of its reports.  Turkey noted 
that some Members had mentioned that the Appella te Body had not been able to meet the 90-day 
time-limit in 18 cases.  In Turkey's view, this showed that the Appellate Body had violated 
Article 17.5 of the DSU 18 times.  Turkey ackno wledged that there had been times when the 
Appellate Body was faced with problems and challenges in an effort to meet the 90-day time-limit.  In 
Turkey's view, Article 17.5 of the DSU was clear and should be respected.  Turkey noted that the 
Appellate Body could not make rules, but Members c ould and, therefore, Turkey was ready to engage 
in further discussions with other Members to review  Article 17.5 of the DSU in order to take into 
account the reality and needs of the current situation.    
110. The DSB took note of the statements, and adopte d the Appellate Body Reports contained in 
WT/DS384/AB/R – WT/DS386/AB/R and the Pa nel Reports contained in WT/DS384/R – 
WT/DS386/R, as modified by the Appellate Body Reports. 
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