RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/DSB/M/178 
17 January 2005 
 (05-0188) 
Dispute Settlement Body 
24 and 26 November 2004  
 
 
 
MINUTES OF MEETING 
 
Held in the Centre William Rappard  
on 24 and 26 November 2004  
 
Chairperson:  Ms Amina Mohamed (Kenya) 
 
 
 Prior to the adoption of the agenda, the Chairperson  said that, in light of certain differences, 
the consideration of the item related to the requ ests for suspension of tariff concessions and other 
obligations vis-à-vis  the United States in the Byrd Amendment dispute would have to be postponed in 
order to enable further consultations in an effort to  finding a solution.  Accord ingly, she proposed that 
the DSB agree to suspend the proceedings of the present meeting in respect of the agenda item to 
which she had just referred with a vi ew to re-convening as soon as possible. 
 
 The DSB so agreed .  
 Subjects discussed
: Page  
 
1. Surveillance of implementation of recommendations adopted by the DSB.........................2  
(a) United States – Anti-Dumping Act of 1916:  Status report by the United States ......................2  
(b) United States – Section 211 Omnibus Appropr iations Act of 1998:  Status report by 
the United States ............................................................................................................. ...........3  
(c) United States – Anti-dumping measures on certain hot-rolled steel products from 
Japan:  Status report by  the United States ..................................................................................4  
(d) United States – Continued Dumping and Subsidy Offset Act of 2000:  Status report 
by the Unite d Stat es .......................................................................................................... .........5  
(e) United States – Section 110(5) of the US Copyright Act:  Status report by the United 
States ........................................................................................................................ ..................7  
(f) United States – Final countervailing duty determination with respect to certain 
softwood lumber from Canada:  Status report by the United States ..........................................7  
2. Adoption of the 2004 draft Annual Report of the DSB ........................................................7  
3. Proposed nomination for the indicative list of governmental and non-governmental panelists .................................................................................................... 8
 
4. United States – Tax treatment for "Foreign Sales Corporations".......................................8  
(a) Statement by the United States regarding the implementation of the DSB's 
recommendations and rulings .................................................................................................... .8 
 
 WT/DSB/M/178 
Page 2  
 
  
5.
 United States – Continued Dumping and Subsidy Offset Act of 2000 ...............................10  
(a) Recourse to Article 22.7 of the DSU by Brazil ........................................................................10  
(b) Recourse to Article 22.7 of the DSU by the European Communities ......................................10  
(c) Recourse to Article 22.7 of the DSU by India .........................................................................10  
(d) Recourse to Article 22.7 of the DSU by Japan ........................................................................10  
(e) Recourse to Article 22.7 of the DSU by Korea ........................................................................10  
(f) Recourse to Article 22.7 of  the DSU by Canada .....................................................................10  
(g) Recourse to Article 22 of  the DSU by Mexico .........................................................................10  
 
1. Surveillance of implementation of recommendations adopted by the DSB 
(a) United States – Anti-Dumping Act of 1916:   Status report by the United States 
(WT/DS136/14/Add.32 – WT/DS162/17/Add.32) 
 (b) United States – Section 211 Omnibus Appropr iations Act of 1998:  Status report by the 
United States (WT/DS176/11/Add.25) 
 (c) United States – Anti-Dumping Measures on Certain Hot-Rolled Steel Products from Japan:  
Status report by the United States (WT/DS184/15/Add.25) 
 (d) United States – Continued Dumping and Subsid y Offset Act of 2000:  Status report by the 
United States (WT/DS217/16/Add.10 – WT/DS234/24/Add.10) 
 (e) United States – Section 110(5) of the US Copyright Act:  Status report by the United States 
(WT/DS160/24) 
 
(f) United States – Final countervailing duty dete rmination with respect to certain softwood 
lumber from Canada:  Status report by the United States (WT/DS257/14) 
 1. The Chairperson
 recalled that Article 21.6 of the DSU required that "unless the DSB decides 
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 establishment of the reasonable 
period of time pursuant to paragraph 3 and shall remain on the DSB's agenda until the issue is 
resolved".  She proposed that the six sub-items  to which she had just referred be considered 
separately. 
(a) United States – Anti-Dumping Act of 1916:  Status report by the United States 
(WT/DS136/14/Add.32 – WT/DS162/17/Add.32) 
2. The Chairperson  drew attention to document WT/D S136/14/Add.32 – WT/DS162/17/Add.32, 
which contained the status report by the United St ates on progress in the implementation of the DSB's 
recommendations in the case concerning the US Anti-Dumping Act of 1916.  
3. The representative of the United States  said that her country was pleased to report that, since 
the United States had submitted its status report in these disputes on 10 November 2004, the US 
Congress had completed steps to repeal the 1916 Act, thereby implementing the DSB's 
recommendations and rulings in this matter.  On  Friday, 19 November 2004, the US Senate had 
passed the Miscellaneous Trade and Technical Corre ctions Act of 2004, which included a provision  WT/DSB/M/178 
 Page 3 
 
 
 repealing the 1916 Act.  The US House of Re presentatives had earlier approved the Act, on 
8 October 2004.  The President would be signing the Act in the near future. 
4. The representative of the European Communities  said that the EC welcomed the repeal of the 
1916 Anti-Dumping Act by the US Congress.  The EC hoped that the US administration would now stand by its declaration made in the DSB and would take the necessary final steps for that repeal to 
become effective.  The EC noted that the repeal w ould not affect on-going court cases.  In this respect, 
the EC wished to make clear that its satisfac tion expressed at the present meeting should not be 
understood as a change of the EC's position, namely , that a proper solution to this case called for a 
repeal of the 1916 Anti-Dumping Act and a termination of the on-going court cases.  The issue had become moot for the EC since to the best of the EC's knowledge no cases were currently active 
against the EC companies.  Therefore, no further action on the part of the EC would appear to be 
necessary.  However, the EC reserved its rights if it became apparent that there were cases currently 
open against the EC companies 
5. The representative of Japan
 said that his country welcomed the fact that the Conference 
Report, which contained the bill, Miscellaneous Ta riff Act, H.R. 1047, repealing the 1916 Anti-
Dumping Act, had been passed by the US Hou se of Representatives on 8 October, and then on 
19 November, in the US Senate.  Japan urged the Unite d States to put this bill into effect as soon as 
possible.  However, Japan must again register its regret over continued suffering imposed upon the  
Japanese company, as a result of the judgment by a Fe deral District Court in the state of Iowa, in 
May 2004, upholding the order im posing on that Japanese company a payment of damages amounting 
to US$30 million.  The fact was that the bill, whic h had just been passed in the House and in the 
Senate, had explicitly stated that "the repeal made  shall not affect any action under Section 801 of the 
Act that was commenced before the date of the enactment of that  Act and is pending on such date".  
More simply, the bill did not have any retroactive effect and did not save that Japanese company from 
the judgment issued in May.  Japan had repeatedly  asked the United States to take some action in 
order to prevent such incidents from recurring, in case the bill repealing the 1916 Anti-Dumping Act 
did not apply retroactively.  To Japan's regret, so far, the United States had not taken any positive step 
to respond to Japan's calls in this regard.  At the pr esent meeting, Japan wished to reiterate its call for 
the United States to do its utmost in order to prevent further damages from being inflicted upon Japanese companies. 
6. The DSB took note
 of the statements.  
(b) United States – Section 211 Omnibus Appropria tions Act of 1998:  Status report by the 
United States (WT/DS176/11/Add.25) 
7. The Chairperson  drew attention to document WT/DS176/11/Add.25, 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. 
8. The representative of the United States  said that her country had provided a status report in 
this dispute on 10 November 2004, in accordance with  Article 21.6 of the DSU.  As noted in the 
report, legislation amending or repealing Section 211 was pending in the US Senate and the US House 
of Representatives, and the Senate had held hear ings on this legislation in July.  The US 
administration would continue to work with the US Congress concerning appropriate statutory 
measures to resolve this matter. 
9. The representative of the European Communities  said that time for action was running out.  
He noted that the time-period for implementing the DSB's recommendations in the dispute under 
consideration would expire at the end of 2004.  Th e EC recalled that two bills pending respectively in 
the Senate and in the House of Representatives would allow to bring a solution to this dispute to the WT/DSB/M/178 
Page 4  
 
 benefit of all.  The enactment of the "US - Cuba  Trademark Protection Act" would not only repeal 
Section 211, a special interest and discriminatory le gislation.  It would also ensure enhanced and 
effective protection of intellectual property rights bot h in Cuba and in the United States.  Passage of 
these bills would also demonstrate that the United St ates was eager to provide to others an efficient 
and non-discriminatory protection of intellectual prope rty rights, which it was promoting worldwide.  
The EC expected that the US administration w ould support the "US - Cuba Trademark Protection 
Act" as an appropriate solution to this dispute. 
10. The representative of Cuba
 said that her delegation wished to point out that the objective of 
the dispute settlement mechanism was to secure pr ompt and positive solutions to disputes, thereby 
guaranteeing security and predictability in the multilate ral trading system.  However, the US status 
report, far from reporting on progress made, was conf ined to repeating litera lly the same excuses 
already contained in previous reports.  She noted that the third time-period granted for compliance 
with the DSB's recommendations would expire in  December 2004.  The US failure to comply 
highlighted, yet again, the US indifference and disr espect for the WTO obligations.   It was also a 
clear sign of indolence in the face of claims by its own companies, which saw the fate of their 
trademarks jeopardized in Cuba, as had already been  stated by representatives of those companies in 
the US Senate Judicial Committee and indicated in some  articles published in the US press.  It was an 
open secret that Section 211, which Cuba had alread y denounced in the DSB, had been made to meet 
the interests of a non-US company –  the Bacardi Company – which had for decades been involved in 
shady political intrigues against Cuba.  Furthermore,  in the area of trade, it was the only one that 
benefited from the Act, that had prevented free and fair competition on the US territory in products 
covered by the "Havana Club" trademark, lawfully re gistered in that country after a declaration of 
legal abandonment by its original owner, Arechab ala S.A.  Section 211 was in breach of the 
internationally accepted principle that the original owners of abandoned trademarks lacked any rights 
to use them. Cuba condemned, once again, the abse nce of any progress by the United States in this 
dispute. Convinced that this legal mess was inadmi ssible, Cuba continued to maintain that the only 
possible solution to this dispute was to repeal Section 211. 
11. The DSB took note  of the statements and agreed  to revert to this matter at its next regular 
meeting. 
(c) United States – Anti-dumping measures on certain hot-rolled steel products from Japan:  
Status report by the United States (WT/DS184/15/Add.25) 
12. The Chairperson  drew attention to document WT/DS184/15/Add.25, 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. 
13. The representative of the United States  said that her country had provided a status report in 
this dispute on 10 November 2004, in accordance with Article 21.6 of the DSU.  The US administration would continue to work with th e US Congress with respect to the recommendations 
and rulings of the DSB that had not been  already addressed by the US authorities by 
23 November 2002. 
14. The representative of Japan
 said that, in July 2004, it had been agreed that the reasonable 
period of time for the United States to secure the DSB's recommendations and rulings be re-extended 
until 31 July 2005.  Japan had, by no means, taken li ghtly the fact that the United States had twice 
missed its deadline for compliance.  On the contrary , Japan had agreed to the extension of the time-
period on the premise that the United States woul d fully implement the DSB's recommendations and 
rulings during the third reasonable period of time, at  long last. Japan noted the US status report,  
which stated that the US administration continued to support specific legislative amendments with 
respect to the US anti-dumping statute and wa s working with the US Congress to pass these  WT/DSB/M/178 
 Page 5 
 
 
 amendments.  Almost identical words had been rep eated by the United States at each  DSB meeting.  
It would be an understatement to say that Japan was extremely dismayed by the fact that it was yet to 
see a bill that would rectify the violation by the Un ited States of the WTO law.  The United States 
must recognize that every delay in implementation undermined the credibility of the WTO dispute settlement mechanism.  This was a regrettable situat ion indeed.  If by the end of the reasonable period 
of time, the United States fell short of fully-fle dged implementation, Japan would have no option, but 
to have recourse to the relevant provisions provided for under the DSU. 
15. The DSB took note
 of the statements and agreed  to revert to this matter at its next regular 
meeting. 
(d) United States – Continued Dumping and Subsidy Offset Act of 2000:  Status report by the 
United States (WT/DS217/16/Add.10 – WT/DS234/24/Add.10) 
16. The Chairperson  drew attention to document WT/D S217/16/Add.10 – WT/DS234/24/Add.10, 
which contained the status report by the United St ates on progress in the implementation of the DSB's 
recommendations in the case concerning the US Conti nued Dumping and Subsidy Offset Act of 2000. 
17. The representative of the United States  said that her country had provided a status report on 
10 November 2004, in accordance with Article 21.6 of the DSU.  As noted in the report, on 
19 June 2003, legislation to bring the Continued Dumping and Subsidy Offset Act into conformity 
with US WTO obligations had been introduced in the US Senate (S. 1299).  On 10 March 2004, 
legislation repealing the CDSOA had been intr oduced in the US House of Representatives 
(H.R. 3933).  In addition, on 2 February 2004, th e US administration had, once again, proposed 
repeal of the CDSOA in its budget proposal for fiscal year 2005.  The US administration would 
continue to work with Congress to achieve furt her progress in resolving these disputes with the 
complaining parties. 
18. The representative of the European Communities  said that the EC wished to reserve its 
intervention on the CDSOA case in the context of the agenda item regarding the EC's recourse to 
Article 22.7 of the DSU and would, consequently, not elaborate at this stage.  The EC only wished to 
note with great disappointment that the US status report  could, again, be described in two words:  i.e. 
no progress. 
19. The representative of Chile  said that, once again, his country was obliged to express concern 
about the lack of progress in complying with the DS B's recommendations and rulings in this dispute.  
With a few days left before the end of the session of the US Congress, neither of the two Chambers 
had discussed the bills mentioned in the US stat us report.  Indeed, recently the US Congress had 
adopted the Omnibus Appropriations Bill for Fi scal Year 2005, which was one of the last 
opportunities to approve a repeal of the Byrd Ame ndment, as proposed by the US administration early 
in the year.  Unfortunately, this option was now lost. In the course of the present meeting, under 
another agenda item, seven Members would be re questing authorization from the DSB to suspend 
concessions or other obligations vis-à-vis  the United States due to the lack of compliance for almost a 
year.  As confirmed in the recent award of the ar bitrator, the Byrd Amendment caused economic harm 
to those Members who were subject to anti-dum ping and countervailing measures, because the duties 
charged were being given to US firms competing with exporters from those countries.  Chile supported the seven requests for re taliation and was still assessing what steps to take and was 
consulting with all interested sectors in the hope of  reaching a prompt decision.  Chile reiterated its 
call for  the United States to comply as soon as po ssible and to redouble its efforts so that the 
elimination of the CDSOA would be approved in the few days that had been left before the end of the 
current legislative session.  Chile would closely fo llow the next steps by the US administration and 
the US Congress.  If no proper progress was made, Chile  would be obliged to use its rights and would WT/DSB/M/178 
Page 6  
 
 join Brazil, Canada, the EC, Korea, India, Japan  and Mexico in requesting authorization from the 
DSB to apply tariff surcharges on certain products from the United States.  
20. The representative of Canada
 said that in what had become a constant refrain, Canada 
continued to be disappointed by the failure of the United States to bring itself into compliance with its 
obligations under the WTO Agreement.  Canada wa s all the more concerned because, as a result of 
the US failure, Canada had been put in the undesi rable position of seeking authorization to retaliate, 
pursuant to the Award of the Arbitrator.  The amounts at issue were not insignificant.  To date, nearly 
US$3 billion in duties had been collected in one sector  alone.  Canada certainly hoped that the United 
States would repeal the offending measure before fu rther illegal disbursements were to be made, and 
before Canada was forced to  take additional measures. 
21. The representative of Japan  said that much to his country's dismay, the most recent status 
report of the United States had again failed to provide any information on progress toward the 
implementation of the DSB's recommendations and ruli ngs in this proceeding.  He recalled that the 
United States should have complied with th e DSB's recommendations and rulings before 
27 December 2003.  Despite repeated calls by Japan  and other co-complainants, the United States had 
not shown any tangible proof to that effect.  This was a very serious situation that Japan and the whole 
Membership could not overlook.  As notified, Japan , together with Brazil, Canada, the EC, India, 
Korea and Mexico had requested authorization from the DSB to suspend concessions or other 
obligations, following the Arbitrator's Award on th e level of such suspension.  These requests had 
been placed on the agenda of the present meeting and Jap an wished to revert to these issues at a later 
stage.  Japan hoped that the United States would take seriously the fact that these seven Members 
were making such requests.  Japan urged the United States to make every effort to have the CDSOA 
repealed as soon as possible. 
22. The representative of Brazil  said that his country wished to put on record its disappointment 
with the continued lack of compliance by the United Stat es in this matter.  Brazil wished to recall that 
almost one year had already passed since the end of  the reasonable period of time for compliance and 
more than one billion dollars had already been disbursed under that illegal measure. 
23. The representative of India  said that his delegation wished to join previous speakers in 
expressing disappointment that no further progress had been made by the United States to repeal the CDSOA.  India would request the United States to  redouble its efforts to repeal the CDSOA and to 
bring its measure into consistency and conformity with the WTO Agreements. 
24. The representative of Korea
 said that his country was disappointed that no progress had been 
made by the United States towards implementation in  the Byrd Amendment dispute.  Therefore, the 
complaining parties were making recourse to Article 22.7 of the DSU.  Korea urged the United States 
to redouble its efforts to bring its measures into conformity with the DSB's rulings and 
recommendations. 
25. The representative of Malaysia  said that her delegation wished to express her country's 
disappointment with the lack of progress on this ma tter.  Malaysia would like to encourage the United 
States to bring its anti-dumping legislation into c onformity with the Anti-Dumping Agreement and the 
Subsidies Agreement, as soon as possible, in line with the DSB's recommendations. 
26. The DSB took note  of the statements and agreed  to revert to this matter at its next regular 
meeting.  WT/DSB/M/178 
 Page 7 
 
 
 (e) United States – Section 110(5) of the US Copyright Act:  Status report by the United States 
(WT/DS160/24) 
27. The Chairperson  drew attention to document WT/DS160/24, 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. 
28. The representative of the United States  said that her country had provided a status report in 
this dispute on 10 November 2004, in accordance with  Article 21.6 of the DSU.  As noted in the 
report, the US administration had been consulti ng with the US Congress on this matter.  The US 
administration would continue to work with the US Congress and confer with the EC in order to reach 
a mutually satisfactory resolution of this matter. 
29. The representative of th e European Communities  said that the status report submitted by the 
United States could not be more disappointing:  i.e.  three years after the adoption of the Panel Report, 
the United States had merely stated that it was cons ulting with the US Congress with a view to finding 
a solution.  Unfortunately, the EC was bound to note that compliance with WTO rulings was not a top priority for the United States.  Moreover, it was ironic that one of the Members that put most 
emphasis on the worldwide protection of intellectual property rights was also the Member with the 
worst record as regards non-implemented adverse ru lings on TRIPS matters.  Charity must start at 
home.  The US legitimacy to ask  for respect of TRIPS obligations would be questioned as long as the 
United States did not take the necessary steps to bring its legislation into compliance with its 
international obligations.  However, the EC was, of  course, ready to hold discussions with the United 
States with a view to finding a solution to this dispute. 
30. The DSB took note
 of the statements and agreed  to revert to this matter at its next regular 
meeting. 
(f) United States – Final countervailing duty dete rmination with respect to certain softwood 
lumber from Canada:  Status report by the United States (WT/DS257/14) 
31. The Chairperson  drew attention to document WT/DS257/14, which contained the status 
report by the United States on progress in the impl ementation of the DSB's recommendations in the 
case concerning final countervailing duty determinati on with respect to certain softwood lumber from 
Canada. 
32. The representative of the United States  said that her country had provided a status report on 
10 November 2004, in accordance with Article 21.6 of the DSU.  As noted in the report, the US Department of Commerce had been collecting and analyzing information relevant to the DSB's 
recommendations and rulings in its countervailing dut y investigation of softwood lumber products 
from Canada and, on the basis of that informati on, it intended to issue a determination in that 
investigation in the near future.  Indeed, the US Department of Commerce had already drafted a 
determination, and had provided that draft to the in terested parties in the investigation for comments. 
33. The DSB took note
 of the statement and agreed  to revert to this matter at its next regular 
meeting. 
2. Adoption of the 2004 draft Annual Report of the DSB (WT/DSB/W/269 and Add.1) 
34. The Chairperson  recalled that, in pursuance of the Procedures for an Annual Overview of 
WTO Activities and for Reporting under the WTO contained in document WT/L/105, she was submitting for adoption the draft text of the 2004 Annual Report of the DSB contained in document 
WT/DSB/W/269 and Add.1.  This report covered the work of the DSB since the previous Annual WT/DSB/M/178 
Page 8  
 
 Report contained in documents WT/DSB/34, WT/D SB/35 and Add.1.  For practical purposes, the 
overview of the state of play of WTO disputes c overing the period from 1 January 1995 to 31 October 
2004, prepared by the Secretariat on its own res ponsibility, was included in the addendum to this 
report.  She proposed that after the adoption of  the Annual Report at the present meeting, the 
Secretariat be authorized to update this Report under its own responsibility in order to include actions 
taken by the DSB at the present meeting.  The updated Annual Report of the DSB would then be 
submitted for consideration by th e General Council at its meeting in December 2004.  Finally, she 
said that it was her understanding that the Secretariat had already received some comments of a typographical nature on the draft Annual Report, wh ich would be taken into account in the final 
version of the Annual Report. 
35. The DSB took note
 of the statement and adopted  the draft Annual Report of the DSB 
contained in WT/DSB/W/269 and Add.1 on the unders tanding that it would be further updated by the 
Secretariat1.  
3. Proposed nomination for the indicative list of governmental and non-governmental 
panelists (WT/DSB/W/270) 
36. The Chairperson  drew attention to document WT/DSB /W/270 which contained an additional 
name proposed for inclusion on the indicative list, in  accordance with Article 8.4 of the DSU.  Unless 
there was any objection, she proposed that the DSB approve the name contained in document WT/DSB/W/270. 
37. The DSB so agreed
.  
4. United States – Tax treatment for "Foreign Sales Corporations" 
(a) Statement by the United States regarding the implementation of the DSB's recommendations 
and rulings  
38. The representative of the United States , speaking under "Other Business", said that in 
connection with the dispute on:  "United States – Tax Treatment for 'Foreign Sales Corporations'" 
(DS108), her delegation was pleased to inform th e DSB that on 22 October 2004, President Bush had 
signed into law the American Jobs Creation Act of  2004 ("AJCA").  The AJCA had repealed the tax 
exclusion of the "FSC Repeal and Extraterritorial In come Exclusion Act of 2000" ("ETI Act").  It had  
thereby withdrawn the subsidy fou nd to exist and brought the measure in question into conformity 
with US WTO obligations.  The repeal of the ETI  provision was effective for transactions occurring 
after 31 December 2004.  This was the most significant piece of US tax legislation in 20 years.  In terms of the volume of trade which the arbitr ator had found to be involved, the AJCA was 
undoubtedly the most significant act of compliance with a DSB recommendation in the history of the 
WTO.  While the scale, complexity and sensitivity of this tax issue required a lengthy legislative process, the United States, at the outset, had stated that it would implement the DSB's recommendations and rulings in this dispute, and it had done so.  The United States expected and 
looked forward to the withdrawal of the suspension of concessions by the EC.  
39. The representative of the European Communities
 said that the EC welcomed the efforts made 
by the United States in this matter, but had concer ns with regard to the WTO conformity of some 
aspects of the new legislation.  That was the reas on why the EC had requested consultations with the 
United States pursuant to Article 21.5 of the DSU.  The EC confirmed that it was in the process of 
preparing legislation that would susp end the application duties to the US. 
                                                      
1 The Annual Report was subsequently circulated in document WT/DSB/37 and Add.1.  WT/DSB/M/178 
 Page 9 
 
 
 40. The representative of the United States  said that her country was surprised and disappointed 
by the EC's request to consult, given that US congressional leaders had cons ulted frequently with the 
EC in the course of the legislative process.  None theless, the United States reco gnized that the EC had 
a right to request consultations and the United States was looking forward to this opportunity to explain to the EC how the AJCA addressed the concerns expressed by EC representatives to 
congressional leaders. 
41. The representative of Norway
 said that he did not wish to make comments on the "Foreign 
Sales Corporations" dispute, but with regard to  the agenda item that had been postponed at the 
opening of the present meeting.  Norway understood and supported the procedural solution to suspend 
the consideration of that agenda item.  He noted that a similar solution had been proposed in 1999 in 
the course of the "Banana" dispute.  He said that he hoped that it would also be possible for other 
Members to express their views on this matter in orde r to ensure that any solution, which would be  
found in the consultations to be held by the Chai rperson, did not prejudice or set a precedent with 
regard to the interpretation of Article 22.7 of th e DSU or the interpretation of the negative consensus 
rule.  This could be done through consultations dir ectly with the Chairperson or in the form of an 
informal meeting prior to the resumption of the formal meeting or in any other way that the 
Chairperson considered to be appropriate. 
42. The Chairperson  said that Members would be duly info rmed in case it was necessary to hold 
an informal meeting prior to a formal one.  Howeve r, she hoped that that would not be necessary.  The 
time was needed to hold consultations and she hope d that during these consultations there would be 
no issue that could raise concerns to other Member s.  She asked Members for their understanding and 
said that she would keep them informed in relation to this matter. 
43. The representative of Canada  said that, in view of the statement made by the representative of 
Norway, he wished to stress that in Canada's view, nothing in the course of informal consultations or 
whatever a solution the parties might come up with respect to the postponed agenda item, should be 
viewed as compromising, in any way, the negative consensus rule that Canada believed applied in 
respect of Article 22.7 of the DSU. 
44. The representative of Brazil  said that his country wished to echo Canada's statement.  In 
Brazil's view, nothing in the consultations nor the solution to suspend the meeting and to reconvene 
later would, in any circumstances, affect th e interpretation of Article 22.7 of the DSU. 
45. The Chairperson  recalled that the consideration of the item related to the Byrd Amendment 
dispute had been suspended.  She indicated that af ter the consultations on this  matter were concluded, 
the Secretariat would send a fax reconvening the meeting.  
46. The DSB took note  of the statements and suspended  the proceedings of the meeting.  
47. Upon the resumption of the meeting on 26 November 2004 , the Chairperson  recalled that on 
24 November, in light of certain differences between the United States and the Members requesting the DSB's authorization to suspe nd concessions and other obligations vis-à-vis  the United States in the 
Byrd Amendment dispute, the DSB had agreed to postpone the consideration of that agenda item to 
allow the parties to the dispute and the Chair to cons ult with a view to finding a solution.  Over the 
course of the past several days, the parties and the Chairperson had been engaged in intensive 
consultations and, at the present meeting, she w as in a position to announce that these consultations 
had yielded a successful outcome.  She thanked th e delegations involved in these consultations for 
their cooperative efforts and their constructive attit ude.  She also wished to thank all the other 
Members of the DSB for allowing a suspension of  the DSB meeting and for their patience and 
understanding during the process of consultation.  The positive outcome in this matter and the way it 
had been achieved was an excellent example of the collaborative spirit that existed in the DSB, which WT/DSB/M/178 
Page 10  
 
 was absolutely essential for the resolution of probl ems as they arose and she was honoured to have 
been part of it. She then proposed that  the DSB take up the following item:    
5. United States – Continued Dumping and Subsidy Offset Act of 2000  
(a) Recourse to Article 22.7 of the DSU by Brazil (WT/DS217/38) 
(b) Recourse to Article 22.7 of the DSU by the European Communities (WT/DS217/39) 
(c) Recourse to Article 22.7 of the DSU by India (WT/DS217/40) 
(d) Recourse to Article 22.7 of the DSU by Japan (WT/DS217/41) 
(e) Recourse to Article 22.7 of the DSU by Korea (WT/DS217/42) 
(f) Recourse to Article 22.7 of the DSU by Canada (WT/DS234/31) 
(g) Recourse to Article 22 of the DSU by Mexico (WT/DS234/32) 
48. The Chairperson
 proposed that the seven sub-items to which she had just referred be 
considered together since they pertained to the same matter. First, she drew attention to the 
communication from Brazil contained in document WT /DS217/38 and invited the representative of 
Brazil to speak.  
49. The representative of Brazil  recalled that on 15 January 2004, given the continued non-
compliance by the United States in the case on:  "United States – Continued Dumping and Subsidy 
Offset Act of 2000",  Brazil had requested the DSB's au thorization to suspend the application of tariff 
concessions and related obligations to the United St ates.  Since the United States had objected to the 
level of suspension proposed, the matter had been referred to arbitration pursuant to Article 22.6 of 
the DSU.  The Arbitration Award, which had been circulated on 31 August 2004, had clearly 
reaffirmed the illegality of the Byrd Amendment and had defined the right of Brazil to suspend 
concessions or other obligations vis-à-vis  the United States up to an amount of 72 per cent of the 
disbursements made under the CDSOA and related to anti-dumping and countervailing duties paid on 
imports from Brazil.  Brazil recalled again that, if the Arbitrators had found that 72 per cent of the 
disbursements had caused nullification or impairment , a 100 per cent of all disbursements had been 
found by the Appellate Body to be incompatible w ith the WTO Agreements and continued, therefore, 
to be 100 per cent illegal.  As stated previously before the DSB, the CDSOA had been described as a 
"double hit", intended to provide an additional, and clearly illegal, reme dy to dumping and subsidy.  It 
had been designed to assist US companies at the expe nse of their foreign competitors.  That assistance 
amounted already to more than US$1 billion.  This ill egality was aggravated by the fact that almost 11 
months had passed since the end of the long reasona ble period of time (also 11 months) that had been 
granted to the United States and which had ended in December 2003. 
50. Since the circulation of the Arbitrator's Award , the United States had given no concrete sign 
of implementation.  At the present meeting, ther efore, fully aware of the obligation set out in 
Article 22.7 of the DSU that the DSB "shall.....grant  authorization to suspend concessions or other 
obligations where the request is c onsistent with the decision of the arbitrator", Brazil was submitting  
to the DSB its request for susp ension of concessions, contained in document WT/DS217/38, which 
was made in full compliance with the Award of th e Arbitrator. Finally, Brazil still expected the 
United States to abide by its multilateral obligations  and to adjust or repeal the Byrd Amendment 
without delay.  Given the number of Members that were being affected by that illegal measure and 
could still be affected in the future, all WTO Me mbers, and not only the complainants, should be 
concerned about the lack of implementation by the United States.  WT/DSB/M/178 
 Page 11 
 
 
 51. The Chairperson  drew attention to the communication from the European Communities 
contained in document WT/DS217/39 and invited the representative of the European Communities to 
speak.  
52. The representative of the European Communities  said that since the enactment of the 
CDSOA, more than US$800 million had been collected  on foreign products to subsidize the directly 
competing US products.  The fourth distribution that had started on 1 October 2004 could amount to 
more than US$290 million, which meant that the th reshold of US$1 billion distributed would soon be 
reached.  In August 2004, the Arbitrators had clear ly rejected the US assertion that the CDSOA was 
harmless and had not caused any nullification or impairment to other WTO Members.  On the 
contrary, they had concluded that every year, the CDSOA had nullified or impaired EC benefits at a 
level equivalent to 72 per cent of the payments  made under the CDSOA from duties paid on imports 
from the EC for the most recent year for which data we re available at that time.  In the absence of any 
credible sign that the US Congress was work ing on implementation, the EC had sent, on 
10 November 2004, a request for the DSB's authori zation to suspend the application to the United 
States of tariff concessions and related obligati ons under the GATT 1994 at a level that would be 
equivalent, every year, to the annual level of nullif ication or impairment determined, in accordance 
with the Arbitration Award. 
53. The EC was fully convinced that the present re quest was made in compliance with the Award 
of the Arbitrator circulated on 31 August 20 04 (WT/DS217/ARB/EEC) and requested, at the present 
meeting, that the DSB grant authorization, in  accordance with Article 22.7 of the DSU.  The 
suspension of concessions would be in the form  of an additional duty on imports from the United 
States of certain products that would be selected fro m the indicative list attached to the EC request. 
Before applying the additional import duty, the EC  would notify the specific list of products that 
would be effectively subject to the additional im port duty.  The same notification would be made 
before the application of any new level of suspension.   The EC wished to underline that the extent of 
the concerns raised by the CDSOA was apparent from the fact that six other Members were making 
the same request at the present meeting.  The EC called on the US administration to transmit that  
message to the US Congress and to defend the im portance for the US credibility in the WTO to 
comply with its obligations without further dela y.  The EC hoped that implementation would soon 
follow and that it would not be necessary to  make use of the DSB's authorization. 
54. The Chairperson  drew attention to the communication from India contained in document 
WT/DS217/40, and invited the representative of India to speak. 
55. The representative of India  said that through its communication, dated 10 November 2004, his 
country had made a request to the DSB to consider  its recourse to Article 22.7 of the DSU in the 
dispute "Unites States - Continued Dumping and Subsidy Offset Act of 2000" (WT/DS217/40).  The finding of the Panel and the Appellate Body that the Continued Dumping and Subsidy Offset Act of 
2000 (CDSOA) was inconsistent with the US oblig ations under the WTO had been adopted by the 
DSB on 27 January 2003.  The United States had not implemented the DSB's recommendations and 
rulings within the reasonable period of time available to it, which had expired on 27 December 2003.    
On 15 January 2004 India had requested authorizat ion to suspend concessions  and other obligations 
pursuant to Article 22.2 of the DSU.  The United States had objected to it on 23 January 2004 and the matter had been referred to arbitration.  Conse quently, on 31 August 2004, the Arbitrator had issued 
an award (WT/DS217/ARB/IND).  Now, pursuant to Article 22.7 of the DSU, India was requesting 
the DSB's authorization to suspend the application to the United States of tariff concessions and other 
obligations under the GATT 1994, in the form of the imposition of additional import duties on products originating in the United States, at a level not exceeding every year 72 per cent of the 
amount of CDSOA disbursements re lating to anti-dumping or count ervailing duties paid on imports 
from India for the most recent year for which data we re available at that time. India wished to take 
this opportunity to reaffirm its commitment to strict ly comply with the Award of the Arbitrator, dated WT/DSB/M/178 
Page 12  
 
 31 August 2004 (WT/DS217/ARB/IND).  In accordan ce with the Award, India would notify the DSB 
every year, prior to the entry into force of a leve l of suspension of concessions or other obligations, 
the list of products on which the additional import duty would apply.  That list would be drawn from 
the indicative list attached to India's request contained in document WT/DS217/40. 
56. The Chairperson
 drew attention to the communication from Japan contained in document 
WT/DS217/41, and invited the re presentative of Japan to speak. 
57. The representative of Japan  said that on 10 November 2004, his country, along with six other 
co-complainants, had requested authorization from the DSB to suspend concessions or other 
obligations vis-à-vis  the United States, in view of the fact that the United States had failed to 
implement the DSB's recommendations and rulings regarding the CDSOA.  Almost two years had 
already lapsed since the DSB's ruling in January 20 03.  The reasonable period of time had expired in 
December 2003.  While the WTO-inconsistent law con tinued to nullify or impair  benefits accruing to 
Japan and other Members under the WTO Agreements, it had been reported that the United States was 
ready to execute yet another round of disburseme nts to its domestic companies under the CDSOA, 
amounting to US$294 million.  Japan could not overlook this disregard by the United States of its 
obligations under the WTO.  It was under those circ umstances that Japan was seeking recourse to the 
procedures set forth in Article 22.7 of the DSU.  Jap an thus asked the DSB to grant authorization to 
Japan as requested in document WT/DS217/41.  Japan, once again, called for the prompt repeal of the 
CDSOA by the United States, so that Japan would no t need to exercise its rights under Article 22.7 of 
the DSU. 
58. The Chairperson  drew attention to the communicati on from Korea contained in document 
WT/DS217/42, and  invited the representative of Korea to speak. 
59. The representative of Korea  said that his country wished to refer to the detailed history of this 
dispute, which previous speakers had already mentione d at the present meeting.  As the United States 
had failed to comply with the DSB's rulings and recommendations by the end of the reasonable period 
of time, Korea had requested, on 15 January 2004, au thorization to suspend the application to the 
United States of tariff concessions and other obl igations under GATT 1994, and as the result of the 
US objection to the level of the suspension proposed, the matter had been referred to arbitration.  
Subsequently, the Arbitrators had issued their decision on 31 August 2004.  Korea was seriously concerned that the United States had still not br ought its measures, which were found to be 
inconsistent with the WTO Agreements, into  conformity with the DSB's rulings and 
recommendations.  In this connection, pursuant to Article 22.7 of the DSU, Korea was requesting the 
DSB's authorization to suspend the application to  the United States of tariff concessions and other 
obligations with respect to imports of products from the United States at a level not exceeding every 
year 72 per cent of the amount of CDSOA disbur sements relating to anti-dumping or countervailing 
duties paid on imports from Korea.  Further details  were contained in document WT/DS217/42, dated 
11 November 2004.  As Members were aware, the am ount of suspension authorized by the Arbitrators 
depended upon the amount of disbursements under the Byrd Amendment for the most recent year for 
which data was available.  The level of suspensi on imposed would, by necessity, vary from year to 
year, but would be consistent with this decision of  the arbitrator.  As mentioned at the DSB meeting 
on 26 January 2004 in the context of Korea's requ est under Article 22.2, Korea was exercising its 
right under Article 22.7 of the DSU for the purpose of ensuring prompt compliance by the United States with the DSB's recommendations or rulings.  This was critical for effective resolution of 
disputes to the benefit of all Members and the integrity of the WTO dispute settlement system. 
60. The Chairperson
 drew attention to the communication from Canada contained in document 
WT/DS234/31, and invited the representative of Canada to speak.  WT/DSB/M/178 
 Page 13 
 
 
 61. The representative of Canada  said that it was unfortunate that Canada must now seek final 
retaliation authorization from the WTO because of the US continued failure to repeal the WTO-
inconsistent Byrd Amendment.  Canada's request  followed the 31August WTO Arbitrator's decision, 
which had recognized the existence of a direct adve rse effect on trade amounting to 72 per cent of the 
level of disbursements in a given year.  The Arbitrat or had also rejected the US assertion that the Byrd 
Amendment did not cause any adverse effect.  Members might be aware that recently Canada had 
launched a month long public consu ltation with Canadians on its retalia tory options.  He noted that 
the Secretariat was distributing, as a room docum ent, the Canada Gazette Notice launching these 
consultations and its attached draf t list of products subject to a possible surtax.  Canada was asking 
that the Gazette Notice with its attachment be in cluded in Canada's formal  request for retaliation 
authorization.  Of course, Canada  would not be taking any decisions  on retaliatory options until that 
process was completed.  As had been made clear in Canada's retaliation authorization request, 
however, if a decision was taken to retaliate, Ca nada would notify the DSB of the terms of the 
retaliatory measures that would be implemented.  It had been nearly two years since the DSB had 
adopted the Report of the Appellate Body and the United States could not point to any progress for 
the repeal of the Byrd Amendment.  This despite  the US statement that it remained committed to 
implementing the DSB's recommendations and ruling in  this dispute.  The United States did not 
hesitate to remind Members through its unchanged st atus reports that implementation measures were 
before Congress.  However, once again, the Un ited States did not provide Members with any 
timelines for the passage of that measure.  The Un ited States had received ample time to bring itself 
into compliance.  It was one thing to state in tentions and it was quite another to act on those 
intentions.  It was time that the United States made the repeal of this measure a priority.  Once again, 
Canada asked the United States when it would implem ent the DSB's  recommendations of the rulings.  
Throughout this dispute, Canada had stated the systemic and direct commercial harm caused to 
Canada by the continued operation of that measur e.  These were well-known and, therefore, he would 
not repeat them again at the present meeting.  Wh at was worth noting, however, was that Canada was 
taking this action in concert with six other WT O Members.  This was the largest group of WTO 
Members to ever request an Article 22.7 authoriza tion in regards to the same dispute.  It was the 
clearest possible signal of the breadth and depth of concern about that measure among the membership.  Again, Canada's preferred option was not  retaliation, but to have the US repeal the Byrd 
Amendment.  Canada urged the United States to live up to its WTO obligations, end this dispute, and 
repeal the Byrd Amendment.  Canada called upon the DSB to authorize its request. 
62. The Chairperson
 thanked the representative of Canada a nd asked if there was any objection to 
have the Gazette Notice referred to by Canada circ ulated as an addendum to Canada's request for 
retaliation.  
63. The representative of the United States  said that Canada had suggested that the room 
document be attached to its request submitted some te n days ago and circulated ten days ago.  He was 
a bit surprised since the suggesti on was new to him, he had not h eard about it before and so he 
certainly would not be in a position to agree to th e request as formulated by Canada.  Should Canada 
wish to have the document circulated in a different fashion that might be a different question.  He  
noted that the Chairperson had suggested that that document be circulated as an addendum, presumably as one submitted at the present meeting.  If that were what Canada were to request, the 
United States could certainly consider that possibility. 
64. The Chairperson
  invited Canada to make comments. 
65. The representative of Canada  said that his delegation had hope d that it could have the Notice 
circulated as an attachment to Canada's formal reque st for retaliation.  His delegation realized that the 
Notice was published after that request had been circulated.  He had received the Notice only two 
days prior to this meeting:  i.e. as soon as it ha d been published.  That was why his delegation had 
asked if Members could accept that the Notice be att ached to Canada's request for retaliation.  If, WT/DSB/M/178 
Page 14  
 
 however, there was an objection, his delegation was open to any suggestions the United States might 
have.  He did not think that there was any requireme nt to provide a list of products subject to import 
duties, but Canada had provided such a list for inform ation.  Finally, he said that Canada was open to 
any suggestion that the United States might have regarding this matter. 
66. The representative of the United States
 said that he did not think that he had anything to add.  
He would not be in a position to agree to the requ est formulated by Canada.  He could not agree to 
have the document considered as part of the Artic le 22.7 request that was being considered by the 
DSB at the present meeting.  Should Canada wish to  have it circulated in some other fashion, the 
suggestion made by the Chairperson might work:  i.e. that the Notice be circulated bearing the date of 
the present meeting for information purposes.  However,  he would not be in a position to agree to the 
precise proposal that Canada had put before the DS B since he had literally seen the Notice just a few 
moments earlier. 
67. The Chairperson  asked if Canada objected to having the Notice circulated as an addendum 
with the date of the present meeting. 
68. The representative of Canada  said that his delegation had no objection. 
69. The Chairperson  drew attention to the communicati on from Mexico contained in document 
WT/DS234/32, and invited the representative of Mexico to speak. 
70. The representative of Mexico  said that since the Byrd Amendm ent had come into force in the 
year 2000, the US industries were benefiting from ill egal contributions of more than US$750 million.   
The Byrd Amendment was a remedy against unfair trade practices, one which was contrary to the 
WTO, which at the same time created an incentive for the US industry to support the imposition of 
trade remedies.  Notwithstanding its international responsibility and the unfavourable effects for its 
trading partners, the United States simply had not complied with the DSB's recommendations and rulings.  The suspension of obligations was not Mexico 's preferred option, even less, against a trading 
partner with such an importance as the United Stat es.  Nevertheless, this was the only legal tool 
available to Mexico in order to induce the United States to comply with the DSB's recommendations 
and rulings, and which would prevent the interests of Mexico's exporters from continuing to be 
impaired.  At the DSB meeting on 26 January 2004,  Mexico, together with other complainants, had 
requested authorization to suspend obligations vis-à-vis  the United States, due to its lack of 
compliance.  The United States had challenged the level of suspension proposed by Mexico, and the 
matter had been referred to arbitration.  The Awar d of the Arbitrator under Article 22.6 of the DSU 
had been circulated on 31 August 2004.  With the statem ent and in conformity with Article 22.7 of the 
DSU, Mexico requested the DSB's authorization to suspend obligations against the United States, in 
accordance with the Arbitrator's award circulat ed in document WT/DS234/ARB/MEX.  Mexico 
wished to reaffirm its intention to comply with that Award in relation to suspension of concessions.  
Unfortunately, Members found themselv es in a situation that best dem onstrated the central problem of 
the DSU.  In other words, the scheme of incentives to impose or ma intain the illegal measures or the 
de facto waiver.  If there was something to be resolved in the DSU negotiations, it was precisely the 
problem at hand. 
71. The Chairperson
 invited the representative of  the United States to speak. 
72. The representative of the United States  said that his country wished to reiterate at the outset 
that it intended to comply with the DSB’s reco mmendations and rulings in these disputes.  Thus, 
while the United States understood that the DSB would, at the present meeting, be authorizing the 
suspension of concessions or other obligations, th e United States did not believe that it would be 
necessary for Members to exercise that authoriza tion.  At this point he wished to thank the 
Chairperson for the consultations that she had held over the past several days.  The United States very  WT/DSB/M/178 
 Page 15 
 
 
 much appreciated the personal efforts of the Chai rperson to address the concerns of the various 
parties.  The United States also wished to take  the opportunity to thank the Arbitrators and the 
Secretariat for their hard work in these proceedin gs.  He noted that the requesting parties had 
commented on these awards at the DSB meeting on 27 September and the United States also wished 
to comment briefly on the Awards at the present meeting. 
73. First, the United States welcom ed the Arbitrators' recognition of the distinction between, on 
the one hand, the failure of a Member to carry out  its obligations under a c overed agreement and, on 
the other, the nullification or impairment of benefits  that may – or may not – result from that failure.  
The Arbitrators had correctly rejected the rela ted argument that the level of nullification or 
impairment was automatically equivalent to the am ount of CDSOA disbursements.  The United States 
also welcomed the Arbitrators' rejection of the ar gument that the "ultimate goal" of the suspension of 
concessions or other obligations was to "induce comp liance".  The Arbitrators had noted that inducing 
compliance was, "at most," only one objective, and that the DSU "equivalence" requirement 
suggested that suspension was also intended to pr ovide a form of "temporary compensation".  In 
addition, the United States welcomed the Arbitrators'  decision to examine the "trade effects" of the 
CDSOA in order to determine the level of nullifica tion or impairment.  The United States noted that 
the language in the final decision referring to susp ension of concessions or ot her obligations on a list 
of US products "covering ... a total value of trade" not exceeding 72 per cent of the CDSOA disbursements relating to the relevant Member was important in this regard. 
74. But the United States disagreed that the "trade e ffect" approach was just one of many possible 
measures of nullification or impairment.  In light  of the actual awards, the Arbitrators' comments 
about the theoretical possibility of a broader "economi c effects" test were merely dicta.  They also 
demonstrated a misunderstanding of Article 22.6 and prior arbitrations .  For example, if there could 
be various legitimate ways to measure the level of nullification or impairment  in any given dispute, 
there would naturally be multiple levels of nullif ication or impairment.  However, the DSU only 
provided for a single level of nullification or impa irment.  Moreover, it was not clear how one could 
ensure that "the level" of suspension was "equivalent  to the level of nullification or impairment", if 
there were multiple levels of  nullification or impairment. 
75. The Arbitrators' citation to the case on United States – Section 110 arbitration as the origin of 
an "economic" effects test was also misplaced.  The CDSOA Arbitrators had incorrectly stated that 
"no actual trade took place" in that dispute because it involved intellectual property rights.  However, the Section 110 dispute involved the Agreement on Trade-Related Aspects of Intellectual Property 
Rights.  In fact, the United States doubted the Secti on 110(5) Arbitrator had thought it was creating an 
alternative measure of nullification or impairment, separate and distinct from – and broader than – a 
"trade effects" test.  Likewise, referring to the 1916 Act dispute, the Arbitrator had asserted that 
"[s]ince a judicial decision or settlement under the 1916 Act did not automatically restrict trade, the 
broader concept of economic effect was more appropr iate".  In the US view, however, one could not 
argue that a trade effects test was inappropriate simply because it had not yielded the desired result. 
The United States was also disappoint ed that the Arbitrators had found the Article 22.2 requests to be 
sufficiently specific.  As the Arbitrator had stated in the "Hormones" dispute: "the Member requesting 
suspension . . . has to identify th e level of suspension of concessions  it proposes in a way that allows 
[the arbitrator] to determine equi valence".  Here, the Arbitrators had found that "nothing in the 
[requesting party’s] proposal enables us to conclu de at this stage that [the requesting party’s] 
proposed suspension of concessions or other obligations  will or will not be equivalent to the level of 
nullification or impairment[.]"  This was hard to s quare with the Arbitrator’s finding that the requests 
were sufficiently specific. 
76. The United States remained concerned that the Arbitrators had decided that a Member could 
adjust the level of suspension from year to year.  Providing for varying levels of suspension on an 
annual basis was difficult to reconcile with the lang uage in the DSU calling for a single level.  The WT/DSB/M/178 
Page 16  
 
 Arbitrators noted that adjustments would be permissi ble, so long as "unpredictability is not increased 
as a result".  But, in these cases, the annual ad justments would increase unpredictability.  For 
example, suppose a Member retaliated based on CD SOA disbursements for Year 1 and began that 
retaliation shortly before US authorities publis hed more recent data on the amount of CDSOA 
disbursements for Year 2.  Could that Member  base its retaliation on Year 1 data for a full 
twelve-month period, or must it immediately modify  the level of suspension to account for the more 
recent data? 
77. While the Arbitrators assured the United Stat es that it had recourse to dispute settlement 
procedures if it disagreed with an adjustment, the f act that the Arbitrators already anticipated disputes 
over these adjustments hardly suggested the predictab ility that one would expect at the conclusion of 
an arbitration.  Finally, while the Arbitrators had found the level of nullificati on or impairment to be 
greater than that which the United States had argue d for, it would not, at the present meeting, address 
the specifics of the Arbitrators' methodologies, as th ese specifics did not appear to raise systemic 
issues. 
78. He had heard the delegate of one of the reques ting parties say that he was convinced that his 
delegation's request for authorization was consistent  with the Award of the Arbitrator.  As he was 
aware, the United States had expressed concerns about whether or not that was so, and those concerns 
had led to the temporary suspension of this agenda item.  On this topic, suffice it to say that the 
United States had wanted to make absolutely sure that the authorization that the DSB would grant at 
the present meeting was limited to the decisions reached by the Arbitrators;  that the other parties had 
ultimately understood the US concern; and that the pa rties had worked out a way forward. In light of 
the history of this arbitration and the Arbitrators'  Awards, the application of Article 22.7 of the DSU 
to these requests was a matter of particular importance. 
79. Again, the United States wished to thank the Arb itrators and the Secretariat for their efforts, 
and the Chairperson for hers. 
80. The Chairperson
 proposed that the DSB take note  of the statements.  As provided in 
Article 22.7 of the DSU, and in response to the re quests by Brazil, the Eur opean Communities, India, 
Japan, Korea, Canada and Mexico contained in documents WT/DS217/38;  WT/DS217/39;  
WT/DS217/40;  WT/DS217/41;  WT/DS217/42;  WT/DS234/31 and WT/DS234/32, the Chair proposed that the DSB agree
 to grant authorization to suspend the application to the United States of 
tariff concessions and other obliga tions, as provided in the Decisions by the Arbitrators contained in 
documents: WT/DS217/ARB/BR; WT/D S217/ARB/EEC; WT/DS217/ARB/IND; 
WT/DS217/ARB/JPN;  WT/DS217/ARB/KOR;  WT/DS234/ARB/CAN and WT/DS234/ARB/MEX. 
81. The representative of Chile  said that his country supported the requests submitted by seven 
Members because it considered that the Byrd Am endment, as confirmed by the recent Award of the 
Arbitrator, caused economic prejudice to Members su ch as Chile that had been subject to anti-
dumping and countervailing measures.  Chile, therefore, continued to consider what steps to take.  It 
was consulting with all of the interested sectors in the hope of reaching a rapid decision.  Chile 
regretted that it had not been consulted during these past few days.  Chile had an interest in this 
dispute and considered that the parties must "accept the arbitrator's decision as final".  Since Chile had 
not participated in the consultations on this matte r, it did not know the context underlying the Chair's 
statement and hence, it did not know possible implications thereof.  While Chile was not opposed to the Chair's proposal, it had no choice but to reserve its rights until it had a clear understanding of the 
implications of the Chair's statement. It was Chile's  understanding that the Chair's statement as well as 
the statements by Brazil, Canada, the European Co mmunities, Korea, India, Japan, Mexico and the 
United States had been made in connection with th e individual requests listed on the agenda of the 
present meeting.  These statements did not, in any wa y, alter the rights and obligations of the other  WT/DSB/M/178 
 Page 17 
 
 
 Members, in particular Chile, nor did they alter th e content, meaning and scope of the Award of the 
Arbitrator circulated in document WT/DS217/ARB/CHL. 
82. The Chairperson  said that she was pleased that Chile w ould go along with the draft decision 
that she had just read out.  Therefore, if there we re no other requests from the floor, she wished to ask 
the DSB to agree to the draft deci sion that she had just proposed.  
83. The DSB so agreed . 
__________