WORLD TRADE  
ORGANIZATION  WT/DS367/AB/R 
29 November 2010 
 (10-6392) 
 Original:   English 
  
 
     
 
    
 
     
AUSTRALIA – MEASURES AFFECTING THE IMPORTATION 
OF APPLES FROM NEW ZEALAND 
 
  
AB-2010-2 
 
 
    
 
     
Report of the Appellate Body  WT/DS367/AB/R 
 Page i 
 
 
I. Introduction................................................................................................................ .................1 
II. Arguments of the Participants  and the Third Participants ..........................................................6 
A. Claims of Error by Australia – Appellant ......................................................................6 
1. Annex A(1) to the SPS Agreement :  "SPS Measure" ........................................7 
2. Articles 5.1, 5.2, and 2.2 of the SPS Agreement ................................................9 
(a) Measures regarding Fire Blight .........................................................12 
(b) Measures regarding ALCM ...............................................................15 
3. Article 11 of the DSU .....................................................................................16 
(a) Treatment of Expert Testimony.........................................................16 (b) The Panel's Alleged Misunderstanding of the IRA............................18 
4. Article 5.6 of the SPS Agreement ....................................................................19 
B. Arguments of New Zealand – Appellee ........................................................................22 
1. Annex A(1) to the SPS Agreement :  "SPS Measure" ......................................22 
2. Articles 5.1, 5.2, and 2.2 of the SPS Agreement ..............................................23 
(a) Measures regarding Fire Blight .........................................................26 
(b) Measures regarding ALCM ...............................................................28 
3. Article 11 of the DSU .....................................................................................29 
(a) Treatment of Expert Testimony.........................................................29 (b) The Panel's Alleged Misunderstanding of the IRA............................31 
4. Article 5.6 of the SPS Agreement ....................................................................31 
C. Claims of Error by New Zealand – Other Appellant ...................................................33 
1. Annex C(1)(a) and Article 8 of the SPS Agreement ........................................33 
D. Arguments of Australia – Appellee ..............................................................................35 
1. Annex C(1)(a) and Article 8 of the SPS Agreement ........................................35 
E. Arguments of the Third Participants ............................................................................37 
1. European Union ..............................................................................................37 
2. Japan................................................................................................................39 
3. United States ...................................................................................................41 
III. Issues Raised in This Appeal .............................................................................................. ......43 
IV. The Measures at Issue an d the Risk Assessment on which They were Based..........................44 
A. The Measures at Issue ..................................................................................................44 
B. Background to the Adoption of the Measures at Issue .................................................47 
C. Relevant Aspects of the IRA and the Methodology Used .............................................48 
1. Pest Risk Assessment......................................................................................48 
(a) Pest Categorization and Pests at Issue ...............................................48 (b) Assessment of the Probability of Entry, Establishment and 
Spread ................................................................................................50 
(i) Assessment for Pathogens (Including Fire Blight) ...............50 
(ii) Assessment for Arthropods (Including ALCM) ....................53 
(c) Assessment of Consequences ............................................................54 WT/DS367/AB/R 
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(d) Combining the Estimated Probability of Entry, Establishment 
and Spread with the Estimate of Consequences ................................54 
2. Pest Risk Management....................................................................................56 
D. The IRA's Conclusions on Fire Blight .........................................................................57 
1. Pest Risk Assessment......................................................................................57 
(a) Assessment of Probability of En try, Establishment and Spread........57 
(b) Assessment of Consequences ............................................................58 (c) Combining the Estimated Probability of Entry, Establishment 
and Spread with the Estimate of Consequences ................................59 
2. Pest Risk Management....................................................................................59 
E. The IRA's Conclusions on ALCM ................................................................................60 
1. Pest Risk Assessment......................................................................................60 
(a) Assessment of Probability of En try, Establishment and Spread........60 
(b) Assessment of Consequences ............................................................62 (c) Combining the Estimated Probability of Entry, Establishment 
and Spread with the Estimate of Consequences ................................62 
2. Pest Risk Management....................................................................................62 
V. Annex A(1) to the SPS Agreement :  "SPS Measure"................................................................64 
A. Interpretation of Annex A(1) to the SPS Agreement ....................................................65 
B. Application of Annex A(1) to the Measures at Issue ....................................................68 
C. Conclusion ...................................................................................................................71 
VI. Articles 5.1, 5.2, and 2.2 of the SPS Agreement .......................................................................71 
A. IRA Structure and Panel Findings ...............................................................................71 
B. Claims of Error and Arguments on Appeal .................................................................75 
C. The Panel's Assessment of the IRA ..............................................................................77 
1. Articles 5.1, 5.2, and 2.2 of the SPS Agreement ..............................................77 
2. The Standard of Review Used by the Panel in Its Review of the IRA 
under Article 5.1 of the SPS Agreement ..........................................................80 
3. The Panel's Assessment of the Use of IRA Expert Judgement .......................84 4. The Materiality of the Faults th e Panel Found with the Reasoning of 
the IRA............................................................................................................89 
D. Conclusion ...................................................................................................................93 
VII. Article 11 of the DSU ..................................................................................................... ..........93 
A. The Panel's Treatment of Testimony by Its Appointed Experts ....................................94 
B. The Panel's Characterization of the Methodology Employed in the IRA ..................107 
C. Conclusion .................................................................................................................111 
VIII. Article 5.6 of the SPS Agreement ...........................................................................................111 
A. Article 5.6 and Footnote 3 .........................................................................................114  WT/DS367/AB/R 
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B. Australia's Appeal ......................................................................................................118 
1. Whether the Panel's Finding under Article 5.6 was Consequential upon 
Its Findings under Articles 5.1, 5.2, and 2.2 of the SPS Agreement ..............118 
2. The Alleged Errors in the Panel's Analysis of New Zealand's 
Article 5.6 Claim...........................................................................................119 
(a) The Panel's Analytical Approach to Article 5.6 of the 
SPS Agreement .................................................................................119 
(b) Completion of the Analysis .............................................................124 
(i) Whether the Appellate Body can complete the 
analysis with respect to New Zealand's alternative 
measure for fire blight ........................................................126 
(ii) Whether the Appellate Body can complete the 
analysis with respect to New Zealand's alternative 
measure for ALCM .............................................................134 
3. Australia's Remaining Allegations of Error ..................................................140 
C. Conclusion .................................................................................................................142 
IX. New Zealand's Other Appeal – A nnex C(1)(a) and Article 8 of the SPS Agreement .............142 
A. Whether the Panel Erred in Finding that New Zealand's Claims under 
Annex C(1)(a) and Article 8 of th e SPS Agreement were Outside Its 
Terms of Reference ....................................................................................................143 
B. Completion of the Legal Analysis ..............................................................................148 
C. Conclusion .................................................................................................................153 
X. Findings and Conclusions.................................................................................................... ...154 
 
 ANNEX I(a) and (b) Notification of an Appeal by Australia, WT/DS367/13 and Corr.1 
 
ANNEX II Notification of an Other Appeal by New Zealand, WT/DS367/14  ANNEX III  Procedural Ruling of 14 September 2010 allowing public observation 
 of the oral hearing 
 WT/DS367/AB/R 
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CASES CITED IN THIS REPORT 
 
Short title Full case title and citation 
Australia – Apples Panel Report, Australia – Measures Affecting the Importation of Apples from 
New Zealand , WT/DS367/R, circulated to WTO Members 9 August 2010 
Australia – Salmon Appellate Body Report, Australia – Measures Affecting Importation of Salmon , 
WT/DS18/AB/R, adopted 6 November 1998, DSR 1998:VIII, 3327 
Australia – Salmon Panel Report, Australia – Measures Affecting Importation of Salmon , 
WT/DS18/R and Corr.1, adopted 6 November 1998, as modified by Appellate 
Body Report WT/DS18/AB/R, DSR 1998:VIII, 3407 
Australia – Salmon 
(Article 21.5 – Canada) Panel Report, Australia – Measures Affecting Importation of Salmon – 
Recourse to Article 21.5 of the DSU by Canada , WT/DS18/RW, adopted  
20 March 2000, DSR 2000:IV, 2031 
Brazil – Retreaded Tyres Appellate Body Report, Brazil – Measures Affecting Imports of Retreaded 
Tyres , WT/DS332/AB/R, adopted 17 D ecember 2007, DSR 2007:IV, 1527 
Canada – Autos Appellate Body Report, Canada – Certain Measures Affecting the Automotive 
Industry , WT/DS139/AB/R, WT/DS142/AB/R, adopted 19 June 2000, DSR 
2000:VI, 2985 
Canada – Continued 
Suspension Appellate Body Report, Canada – Continued Suspension of Obligations in the 
EC – Hormones Dispute , WT/DS321/AB/R, adopted 14 November 2008 
EC – Approval and Marketing 
of Biotech Products Panel Report, European Communities – Measures Affecting the Approval and 
Marketing of Biotech Products , WT/DS291/R, WT/DS292/R, WT/DS293/R, 
Add.1 to Add.9, and Corr.1, adopted 21 November 2006, DSR 2006:III-VIII, 
847 
EC – Asbestos Appellate Body Report, European Communities – Measures Affecting Asbestos 
and Asbestos-Containing Products , WT/DS135/AB/R, adopted  
5 April 2001, DSR 2001:VII, 3243 
EC – Bananas III Appellate Body Report, European Communities – Regime for the Importation, 
Sale and Distribution of Bananas , WT/DS27/AB/R, adopted 25 September 
1997, DSR 1997:II, 591 
EC – Bananas III 
(Article 21.5 – Ecuador II) / 
EC – Bananas III (Article 21.5 – US) Appellate Body Reports, European Communities – Regime for the Importation, 
Sale and Distribution of Bananas – Second Recourse to Article 21.5 of the 
DSU by Ecuador , WT/DS27/AB/RW2/ECU, adopted 11 December 2008, and 
Corr.1 / European Communities – Regime for the Importation, Sale and 
Distribution of Bananas – Recourse to Article 21.5 of the DSU by the United 
States , WT/DS27/AB/RW/USA and Corr.1, adopted 22 December 2008 
EC – Hormones Appellate Body Report, EC Measures Concerning Meat and Meat Products 
(Hormones) , WT/DS26/AB/R, WT/DS48/AB/R, adopted 13 February 1998, 
DSR 1998:I, 135 
EC – Sardines Appellate Body Report, European Communities – Trade Description of 
Sardines , WT/DS231/AB/R, adopted 23 October 2002, DSR 2002:VIII, 3359 
EC – Selected Customs 
Matters Appellate Body Report, European Communities – Selected Customs Matters , 
WT/DS315/AB/R, adop ted 11 December 2006, DSR 2006:IX, 3791 
Guatemala – Cement I Appellate Body Report, Guatemala – Anti-Dumping Investigation Regarding 
Portland Cement from Mexico , WT/DS60/AB/R, adopted 25 November 1998, 
DSR 1998:IX, 3767  WT/DS367/AB/R 
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Short title Full case title and citation 
Japan – Agricultural  
Products II Appellate Body Report, Japan – Measures Affecting Agricultural Products , 
WT/DS76/AB/R, adopted 19 March 1999, DSR 1999:I, 277 
Japan – Alcoholic  Beverages II Appellate Body Report, Japan – Taxes on Alcoholic Beverages , 
WT/DS8/AB/R, WT/DS10/AB/R, WT/DS11/AB/R, adopted 1 November 
1996, DSR 1996:I, 97 
Japan – Apples Appellate Body Report, Japan – Measures Affecting the Importation of Apples , 
WT/DS245/AB/R, adop ted 10 December 2003, DSR 2003:IX, 4391 
Japan – Apples Panel Report, Japan – Measures Affecting the Importation of Apples , 
WT/DS245/R, adopted 10 December 2003, as upheld by Appellate Body 
Report WT/DS245/AB/R, DSR 2003:IX, 4481  
Korea – Dairy Appellate Body Report, Korea – Definitive Safeguard Measure on Imports of 
Certain Dairy Products , WT/DS98/AB/R, adopted 12 January 2000, DSR 
2000:I, 3 
Korea – Various Measures on 
Beef Appellate Body Report, Korea – Measures Affecting Imports of Fresh, Chilled 
and Frozen Beef , WT/DS161/AB/R, WT/DS169/AB/R, adopted 10 January 
2001, DSR 2001:I, 5 
US – Carbon Steel Appellate Body Report, United States – Countervailing Duties on Certain 
Corrosion-Resistant Carbon Steel Flat Products from Germany , 
WT/DS213/AB/R and Corr.1, adopted 19 December 2002, DSR 2002:IX, 3779 
US – Continued Suspension Appellate Body Report, United States – Continued Suspension of Obligations 
in the EC – Hormones Dispute , WT/DS320/AB/R, adopted 14 November 
2008, DSR 2008:X, 3507 
US – Continued Zeroing Appellate Body Report, United States – Continued Existence and Application 
of Zeroing Methodology , WT/DS350/AB/R, adopted 19 February 2009 
US – Corrosion-Resistant 
Steel Sunset Review Appellate Body Report, United States – Sunset R eview of Anti-Dumping Duties 
on Corrosion-Resistant Carbon Steel Flat Products from Japan , 
WT/DS244/AB/R, adopted 9 January 2004, DSR 2004:I, 3  
US – Poultry (China) Panel Report, United States – Certain Measures Affecting Imports of Poultry 
from China , WT/DS392/R, adopted 25 October 2010 
US – Steel Safeguards Appellate Body Report, United States – Definitive Safeguard Measures on 
Imports of Certain Steel Products , WT/DS248/AB/R, WT/DS249/AB/R, 
WT/DS251/AB/R, WT/DS252/AB/R, WT /DS253/AB/R, WT/DS254/AB/R, 
WT/DS258/AB/R, WT/DS259/AB/R, adopted 10 December 2003, DSR 
2003:VII, 3117 
US – Upland Cotton Appellate Body Report, United States – Subsidies on Upland Cotton , 
WT/DS267/AB/R, adopted 21 March 2005, DSR 2005:I, 3 
US – Upland Cotton  (Article 21.5 – Brazil) Appellate Body Report, United States – Subsidies on Upland Cotton – 
Recourse to Article 21.5 of the DSU by Brazil , WT/DS267/AB/RW, adopted 
20 June 2008, DSR 2008:III, 809 
US – Wheat Gluten Appellate Body Report, United States – Definitive Safeguard Measures on 
Imports of Wheat Gluten from the European Communities , WT/DS166/AB/R, 
adopted 19 January 2001, DSR 2001:II, 717 
US – Wool Shirts and Blouses Appellate Body Report, United States – Measure Affecting Imports of Woven 
Wool Shirts and Blouses from India , WT/DS33/AB/R, adopted 23 May 1997, 
and Corr.1, DSR 1997:I, 323 WT/DS367/AB/R 
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Short title Full case title and citation 
US – Zeroing (EC)  
(Article 21.5 – EC) Appellate Body Report, United States – Laws, Regulations and Methodology 
for Calculating Dumping Margins ("Zeroing") – Recourse to Article 21.5 of the DSU by the European Communities , WT/DS294/AB/RW and Corr.1, 
adopted 11 June 2009 
US – Zeroing (Japan)  
(Article 21.5 – Japan) Appellate Body Report, United States – Measures Relating to Zeroing and 
Sunset Reviews – Recourse to Article 21.5 of the DSU by Japan , 
WT/DS322/AB/RW, adopted 31 August 2009 
 
  WT/DS367/AB/R 
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ABBREVIATIONS USED IN THIS REPORT 
 
Abbreviation Description 
ALCM Apple leafcurling midge 
ALOP Appropriate level of protection 
AQIS Australian Quarantine and Inspection Service 
DSB Dispute Settlement Body 
DSU Understanding on Rules and Procedures Governing the Settlement of 
Disputes 
FAO Food and Agriculture Organization of the United Nations 
GATT 1994 General Agreement on Tariffs and Trade 1994 
Imp Importation step 
IPPC International Plant Protection Convention 
IRA  Biosecurity Australia, Final Import Risk Analysis Report for Apples from 
New Zealand (Canberra, November 2006), Parts A, B, and C (Panel 
Exhibits AUS-1, AUS-2, and AUS-3, respectively) 
ISPM IPPC's International Standards for Phytosanitary Measures  
Panel Report Panel Report, Australia – Measures Affecting the Importation of Apples 
from New Zealand , WT/DS367/R 
SPS Sanitary and phytosanitary 
SPS Agreement Agreement on the Application of Sanitary and Phytosanitary Measures  
Working Procedures Working Procedures for Appellate Review , WT/AB/WP/5, 
4 January 2005. (Note:  Although this version of the Working Procedures 
for Appellate Review  applied to this appeal, it has been replaced by a 
subsequent version, WT/AB/WP/6, 16 August 2010) 
WTO World Trade Organization  WT/DS367/AB/R 
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WORLD TRADE ORGANIZATION  
APPELLATE BODY 
  
Australia – Measures Affecting the Importation 
of Apples from New Zealand  
 
Australia, Appellant/Appellee  
New Zealand, Other Appellant/Appellee  
 
Chile, Third Participant  
European Union
1, Third Participant  
Japan, Third Participant  
Pakistan, Third Participant  
Separate Customs Terr itory of Taiwan, Penghu,
 Kinmen and Matsu, Third Participant 
United States,  Third Participant AB-2010-2 
 
Present:  Zhang, Presiding Member Hillman, Member 
Oshima, Member 
 
 
I. Introduction 
1. Australia and New Zealand each appeals certain issues of law and legal interpretations 
developed in the Panel Report, Australia – Measures Affecting the Importation of Apples from 
New Zealand  (the "Panel Report").2  The Panel was established on 21 January 2008 to consider a 
complaint by New Zealand concerning several Aust ralian measures on the importation of apples from 
New Zealand.3 
2. Following a request for access to the Austra lian market filed by New Zealand in 
January 1999, the Australian Quarantine and Insp ection Service ("AQIS") initiated an import risk 
analysis4 to assess the risks associated with the importa tion of apples from New Zealand, including, 
notably, the risks associated with the following three quarantine pests:  fire blight, European canker, 
and apple leafcurling midge ("ALCM").5  In November 2006, Biosecurity Australia issued its 
                                                      
1This dispute began before the entry into force of the Treaty of Lisbon amending the Treaty on 
European Union  and the Treaty establishing the European Community  (done at Lisbon, 13 December 2007) on 
1 December 2009.  On 29 November 2009, the World Trade Organization received a Verbal Note (WT/L/779) 
from the Council of the European Union and the Commission of the European Communities stating that, by 
virtue of the Treaty of Lisbon , as of 1 December 2009, the European Union replaces and succeeds the European 
Community.  Thus, although the European Communities reserved its right to participate in the panel proceedings as a third party, and th e Panel referred to the European Comm unities in its Report, the European 
Union filed a third participant's submission in this appe al, and we will refer to th e European Union in this 
Report. 
2WT/DS367/R, 9 August 2010. 
3Panel Report, paras. 1.1 and 1.2. 
4Panel Report, para. 2.31.  At the time, Biosecurity Australia was part of AQIS.  In 2004, Biosecurity 
Australia was created as a separate agency, and is part of the Commonwealth Department of Agriculture, 
Fisheries and Forestry. ( Ibid., para. 7.157;  Biosecurity Australia,  Final Import Risk Analysis Report for Apples 
from New Zealand (Canberra, November 2006) (the "IRA"), Part B (Panel Exhibit AUS-2), p. 8) 
5Panel Report, para. 2.27.  In addition to fire bli ght, European canker, and ALCM, the IRA assessed the 
risks associated with eight other pests. WT/DS367/AB/R 
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Final Import Risk Analysis Report for Apples from New Zealand  (the "IRA").
6  This risk assessment 
was "semi-quantitative" in that, for each pest, it co mbined a quantitative assessment of the likelihood 
of entry, establishment and spread with a qualita tive assessment of the li kely associated potential 
biological and economic consequences.7  The combination of these probability assessments then 
yielded an overall determination of "unrestricted risk ", that is, the risk associated with the importation 
of apples from New Zealand in the absence of any risk management measures.8  When the 
"unrestricted risk" associated with a specific pest was determined to exceed Australia's appropriate 
level of protection ("ALOP")9, then possible risk management measures that could be adopted to 
mitigate the risk were evaluated, and recommendations made accordingly.10  Thus, the IRA 
recommended a number of risk management measures to the Director of Animal and Plant Quarantine.
11  The Director subsequently determined th at the importation of apples from New Zealand 
can be permitted subject to, inter alia , the application of the phytosan itary measures specified in the 
IRA.12 
3. The 17 measures listed by New Zealand in its re quest for the establishment of a panel are 
among those specified in the IRA.13  Of the 17 challenged measures, eight  relate to fire blight, five to 
European canker, and one to ALCM.  Three additio nal "general" measures apply to all three of these 
pests.14  The IRA provides that New Zealand and Aust ralia must agree standard operating procedures 
for each quarantine pest of concern before exports of apples may begin, but no such agreement has yet 
been reached.15  Further details regarding the measures exam ined by the Panel and the process leading 
to their adoption are set out in section IV of this Report. 
                                                      
6Biosecurity Australia,  Final Import Risk Analysis Report for Apples from New Zealand (Canberra, 
November 2006), Part A (Panel Exhibit AUS-1), Part B (Panel Exhibit AUS-2), and Part C (Panel Exhibit 
AUS-3). 
7Panel Report, paras. 2.36 and 2.61-2.67. 
8Panel Report, paras. 2.56 and 2.57. 
9Australia's appropriate level of protection is expressed in qualitative terms as "providing a high level 
of sanitary or phytosanitary protection aimed at reducing risk to a very low level, but not to zero". (See Panel 
Report, paras. 2.59, 7.963, and 7.1136;  and IRA, Part A, p. 3, and Part B, p. 4) 
10The IRA states that the measures, or combinations of measures, that it sets out are necessary to 
achieve Australia's appropriate level of protection by reducing risk to an acceptable level. (Panel Report, 
paras. 2.58, 2.59, and 7.134 (referring to IRA, Part A, pp. 9 and 13, and Part B, pp. 41, 105-115, 151-155, 
187-192, and 313-325)) 
11Further details on the methodology used by the IRA to assess the risks associated with the import of 
apples from New Zealand and to recomme nd risk management measures are set out infra , paras. 132-148 of this 
Report. 
12Biosecurity Australia Policy Memorandum 2007/07, Biosecurity Policy Determination – Importation 
of Apples from New Zealand , 27 March 2007 (Panel Exhibit NZ-2) quoted, in relevant part, in Panel Report, 
para. 7.165.  
13The 17 measures are set out infra , para. 125 of this Report.  See also Request for the Establishment of 
a Panel by New Zealand, WT/DS367/5. 
14Panel Report, para. 2.92.  These general requirements are also relevant to other pests examined in the 
IRA, which are not at issue in this dispute. 
15Panel Report, para. 2.33.  WT/DS367/AB/R 
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4. Before the Panel, New Zealand claimed that th e measures at issue, both individually and as a 
whole, are inconsistent with Articles 2.2, 2.3, 5.1,  5.2, 5.5, 5.6, and 8, and Annex C(1)(a) to the 
Agreement on the Application of Sanitary and Phytosanitary Measures  (the " SPS Agreement ").16  
New Zealand alleged that the Australian measures:  (i) are maintained without scientific evidence17;  
(ii) are not based on a proper risk assessment18;  (iii) subject imported fruit with a degree of risk 
equivalent to or higher than that of New Zealand a pples to measures substantially less restrictive than 
those imposed on imports of New Zealand apples19;  and (iv) are more trade restrictive than necessary 
to achieve Australia's appr opriate level of protection.20  New Zealand also claimed that the IRA 
ignores available scientific evidence, Australia n border inspection processes, relevant apple 
production processes in New Zealand, relevant di seases or pests in New Zealand, and relevant 
climatic conditions in both New Zealand and Australia.21  Furthermore, New Ze aland alleged that the 
delay of almost eight years between New Zealand' s request for the admission into Australia of 
New Zealand apples and the completion of Australia's approval procedures was "undue".22 
5. On 13 March 2008, Australia requested a pre liminary ruling from the Panel regarding the 
consistency of New Zealand's panel request with Article 6.2 of the Understanding on Rules and 
Procedures Governing the Settlement of Disputes  (the "DSU").  On 6 June 2008, the Panel issued a 
preliminary ruling and determined that the 17 sp ecific measures set out in New Zealand's panel 
request had been properly identified;  that no other measure had been identified by New Zealand;  and 
that New Zealand's panel request contained sufficient information re garding the legal basis of the 
complaint to present the problem clearly wi th respect to the 17 identified measures.23  
On 22 August 2008, Australia requested a second prelim inary ruling.  Australia requested the Panel to 
find that New Zealand's claim under Ar ticle 8 and Annex C(1)(a) to the SPS Agreement  fell outside 
the scope of the dispute, because New Zealand ha d not identified the "process" that had allegedly 
been "unduly delayed".  On 8 September 2008, the Panel informed the parties that it would address 
New Zealand's claim under Article  8 and Annex C(1)(a) to the SPS Agreement  in its final report since 
it had found no good cause to issue a second preliminary ruling.24  On 19 December 2008, the parties 
                                                      
16Panel Report, para. 3.1. 
17Panel Report, para. 4.13. 
18Panel Report, para. 4.28. 
19Panel Report, para. 4.44. 
20Panel Report, para. 4.46. 
21Panel Report, para. 4.43. 
22Panel Report, para. 4.49. 
23Communication from the Chairman of the Panel, Preliminary Ruling by the Panel, WT/DS367/7. 
24Panel Report, para. 1.16. WT/DS367/AB/R 
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advised the Panel that they had reached agreemen t on one of the 17 measures.  Consequently, the 
Panel did not rule on New Zealand's claims in respect of this measure.
25 
6. The Panel decided to seek expert advice and requested the International Plant Protection 
Convention  (the "IPPC") Secretariat and the Council fo r International Congresses of Dipterology to 
provide names of experts in the following fields:  fire blight ( Erwinia amylovora );  European canker 
(Neonectria galligena );  ALCM ( Dasineura mali );  and pest risk assessment, including semi-
quantitative methodologies.26  On 15 December 2008, the Pane l informed the parties that it had 
appointed seven experts:  Dr. Jean-Pierre Paul in and Dr. Tom Deckers for fire blight;  
Dr. Bernardo Latorre and Dr. Terence Swinburne for European canker;  Dr. Jerry Cross for ALCM;  
and Dr. Gritta Schrader and Dr. Ricardo Sgrillo for pest risk assessment, including the use of semi-
quantitative methodologies.27 
7. The Panel Report was circulated to Members of the World Trade Organization (the "WTO") 
on 9 August 2010.  For the reasons set out  in its Report, the Panel found that: 
(a) [t]here is no evidence that the process of selection and 
consultation of experts was c onducted improperly, that due 
process in the expert consultation phase of these proceedings was compromised, nor that Australia's procedural rights were in 
any manner negatively affected in this regard
28; 
(b) [t]he 16 measures at issue in the current dispute, both as a 
whole and individually, constitu te SPS measures within the 
meaning of Annex A(1) and are covered by the SPS Agreement
29; 
(c) Australia's measures at issue re garding fire blight, European 
canker and ALCM, as well as the requirements identified by 
New Zealand as "general" measures that are linked to all three pests at issue in the present dispute, are inconsistent with Articles 5.1 and 5.2 of the SPS Agreement and, by implication, these requirements are also inconsistent with Article 2.2 of the 
SPS Agreement
30; 
(d) New Zealand has failed to demonstrate that the measures at 
issue in the current dispute are in consistent with Article 5.5 of 
the SPS Agreement and, consequentially, has also failed to 
                                                      
25Panel Report, paras. 1.20 and 2.96.  The agreement concerned Measure 12 relating to European 
canker. (See infra , para. 126 of this Report) 
26Panel Report, paras. 1.21-1.32. 
27Panel Report, para. 1.33. 
28Panel Report, para. 8.1(a);  see also para. 7.102. 
29Panel Report, para. 8.1(b);  see also para. 7.187. 
30Panel Report, para. 8.1(c);  see also paras. 7.510 (with respect to fire blight), 7.781 (with respect to 
European canker), 7.887 (with respect to ALCM), 7.905 (with respect to the general measures), and 7.906 
(overall conclusion).  WT/DS367/AB/R 
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demonstrate that these measures are inconsistent with Article 2.3 of the SPS Agreement
31; 
(e) Australia's measures at issue re garding fire blight, European 
canker, and ALCM, are inconsiste nt with Article 5.6 of the 
SPS Agreement;  New Zealand has failed to demonstrate, 
however, that the requirements identified by New Zealand as 
"general" measures that are linked to all three pests at issue in 
the present dispute, are inconsistent with Article 5.6 of the SPS Agreement
32;  and 
(f) New Zealand's claim under Annex C(1)(a) ... and its 
consequential claim under Article 8 of the SPS Agreement are 
outside of the Panel's terms of  reference in this dispute.33 
Accordingly, the Panel recommended that the Disput e Settlement Body (the "DSB") request Australia 
to bring those measures found to be inconsistent into conformity with its obligations under the 
SPS Agreement . 
8. On 31 August 2010, Australia notified the DSB of its intention to appeal certain issues of law 
covered in the Panel Report and cer tain legal interpretations devel oped by the Panel, pursuant to 
Articles 16.4 and 17 of the DSU, and filed a Notice of Appeal34 pursuant to Rule 20 of the Working 
Procedures for Appellate Review (the " Working Procedures ").35  On 7 September 2010, Australia filed 
an appellant's submission.36  On 13 September 2010, New Zealand notified the DSB of its intention to 
appeal certain issues of law covered in the Panel Re port and certain legal inte rpretations developed by 
the Panel, pursuant to Articles 16.4 and 17 of the DSU, and filed a Notice of Other Appeal37 pursuant 
to Rule 23(1) and (2) of the Working Procedures .  On 15 September 2010, New Zealand filed an other 
                                                      
31Panel Report, para. 8.1(d);  see also  paras. 7.1089, 7. 1090, and 7.1095. 
32Panel Report, para. 8.1(e);  see also para. 7.1403.  With respect to New Zealand's claim relating to the 
first requirement in Article 2.2 of the SPS Agreement , that measures be applied only  to the extent necessary to 
protect human, animal or plant life or health, the Panel recalled that it had al ready found the measures at issue to 
be inconsistent with the requirement in Article 2.2 that  Members' sanitary and phytosanitary measures be based 
on scientific principles and not be maintained  without sufficient scientific evidence. ( Ibid., para. 7.1409)  The 
Panel considered that a positive solution to the dispute did not require it to assess whether the same measures 
violate another requirement in Article 2.2.  Thus, the Panel deemed it unnecessary to rule on this "Article-5.6-related Article 2.2 claim by New Zealand" or "to engage in a detailed analysis of the relationship 
between the third condition of the Article 5.6 test and the first requirement of Article 2.2" of the SPS Agreement . 
(Ibid., para. 7.1410) 
33Panel Report, para. 8.1(f);  see also para. 7.1477. 
34WT/DS367/13 (attached as Annex I(a) to this Report).  By letter dated 16 September 2010, Australia 
requested authorization from the Appellate Body Division hearing this appeal to corr ect a clerical error in its 
Notice of Appeal, pursuant to Rule 18(5) of the Working Procedures .  On 17 September 2010, pursuant to 
Rule 18(5), the Division invited New Zealand and the th ird participants to comment on Australia's request.  No 
objections to Australia's request were received.  On 23 September 2010, the Division authorized Australia to 
correct the clerical error in its Noti ce of Appeal. (WT/DS367/13/Corr.1 (attached as Annex I(b) to this Report)) 
35WT/AB/WP/5, 4 January 2005. (Note:  Although this version of the Working Procedures  applied to this 
appeal, it has been replaced by a subsequent version, WT/AB/WP/6, 16 August 2010) 
36Pursuant to Rule 21 of the Working Procedures . 
37WT/DS367/14 (attached as Annex II to this Report). WT/DS367/AB/R 
Page 6  
 
appellant's submission.
38  On 27 September 2010, Australia and New Zealand each filed an appellee's 
submission.39  On the same day, the European Union, Japan, and the United States each filed a third 
participant's submission40 and the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu 
notified its intention to appear at the oral hearing as a third participant.41  On 28 September 2010, 
Chile and Pakistan each notified its intention to a ppear at the oral hearing as a third participant.42 
9. On 1 September 2010, the Division hearing this a ppeal received a joint letter from Australia 
and New Zealand requesting the Appellate Body to au thorize public observation of the oral hearing.  
On 2 September 2010, the Division invited the third participants to comment in writing on the joint 
request of Australia and New Zealand and on the l ogistical arrangements proposed in the request.  
Comments were received on 6 September 2010 from th e European Union, and on 7 September 2010 
from the Separate Customs Territory of Taiwan, Pe nghu, Kinmen and Matsu, and the United States.  
These third participants expressed support for the request  by the participants.  In a Procedural Ruling 
dated 14 September 2010, the Division authorized pub lic observation of the oral hearing by means of 
simultaneous closed-circuit television broadcast, shown in a separate room.43 
10. The oral hearing in this appeal was held on 11 and 12 October 2010.  The participants and 
four of the third participants (Chile, the Europ ean Union, Japan, and the United States) made oral 
statements.  The participants and third participan ts responded to questions posed by the Members of 
the Division hearing the appeal. 
II. Arguments of the Participants  and the Third Participants 
A. Claims of Error by Australia – Appellant 
11. First, Australia appeals the Panel's finding that the 16 measures at issue, both as a whole and 
individually, constitu te SPS measures within the meaning of Annex A(1) to the SPS Agreement .  
Second, Australia appeals the Panel's finding that the measures at issue regarding fire blight and 
ALCM, as well as the requirements identified by Ne w Zealand as "general" measures that are linked 
to all three pests at issue in the present dispute, are inconsistent with Articles 5.1 and 5.2 of the 
SPS Agreement  and, by implication, with Article 2.2 of the SPS Agreement .  Third, Australia claims 
                                                      
38Pursuant to Rule 23(3) of the Working Procedures . 
39Pursuant to Rules 22 and 23(4) of the Working Procedures . 
40Pursuant to Rule 24(1) of the Working Procedures .  On 29 September 2010, the Director of the 
Appellate Body Secretariat received the executive summary of the United States' third participant's submission.  
By letter dated 30 September 2010, the Division informed the United States that the executive summary would 
not be accepted because it had been submitted after 27 September 2010, the de adline for filing a third 
participant's submission.  The original and copies of the executive summary were returned to the United States. 
41Pursuant to Rule 24(2) of the Working Procedures . 
42Pursuant to Rule 24(4) of the Working Procedures . 
43The Procedural Ruling is attached as Annex III to this Report.  WT/DS367/AB/R 
 Page 7 
 
 
that the Panel failed to engage with all of the im portant evidence before it, failed to understand the 
methodology employed in the IRA, and, thus, faile d to make an objective assessment of the facts 
before it, as required by Article 11 of the DSU.  Finally, Australia appeals the Panel's finding that 
Australia's measures at issue are more trade restri ctive than required and are therefore inconsistent 
with Article 5.6 of the SPS Agreement . 
1. Annex A(1) to the SPS Agreement :  "SPS Measure"  
12. Australia requests the Appellate Body to find that the Panel applied an incorrect legal 
interpretation of the definition of sanitary and ph ytosanitary ("SPS") measure in Annex A(1) to the 
SPS Agreement  and, accordingly, to reverse the Panel's fi nding at paragraphs 7.172 and 8.1(b) of the 
Panel Report that the measures at issue individually  constitute SPS measures within the meaning of 
that definition.  Australia accepts that all of th e measures at issue constitute SPS measures when taken 
as a whole or "grouped appropriately".44  However, Australia contends that the Panel erred in finding 
that the 16 measures at issue cons titute SPS measures not only as a whole, but also individually, and  
that the Panel failed to assess whether the 16 measures individually meet the requirements of 
Annex A(1) to the SPS Agreement . 
13. Australia contends that, in order for a measure to fall discretely within the definition of an 
SPS measure in the first sentence of Annex A(1), it mu st have three essential characteristics.  First, it 
must imply the taking of some discrete and recognizable action or course of action as a means to an 
end.  Second, the measure must be applied, that is, deployed or put into practical operation.  Third, the 
measure must be so applied for a specific purpose, namely, to protect against a specified category of 
risk.  The last sentence of the definition in Annex A(1) serves to ensure that the things to which it 
refers are not excluded a priori  from being deemed to be SPS measur es.  Australia stresses, however, 
that the last sentence does not mean that any require ment, procedure, or process described in the list is 
necessarily to be classified as an SPS measure, and does not undermine the essential characteristics of 
an SPS measure required by the first sentence of th e definition.  It follows that, for a panel to 
characterize a measure as an SPS measure, the panel mu st identify, practically and purposively, some 
action or course of action (including an identifiabl e omission) that a Member puts into practical 
operation for the purpose of protecting against some re levant risk.  Activities or requirements, such as 
administrative processes or procedures, that have no  operation other than to enhance the efficacy of 
some active mechanism for protecting animal or plant life or health from relevant risk, should not be 
identified as separate SPS measures.  Such ancilla ry processes or procedures should be identified 
together with the mechanisms to which they rela te collectively as amounting to a single, composite 
                                                      
44Australia's appellant's submission, para. 60.  WT/DS367/AB/R 
Page 8  
 
SPS measure.  Otherwise, cautions Australia, poten tially every detail of an administrative regime 
would be opened up for separate ev aluation of compliance with the SPS Agreement . 
14. Australia maintains that its conception of  an SPS measure is supported by the 2008 Glossary 
of Phytosanitary Terms , the IPPC's International Standards for Phytosanitary Measures ("ISPM"s) 
ISPM No. 5
45, which draws a distinction between a phytosanitary measure  and a phytosanitary 
procedure .  A phytosanitary measure is "[a]ny legislati on, regulation or official procedure having the 
purpose to prevent the introduction and/or spread of quarantine pests, or to limit the economic impact 
of regulated non-quarantine pests";  a phytosanitary procedure is "[a]ny official method for implementing phytosanitary measures including the pe rformance of inspections, tests, surveillance or 
treatments in connection with regulated pests".
46  Australia asserts that these definitions make clear 
that a phytosanitary procedure, aimed simply at implementing  a phytosanitary measure, is not itself a 
distinct phytosanitary measure.   
15. With regard to the present dispute, Australia a lleges that the Panel failed to ask whether each 
"measure" identified by New Zealand individually me t the essential characteristics of the definition of 
an SPS measure in Annex A(1)(a).  The Panel's fi nding that all 16 measures have a purpose that 
corresponds to Annex A(1)(a) is not sufficient fo r each of them individually to amount to an SPS 
measure.  Indeed, certain requirements identifie d by New Zealand were dependent on a principal 
measure and would be meaningless and ineffective to achieve any protection from risk if considered 
individually.  Australia illustrates this point by referring to what New Zealand identified as 
Measure 3.  This measure requires that an orchard inspection methodology be developed and 
approved that addresses issues such as:  visibility of  symptoms in the tops of trees;  the inspection 
time required;  the number of trees to be inspected to meet the efficacy level;  and training and certification of inspectors.
47  Australia argues that, taken alone, this requirement would be 
meaningless and ineffective for achieving any pr otection from risk, and that it would only have 
meaning insofar as it is ancillary to the principal measure requiring that apples be sourced from areas 
free from fire blight disease symptoms.  Australia explains that what New Zealand identified as 
Measures 1, 2, 3, 4, 5, 8, 15, 16, and 17 are pr operly seen as a single, composite SPS measure, rather 
                                                      
45Glossary of Phytosanitary Terms , 2008 (ISPM No. 5, FAO, Rome (Panel Exhibit AUS-164)).  
Regarding ISPMs, see further explanation, infra , footnote 195 of this Report. 
46Australia's appellant's submission, para. 59 (quoting ISPM No. 5, supra , footnote 45 of this Report). 
47See infra , para. 125 of this Report.   WT/DS367/AB/R 
 Page 9 
 
 
than as separate SPS measures.48  Overall, adds Australia, the Pa nel should have found that Australia 
had not 16 SPS measures, but  four:  two for fire blight, one for European canker, and one for ALCM.  
For fire blight, the two measures are inspection of so urce orchards and disinfection of fruit;  and, for 
ALCM, the measure is:  the option of inspection of  3000 fruit for export and, if necessary, treatment 
or rejection of fruit for export. 
2. Articles 5.1, 5.2, and 2.2 of the SPS Agreement  
16. Australia requests the Appellate Body to reverse the Panel's findings that its measures for fire 
blight and ALCM, as well as the general measures, are inconsistent with Articles 5.1, 5.2, and 2.2 of 
the SPS Agreement .  Australia argues that, in so finding, the Panel erred because it applied an 
incorrect legal interpretation of "risk assessme nt" and misapplied the criteria identified in 
paragraphs 590-592 of the A ppellate Body reports in US/Canada – Continued Suspension49 for a 
panel's analysis of whether a risk assess ment complies with Articles 5.1 and 5.2. 
17. In Australia's view, the Appellate Body, in US/Canada – Continued Suspension , confirmed 
the limited role of a panel reviewing an SPS measure  for conformity with Articles 5.1 and 5.2.  The 
panel is not to itself conduct a risk assessment but to review the risk assessment relied upon by the 
Member in order to determine whether the risk assess ment is "objectively justifiable", rather than 
whether it is "correct".50  Referring, in particular, to para graph 591 of those Reports, Australia 
explains that the Appellate Body considered that this requires a panel to:  (i) identify the scientific 
basis upon which the SPS measure was adopted;  (ii) verify that the scientific basis comes from a 
respected and qualified source;  (iii) assess whethe r the reasoning articulated on the basis of the 
scientific evidence is objective and coherent;  and (iv) determine whether the results of the risk 
assessment sufficiently warrant  the SPS measure at issue. 
                                                      
48Australia's appellant's submission, para. 66, and additional clarifications provided at the oral hearing 
in this appeal.  Thes e Measures are set out infra , para. 125 of this Report.  In essence, they require:  that apples 
be sourced from areas free from fire b light disease symptoms;  that orchards/blocks be inspected for fire blight 
disease symptoms;  that an appropriate orchard/block inspection methodology be developed and approved;  that 
an orchard/block be suspended for the season on the basis of evidence of an attempt to remove or hide symptoms of fire blight;  that an orchard/block be suspended for the season upon detection of any visual 
symptoms of fire blight;  that packing houses registered for export of apples process only fruit sourced from 
registered orchards;  that Australian Quarantine and Inspection Service officers be involved in orchard 
inspections, verification of packing house procedures, and in fruit inspection and treatment;  that New Zealand 
ensure that all orchards registered fo r export to Australia operate under sta ndard commercial practices;  and that 
packing houses provide details of the layout of premises. 
49In this Report, we use the term " US/Canada – Continued Suspension " to refer to both Appellate Body 
Reports, US – Continued Suspension  (WT/DS320/AB/R) and Canada – Continued Suspension  
(WT/DS321/AB/R). 
50Australia's appellant's submission, para. 68 (referring to Appellate Body Reports, US/Canada – 
Continued Suspension , para. 590). WT/DS367/AB/R 
Page 10  
 
18. Regarding the Panel's findings that intermediate  conclusions in the IRA were not supported 
by "adequate" or "sufficient" scien tific evidence, Australia argues that  the Panel applied a standard of 
scientific sufficiency "well beyond anythi ng required by the first criterion in US/Canada – Continued 
Suspension and wholly at odds with Japan – Agricultural Products II ".
51  According to Australia, if a 
risk assessment within the meaning of Article 5.1 gi ves rise to significant instances of uncertainty or 
inconclusiveness, a risk assessor should still be able to  exercise expert judgement to deal with such 
uncertainty, taking into account risk assessment tec hniques developed by the relevant international 
organizations, such as those found in ISPM No. 2 and ISPM No. 11. 
19. Australia claims that, while the available sci entific evidence may be sufficient to conduct a 
risk assessment, thus foreclosing recourse to Article 5.7 of the SPS Agreement , such evidence may 
still be inconclusive or uncertain, and in such cases a risk assessor may resort to expert judgement in 
reaching its conclusions.  The fact that a circumstance may present particular methodological 
difficulties does not excuse the risk  assessor from evaluating the risk.  Australia claims that, where 
there is little available scientific evidence, th e phrase "as appropriate to the circumstances" in 
Article 5.1 provides a measure of flexibility in terms of how the risk assessment is conducted. 
20. According to Australia, the flexibility to adap t risk assessment methodologies as a function of 
the available scientific evidence is reinforced by th e reference in Article 5.1 to the risk assessment 
techniques developed by internationa l organizations.  In this respect, Australia notes that the relevant 
risk assessment standards of the IPPC, including ISPM No. 2 and ISPM No. 11, recognize the need 
for expert judgement in risk assessments in circ umstances of scientific uncertainty arising from 
incomplete, inconsistent , or conflicting data. 
21. Regarding the Panel's findings that intermedia te conclusions in the IRA were not "objective 
and coherent", Australia argues that the Panel app lied a standard "well beyond anything required by 
the third of the criteria in US/Canada – Continued Suspension and wholly at odds with Japan – 
Agricultural Products II ".52  According to Australia, it was enough for Biosecurity Australia to 
explain its overall methodology, identify the availa ble scientific evidence and the areas and degree of 
scientific uncertainty, record any expert judgement made, and ensure that an y expert judgement fell 
"within a range that could be considered legitim ate by the standards of the scientific community".53 
                                                      
51Australia's appellant's submission, para. 92. 
52Australia's appellant's submission, para. 93. 
53Australia's appellant's submission, para. 93.  WT/DS367/AB/R 
 Page 11 
 
 
22. In Australia's view, the criterion identified in US/Canada – Continued Suspension that "the 
reasoning articulated on the basis of the scientific ev idence is objective and coherent" is not directed 
at assessing the quality of the reasoning as an end in  itself, but rather at determining whether the 
"particular conclusions" drawn by the Member asse ssing the risk are sufficiently supported by the 
scientific evidence relied upon.  The application of this criterion thus "focuses on the relationship 
between the scientific evidence and the conclusions  ultimately reached by the Member as the basis for 
an SPS measure".54  Australia argues that the question of wh ether a particular conclusion ultimately 
reached by a Member as the basis for the SPS m easure is sufficiently supported by "available 
scientific evidence" is properly an swered by asking whether the particular conclusion is rationally or 
objectively related to that scientific evidence, not  by asking whether the conclusion is correct or 
whether it is the same conclusion that the Panel, or an expert , would have reached. 
23. According to Australia, Biosecurity Australia w as not required to explain in greater detail 
precisely how it drew each intermediate conclusion.  Australia claims that the Panel erred in asking 
whether itself or its appointed experts would have made the same judgement as Biosecurity Australia, 
rather than whether the expert judgements made by Biosecurity Australia at intermediate steps in the 
IRA fell "within a range that could be consider ed legitimate by the standards of the scientific 
community".55 
24. Australia also argues that the Panel erred in  requiring that Biosecurity Australia explain 
precisely how it arrived at the expert judgements it made  at intermediate steps in the IRA.  Australia 
claims that no such obligation exists in Article 5.1 of the SPS Agreement .  The standards of 
"documentation" and "transpare ncy" set forth in ISPM No. 2 and ISPM No. 11 only require 
identification of where expert ju dgement has been used and an explanation of what scientific 
uncertainty has given rise to the need for that e xpert judgement.  However, ISPM No. 2 and ISPM 
No. 11 do not suggest any need for an explanation of  how a particular expert judgement was reached.  
The IRA was transparent in its use of expert judge ment and noted that, at each intermediate step 
where the inconclusive or incomplete nature of sci entific data gave rise to scientific uncertainty, the 
IRA identified and recorded the expert judgement requi red in the light of that scientific uncertainty.  
Australia also points out that the IRA included an explicit statement documenting the process of 
making expert judgements and the constraints observed. 
25. Australia further claims that the Panel erred be cause it failed to assess the materiality of the 
faults it found in the intermediate conclusions reach ed in the IRA.  Australia, relying on the panel 
report in Australia – Salmon (Article 21.5 – Canada) , argues that the Panel should have asked, but 
                                                      
54Australia's appellant's submission, para. 76. (original underlining) 
55Australia's appellant's submission, para. 95. WT/DS367/AB/R 
Page 12  
 
erroneously failed to ask, whether any alleged flaw s in the IRA's reasoning were "so serious" as to 
undermine "reasonable confidence" in the risk assessment as a whole.
56 
26. Australia then illustrates how these errors of in terpretation and application under Article 5.1 
of the SPS Agreement  affected the Panel's analysis of the IRA' s assessment of the risk of fire blight 
and ALCM. 
(a) Measures regarding Fire Blight 
27. Regarding importation step 157 (the probability that Erwinia amylovora  is present in source 
orchards in New Zealand), Australia argues that the Panel adopted Dr. Paulin's view that the estimate 
had not been shown to be "true"58 rather than determining, based on his expert testimony, whether the 
estimate was within a legitimate range.  Australia  also argues that the Panel failed to assess the 
significance of any overestimation under importation step 1, either to the overall probability of 
importation or to the overall assessment of risk. 
28. Regarding importation step 2 (the probability that fruit picked from an orchard in which 
Erwinia amylovora is present will itself be either infested or in fected), Australia claims that, in relying 
on Dr. Paulin's testimony that no general and reas onable conclusion could be based on the disparate 
results of the various scientific studies reviewed by  the IRA, the Panel failed to adhere to the 
Appellate Body's guidance that scientific uncertain ty or inconclusiveness does not excuse the risk 
assessor from evaluating the risk, and failed to properly assess whether the judgement made was 
within a range that could be considered legitim ate according to the stan dards of the scientific 
community.  Australia further contends that th e Panel failed to assess the significance of any 
overestimation under importation step 2, either to the overall probability of importation or to the 
overall assessment of risk. 
29. Regarding importation step 3 (the probability that clean fruit is contaminated with Erwinia 
amylovora during picking and transportation to a packing house), Australia argues that, in finding that 
                                                      
56Australia's appellant's submission, paras. 84 and 90 (quoting Panel Report, Australia – Salmon 
(Article 21.5 – Canada) , para. 7.57). 
57Australia explains, at paragraphs 33-35 of its appella nt's submission, that the IRA, first, identified a 
series of discrete steps at which infection or infestation might occur beginning with the sourcing of apples from 
orchards in New Zealand and ending with their arrival in Australia after passing through various stages of 
processing and transportation.  Eight points at which an apple could potentially become or remain infested or 
infected with the pest were identif ied and the conditional likelihood of infestation or infection occurring or 
remaining at each point was estimated.  The eight point s were labelled as numbered "importation steps".  The 
importation steps do not describe a single, linear process of infection or infestation.  Rather, there are ten distinct 
pathways through the importation steps by which an apple that is infested or infected may be imported (importation scenarios).  The probability of an infected or infested apple being imported into Australia was 
calculated as the sum of the probabilities for each of these ten alternative importation scenarios. 
58Australia's appellant's submission, para. 101 (quoting Panel Report, para. 7.258).  WT/DS367/AB/R 
 Page 13 
 
 
the studies relied upon by the IRA cannot constitute an  adequate scientific basis for a coherent and 
objective analysis, the Panel overlooked the prac tical necessity for a risk assessor to make a 
judgement even when confronted by limited scientif ic evidence.  Moreover, Australia contends that 
the Panel erred in relying on the experts' views th at the probability of contamination estimated by the 
IRA seemed "rather high"59, instead of asking whether the estimate was within a range that could be 
considered legitimate according to  the standards of the scientific community, and that it failed to 
assess the significance of any overestimation under impor tation step 3, either to the overall probability 
of importation or to the overall assessment of risk. 
30. Regarding importation step 5 (the probability that clean fruit is contaminated with Erwinia 
amylovora  during processing in the packing house), Austra lia argues that the Panel erred in finding 
that the estimate for this step was not objective a nd coherent, because there was no indication in the 
IRA of how the results of certain scientific studies referenced in the IRA we re taken into account.  
The Panel should instead have verified whether the estimate was within a range that could be 
considered legitimate according to the standards of the scientific community.  According to Australia, 
the Panel also erred in failing to assess the significance of any overestimation under importation 
step 5 either to the overall pr obability of importation or to the overall assessment of risk. 
31. Regarding importation step 7 (the probability that clean fruit will become contaminated with 
Erwinia amylovora  during palletization, quality inspection, containerization, and transportation), 
Australia contends that the Panel failed to verify wh ether the estimate for this step was within a range 
that could be considered legitimate according to the standards of the scientific community, 
irrespective of any perceived flaw in the relations hip between the numerical range and the qualitative 
descriptor.  Moreover, Australia argues that the Panel erred by not assessing the significance of any 
overestimation under importation step 7, either to the overall probability of importation or to the 
overall assessment of risk, and observes that the contribution made by importation step 7 to the 
overall probability of importation of infested or infe cted fruit was "several orders of magnitude less 
than could be considered material".60 
32. Regarding "exposure" (the transfer of Erwinia amylovora  from infested or infected apple 
waste to a susceptible host plant), Australia argues th at, in finding that the IRA's conclusions were not 
supported by scientific evidence, the Panel overl ooked that, while direct scientific evidence on 
specific mechanisms of transfer ma y be lacking, it is established, including through the testimony of 
the Panel's appointed experts, that transfer ca n occur.  Confronted with such evidence and 
uncertainties, the IRA team was not excused from maki ng an assessment of risk.  In Australia's view, 
                                                      
59Australia's appellant's submission, para. 105 (quoting Panel Report, para. 7.288). 
60Australia's appellant's submission, para. 108. WT/DS367/AB/R 
Page 14  
 
in finding that the probability of transfer should be commensurate to the extremely low likelihood of 
transmission through one transfer scenario, the Panel failed to give any consideration to the range of 
estimates that would be considered legitimate acco rding to the standards of the scientific community, 
and displaced the judgement made by the IRA in favour of its own implicit assessment of the 
probability of transfer as "extremely low". 
33. Regarding the use of uniform distribution
61, Australia argues that, in reaching its conclusion, 
the Panel relied on Dr. Sgrillo's testimony that a triangular distribution would have been more 
appropriate, without assessing the significance of Dr. Schrader's testimony that a uniform distribution is useful when there is insufficient information to estimate a most likely value.  The Panel should have 
verified whether the decision by the IRA to use a uniform distribution was within a legitimate range 
of available judgements, not whether this decision was the correct or the pr eferable one.  Australia 
adds that the Panel's error in this  regard directly affects, and similarly taints, the Panel's somewhat 
unclear finding with respect to the IRA's conclusions on the probability of spread. 
34. Regarding the likelihood of establishment of fire blight in Australia, Australia argues that the 
Panel's criticism that the IRA failed to note th e difference between expe riments taking place under 
ideal conditions in the laboratory and under natural circumstances highlights the Panel's failure to ask 
the correct question, that is, whether the IRA's est imate of the probability of establishment was within 
a range that could be considered legitimate accord ing to the standards of the scientific community, 
irrespective of any differences between laboratory and natural conditions. 
35. Regarding the potential biological and economic  consequences associated  with the entry, 
establishment and spread of fire blight, Australia clai ms that, in finding that the IRA's assessment did 
not rely on adequate scientific evidence, the Panel relied almost exclusively upon the testimony of one 
expert, Dr. Paulin, and unduly relied on the scientif ic aspects of the evidence, thereby failing to 
appreciate that Article 5.3 of the SPS Agreement  requires a risk assessment to assess "potential" 
consequences and take into account  "relevant economic factors".  Australia argues that, had the Panel 
properly appreciated the meaning of a "risk assessme nt" in this regard, it would not have overlooked 
the evidence of the economic impact of the outbreaks of fire blight at Hawkes Bay, New Zealand, 
in 1998, and in Michigan, United States, in 2000, which were reviewed in the IRA. 
                                                     
 
61Australia explains, at paragraph 42 of its appellant's submission, that in its quantitative assessment of 
the likelihood of entry, establishment and spread, the IRA evaluated each step in the schemata for importation 
and distribution, utilization, waste generation, and disposal using a probability distribution.  The IRA used pert, 
triangular, and uniform distributions as appropriate.  Each of those distributions has as parameters minimum and 
maximum values, but only the pert and triangular distributions have as a third parameter the "most likely value".  Australia explains that uniform distributions (where any value contained in the range between the minimum and 
maximum values occurs with equal probability) were used  in cases where insufficient information was available 
to determine the most likely value.  WT/DS367/AB/R 
 Page 15 
 
 
(b) Measures regarding ALCM 
36. Australia claims that the Panel erred in findi ng that certain matters had not properly been 
taken into account in the IRA, or that the IR A was based upon incorrect assumptions, without asking 
"whether the judgement in fact made in the IRA,  notwithstanding any perceived shortcomings in the 
reasoning to that judgement, was within a range that could be considered leg itimate according to the 
standards of the scientific community".62  Australia adds that the Pane l failed to assess the materiality 
of the errors it found, and failed to verify whethe r those errors took the judgements made in the IRA 
outside a legitimate range. 
37. Australia recalls that, with respect to the pr obability of importation of ALCM, the IRA made 
two separate estimates for ALCM.  The first, base d on the IRA's methodology, yielded an estimated 
probability of 4.1 per cent.  The second, based on August 2005 trade data supplied by New Zealand, 
yielded an estimate of between 0.1 and 0.38 per cent.  The Panel found that the IRA's reasoning 
regarding the viability of ALCM was not objectivel y justifiable because it did not take into account 
the proportions of cocoons with viable ALCM, in th e light of the possible incidence of the parasitic 
wasp Platygaster demades .  At no point did the Panel find that the estimate of probability of 
importation was not within a legitimate range.  Moreove r, in the Article 5.6 section of its Report, the 
Panel described the infestation rate of 0.1-0.38 pe r cent as "more realistic" than the infestation rate 
of 4.1 per cent.63  Australia points out that the measures relating to ALCM were  adopted on the basis 
of the 0.1-0.38 per cent infestation rate and argues,  accordingly, that the Panel has found "abstract 
fault" in the IRA's "perceived failure" to take into account viability even though the Panel itself 
concluded that the infestation rate actually relied upon was "more realistic".64 
38. With respect to establishment and spread of  ALCM, Australia notes that the Panel assessed 
four alleged flaws and found against the IRA with respect to three of them.  The Panel failed, 
however, to ask the "correct" question, namely, wh ether any of these flaws meant that the estimate 
reached by the IRA was outside a legitimate range. 
39. Regarding the potential biological and economic  consequences associated  with the entry, 
establishment and spread of ALCM, Australia claims  that the Panel erred in relying on Dr. Cross' 
testimony that different impact scores for particul ar factors "would be more appropriate" or "more 
objective and credible", while ignoring Dr. Cross' statement that he would not change the IRA's 
overall rating of the consequences of ALCM ("low") and that Australia's analysis was objective and 
                                                      
62Australia's appellant's submission, para. 118. 
63Australia's appellant's submission, para. 120 (quoting Panel Report, para. 7.1360). 
64Australia's appellant's submission, para. 120. WT/DS367/AB/R 
Page 16  
 
credible.
65  Australia contends that the Panel failed to  enquire whether the overall judgement of the 
IRA on the potential biological and economic con sequences of ALCM was within a legitimate range, 
having regard to the requirement to assess "poten tial" consequences and taki ng into account relevant 
economic factors.66 
3. Article 11 of the DSU  
40. Australia requests the Appellate Body to find that the Panel failed to observe its duty under 
Article 11 of the DSU to make an objective assessme nt of the matter before it, and to reverse the 
Panel's findings that Australia's measures for fire blight and ALCM, as well as the general measures, 
are inconsistent with Articles 5.1, 5.2, and 2.2 of the SPS Agreement .  Australia claims that the Panel 
failed to make an objective assessment of the facts before it, as required by Article 11 of the DSU, 
because it failed to engage with all of the importa nt evidence before it and failed to understand the 
methodology employed in the IRA. 
(a) Treatment of Expert Testimony 
41. Australia argues that the Panel disregarded critical  aspects of the appointed experts' testimony 
that were favourable to Australia.  A panel must en gage with all of the impor tant evidence before it 
that is relevant to the matter at issue and will err if  it fails to give significant evidence proper, genuine, 
and realistic consideration and assess its significance.  In this respect, Australia relies on the Appellate 
Body reports in US/Canada – Continued Suspension  and argues that if, in those proceedings, the 
panel erred by merely reproducing testimony and not assessing its significance, the Panel in the 
present dispute committed an even more serious error, because in several instances it overlooked 
entirely testimony that was favourable to Australia's case.67  While a panel has a margin of discretion 
as the trier of facts, such discretion does not underm ine the panel's overriding obligation to make an 
objective assessment of the facts.  Merely reproducing testimony without discussing it, or 
disregarding it entirely, constitutes a failure to make an objective assessment of the facts.68  Australia 
stresses, in this regard, the importance of the overlooked testimony to its case. 
42. In respect of the overall probability of importati on of infested or infected apples, Australia 
argues that the Panel incorrectly characterized Dr. Deckers as having stated that the overall likelihood 
of importation "is probably" overestimated, when Dr. Deckers had in fact stated that such probability 
                                                      
65Australia's appellant's submission, para. 123  (referring to Panel Report, para. 7.881). 
66Australia's appellant's submission, para. 123. 
67Australia's appellant's submission, para. 133. 
68Australia's appellant's submission, para. 130.  WT/DS367/AB/R 
 Page 17 
 
 
"could be" overestimated.69  The Panel further failed to consider that Dr. Deckers had also stated that 
he did not think that the estimation in the importati on steps was exaggerated.  Dr. Deckers' statement 
that the IRA's assessment of the probability of im portation was not exaggerated should be read to 
qualify significantly Dr. Deckers' earlier statement that the probability of importation "could be" overestimated.  By failing to reproduce and assess Dr . Deckers' position comprehensively, the Panel 
failed to make an objective assessment of the ma tter, as required under Article 11 of the DSU.  
Australia adds that this error was made worse by the fact that the Panel referred to Dr. Deckers' 
testimony that was favourable to Australia in a foot note "in peremptory and dismissive terms:  'But 
see, Dr. Deckers' reply in Transcript of th e Panel's meeting with experts, para. 259.'"
70 
43. In respect of the Panel's analysis of "exposure",  Australia argues that the Panel failed to make 
an objective assessment of the facts, because it relie d on Dr. Deckers' initial testimony that the chance 
of epiphytic bacteria being transmitted to the su sceptible organs of a host plant at the appropriate 
moment to realize an infection was "rather sma ll", without reproducing or assessing the significance 
of Dr. Deckers' clarifying testimony that he thought the IRA's estimation of the probability of 
exposure of 0 to 10-6 (zero to one in one million) was "true".71 
44. Regarding the Panel's review of the IRA's anal ysis of the potential biological and economic 
consequences of fire blight, Australia claims that the Panel acted inconsistently with Article 11 of the 
DSU, because it relied exclusively on certain testim ony by Dr. Paulin to the effect that certain 
individual impact scores in the assessment of con sequences "could be exaggerated", but failed to 
reproduce or assess the significance of testimony fa vourable to Australia given by Dr. Deckers and 
Dr. Paulin, both of whom rated the overall poten tial biological and economic consequences of fire 
blight as "high".  Australia points out that the onl y reference in the Panel Report to Dr. Deckers' 
testimony favourable to Australia on this point w as a bare reference in a footnote preceded by the 
words "[b]ut see".72  Australia also claims that the Panel act ed inconsistently with Article 11 of the 
DSU, because it proceeded on the erroneous basis th at an assessment of consequences must be based 
only on scientific evidence and failed, thereby, to e ngage with or refer to the evidence of actual 
production losses caused by outbreaks of fire blight at Hawkes Bay, New Zealand, in 1998, and in 
Michigan, United States, in 2000. 
                                                      
69Australia's appellant's submission, para. 137 (quoting Panel Report, para. 7.356;  and Dr. Deckers' 
response to Panel Question 34, Panel Report, Annex B-1, para. 237). 
70Australia's appellant's submission, para. 137 (quoting Panel Report, footnote 1595 to para. 7.356). 
71Australia's appellant's submission, paras. 139 and 140 (quoting Dr. Deckers' response to Panel 
Question 42, Panel Report, Annex B-1, para. 271). 
72Australia's appellant's submission, para. 142 (quoting Panel Report, footnote 1796 to para. 7.465). WT/DS367/AB/R 
Page 18  
 
45. Australia contends that the Panel reproduced, but dismissed without explanation, the 
testimony given by Dr. Deckers that "[t]he limitation of apple exports to mature symptomless apples 
is not enough to achieve Australia's ALOP".
73  According to Australia, the Panel failed to assess the 
significance of this testimony not only in relation to New Zealand's claims under Article 5.6 of the 
SPS Agreement , but also in relation to Articles 5.1, 5.2, and 2.2 of the SPS Agreement , because this 
testimony also shows that Australia's SPS measu res were sufficiently warranted by the IRA. 
46. Regarding the use of uniform distribution, Aust ralia argues that the Panel's finding that such 
use is unjustified is based on Dr. Sgrillo's testimony that the IRA team should have used a triangular 
distribution, and on only part of Dr. Schrader's test imony, opining that uniform distribution is the least 
realistic of the three types of distribution.  Australia contends, however, that the Panel acted 
inconsistently with Article 11 of the DSU by fa iling to reproduce or assess the significance of 
Dr. Schrader's additional statement, favourable to Australia, that uniform distribution is useful in 
situations presenting "a high degree of uncertainty" and where there is insufficient information to 
determine the most likely value.74 
47. Regarding the IRA's assessment of potential bi ological and economic c onsequences of entry, 
establishment and spread of ALCM, Australia ar gues that the Panel committed an error under 
Article 11 of the DSU by failing to reproduce or assess the significance of testimony given by Dr. Cross that was favourable to Australia.  The Panel reproduced Dr. Cross' testimony opining that 
certain individual impact scores assigned by the IRA were too severe and that a more credible score 
could be assigned, but the Panel failed to reproduce or assess the significance of Dr. Cross' testimony, 
favourable to Australia, that even assuming that th e most severe scores (for plant health and control 
treatment) were reassigned based on his appreciation of the facts, this would not result in a change of 
the rating of the overall consequences as "low" and that , in this respect, "the conclusion of Australia's 
analysis was objective and credible".
75 
(b) The Panel's Alleged Misunderstanding of the IRA 
48. Australia further argues that the Panel acted inconsistently with Article 11 of the DSU 
because it failed to understand the risk assessmen t methodology employed in the IRA and, in 
particular, the choice of a probability interval of 0 to 10-6 (zero to one in one million) with a midpoint 
(if uniform distribution is used) of 5 × 10-7 (0.5 in one million) for events with a "negligible" 
                                                      
73Dr. Deckers' response to Panel Question 15, Panel Report, Annex B-1, para. 117. 
74Australia's appellant's submission, paras. 147 and 148 (quoting Dr. Schrader's response to Panel 
Question 135, Panel Report, Annex B-1, paras. 781-783). 
75Australia's appellant's submission, paras. 149 and 150 (quoting Dr. Cross' response to Panel 
Question 96, Panel Report, Annex B-1, para. 561).  WT/DS367/AB/R 
 Page 19 
 
 
likelihood of occurring.  Australia contends that, if the Panel misunde rstood in a material respect what 
the risk assessor had done, it necessarily failed to perform its duties under Article 11 of the DSU. 
49. Australia recalls that, in the IRA's semi -quantitative risk assessment methodology, a 
quantitative assessment of entry, establishment and spread was combined with a qualitative 
assessment of potential consequences.  In exercisi ng expert judgement to arrive at an estimated 
probability distribution, the IRA team was not c onstrained by the intervals suggested by the 
nomenclature.  Indeed, that nomenclature, wh ich defined correspondence between a so-called 
"negligible" event and a probability interval of 0 to 10-6 was, in and of itself, inevitably arbitrary.  The 
relevant issue was that the probab ility distribution assigned to particular  events was not arbitrary.  The 
qualitative label "negligible" was assigned to the qua ntitative range, rather than the range being 
assigned to the label.  Australia contends th at at the steps where the interval 0 to 10-6 was used 
(importation step 7 and "exposure") the relevant question for the Panel was whether the estimate was 
within a range that might be considered legitima te according to the standards of the scientific 
community, not whether the definitional corres pondence between the range and the label was 
justified. 
50. Australia also argues that the Panel, in fi nding that the methodological flaws constituted an 
independent basis for the invalidity of the IRA, fa iled to acknowledge that the IRA team used the 
interval of 0 to 10-6 at just two points (importation step 7 and "exposure") and in combination with 
uniform distribution only for "exposure".  The Pane l's conclusion that the alleged methodological 
flaws were serious enough to cons titute an independent basis for the IRA's invalidity cannot stand if 
the limited uses of the impugned methodologies are understood in their broader context.  Australia observes in this regard that, based on the contested  interval, only 72 clean apples were estimated to 
become contaminated at importation step 7, which Australia argues is an insignificant number relative 
to the 6 million infested apples that the IRA estimated would be imported annually. 
51. Australia concludes that, without the multiple fa ilures to observe its duties under Article 11 of 
the DSU, the Panel should have found that Austra lia's SPS measures for fire  blight and ALCM, as 
well as the general measures linked to both pests, were  consistent with Articles 2.2, 5.1, 5.2, and 5.6 
of the SPS Agreement . 
4. Article 5.6 of the SPS Agreement
 
52. Australia requests the Appellate Body to reverse the Panel's conclusion, in  paragraph 8.1(e) of 
the Panel Report, that the measures imposed in resp ect of fire blight and ALCM were more trade 
restrictive than required and therefore inconsistent with Article 5.6 of the SPS Agreement .  Australia 
further requests the Appellate Body to reverse the two intermediate fi ndings upon which this WT/DS367/AB/R 
Page 20  
 
conclusion was based:  that New Zealand had ra ised a sufficiently convincing presumption that 
restricting imports of New Zealand apples to mature, symptomless apples was an alternative measure 
with respect to fire blight that would meet  Australia's appropriate level of protection
76;  and that 
New Zealand had made a prima facie  case that the inspection of a 600-fruit sample of each import lot 
would be an alternative measure with respect to AL CM that would meet Australia's appropriate level 
of protection.77 
53. Australia identifies two bases for reversal of the Panel's findings under Article 5.6.  First, 
Australia argues that the Panel's findings under Artic le 5.6 should be reversed consequentially upon a 
reversal of the Panel's findings under Articles 5.1, 5.2, and 2.2 of the SPS Agreement .  According to 
Australia, the Panel's findings under Article 5.6 are based on its previous findings under Articles 5.1, 
5.2, and 2.2.  Thus, if the Appellate Body reverses  the Panel's findings under Articles 5.1, 5.2, and 2.2 
the basis for the Panel's findings relating to Article  5.6 would fall, because t hose findings could not be 
sustained on their own terms. 
54. Second, irrespective of its arguments under Article s 5.1, 5.2, and 2.2, Australia alleges that 
the Panel misinterpreted the requirements of Article 5.6 and misapplied the rules governing the 
burden of proof.  Although the Panel correctly stat ed the burden of proof at the outset and at the 
conclusion of its analysis, the Panel in fact app lied a significantly lower standard.  The Panel relied 
"virtually entirely"78 upon its ultimate finding under Article 5. 1 as to the IRA's exaggeration of risk 
associated with the importation of apples.  With respect to both fire blight and ALCM, the Panel 
purported to consider whether the alternative meas ures would meet Australia's appropriate level of 
protection, but in fact only reviewed the perceived inadequacy of the scientific  basis for intermediate 
estimates in the risk analysis.  Even assuming arguendo  that the Panel's analysis was correct, this 
entitled the Panel to conclude only that, in the light of  the shortcomings in the IRA, an inference that 
the alternative measures would meet the appropriate level of protection was not foreclosed.  This is 
not sufficient to establish a prima facie  case, which consists of evidence on the basis of which a panel 
would be required to rule in favour of the claim.  The Panel, however, "fundamentally 
misunderstood"79 that New Zealand's burden was not to s how that its proposed alternative measures 
"might" or "may" achieve Australia's appropriate leve l of protection, but that they "would" do so.  In 
Australia's view, therefore, by prematurely shifting the burden to Australia to rebut the presumption of 
inconsistency, the Panel effectively reversed th e burden of proof, and requi red Australia to prove 
                                                      
76Panel Report, para. 7.1197. 
77Panel Report, para. 7.1328. 
78Australia's appellant's submission, para. 171. 
79Australia's appellant's submission, para. 172.  WT/DS367/AB/R 
 Page 21 
 
 
consistency of its measures upon a showing by New Zealand of no mo re than "doubt" about whether 
an alternative measure would achieve th e appropriate level of protection.  
55. Australia further contends that the Panel mi sinterpreted the words "appropriate level of 
sanitary or phytosanitary protection" in Article 5.6.   In determining whethe r an alternative measure 
proposed by a complainant achieves the respondent's appropriate level of protection, a panel must 
apply the definition of "appropriate level of prot ection" in accordance with Annex A(5) to the 
SPS Agreement .  This must also be understood by reference to the meaning of "risk" as set out in the 
definition of "risk assessment" in Annex A(4).  Pursuant  to this definition, "risk" is the combination of 
"the likelihood of entry, establishment or spread" of  a pest and of "the associated potential biological 
and economic consequences".  The Pa nel's analysis of New Zealand's Article 5.6 claim, however, 
focused solely on the likelihood of entry, establishment and spread of a pest and failed to consider any 
such associated consequences.  Australia submits that, without having considered the potential 
consequences, the Panel could not have reached any conclusion about the "risk" associated with 
New Zealand's alternative measures and, therefore, could not have properly determined whether those 
measures meet Australia's appropriate level of protection. 
56. Furthermore, Australia alleges that the Panel misinterpreted the requirement that there be 
"another measure ... that  achieves" the Member's ap propriate level of protec tion in order to establish 
that the measure at issue is more trade restrictive th an required.  It is not enough that the alternative 
measures "could" or "might" achieve the appropriate level of protection.   In its anxiousness to avoid 
impermissible de novo  review, the Panel failed to satisfy itself that the evidence and arguments 
adduced by New Zealand demonstrate that the alternative measures "would achieve" Australia's 
appropriate level of protection, and instead wrongl y relied on its findings unde r Article 5.1 regarding 
the inadequacy of the IRA as also establishing incons istency with Article 5.6.  However, the correct 
question for a panel assessing a breach of Article 5.6 to ask itself is whether a "proper" risk 
assessment would necessarily have concluded that  the alternative measure "would" achieve the 
Member's appropriate level of protection.80  This does not require an impermissible de novo review, 
because the panel does not have to determine what the risk in fact is, and therefore does not have to 
perform a risk assessment, nor make judgements in the nature of a risk assessor.  For Australia, it is 
clear that, had the Panel asked itself the correct legal question, it would have answered in the 
negative, because the Panel expressly recognized that  a proper risk assessment might conclude that 
the alternative measures exceed Australia's appropriate level of protection. 
                                                      
80Australia's appellant's submission, para. 179. WT/DS367/AB/R 
Page 22  
 
B. Arguments of New Zealand – Appellee 
1. Annex A(1) to the SPS Agreement :  "SPS Measure"
 
57. New Zealand requests the Appellate Body to up hold the Panel's findings that the 16 measures 
at issue, both as a whole and individually, constitu te SPS measures within the meaning of Annex A(1) 
and are covered by the SPS Agreement .  New Zealand characterizes Australia's conception of an 
SPS measure—and, in particular, the alleged di stinction between "principal" and "ancillary" 
measures—as "mere assertion" with "no basis in the SPS Agreement or the jurisprudence".81 
58. New Zealand refers to Australia's argument that to not distinguish between principal and 
ancillary measures would "potentially open up every detail of an administrative regime to separate 
evaluation for compliance" with Articles 2.2, 5.1, 5.2, and 5.6 of the SPS Agreement .82  I n  
New Zealand's view, this argument overlooks two points.  First, onl y SPS measures that directly or 
indirectly affect international trad e are subject to scrutiny under the SPS Agreement , and thus not 
every detail is open to evaluation.  Second, what is  required to comply with the obligations of the 
SPS Agreement  depends on the particular circumstances and the nature of the measures at issue.  
Where measures are closely related to each othe r and rely to a significant degree on the same 
underlying science, this is relevant in determining whether those measures comp ly with the applicable 
obligations. 
59. New Zealand makes reference to Australia's ar guments that, in order to constitute an SPS 
measure, a measure must have the three essential characteristics required by the first sentence of 
Annex A(1) to the SPS Agreement , and that the Panel should have asked whether each measure 
requires, practically and purposively, some discret e and recognizable action or course of action that 
was deployed or put into practical operation for the purpose of protecting against some relevant risk.  
New Zealand highlights, however, that the Panel appr oached this issue in acco rdance with the text of 
the SPS Agreement and the relevant jurisprudence, rather than in accordance with the definition set 
forth by Australia.  The Panel considered, first,  whether the purposes of the 16 measures correspond 
to the purposes in subparagraphs (a) through (d) of Annex A(1);  and, second, whether the measures 
correspond to the "form and nature" elements  in the last sentence of Annex A(1).83  New Zealand 
maintains, in any event, that all three elements  of an SPS measure identified by Australia were 
addressed by the Panel. 
                                                      
81New Zealand's appellee's submission, para. 2.6. 
82New Zealand's appellee's submission, para. 2.11 (r eferring to Australia's appellant's submission, 
para. 58). 
83New Zealand's appellee's submission, para. 2.17 (referr ing to Panel Report, paras. 7.118 and 7.119;  
and Australia's second written submission to the Panel, paras. 75 and 76).  WT/DS367/AB/R 
 Page 23 
 
 
60. With respect to the first element identified by Australia, namely, that the instrument requires 
some action or course of action, New Zealand submits that the Panel confirmed that "each of 
the 16 measures requires New Zealand or its appl e producers, packing houses and traders to do 
something  as a condition for New Zealand apples to have access to the Australian market".84  
Regarding Australia's second element, namely, whet her the measures were "deployed or put into 
practical operation", the Panel found that "New Zeal and needs to comply with each of the measures in 
order to export apples to Australia", and that, ther efore, the measures were "deployed or put into 
practical operation".85  The Panel also addressed the third element of Australia's definition and 
identified the purpose of the 16 measures.  The Pane l analyzed the elements in subparagraph (a) of 
Annex A(1), looking at the subject ("animal or plan t life or health"), geography ("within the territory 
of the Member"), and risk ("arising from the entry, establishment or spread of pests, diseases, disease-
carrying organisms or disease-causing organisms").  For New Zealand, the Panel correctly concluded 
that the 16 measures were applied to protect against a category of risk specified in subparagraph (a) of 
Annex A(1).86   
61. New Zealand also refers to Australia's argumen t that the exclusion of "ancillary" measures 
from the definition of an "SPS measure" is supporte d by ISPM No. 5, which distinguishes between 
"phytosanitary measures" and "phytosanitary pr ocedures".  New Zealand responds that the 
SPS Agreement 's definition of SPS measure is clear and unambiguous, and does not exclude SPS 
measures because they "support", "enhance", or "i mplement" other SPS measures.  In addition, 
New Zealand maintains that an SPS regime may well be made up of many interlinked measures.  The 
fact that a measure is linked to another measur e does not disqualify it from being an SPS measure in 
its own right.  New Zealand further submits that th e last sentence of Annex A(1) lists, as examples of 
SPS measures, the very types of measures that Australia argues are "ancillary". 
2. Articles 5.1, 5.2, and 2.2 of the SPS Agreement  
62. New Zealand requests the Appellate Body to reject Australia's claim that the Panel 
misinterpreted and misapplied Articles 5.1, 5.2, and 2.2 of the SPS Agreement  and to find, instead, 
that the Panel was correct in its interpretation of  what constitutes a "risk assessment", and that it 
properly interpreted and applied Ar ticles 5.1, 5.2, and 2.2 of the SPS Agreement  according to the 
guidance provided by the Appellate Body in US/Canada – Continued Suspension . 
                                                      
84New Zealand's appellee's submission, para. 2.21 (quoting Panel Report, para. 7.161). (underlining 
added by New Zealand) 
85New Zealand's appellee's submission, para. 2.22 (quoting Panel Report, para. 7.161, and Australia's 
appellant's submission, para. 63). 
86New Zealand's appellee's submission, para. 2.23 (referring to Panel Report, para. 7.139). WT/DS367/AB/R 
Page 24  
 
63. New Zealand argues that two of Australia's main  assertions, that the standard of objectivity 
and coherence set out in paragraph 59 1 of the Appellate Body reports in US/Canada – Continued 
Suspension  should apply only to conclusions ultimately r eached and that a panel should only review 
whether expert judgements fall within  a range considered legitimate by  the standards of the scientific 
community, are "designed to shelter the IRA from effective review".
87 
64. According to New Zealand, Australia's discussi on of the concepts of "sufficient scientific 
evidence" under Articles 2.2 and 5.7 of the SPS Agreement  and of "as appropriate to the 
circumstances" and "risk assessment techniques developed by the relevant international 
organizations" under Article 5.1, is unclear.  New Zealand agrees that risk assessments often involve 
scientific uncertainty and that expert judgement ma y be used in such circumstances, but argues that 
the third criterion in US/Canada – Continued Suspension , that reasoning in a risk assessment be 
"objective and coherent" and that the "conclusions  drawn find sufficient support in the scientific 
evidence", applies equally to reasoning and to conclusi ons that are based in part on the application of 
expert judgement. 
65. New Zealand claims that, unlike the defi nition proposed by Australia, the phrase "as 
appropriate to the circumstances" in Article 5.1 provi des for some flexibility regarding the nature of a 
risk assessment, but does not allow deviation from Ar ticle 5.1's substantive obligations.  New Zealand 
recalls that, during the eight-year risk assessment process for New Zealand apples, Australia deviated 
from its usual "qualitative" approach to assessing ri sk and adopted a "semi-quantitative" approach in 
which the probability of entry, establishment and spread was ass essed quantitatively.  New Zealand 
further notes that the Panel agreed with its appoi nted experts that "a quantitative methodology should 
only be used 'when reliable specifi c numeric data are available'".88 
66. New Zealand observes that, under Article 5.1, i rrespective of the particular risk assessment 
methodology adopted by a WTO Member, according to the third criterion set out in paragraph 591 of 
the Appellate Body reports in US/Canada – Continued Suspension , there must be a sufficient 
relationship between the scientific evidence and th e conclusions reached by the risk assessor.  
ISPM No. 2 and ISPM No. 11, which establish genera l principles for risk assessment, cannot be used 
to limit the specific obligations contained in Article 5.1.  Specifically, New Zealand claims that, even 
if a risk assessment takes into account techniques de veloped by relevant inte rnational organizations, 
the risk assessment is not "sheltered" from revi ew under Article 5.1, nor can it be considered 
objectively justified based only on the implementing Member's indication that expert judgement was 
used. 
                                                      
87New Zealand's appellee's submission, para. 2.40. 
88New Zealand's appellee's submission, para. 2.47 (quoting Panel Report,  para. 7.441).  WT/DS367/AB/R 
 Page 25 
 
 
67. New Zealand asserts that the "objective and coherent" standard in US/Canada – Continued 
Suspension  refers to "particular conclu sions", not only to "conclusions ultimately reached", and is not 
replaced or weakened by ISPM No. 2 and ISPM No. 11.  New Zealand claims that requiring a panel 
to assess only "conclusions ultimately reached" is tantamount to prohibiting a panel from making an objective assessment, because a panel would be prev ented from reviewing the relevant relationships 
between the scientific evidence, intermediate dete rminations, and the ultimate conclusions reached.   
68. New Zealand rejects Australia's contention that the Panel erred by considering whether the 
Panel itself or its appointed experts would have ma de the same judgement as Biosecurity Australia at 
intermediate steps in the IRA.  In New Zealand' s view, the Panel did not do so, but instead assessed 
whether the scientific evidence supporting the IRA was objective and coherent.  According to New Zealand, Australia's assertion that a panel s hould assess whether an intermediate conclusion in a 
risk assessment was within a range that could be  considered legitimate by the standards of the 
scientific community would establish a lower thres hold for a panel reviewing a risk assessment than 
the threshold clarified by the Appellate Body in US/Canada – Continued Suspension , and such a 
lower threshold would eliminate the need to asse ss the link between the scientific evidence and the 
conclusions reached in a risk assessment. 
69. New Zealand rejects Australia's contention that, where expert judgement was used to address 
scientific uncertainty, the Panel could only consider  whether this expert judgement was legitimate by 
the standards of the scientific community.  New Zealand asserts that the IRA did not face an 
unprecedented level of scientific uncertainty, and argues that the standard  proposed by Australia 
would prevent a panel from assessing the relationshi p between scientific evidence and conclusions.  
70. New Zealand disagrees with Australia's cont ention that the Panel failed to assess the 
materiality of flaws it found in the intermediate st eps of the IRA or to consider whether such flaws 
undermined the overall risk assessment.  New Z ealand argues that the Panel did focus on the 
materiality of the flaws it found in the interm ediate steps of the IRA and that it assessed the 
cumulative effect of such flaws. 
71. New Zealand asserts that, contrary to Australia's claims, the Panel did not discount the IRA's 
use of expert judgement because it was not documente d and transparent.  Rather, the Panel rejected 
the concept that the mere recourse to expert judgement requires a panel to uphold the conclusions 
reached through that expert judgement. WT/DS367/AB/R 
Page 26  
 
(a) Measures regarding Fire Blight 
72. New Zealand characterizes as without merit Au stralia's contentions that, because the Panel 
failed to assess the materiality of the purported flaws in the IRA, failed to consider whether the IRA's 
conclusions were within a range that  could be considered legitimate by  the standards of the scientific 
community, and misapplied the required standard of scientific sufficiency, the Panel misinterpreted and misapplied Articles 5.1, 5.2, and 2.2 of the SPS Agreement  in finding that Australia's measures 
regarding fire blight are inconsistent with those provisions. 
73. First, New Zealand disagrees that the Panel fa iled to assess the materiality of the faults it 
found with the IRA because it failed to engage with significant testimony of Dr. Deckers that was 
favourable to Australia.  Dr. Deckers' views on th e probability of importation were consistent with 
those of other experts and his statement that the IR A's prediction that the likelihood of importation of 
apples infested with fire blight is 3.9 per cent was not exaggerated is taken out of context by 
Australia.  Read in context, it is clear that Dr . Deckers was commenting on the way in which the IRA 
aggregated the importation steps and not on the overall figure of 3.9 per cent.  In addition, the Panel 
did not ignore Dr. Deckers' views on consequences, and Dr. Deckers' testimony that "[t]he limitation of apples exports to mature symptomless apples is not enough to achieve Australia's ALOP" is an 
issue to be dealt with under the Article 5.6 analys is and not under Article 5.1, as Australia suggests.
89  
New Zealand adds that, in any event, this testimony was not favourable to Australia. 
74. Second, New Zealand argues that Australia's proposed standard of "legitimate according to 
the standards of the scientific community" should  not be adopted because it is not based on the 
Appellate Body's statements in US/Canada – Continued Suspension .90  New Zealand agrees that the 
Panel was not required or permitte d to make its own risk assessment, but highlights how the Panel 
correctly applied the required standard of objectivity and coherence of the reasoning in its analysis of 
importation steps 1, 2, 3, 5, and 7, and of expos ure and spread, uniform distribution, establishment, 
and consequences of fire blight. 
75. Regarding importation step 1, New Zealand asserts that Australia has not established that the 
Panel erred by failing to consider fully Dr. Pa ulin's testimony regarding the likelihood that Erwinia 
amylovora  is present in any source orchard in New Z ealand or by failing to assess the significance of 
any overestimation under importation step 1 either to  the overall probability of importation or to the 
overall risk assessment, because the Panel fully co nsidered Dr. Paulin's relevant testimony and the 
Panel noted the significance of any overestimation under importation step 1. 
                                                      
89New Zealand's appellee's submission, para. 2.95 (quoting Dr. Deckers' response to Panel Question 15, 
Panel Report, Annex B-1, para. 117). 
90See, for instance, New Zealand's ap pellee's submission, para. 2.115.  WT/DS367/AB/R 
 Page 27 
 
 
76. New Zealand rejects Australia's criticisms of th e Panel's assessment of importation step 2, 
including that the Panel erred by failing to adhe re to Appellate Body guidance that scientific 
uncertainty or inconclusiveness does not excuse  the risk assessor from evaluating the risk.  
New Zealand argues that the Panel was cognizant of scientific uncertainty or inconclusiveness, but 
that this does not excuse non-compliance with the SPS Agreement ;  that the Panel used the word 
"aggregated" simply to mean "collected together" and explained that the IRA did not indicate 
transparently how the scientific data from a range of disparate studies were used under 
importation step 2;  that the Panel made findings that would satisfy the Australian-proposed test of 
"within a range that could be considered legitima te according to the sta ndards of the scientific 
community" (even though this test is itself flawed);  and that the Panel considered the significance of 
an overestimation under importation step 2.91 
77. Regarding importation step 3, New Zealand contest s Australia's claims that the Panel erred by 
overlooking the practical necessity of making a risk assessment judgement even when there is limited 
scientific evidence, by failing to assess whether Austra lia's estimates could be considered legitimate 
by the scientific community, and by failing to assess the significance of any overestimation under 
importation step 3.  The Panel did not require Austra lia to make a specific kind of risk assessment.  
Rather, in applying the requirement that the j udgements made by a risk assessor be objectively 
justifiable, the Panel did not consider Australia's  estimate to be sufficiently supported by scientific 
evidence.  New Zealand also argues that the Pa nel assessed the significance of an overestimation 
under importation step 3. 
78. In response to Australia's claims regarding importa tion step 5, that the Panel erred in failing to 
ascertain whether importation step 5 could be consider ed legitimate according to the standards of the 
scientific community and in failing to assess the significance of any overestimation under importation step 5, New Zealand asserts that the Panel assessed  the connection between the IRA's conclusions on 
importation step 5 and the scientific evidence and c onsidered the materiality of any overestimation 
under importation step 5. 
79. Similarly, with respect to Australia's arguments on importation step 7, New Zealand contends 
that the Panel assessed the connection between the IRA's conclusions on importation step 7 and the 
scientific evidence
92 and considered the cumulative effect of importation step 7. 
80. Regarding exposure and spread, New Zealand asserts  that Australia mistak enly maintains that 
the Panel failed to consider the possibility that a tr ansfer may occur despite a lack of direct scientific 
                                                      
91New Zealand's appellee's submission, paras. 2.113-2.116. 
92New Zealand's appellee's submission, para. 2.131. WT/DS367/AB/R 
Page 28  
 
evidence on specific transfer mechanisms and made its finding on exposure without assessing the 
range of estimates that the scientific commun ity would consider legitimate, while overlooking 
Dr. Deckers' testimony.  New Zealand argues that it was not established before the Panel that the 
transfer itself could occur, that the Panel consider ed the relevant scientific  evidence, and that the 
Panel assessed Dr. Deckers' testimony on exposure. 
81. New Zealand disputes Australia's claims that th e Panel erred by not questioning whether the 
use of uniform distribution was within a legitimate  range of available judgements and by not assessing 
the significance of Dr. Schrader's testimony that uniform distribution may be useful.  New Zealand 
responds that the Panel enquired whether uniform distributions may be used and properly assessed 
Dr. Schrader's testimony. 
82. Regarding establishment, New Zealand disagrees  with Australia's assertions that the Panel 
failed to assess whether the IRA's estimate of the prob ability of establishment was within a range that 
could be considered legitimate ac cording to the standards of the scientific community, and contends 
that the Panel correctly assessed whether the IR A's conclusions found sufficient support in the 
scientific evidence and were thus objective and coherent. 
83. New Zealand rejects Australia's arguments that the Panel erred in its assessment of the 
consequences of fire blight by not consideri ng economic evidence of actual production losses shown 
to have been caused by prior outbreaks of fire bli ght and by ignoring Dr. Paulin's and Dr. Deckers' 
views that the consequences could properly be assess ed as "high".  In New Zealand's view, the Panel 
did not fail to consider any relevant economic ev idence and did not overlook the relevant expert 
testimony regarding the consequences of fire blight. 
(b) Measures regarding ALCM 
84. Regarding ALCM, New Zealand disagrees with Aust ralia's argument that the Panel failed to 
assess whether the estimate of the probability of  importation was within a legitimate range.  
New Zealand responds that Australia's proposed standa rd of "within a range that could be considered 
legitimate according to the standa rds of the scientific community" s hould not be adopted because it is 
not based on the Appellate Body's guidance in US/Canada – Continued Suspension , that Australia 
conflates the concepts of "infestati on rate" and "likelihood of importation"
93, and that the Panel 
reasonably concluded that the IRA's reasoning was not objectively justifiable.94  New Zealand 
disputes Australia's contention that the Panel failed to assess the materiality of  the perceived errors in
                                                      
93New Zealand's appellee's submission, para. 2.186. 
94New Zealand's appellee's submission, paras. 2.187-2.190.  WT/DS367/AB/R 
 Page 29 
 
 
the IRA, because the Panel was not required or pe rmitted to conduct its own risk assessment and the 
Panel assessed the materiality of the perceived erro rs in the IRA.  Moreover, New Zealand challenges 
Australia's argument that the Panel erred in not assessing whether the overall judgement made by the 
IRA was within a legitimate range, as evidenced by th e Panel's failure to refer to Dr. Cross' testimony, 
because Australia's proposed standard of "within a range that could be considered legitimate 
according to the standards of the scientific commun ity" should not be adopte d and the Panel was not 
required to refer to Dr. Cross' testimony.95 
3. Article 11 of the DSU  
85. New Zealand requests the Appellate Body to rej ect Australia's claim that the Panel failed to 
make an objective assessment of the matter before  it in accordance with Article 11 of the DSU.  
Referring to the Appellate Body report in Brazil – Retreaded Tyres , New Zealand notes that a panel 
enjoys discretion in assessing whether a given piece of  evidence is relevant for its reasoning, and is 
not required to discuss, in its report, each and every piece of evidence.96 
(a) Treatment of Expert Testimony 
86. New Zealand highlights the differences in circumstances between this case and US/Canada – 
Continued Suspension .  New Zealand points out that, in US/Canada – Continued Suspension , there 
were justifiable doubts as to the independence or im partiality of the two e xperts on whom the panel 
relied extensively, whereas the experts relied upon by the Panel in this dispute are clearly independent 
and impartial.97  New Zealand then turns to specific statem ents made by the experts that Australia 
alleges the Panel overlooked. 
87. First, New Zealand argues that Dr. Deckers' statement that the overall probability of 
importation was "not an exaggerated situation" is not favourable to Australia and, further, that the 
Panel did assess the significance of it.98  New Zealand claims that this statement does not qualify 
Dr. Deckers' earlier statement that the probability of importation "could be overestimated".99  
New Zealand also submits that the statement c oncerning the overall probability of importation does 
not support Australia's position because Dr. Deck ers considered that the likelihoods assessed under 
                                                      
95New Zealand's appellee's submission, paras. 2.201 and 2.202. 
96New Zealand's appellee's submission, para. 2.207 (quoting Appellate Body Report, Brazil – 
Retreaded Tyres , para. 202).  
97New Zealand's appellee's submission, para. 2.209.  
98New Zealand's appellee's submission, paras. 2.217-2.222 (quoting Transcript of the Panel's meeting 
with the scientific experts, Panel Report, Annex B-2, Dr. Deckers, para. 259). 
99New Zealand's appellee's submission, para. 2.220 (referring to Australia's appellant's submission, 
para. 137;  and quoting Dr. Deckers' response to Panel Question 34, Panel Report, Annex B-1, para. 237). WT/DS367/AB/R 
Page 30  
 
importation steps 2, 3, and 5, which are aggregated  as parts of the overall probability of importation, 
are overestimated. 
88. Second, New Zealand points out that, when sta ting that the IRA's estimation of exposure as 
an interval of 0 to 10
-6 appeared to be correct, Dr. Deckers "was not making an informed comment on 
the interval"100, because he was not considering whether the likelihood at issue corresponds to an 
event that almost certainly would not occur.  Ne w Zealand also notes that Dr. Deckers admitted the 
insufficiency of his expertise in examining the appropriateness of risk analysis methodologies. 
89. Third, as to the IRA's assessment of conseque nces associated with fire blight, New Zealand 
claims that the Panel made an objective assessm ent of the views of Dr. Deckers and those of 
Dr. Paulin.  The Panel chose to rely primarily on Dr. Paulin's views because they were more 
comprehensive and detailed on this issue than tho se of Dr. Deckers.  New Zealand also argues that 
Dr. Deckers' response to Panel Question 11 and his testimony are of limited assistance in considering 
whether the IRA's evaluation of th e potential consequences of entry, establishment and spread of fire 
blight was coherent and objective. 
90. Fourth, New Zealand argues that, in concluding that restricting the importation of apples to 
mature, symptomless apples would meet Australia's a ppropriate level of protec tion, the Panel properly 
engaged with the totality of the evidence and did no t, as Australia claims, di smiss without explanation 
Dr. Deckers' testimony stating that such a limitation is not enough to achieve Australia's appropriate 
level of protection. 
91. Fifth, New Zealand claims that Dr. Schrader's general statement, that the use of uniform 
distribution is useful when there is not sufficient in formation to determine the most likely value, could 
not be applied to the IRA because this statemen t relied on the existence of a properly justified 
maximum value, and the maximum va lue was not properly justified in the IRA.  New Zealand also 
argues that the Panel properly chose to rely prim arily on the responses of experts who had addressed 
the IRA's use of uniform distribution in combination with the interval of 0 to 10-6. 
92. Lastly, New Zealand contests Australia's argument  that the Panel failed to make an objective 
assessment of Dr. Cross' views relating to ALCM by failing to reproduce one aspect of his testimony in its Report.  Citing the Appellate Body report in EC – Hormones , New Zealand emphasizes that a 
                                                     
 
100New Zealand's appellee's submission, para. 2.224.   WT/DS367/AB/R 
 Page 31 
 
 
panel should be allowed a substantia l margin of discretion as to which statements are to be explicitly 
referred to in its report.101 
(b) The Panel's Alleged Misunderstanding of the IRA 
93. New Zealand contests Australia's assertion that the Panel misunderstood the IRA's use of the 
interval of 0 to 10-6 and uniform distribution to represent neg ligible events.  First, the Panel was 
correct to consider the definitional correspondence be tween the term "negligible" and the interval and 
distribution.  Table 12 of the IRA sets out a seri es of likelihood labels, corresponding to quantitative 
probability intervals, and defines "negligible" likelih ood as an event that "would almost certainly not 
occur".102  Second, the Panel correctly understood what the interval and uniform distribution assigned 
to "negligible" events represented.  The Panel fo und that the "negligible" interval together with 
uniform distribution were not appropriate for modelling events that almost certainly would not occur.  Lastly, the Panel was correct in concluding that  the methodological flaws were serious enough to 
constitute an independent basis for the IRA's invalid ity.  New Zealand points out that the interval at 
issue was assigned to over one third of all the interv als used in the IRA.  New Zealand also notes that 
Dr. Sgrillo and Dr. Latorre stated that there were  fundamental problems with the IRA's treatment of 
the "negligible" interval. 
4. Article 5.6 of the SPS Agreement
 
94. New Zealand requests the Appellate Body to u phold the Panel's conclusion that Australia's 
measures regarding fire blight and ALCM ar e inconsistent with Article 5.6 of the SPS Agreement .  
New Zealand submits that the Panel was correct  in finding that New Zealand had raised a 
presumption that restricting imports of New Zealand apples to mature, symptomless apples was an alternative measure with respect to fire blight that would meet Australia's appropriate level of 
protection, and that New Zealand had made a prima facie  case that the inspection of a 600-fruit 
sample of each import lot would be an alternativ e measure with respect to ALCM that would meet 
Australia's appropriate level of protection. 
95. In response to Australia's argument that the Panel's findings under Article 5.6 should be 
reversed consequentially upon a reversal of the Pane l's findings under Articles 5.1, 5.2, and 2.2 of the 
SPS Agreement , New Zealand argues that, because the latter findings should not be reversed, the 
conditions for a consequential reve rsal would not arise.  In any event, New Zealand argues that 
Australia is not correct in arguing that the Panel's findings under Article 5.6 are largely consequential 
                                                     
 
101New Zealand's appellee's submission, para. 2.252 (quoting Appellate Body Report, EC – Hormones , 
para. 138).  
102New Zealand's appellee's submission, para. 2.261.  WT/DS367/AB/R 
Page 32  
 
on its findings under Articles 5.1, 5.2, and 2.2, because Australia overlooks that the Panel undertook a 
second step in its analysis, assessing New Zealand's c ontention that, with respect to fire blight and 
ALCM, mature, symptomless apples do not pose a risk exceeding Australia's appropriate level of 
protection. 
96. New Zealand contends that Australia's argument that the Panel, while correctly articulating 
the burden of proof, actually applied a significantly lower burden of proof "does not withstand serious 
analysis".
103  Although Australia asserts that the Panel relied "virtually entirely"104 upon its finding 
under Article 5.1 as to the IRA's exaggeration of risk , the Panel's findings unde r Article 5.1 were only 
the beginning of its analysis and not something on  which it relied "virtually entirely".  The Panel 
adopted a two-step approach, assessing under the first step whether Australia's calculation of the risk 
resulting from the importation of New Zealand apples w as exaggerated, and cons idering more directly 
under the second step whether the alternative measu res proposed by New Zealand would reduce the 
risk to or below Australia's appropriate level of protection.  New Zealand argues that Australia is 
incorrect in asserting that under the second step the Panel merely reviewed the perceived inadequacy 
of the scientific basis for intermediate esti mates in the IRA.  Instead, the Panel assessed 
New Zealand's contention that mature, symptomless a pples do not pose a risk of transmission of fire 
blight or ALCM that exceeds Austra lia's appropriate level of  protection.  The Panel did more than rely 
on its findings under Article 5.1:  it looked at th e arguments made by New Zealand and the views of 
the experts.  New Zealand highlights, in this regard , that it was particularly appropriate for the Panel 
to consider the scientific eviden ce in the IRA and test New Zealand's claim with the assistance of the 
experts, because Australia relied exclusively  on the validity of the IRA to defend New Zealand's claim 
under Article 5.6.  Having done so, Australia cannot now claim that the Panel erred in having regard 
to the evidence in the IRA as part of its Article 5. 6 analysis.  Thus, New Zealand maintains that there 
was no "shifting"105 of the burden of proof. 
97. New Zealand also objects to Australia's allegati on that the Panel, throughout its consideration 
of New Zealand's claim under Artic le 5.6, failed to consider potential biological and economic 
consequences, and instead focused so lely on the likelihood of entry, establishment and spread of the 
pests.  The Panel observed that it had al ready assessed potential biological and economic 
consequences in the context of its analysis under Ar ticle 5.1, and referred back to these findings in its 
analysis under Article 5.6, namely, in the context of fire blight at paragraph 7.1152, and in the context 
                                                      
103New Zealand's appellee's submission, para. 2.290. 
104New Zealand's appellee's submission, para. 2.288 (quoting Australia's appellant's submission, 
para. 171). 
105New Zealand's appellee's submission, para. 2.300 (quoting Australia's appellant's submission, 
para. 173).  WT/DS367/AB/R 
 Page 33 
 
 
of ALCM at paragraph 7.1307 of its Report.106  In addition, the Panel accepted that New Zealand had 
raised a presumption that there is no scientific evidence that mature, symptomless apples can provide 
a pathway for the transmission of fire blight, and that the conditions for the entry, establishment and 
spread of ALCM will "likely 'almost never occur'" even with the "'worst case' infestation level".107  In 
the light of these findings, along with its earlier find ing that the IRA's assessment of consequences 
was not objectively justifiable, the Panel was not requi red to consider consequences any further in this 
part of its analysis. 
98. With respect to Australia's argument that the Panel failed to assess whether a proper risk 
assessment would necessarily have concluded that th e alternative measure would achieve Australia's 
appropriate level of protection, New Zealand argue s that this would constitute an impermissible 
de novo assessment of the risk.  Australia is requiring a degree of scientific certainty that can come 
only from performing a risk assessment.  New Zeala nd maintains that the Panel could not make the 
assessment proposed by Australia without perform ing an actual risk assessment.  New Zealand 
reiterates that Australia's arguments ignore what the Panel found New Zealand to have demonstrated 
regarding the likelihood of entry, establishment and spread of fire blight and ALCM, and observes 
that it is difficult to understand what more the Panel could have done without conducting a de novo 
review. 
C. Claims of Error by New Zealand – Other Appellant 
1. Annex C(1)(a) and Article 8 of the SPS Agreement  
99. New Zealand requests the Appellate Body to re verse the Panel's finding that its claim under 
Annex C(1)(a), and its consequen tial claim under Article 8 of the SPS Agreement , fell outside the 
Panel's terms of reference.  New Zealand alleges th at the Panel erred in finding that New Zealand had 
not properly identified the measure at issue in th e context of its claims under Annex C(1)(a) and 
Article 8, and that New Zealand had to challenge  the completed "IRA process" as a measure separate 
from the measures specified in th e IRA.  New Zealand further requests the Appellate Body to 
complete the analysis of its claim of undue delay. 
100. New Zealand contends that the Panel comm itted three main errors relating to the 
interpretation of Annex C(1)(a) to the SPS Agreement  and Article 6.2 of the DSU, namely:  (i) the 
Panel proceeded on the erroneous assumption that the measure at issue must directly  cause the 
violation of obligations;  (ii) the Panel blurred th e distinction between measures at issue and claims;  
and (iii) by insisting that the IRA process, alt hough expired, was the only measure that could be 
                                                      
106New Zealand's appellee's submission, paras. 2.304 and 2.305. 
107New Zealand's appellee's submission, para. 2.309 (quoting Panel Report, para. 7.1312). WT/DS367/AB/R 
Page 34  
 
challenged, the Panel ignored the fact that it is th e measures challenged by New Zealand that continue 
to impair benefits. 
101. New Zealand maintains that there is no requirement that the measure at issue must directly 
cause the violation of an obligation, and refers to Article 5.1 of the SPS Agreement , Article X:1 of the 
General Agreement on Tariffs and Trade 1994  (the "GATT 1994"), and provisions of the Agreement 
on Safeguards  in support of this proposition.   Thus, under Article 5.1 of the SPS Agreement , it is not 
the measure at issue that causes th e breach, but rather the lack of an objectively justifiable risk 
assessment.  New Zealand adds that the Appellate Body report in EC – Selected Customs Matters  is 
consistent with this proposition.  In that case, the Appellate Body sought to ensure that "measures at 
issue" were not limited by the obligation being cha llenged, and the Appellate Body stated that "a 
complainant is entitled to include in its panel requ est an allegation of inc onsistency with a covered 
agreement of any measure that may be submitted to WTO dispute settlement."
108 
102. New Zealand contends that the Panel erred in finding that the measure at issue must 
necessarily be the "procedure" referred to in the chapeau of Annex C(1) to the SPS Agreement .  In 
doing so, the Panel improperly limited the measures at issue by reference to the specific obligation 
being challenged, thereby blurring the distinction between claims and measures under Article 6.2 of 
the DSU.  In contrast, the Appellate Body in EC – Selected Customs Matters held that the "manner of 
administration" relevant for purposes of Article X:3 of the GATT 1994 need not necessarily be identified as the measure at issue.  By analog y, the reference to "approval procedures" in 
Annex C(1)(a) does not mean that such "approval pr ocedures" must be identified as the measures at 
issue.
109  New Zealand further observes that the Panel's finding is at odds with the finding of the panel 
in EC – Approval and Marketing of Biotech Products , where the measure at issue was the de facto  
moratorium, rather than the "procedures" re ferred to in the chapeau of Annex C(1).110 
103. New Zealand takes issue with the Panel's findi ng that the IRA process, although expired, was 
the only measure that could be challenged, because it continues to impair benefits.  It is the SPS 
measures resulting from the approval process, rather than  the approval process itself, that give rise to 
the continuing impairment of benefits, and that is why New Zealand made those measures the subject 
of its challenge.  The SPS measures are inextricab ly linked to the process by which they were 
developed and they can therefor e be challenged under Annex C(1)(a).  Where SPS measures have 
been developed and adopted in the context of an  unduly delayed approval process, such measures can 
                                                      
108New Zealand's other appellant's submission, para. 12 (quoting Appellate Body Report, EC – Selected 
Customs Matters , para. 133). 
109New Zealand's other appellant's submission, para. 17. 
110New Zealand's other appellant's submission, para. 18 (referring to Panel Report, EC – Approval and 
Marketing of Biotech Products , paras. 7.1491 and 7.1492).  WT/DS367/AB/R 
 Page 35 
 
 
be the basis of a challenge of that undue delay.  There may be other ways to raise a claim of undue 
delay, for example, by challenging, in connecti on with an ongoing process, the approval process itself, 
or the acts or omissions leading to delays in approval, as the measures at issue.  Similarly, as the Panel 
itself recognized, it may be possible to characterize the substantive SPS measures that are developed as part of an approval process, and the approval process itself, as separate SPS measures.
111  However, 
in New Zealand's view, it does not follow from this that only the approval process can be challenged 
under Annex C(1)(a), even when it has expired. 
104. New Zealand requests the Appellate Body to co mplete the legal analysis with regard to 
New Zealand's claim of undue delay.  Ne w Zealand explains that the panel in EC – Approval and 
Marketing of Biotech Products  found that a delay is "undue" if the time taken to complete an approval 
procedure exceeds the time that is reasonably needed to  check and ensure the fulfilment of its relevant 
SPS requirements.112  New Zealand asserts that in the present dispute the key factual matters 
establishing that the time taken to complete the IRA exceeded that which was reasonably needed are 
uncontested, namely:  (i) the eight-year period to co mplete the IRA;  (ii) letters from Australia's 
quarantine service at the outset of the IRA process indicating that the risk assessment would be 
"routine" and would take approximately 12 months to complete because it was "technically less 
complex" than previous processes;  (iii) the recognition, in an Aust ralian government-mandated 
review of Australia's quarantine system, that the de lay was "difficult to justify";  and (iv) the absence 
of explanation or justification of the delay by Australia.113 
D. Arguments of Australia – Appellee 
1. Annex C(1)(a) and Article 8 of the SPS Agreement  
105. Australia requests the Appellate Body to dismiss New Zealand's other appeal and uphold the 
Panel's finding that New Zealand's claims  under Annex C(1)(a) and Article 8 of the SPS Agreement  
were outside the Panel's terms of reference.  Ac cording to Australia, the Panel correctly required 
New Zealand to identify in its panel request the "p rocedure" alleged to be inconsistent with the 
obligation under Annex C(1)(a).   
106. In response to New Zealand's argument that the Panel erroneously assumed that the measure 
at issue must directly cause the violation of obliga tions, Australia asserts that New Zealand "seeks to 
contrive a distinction between the object of a claime d violation and a measure at  issue, when they are 
                                                      
111New Zealand's other appellant's submission, para. 25 (referring to Panel Report, para. 7.1463). 
112New Zealand's other appellant's submission, para. 28 (quoting Panel Report, EC – Approval and 
Marketing of Biotech Products , para. 7.1499). 
113New Zealand's other appellant's submission, para. 28. WT/DS367/AB/R 
Page 36  
 
the same thing."
114  Australia further argues that the Panel did not blur the distinction between the 
measures at issue and the claim because it did not inte rpret the term "measures at issue" in Article 6.2 
of the DSU in the light of the specific obligation.  Rather, the Panel simply found that the object of 
New Zealand's claim was absent from its panel re quest.  The Panel also did not, as New Zealand 
asserts, find that the only measure that could be challenged in the circumstances of this dispute was 
the expired IRA process.  Instead, asserts Australia, the Panel's conclusion concerned simply the way 
in which New Zealand articulated its claims in this dispute. 
107. Australia points to the various ways in which New Zealand formulated and reformulated its 
Annex C(1)(a) and Article 8 claims throughout  these proceedings.  Australia emphasizes that, 
throughout these various formulations, the object of New Zealand's claim was the IRA process, or the 
development of the 17 specified measures, and that  New Zealand never claimed that the 17 measures 
themselves violated Annex C(1)(a) and Article 8.  The Panel correctly understood this, and also 
correctly recognized that the development  of the 17 measures was conceptually distinct from the 
measures themselves.  The measures at issue were, as established in the Panel's preliminary ruling, 
limited to the 17 measures identified in the panel re quest, and the Panel correc tly found that neither 
the development of the 17 measures, nor "the IRA process", were captured by the mere identification 
of the 17 measures in the panel request.  Although New Zealand cites the A ppellate Body report in 
EC – Selected Customs Matters  for the proposition that a complainant is entitled to challenge any 
measure, this ruling does not speak to the more  fundamental requirement that New Zealand has 
consistently overlooked, namely, that the alle gation of inconsistency in respect of the relevant 
measure must be set out in the panel request.  Australia emphasizes that it is not sufficient for the 
relevant measure to be identified in subseque nt submissions, because a complainant cannot be 
permitted to "cure" defects in its panel request by  identifying in its subsequent submissions the 
measure it sought to challenge.115 
108. Australia submits that in any event New Zeala nd's claim is based on a misinterpretation of 
Annex C(1)(a).  Although New Zealand seems to re gard Annex C(1)(a) as a provision containing an 
obligation to develop SPS measures without undue delay, the ordinary meaning of a procedure "to 
check and ensure the fulfilment" of SPS measures refe rred to in the chapeau of Annex C(1) cannot be 
the equivalent of a procedure that "develops" SPS measures.116  The measures at issue were adopted 
following and as a result of the IRA process, and, th erefore, the IRA process cannot be considered as 
a process intended to check or ensure the fulfilmen t of the 17 measures within the scope of the 
                                                      
114Australia's appellee's submission, para. 10. 
115Australia's appellee's submission, para. 14 (quoting Appellate Body Report, US – Carbon Steel , 
para. 127). 
116Australia's appellee's submission, para. 18.  WT/DS367/AB/R 
 Page 37 
 
 
chapeau of Annex C(1).  In addition, before th e Panel, New Zealand submitted that the SPS measure 
to which the chapeau of Annex C(1)  refers is Australia's regime relating to the import approval of 
fresh fruit or vegetables.117  According to Australia, this concessi on makes it all the more explicit that 
the 17 measures within the Panel's terms of refere nce corresponded to neither the "procedure" nor the 
"[SPS] measures" referred to in the chapeau of Annex C(1).118 
109. Finally, Australia submits that the Appellate B ody should not complete the legal analysis of 
New Zealand's claims under Annex C(1)(a) and Article  8 because at least two of the "key factual 
matters" relied upon by New Zealand, namely, the absence of justification for the delay and the 
statements in the domestic review of Australia's quarantine system, have been contested by Australia 
in the course of the Panel proceedings.119 
E. Arguments of the Third Participants 
1. European Union  
110. The European Union disagrees with Australia's  conception of an SPS measure, contending 
instead that, to the extent that an  act or an omission attributable to a WTO Member is applied in order 
to pursue one of the aims listed in Annex A(1)(a ) to (d), the WTO adjudicating bodies can consider 
that act or omission a "measure" within the meaning of Annex A(1) to the SPS Agreement  and, thus, 
examine its conformity with the provisions of the SPS Agreement .  The Appellate Body has adopted a 
broad notion of the term "measure" under the DSU, and there is no reason to interpret the term 
differently in the chapeau  of Annex A(1) to the SPS Agreement .120  Neither Annex A(1) nor any other 
provision of the SPS Agreement  distinguishes between "ancillary" and "principal" measures.  WTO 
Members frequently adopt a number of different me asures that can only attain their objective when 
they operate together.  Thus, an assessment of a given measure cannot always be done in "clinical 
isolation"121, but may require an adjudicator to consider  the interaction among a number of different 
measures.  This, however, does not mean that each act or omission of the State that meets the relevant 
conditions cannot be identified as a discrete "mea sure" for the purpose of WTO dispute settlement.  
The European Union adds that it is up to the compla ining Member, in the first instance, to identify the 
"measure at issue".  The complaining Member ha s some, albeit not unfettered, discretion in this 
respect, and must also accept the consequences that  flow from its identification of the measure at 
                                                      
117Australia's appellee's submission, para. 19 (quoting New Zealand's response to Panel Question 146 
after the first Panel meeting, para. 301).   
118Australia's appellee's submission, para. 19. 
119Australia's appellee's submission, para. 20. 
120European Union's third participant's submission, paras. 3-6 (referring to Appellate Body Report, 
US – Corrosion-Resistant Steel Sunset Review , paras. 81-89). 
121European Union's third participant's submission, para. 9. WT/DS367/AB/R 
Page 38  
 
issue.  In any event, the Europ ean Union observes, sometimes the qu estion of whether one construes a 
single measure or several distinct measures will be of no significance, as appears to be the case in this 
dispute. 
111. With respect to Australia's claims of error under Articles 5.1, 5.2, and 2.2 of the SPS 
Agreement , the European Union submits that the panel's role in reviewing a risk assessment 
conducted by a WTO Member has been correctly iden tified and explained by the Appellate Body in 
previous disputes, in particular in US/Canada – Continued Suspension .  It is not the panel's role to 
determine whether a risk assessment is correct or not.  In addition, as stated by the Appellate Body in 
US/Canada – Continued Suspension , the risk assessment cannot be entirely isolated from, and its 
scope or method may be affected by, the appropr iate level of protection chosen by a Member.
122  The 
fact that there may be some minor flaws, misconceptions, or subjective elements in a risk assessment 
does not, in itself, suffice to disqualify th e risk assessment under Article 5.1 of the SPS Agreement .  
Thus, observes the European Union, the onus of  proof placed on a complaining party is high. 
112. The European Union expresses the view, in connection with Australia's claim under 
Article 11 of the DSU, that experts' opinions shou ld be confined to assessing the scientific evidence 
submitted by the parties.  Neither the panel nor the experts may engage in de novo  review of the 
evidence, conduct their own risk assessments, or consid er or opine on the science in a manner that is 
completely detached from the appropriate level of protection.  Without taking a position as to whether 
Australia has met the high burden of establishing that the Panel acted inconsistently with Article 11 of 
the DSU in this dispute, the Eur opean Union notes that, in a numb er of passages of its Report, the 
Panel seems to have been rather selective in repor ting the experts' opinions, ignoring or dismissing 
without any (or much) explanation testimony that did not support its findings. 
113. Regarding Australia's claim under Article 5.6 of the SPS Agreement , the European Union 
agrees with Australia that, in principle, a findi ng of violation of Article 5.6 cannot be merely 
consequential on a finding of viola tion of Articles 5.1 and 2.2 of the SPS Agreement .  Articles 5.1 
and 5.6 of the SPS Agreement contain distinct and independent obligations.  Measures that are 
properly based on a risk assessment as required by Ar ticles 5.1 and 2.2 may still breach Article 5.6.  
Conversely, the fact that a risk assessment may not  be in compliance with Articles 5.1 and 2.2 does 
not exclude that the SPS measures adopted are consiste nt with Article 5.6.  The European Union takes 
no position on whether the Panel's findings were me rely consequential on its finding of a breach of 
Articles 5.1 and 2.2, but submits that, should the Appellate Body conclude that they were, then 
Australia's claims of error would be well founded. 
                                                      
122European Union's third participant's submission,  para. 20 (quoting Appellate Body Reports, 
US/Canada – Continued Suspension , para. 534).  WT/DS367/AB/R 
 Page 39 
 
 
114. Regarding New Zealand's other appeal, the Eur opean Union submits that a process leading to 
the adoption of a risk assessment th at forms the basis of one or more SPS measures may, under certain 
circumstances, constitute, in itself and independent ly from those measures, an SPS measure.  In the 
present dispute, the European Union "wonders"123 whether the undue delay claim by New Zealand 
relates to the adoption of the measures at issue, ra ther than to an alleged "IRA process".  If so, it 
seems rather artificial to refer to the "IRA process" as a separate and distinct measure.  The 
European Union also points out that New Zealand' s panel request asserts that the 17 measures, both 
individually and as a whole , are inconsistent with the relevant  obligations.  Challenging the alleged 
undue delay of the "IRA process" appears, therefore,  to be tantamount to contesting the undue delay 
with respect to the 17 measures as a whole.  The European Union adds that the fact that 
the 17 measures are imposed and regulated by the IR A means that the alleged delay in undertaking 
and completing approval inevitably and automatical ly affected the 17 measures duly identified by 
New Zealand in its panel request. 
2. Japan  
115. With respect to the issue of whether the Panel erred in finding that the 16 measures 
challenged by New Zealand indivi dually constitute SPS measures, Jap an disagrees with Australia's 
argument that "an administrative or procedural require ment that is necessary, even 'indispensable', to 
achieve ALOP, but not sufficient to do so, cannot without more amount in itself to an SPS 
measure."124  Japan highlights that Annex A(1) to the SPS Agreement  refers to " any measure" and to 
"all relevant laws, decrees, regula tions, requirements and procedures"125, thus suggesting a broad 
range of measures are covered.  Japan further point s to Annex A(1)'s reference to "provisions on 
relevant statistical methods, sampling procedures a nd methods of risk assessment", arguing that such 
measures could be "ancillary", yet they are expressl y included in the definition of an SPS measure.  
Japan cautions that accepting Australia's reasoning would substantially undermine the disciplines of 
the SPS Agreement  and that Members must not be allowed to  circumvent their obligations by putting 
in place trade-restrictive, SPS-type measures th at are merely "ancillary" or "administrative". 
116. Japan agrees with Australia that the Panel e rred in finding that Biosecurity Australia, the 
Australian entity issuing the IRA, acted inconsistent ly with Article 5.1 by failing to document and to 
make transparent its use of expert  judgement.  Japan argues that the SPS Agreement  does not contain a 
requirement for documentation and transparency in a risk assessment.  Japan therefore suggests that 
the Appellate Body should "clarify" that the Pane l's documentation and transparency "test" has no 
                                                      
123European Union's third participant's submission, para. 37. 
124Japan's third participant's submission, para. 18 (quoting Australia's appellant's submission, para. 64). 
125Japan's third participant's submission, para. 19. (original emphasis) WT/DS367/AB/R 
Page 40  
 
basis in the text or context of Article 5.1 and is thus not relevant fo r purposes of determining 
consistency with Article 5.1.
126 
117. With respect to Australia's allegation that the Panel erred in finding Australia's measures to be 
inconsistent with Article 5.6 as a consequence of be ing inconsistent with Articles 5.1 and 5.2, Japan 
does not take a position on whether the Panel in fact made such a consequential finding.  If, however, 
the Appellate Body were to find that the Panel's finding of inconsistency with Article 5.6 rested on 
such a "consequential determination", then Japan  considers that this finding was in error.127  Japan 
emphasizes that Article 5.6 sets out an obligation that  is distinct from the obligations in Articles 5.1 
and 5.2, and does not, in its text, refer to a ri sk assessment.  An SPS measure may be based on a 
proper risk assessment, in accordance with Articles 5.1 and 5.2.  If, however, this measure is more 
trade restrictive than neces sary, this would constitute a stand-alone violation of Article 5.6.  Likewise, 
according to Japan, an SPS measure might not be based  on a proper risk assessment, in violation of 
Articles 5.1 and/or 5.2.  Yet it could still be consistent with Article 5. 6 if it were determined to be the 
least trade-restrictive measure to achieve the Member's appropriate level of protection. 
118. Japan takes issue with the Panel' s approach to the analysis under Article 5.6.  Rather than 
assessing, as an initial matter, whether New Zealand ha d demonstrated that Australia's calculation of 
the risk resulting from the importation of New Zealan d apples was exaggerated, the Panel could have 
analyzed New Zealand's alternativ e measure specifically and directly.  Furthermore, the Panel's 
finding that "there is no reason to believe that  the alternative measure suggested by New Zealand 
would not meet Australia's ALOP" is a "leap of logi c" that cannot be considered equivalent to an 
affirmative showing by New Zealand that its less trade-restrictive alternative measure in fact 
"achieves" Australia's appropriate level of protection.128  Thus, to the extent that the Panel relied on 
"doubt" as to whether the risk exceeds Australia's  appropriate level of protection instead of an 
affirmative determination that the alternative measu res would meet Australia's appropriate level of 
protection, Japan believes that the Panel e rred in its analysis under Article 5.6. 
119. Japan disagrees that New Zeala nd's claims under Annex C(1)(a) and Article 8 were outside 
the Panel's terms of reference.  Rather, New Zealan d identified all the measures at issue in its panel 
request and, by listing Annex C(1)(a), New Zealand clearly presented its concern.  Accordingly, the 
question of whether the 17 measures at issue are in consistent with Annex C(1)(a) and Article 8 was 
properly within the Panel's terms of  reference, and the Panel simply needed to interpret Annex C(1)(a) 
and Article 8 and determine wh ether New Zealand had made a prima facie  case of inconsistency.  
                                                      
126Japan's third participant's submission, para. 25. 
127Japan's third participant's submission, para. 8. 
128Japan's third participant's submission, para. 17 (quoting Panel Report, para. 7.1153).  WT/DS367/AB/R 
 Page 41 
 
 
Japan stresses that the question of whether a complainant has made its prima facie  case should not be 
confused with the question of whether a procedural  violation has occurred pursuant to Article 6.2 of 
the DSU, and cautions that, while due process concerns are important, it is even more important to 
encourage Members positively to resolve disputes ra ther than to engage in procedural arguments.129 
3. United States  
120. The United States disagrees with Australia's  conception of an SPS measure, which the 
United States considers to be "completely divorced from the text of Annex A(1)" to the SPS 
Agreement .130  The Panel determined that the legisla tive basis for each of the 16 measures, the 
procedures under which they were adopted, and the IRA, all had "general objectives" that correspond 
to those set out in Annex A(1)(a).131  The Panel also looked at the 16 measures individually and found 
that each had a "close linkage" to the objective of controlling risks that correspond to the risks set 
forth in Annex A(1).132  The Panel further analyzed the form and nature of the measures at issue and 
found that they fit within the definition in Annex A(1).  The United States notes that, in any event, 
this issue "seems to be of minimal importance for purposes of this dispute".133 
121. The United States submits that the Appellate Body should not adopt the approach to an 
assessment of a measure's conformity with Article 5.1 suggested by Australia.  Such an approach—if 
adopted—would be inconsistent with  findings in prior disputes, would undermine the requirement in 
Article 5.1 that SPS measures be based on a risk assessment, and would severely weaken a panel's 
ability to review the sufficiency of  a risk assessment.  Au stralia's argument that it is not within the 
panel's authority to review the quality of the reasoning contained in the IRA per se , but only the 
quality of the particular conclusions drawn, is inconsistent with the approach adopted by the Appellate 
Body in prior disputes and should not be accepted.   Referring to the Appellate Body reports in 
Japan – Apples  and US/Canada – Continued Suspension , the United States points out that the 
Appellate Body has explained that panels are to "assess whether the reasoning  articulated on the basis 
of the scientific evidence is objective and coherent".134  The United States further disagrees with 
Australia's argument that the Panel was not perm itted to review anything but the IRA's ultimate 
conclusions.  A panel's failure to conduct a full examination of a challenged risk assessment, 
including all intermediate steps leading to the u ltimate conclusion of the assessment, would constitute 
                                                      
129Japan addressed New Zealand's other appeal in its opening remarks at the oral hearing in this appeal. 
130United States' third participant's submission, para. 3. 
131United States' third participant's submission, para. 5 (referring to Panel Report, paras. 7.123-7.141). 
132United States' third participant's submission, pa ra. 5 (referring to Panel Report, paras. 7.140 
and 7.141). 
133United States' third participant's submission, para. 6. 
134United States' third participant's submission, paras. 14 and 15 (referring to Appellate Body Report, 
Japan – Apples , paras. 201, 203, and 205;  and Appellate Body Reports, US/Canada – Continued Suspension , 
para. 591). (original emphasis) WT/DS367/AB/R 
Page 42  
 
"deliberate disregard" for the evidence and be "inc ompatible with a panel's duty to make an objective 
assessment of the facts".
135  As the facts of this dispute illustrate, when the overall probability is the 
result of a sequence of events, each step must be evaluated in order to make an "objective 
assessment", and it would be very difficult, if not impossible, for a panel properly to evaluate the 
ultimate conclusion without any examination of whether the intermediate steps are supported by 
science. 
122. The United States disagrees with Australia that th e Panel acted inconsistently with Article 11 
of the DSU by disregarding expert testimony that was favourable to Australia's case.  The United States maintains that Australia's Article 11 cl aim is based on the theory that a panel fails to 
make an objective assessment when the panel repor t does not include a discussion of every piece of 
evidence that may not be supportive of the panel' s ultimate findings, or when the report does not 
describe in each instance why the pa nel placed more weight on some  pieces of evidence.  In the 
appeal in Brazil – Retreaded Tyres , the European Union argued that the panel had ignored relevant 
studies submitted by the European Union, and claimed th at this was inconsistent with Article 11.  Yet, 
maintains the United States, the Appellate Body did no t require the panel to reproduce or directly cite 
these studies and considered that it was sufficient that  the panel had cited in a footnote paragraphs of 
the European Union's oral statement and answ ers to questions that referred to these studies.
136   
123. The United States also disagrees with Australia's claim that the Panel incorrectly applied the 
burden of proof in its analysis under Article 5.6.  The United States submits that Australia's argument 
ignores the second step of the Panel's analysis, in which the Panel undertook a careful review of the 
evidence before it in order to assess "more directly " whether New Zealand had raised a presumption 
that its proposed alternative measures meet Aust ralia's appropriate level of protection.  The 
United States disagrees with Australia that the Panel misapplied Article 5.6 and found that 
New Zealand had discharged this burden merely by id entifying an alternative measure that "could" or 
"might" achieve Australia's appropriate level of protection.  New Zealand's burden was to present 
sufficient evidence to raise a presumption of inco nsistency, not to adduce evidence to establish 
beyond a shadow of a doubt that its argument was the correct one, as Australia seems to contend.  The 
United States adds that the Panel Report shows that New Zealand adduced evidence sufficient to 
discharge this burden.  Accordingly, for the Un ited States, the Panel properly found that the 
alternative measure meets Australia's appropriate le vel of protection, just as the compliance panel in 
                                                      
135United States' third participant's submission, pa ra. 18 (referring to Appellate Body Report, EC – 
Hormones , para. 133). 
136United States' third participant's submission, para. 26 (referring to Appellate Body Report, Brazil – 
Retreaded Tyres , para. 190).  WT/DS367/AB/R 
 Page 43 
 
 
the Japan – Apples  dispute found that limiting imports to mature, symptomless apples met Japan's 
arguably more stringent appropr iate level of protection. 
III. Issues Raised in This Appeal 
124. The following issues are ra ised in this appeal: 
(a) Whether the Panel erred in finding that the 16 measures at issue, both as a whole and 
individually, constitu te SPS measures within the meaning of Annex A(1) to the SPS 
Agreement ; 
(b) Whether, in finding that the measures regarding fire blight and apple leafcurling 
midge ("ALCM"), as well as the "general" measures relating to these pests, are 
inconsistent with Articles 5.1, 5. 2, and, consequently, 2.2 of the SPS Agreement , the 
Panel misinterpreted and misapplied these provisions, and more specifically: 
(i) whether, in evaluating Australia's risk assessment and the consistency 
of Australia's SPS measures with th ese provisions, the Panel applied 
an improper standard of review; 
(ii) whether, in reviewing Australia's risk assessment and its use of 
expert judgement at several intermed iate steps, the Panel required too 
high a standard of transparency and documentation and, thereby, 
erred in its assessment of the objectivity and coherence of the 
reasoning of the risk assessor;  and  
(iii) whether the Panel erred in failing to assess the materiality of the 
faults it found with Australia's ri sk assessment, and in failing to 
determine whether any alleged flaws were so serious as to call into 
question the risk assessment as a whole; 
(c) Whether the Panel failed to conduct an obj ective assessment of the matter before it 
within the meaning of Article 11 of the DSU, and in particular: 
(i) whether the Panel failed to engage with or disregarded testimony of 
its appointed experts that was favourable to Australia;  and 
(ii) whether the Panel misunderstood the methodology employed in 
Australia's risk assessment; WT/DS367/AB/R 
Page 44  
 
(d) Whether the Panel erred in finding that the measures regarding fire blight and ALCM 
are inconsistent with Article 5.6 of the SPS Agreement , and more specifically: 
(i) whether the Panel inappropriate ly relied on its findings under 
Articles 5.1, 5.2, and 2.2 of the SPS Agreement  in concluding that 
New Zealand's proposed alternative measures would achieve Australia's appropriate level of protection; 
(ii) whether the Panel failed to require New Zealand to establish 
affirmatively the inconsistency of the measures at issue with Article 5.6 of the SPS Agreement  because it determined only that the 
alternative measures "might" or "may" achieve Australia's appropriate level of protection;  and 
(iii) whether the Panel erred in interpretin g the term "appropriate level of 
sanitary or phytosanitary protection", defined in Annex A(5) to the SPS Agreement , by focusing solely on the likelihood of entry, 
establishment and spread of the relevant pests without also 
considering the associated potential biological and economic 
consequences;  and 
(e) Whether the Panel erred in finding that New Zealand's claims under Annex C(1)(a) 
and Article 8 of the SPS Agreement  are outside the Panel's terms of reference, and, if 
so, whether the Appellate Body can comple te the legal analysis and find that 
Australia's measures at issue are incons istent with the "without undue delay" 
obligation in Annex C(1)(a) and Article 8 of the SPS Agreement . 
IV. The Measures at Issue and the Risk Assessment on which They were Based 
A. The Measures at Issue 
125. The following 17 measures relating to the im portation of New Zealand apples into Australia 
were initially identified by New Zealand as the measures at issue in this dispute
137: 
 Measures 1-8 relate to fire blight  
 
Measure 1:  The requirement that apples be sourced from areas free from fire blight 
disease symptoms. 
                                                      
137Panel Report, para. 2.91;  Request for the Establishment of a Panel by New Zealand, WT/DS367/5.  WT/DS367/AB/R 
 Page 45 
 
 
Measure 2: The requirement that orchards/blocks be inspected for fire blight disease 
symptoms, including that they be inspect ed at an intensity that would, at a 
95 per cent confidence level, detect visual symptoms if shown by 1 per cent of the trees, and that such inspections take place between 4 to 7 weeks after 
flowering. 
Measure 3: The requirement that an orchard/bloc k inspection methodology be developed 
and approved that addresses issues such as the visibility of symptoms in the 
tops of trees, the inspection time needed and the number of trees to be inspected to meet the efficacy level,  and the training and certification of 
inspectors. 
Measure 4: The requirement that an orchard/bloc k be suspended for the season on the 
basis that any evidence of pruning or other activities carried out before the 
inspection could constitute an attempt to  remove or hide symptoms of fire 
blight. 
Measure 5: The requirement that an orchard/bloc k be suspended for the season on the 
basis of detection of any visual symptoms of fire blight. 
Measure 6: The requirement that apples be subject to disinfection treatment in the 
packing house. 
Measure 7: The requirement that all grading and packing equipment that comes in direct 
contact with apples be cleaned and disinfected (using an approved disinfectant) immediately before each Australian packing run. 
Measure 8: The requirement that packing houses regi stered for export of apples process 
only fruit sourced from registered orchards. 
 Measures 9-13 relate to European canker
 
 
Measure 9: The requirement that apples be sourced from export orchards/blocks free of 
European canker (pest free places of production). 
Measure 10: The requirement that all trees in expor t orchards/blocks be inspected for 
symptoms of European canker, includi ng that orchards/blocks in areas less 
conducive to disease be inspected for symptoms by walking down every row and visually examining all trees on both sides of each row, and that areas more conducive to the disease are in spected using the same procedure 
combined with inspection of the upper limbs of each tree using ladders (if 
needed), and that such inspections take place after leaf fall and before winter pruning. 
Measure 11: The requirement that all new planting stock be intensively examined and 
treated for European canker. 
Measure 12
138: The requirement that an orchard/bloc k be suspended for the season on the 
basis that any evidence of pruning or other activities carried out before the 
inspection could constitute an attempt to remove or hide symptoms of 
European canker. 
                                                      
138As explained in the next paragraph of this Report, this measure is no longer at issue. WT/DS367/AB/R 
Page 46  
 
Measure 13: The requirement that exports from an orchard/block be suspended for the 
season on the basis of detection of European canker, with reinstatement only upon eradication of the disease, confirmed by inspection. 
 Measure 14 relates to ALCM
 
 
Measure 14: The requirements of inspection and treatment for ALCM, including the 
options of: 
− inspection of each lot on the basis of a 3000-unit sample selected at 
random across the whole lot for ALCM, symptoms of quarantineable 
diseases, quarantineable pests, arth ropods, trash and weed seeds, with 
detection of any live quarantineable  arthropod resulting in appropriate 
treatment or rejection for export;  or 
− inspection of each lot on the basis of a 600-unit sample selected at 
random across the whole lot for symptoms of quarantineable diseases, 
trash and weed seeds, as well as manda tory appropriate treatment of all 
lots. 
 Measures 15-17 were described by New Zealand as "general" measures  
 
Measure 15: The requirement that Australian Quar antine and Inspection Service officers 
be involved in orchard inspections for European canker and fire blight, in 
direct verification of packing house procedures, and in fruit inspection and treatment. 
Measure 16: The requirement that New Zealand ensure that all orchards registered for 
export to Australia operate under standard commercial practices. 
Measure 17: The requirement that packing houses provide details of the layout of 
premises. 
126. Following an agreement between the parties on Measure 12, New Zealand did not pursue its 
claims in respect of this measure, and the Panel did not rule on them.
139   
127. On appeal, Australia challenges the Panel's findi ngs on the measures relating to fire blight 
(Measures 1-8) and ALCM (Measure 14), as well as the general measures (Measures 15-17) to the extent that they apply to these two pests.  Au stralia does not appeal the Panel's findings on the 
measures relating to European canker, or the gene ral measures (Measures 15-17) to the extent that 
they apply to European canker.
140  New Zealand's other appeal rela ting to its "without undue delay" 
claims concerns all of the 16 measures.141 
                                                      
139Panel Report, paras. 1.20 and 2.96.   
140Notification of an Appeal by Australia, WT/DS367/13 and Corr.1 (attached as Annex I(a) and (b) to 
this Report). 
141Notification of an Other Appeal by New Zealand, WT/DS367/14 (a ttached as Annex II to this 
Report).  WT/DS367/AB/R 
 Page 47 
 
 
128. As explained in further detail below, the 16 measures at issue are conditions for the 
importation of apples from New Zealand that have been imposed by Australia following completion 
of an import risk analysis. 
B. Background to the Adoption of the Measures at Issue 
129. Australia banned the importation of New Zeal and apples in 1921 following the entry and 
establishment of fire blight142 in Auckland in 1919.143  New Zealand applied unsuccessfully for access 
to the Australian apple market in 1986, 1989, and 1995.144  New Zealand submitted a fourth request  
for access in January 1999, which led to the initiation,  in February 1999, of an import risk analysis by 
the Australian Quarantine and Inspection Service ("AQIS").145  Following the issuance of draft risk 
assessments in 2000, 2004, and 2005 (as well as cert ain other developments, including the launch of 
two Senate inquiries and the restructuring of the government agencies involved146), in 
November 2006, Biosecurity Australia issued its Final Import Risk Analysis Report for Apples from 
New Zealand  (the "IRA").147  The 16 measures at issue in this dispute are among the risk management 
measures recommended in the IRA.148 
130. Under Australia's current regulatory regime, the importation into Australia of fresh fruit is 
prohibited unless the Director of Animal and Plant Quarantine149 has granted an import permit.150  The 
Director is empowered to grant an import perm it based on, among other things, the information and 
policy recommendations in an import risk analysis.151  In March 2007, Australia's Director of Animal 
and Plant Quarantine determined that the importa tion of apples from New Zealand can be permitted 
subject to, inter alia , the application of the phytosanitary measures specified in the IRA.152  T h e  
                                                      
142A brief explanation of fire blight is provided infra , para. 134 of this Report.  
143Panel Report, para. 2.30. 
144Panel Report, para. 2.30. 
145Panel Report, para. 2.31.  At the time, Bi osecurity Australia was part of AQIS. (See supra , 
footnote 4 of this Report) 
146In 2004, Biosecurity Australia was created as a separate ag ency within the Commonwealth 
Department of Agriculture, Fisheries and Forestry.  Biosecurity Australia was given the responsibility of 
reviewing and reissuing draft risk assessments in progress at that time, including the one relating to apples from New Zealand. (See Panel Report, paras. 2.32 and 7.157;  and Biosecurity Australia,  Final Import Risk Analysis 
Report for Apples from New Zealand (Canberra, November 2006) (the "IRA"), Part B (Panel Exhibit AUS-2), 
p. 8) 
147See Panel Report, para. 2.32;  and IRA, Part B, p. 8. 
148See Request for the Establishment of a Panel by New Zealand, WT/DS367/5. 
149The Director of Animal and Plan t Quarantine is the Secretary of the Department of Agriculture, 
Fisheries and Forestry. (Australia's first written submission to the Panel, para. 61) 
150Australia's biosecurity regime is set out primarily in the Quarantine Act 1908 and its subordinate 
legislation, including the Quarantine Proclamation 1998 . (Panel Report, paras. 7.124 and 7.125;  Australia's 
appellant's submission, paras. 20 and 21) 
151See IRA, Part B, p. 2.  See also Australia's  first written submission to the Panel, para. 61. 
152Biosecurity Australia Policy Memorandum 2007/07, Biosecurity Policy Determination – Importation 
of Apples from New Zealand , 27 March 2007 (Panel Exhibit NZ-2) quoted, in relevant part, in Panel Report, 
para. 7.165. WT/DS367/AB/R 
Page 48  
 
standard operating procedures that New Zealand a nd Australia must agree upon before exports of 
apples can begin have yet to be agreed.
153 
C. Relevant Aspects of the IRA and the Methodology Used 
131. The risk assessment carried out by Biosecurity Au stralia consisted of several stages, including 
pest risk assessment and pest risk management.154  The scope of the IRA's risk assessment was the 
importation of mature apple fruit free of trash, eith er packed or sorted and graded bulk fruit from 
New Zealand.  This was the "starting point" for the IRA's analysis.155 
1. Pest Risk Assessment  
132. The risk assessment process set out in the IRA cons isted of four interrelated steps:  (a) pest 
categorization;  (b) an assessment of the probabili ty of entry, probability of establishment, and 
probability of spread of the pest;  (c) an assessment  of the consequences associated with the pest;  and 
(d) combining the assessment of the probability of entry, establishment and spread with the 
assessment of consequences to estimate the risk.156 
(a) Pest Categorization and Pests at Issue 
133. The IRA first considered whether each of a number of identified pests should be considered 
as a quarantine pest for which a fu ll assessment of risk was needed.157  Fire blight and ALCM were 
among the pests that qualified as quarantine pests subject to further consideration.158 
134. Fire blight is a plant disease caused by the bacterium Erwinia amylovora .  The disease affects 
apple trees, pear trees, and some other members of the Rosaceae  family of plants.159  In apple trees, 
fire blight infects flowers, young leaves, stems, a nd fruits.  The symptoms and seriousness of infection 
vary, but disease development may be severe enough to result in plant death.160  Some infected trees 
develop cankers (sunken areas surrounded by cracked bark) on their limbs and trunks.  In warm, wet, 
spring conditions, cankers become active and exude a bacteria-laden ooze, which is the inoculum for
                                                      
153Panel Report, para. 2.33. 
154Panel Report, para. 2.34 (quoting IRA, Part B, p. 11). 
155Panel Report, para. 2.27 (referring to IRA, Part B, p. 9).  See also IRA, Part B, p. 105. 
156Panel Report, para. 2.35 (quoting IRA, Part B, pp. 13 and 14).  
157Panel Report, para. 2.37 (quoting IRA, Part B, p. 14).  
158European canker was another of the ten pests that  the IRA determined required full consideration for 
the whole of Australia.  In addition, the IRA found that six other pests required consideration for Western 
Australia only. (Panel Report, paras. 2.38 and 2.39 (referring to IRA, Part B, pp. 47 and 48)) 
159Panel Report, paras. 2.1 and 2.2 (referring to IRA, Part C (Panel Exhibit AUS-3), p. 105;  and 
New Zealand's first written submission to the Panel, para. 3.46). 
160Panel Report, para. 2.1 (referring to IRA, Part B,  p. 52;  and New Zealand's first written submission 
to the Panel, para. 3.47).  WT/DS367/AB/R 
 Page 49 
 
 
primary infection in the springtime.  Cankers b ecome inactive during the growing season, generally 
cease ooze production during the summer, and rema in inactive until the following spring.161  F i r e  
blight may spread within host plants, infecting blos soms, fruits, spurs, twigs, branches, and leaves.  
With appropriate environmental conditions, inocul um may then be exuded from infected shoots, 
cankered bark, and infected fruitlets and blossoms.  The inoculum may be spread by, for example, 
rain, insects (including bees), and wind.162  Depending on orchard conditions, fruit can be infested163 
with low levels of Erwinia amylovora , when small populations of the bacteria are present on the 
developing flower parts.  On rare occasions, an in fested flower can develop into a mature apple, but 
bacteria are localized in the calyx (remnant of the blossom) in small numbers.  In orchards with fire 
blight symptoms, bacteria can also be present in small numbers on the surface of an apple, but such 
external populations would not multiply and would tend to diminish over time.164  Fire blight exists in 
New Zealand, but not in Australia.165 
135. ALCM, or Dasineura mali , is a small fly, 1.5-2.5mm long, which has a lifespan of only a few 
days166 and reproduces sexually.167  Apple trees are the only hosts of ALCM .168  Eggs laid by mated 
females hatch to produce immobile larvae that de velop by feeding on the opening leaves of apple 
trees.  This prevents the leaves from unfurling normally  or results in curled margins of the leaves, and 
can result in reduced shoot and tree growth.169  The larvae pupate, usually after having dropped to the 
ground.  A small population of larvae may, however, lodge in and pupate on the tree, often in cracks 
in the bark or sometimes on the calyx- or stalk-ends of the fruit.170  Pupating larvae spin silken 
cocoons from which adult ALCM emerge.  The life cycle of ALCM (mating, egg-laying, larval 
                                                      
161Erwinia amylovora  can survive the winter in infected host plants. (Panel Report, paras. 2.3 and 2.4 
(referring to IRA, Part B, p. 51;  Part C, pp. 110 and 111;  and New Zealand's first written submission to the 
Panel, paras. 3.48 and 3.49)) 
162Panel Report, para. 2.5 (referring to IRA, Part B, p. 51;  Part C, p. 110;  and New Zealand's first 
written submission to the Panel, para. 3.48). 
163Infestation refers to the epiphytic (external) exis tence of a pest on the surface, whereas infection 
refers to the endophytic (internal) occu rrence of a pest in the tissue.  Epiphytic infestation can occur at the stalk- 
and calyx-ends, and on the surf ace, of mature fruit. (Panel Report, footnote  151 to para. 2.6;  IRA, Part B, p. 52) 
164Panel Report, para. 2.6.  
165Panel Report, para. 2.8 (referring to IRA, Part B, p. 51;  Australia's first written submission to the 
Panel, para. 77;  and New Zeal and's first written submission to the Panel, para. 3.55).  In 1997, fire blight was 
detected in Australia, but eradicati on efforts were undertaken and no further outbreaks have been reported. 
(Panel Report, para. 2.8 (referring to IRA, Part C, p. 107)) 
166The lifespan of ALCM was indicated as 2 to 6 days under laboratory conditions by Australia, and 
as 3 to 4 days under laboratory conditions and 1 to 2 days  in the wild by New Zealand. (Panel Report, para. 2.21 
(quoting IRA, Part B, p. 157;  and New Zealand's first written submission to the Panel, para. 3.71)) 
167Panel Report, para. 2.21 (referring to IRA, Pa rt B, p. 157;  and New Zealand's first written 
submission to the Panel, para. 3.71).  
168Panel Report, para. 2.20 (referring to IRA, Pa rt C, p. 121;  and New Zealand's first written 
submission to the Panel, para. 3.69).  
169Panel Report, para. 2.21 (referring to New Z ealand's first written submission to the Panel, 
para. 3.72). 
170Panel Report, para. 2.22. WT/DS367/AB/R 
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growth, pupation, and adult emergence) is usually repeated several times a year.
171  A L C M  i s  
presumed to be native to Europe and is found in cool to temperate apple-producing regions, including 
in New Zealand.  Australia is free from ALCM.172 
(b) Assessment of the Probability of Entry, Establishment and Spread 
136. For the quarantine pests in respect of which it had determined that a risk assessment was 
needed, the IRA set out its methodology for assessing the annual probability of entry, probability of establishment, and probability of spread of that pest  in Australia.  As explained below, there were 
some differences in the methodol ogy used for pathogens (for example, bacteria and viruses), 
including fire blight, and the methodology used for arthropod pests, including ALCM.  For both, the 
assessment was quantitative in natu re, and based on the assumption that apples would be "imported 
from New Zealand for 12 months without phytosanitary measures".
173  The IRA estimated that the 
volume of apple imports from New Zealand would be between 50 million a nd 400 million apples per 
year, with a most likely volume of 150 million.174  As with this estimate, most of the events for which 
the IRA made quantitative estimates were expressed as probability intervals , rather than as single 
numbers.  As explained further below, the IRA also employed probability distributions to pinpoint a 
value within each interval.  The values assigned to  the various steps and factors were based on the 
scientific evidence reviewed by th e IRA as well as on the expert judgement of the IRA team (the 
"IRA expert judgement").175 
(i) Assessment for Pathogens (Including Fire Blight) 
137. The IRA's assessment of the probability of  entry  consisted of three parts:   (i) an estimation of 
the probability of importation  into Australia of an apple infested or infected with the pest;  (ii) an 
estimation of proximity , that is, the likelihood that major handlers and users of apples ("utility 
points"176) would be located sufficiently close to pest hosts ("exposure groups") for transfer of pests 
                                                      
171Panel Report, para. 2.23.  
172Panel Report, para. 2.25 (referring to New Z ealand's first written submission to the Panel, 
para. 3.80). 
173Panel Report, para. 2.56 (quoting IRA, Part B, p. 40). 
174Panel Report, para. 7.503 (referrin g to IRA, Part B, pp. 17-19;  and Australia's first written 
submission to the Panel, paras. 98 and 99). 
175Whenever the IRA team established to assess the ri sk associated with the importation of apples from 
New Zealand, which ultimately consisted of six individual s, determined that there was scientific uncertainty, the 
IRA team itself exercised expe rt judgement to reach conclusions.  Austra lia explained to the Panel that the IRA 
expert judgement was "used when ther e [was] limited evidence or where the underlying biological process is 
naturally highly variable". (Panel Report, para. 7.438 (quoting Australia's response to Panel Question 30 after 
the second Panel meeting, para. 162).  See also paras. 7.433 and 7.746;  and IRA, Part B, pp. 42 and 167) 
176Utility points are "key points ... at which apples ar e distributed or utilised and at which apple waste 
will be generated". (IRA, Part B, p. 25)  WT/DS367/AB/R 
 Page 51 
 
 
from imported apples to susceptible host plants to take place177;  and (iii) an estimation of exposure , 
that is, the likelihood of transfer of a pest from an infested or infected apple to a susceptible host 
plant.178  In its analysis, the IRA assumed that any exposure of the pathogen to a susceptible host 
would take place only from infested or infected apples discarded as waste , rather than via any other 
pathway.179 
138. The IRA calculated the probability of importation  using two key concepts:  (i) eight 
importation steps;  and (ii) ten importation scenarios.180  Each importation step represents a discrete 
point in the journey that apples will make in trave lling from the orchard in New Zealand to arrival in 
Australia.181  The IRA assigned a probability value to each importation step, representing the 
proportion of apples that would be infested or infected with the relevant pest at that point ("importation step value").
182  The "importation scenarios" represent a number of different ways of 
combining these importation steps.183  In each importation scenario, the initiating step "is the sourcing 
                                                      
177Panel Report, paras. 2.44 and 7.377 (referring to IRA, Part B, p. 29). 
178Panel Report, para. 2.45 (referring to IRA, Part B, p. 27). 
179IRA, Part B, p. 33. 
180The IRA refers to importation scenarios also as "biological pathway scenarios" and "importation 
pathways". 
181Panel Report, para. 2.41.  The importation steps used in the IRA are: 
- Importation step 1 (Imp1):  the proportion of New Zealand orchards in which the pest is 
present; 
- Importation step 2 (Imp2):  the proportion of fruit coming from an infected or infested 
orchard in New Zealand that is infected or infested with the pest; 
- Importation step 3a (Imp3a):  the proportion of clean fruit from infected or infested 
orchards in New Zealand that is contaminated by the pest during picking and transport 
to the packing house; 
- Importation step 3b (Imp3b):  the proportion of clean fruit from uninfected or uninfested 
orchards in New Zealand that is contaminated by the pest during picking and transport 
to the packing house; 
- Importation step 4 (Imp4):  the proportion of infected or infested fruit that remains 
infected or infested by the pest after routin e processing procedures  in the packing house; 
- Importation step 5 (Imp5):  the proportion of clean fruit that is contaminated by the pest 
during processing in the packing house; 
- Importation step 6 (Imp6):  the proportion of infected or infested fruit that remains 
infected or infested by the pest during palletization, quality inspection, containerization 
and transportation to Australia; 
- Importation step 7 (Imp7):  the proportion of clean fruit that is contaminated by the pest 
during palletization, quality inspection, cont ainerization and transportation to Australia; 
and 
- Importation step 8 (Imp8):  the proportion of infected or infested fruit that remains 
infected or infested by th e pest after on-arrival minimum border procedures for the 
unrestricted analyses. 
These definitions refer to the likelihood  of infection or infestation at each importation step.  However, 
in this Report, we use the term "importation step" to refer only to a particular point in the journey of an apple from New Zealand to Australia, and the term "importation step value" to refer to the likelihood associated with 
each such importation step. 
182Panel Report, para. 2.41 (quoting IRA, Part B, p. 21). 
183The IRA explains that each "biological pathway", or  "importation scenario", is an "ordered sequence 
of steps undertaken in sourcing, processing and exporti ng a commodity up to the point where it is released from 
quarantine by the importing country". (Panel Report, para. 2.42 (quoting IRA, Part B, p. 19)) WT/DS367/AB/R 
Page 52  
 
of apples from orchards in New Zealand and the end-poi nt is the arrival in Australia of infected or 
infested fruit or packaging materials."
184  Since, however, the scenari os include the possibility of 
contamination of clean fruit at certain importation steps (importation steps 3, 5, and 7), as well as the 
possibility that the pest is eliminated at certain other steps (importation steps 4, 6, and 8), only one 
importation scenario is a simple sequence of importation steps representing an apple that was infested or infected in the orchard in New Zealand and remained infested or infected upon release from 
quarantine in Australia.  The remaining nine impor tation scenarios represent different combinations of 
those importation steps, or different scenarios as to how an apple may become or cease to be infested 
or infected during the process of importation.
185  The probabilities associated with each of the ten 
individual importation scenarios were added to arrive  at the overall probabilit y of importation of an 
apple infested or infected with the relevant pest.186 
139. Turning to the other two elements of the IRA's an alysis of the probability of entry, first, with 
regard to proximity , the IRA estimated the likelihood that a utility  point is located sufficiently close to 
an exposure group for some likelihood of transfer of the pest to a susceptible host plant to exist.  The 
IRA accordingly combined five utility points—na mely, orchard packing house/wholesalers, urban 
packing house/wholesalers, retailers, food service industries, and consumers187—and four exposure 
groups—namely, susceptible commercial fruit cr ops, susceptible nursery plants, susceptible 
household and garden plants, and susceptible wild and amenity species188—and assigned point 
estimates or probability ranges to the resulting 20 different combinations. 
140. Second, with regard to exposure , the IRA explained that it is a complex variable dependent on 
a number of factors, such as viability of the p est, survival mechanism of the pest, transfer 
mechanism(s) of the pest, host receptivity, and environmental factors.189  The IRA noted that a 
sequence of events needs to be completed for success ful exposure of host plants to the pest carried by 
infested or infected apples, and analyzed  key steps in such sequence of events.190   
141. The next step in the IRA's methodology was to estimate the probabilities of establishment  and 
spread  of the pest in Australia for each of the four exposure groups.191  This involved examination of 
a number of biological factors associated with the likelihood that a pest will successfully propagate on 
or in a susceptible host (establishment) and di sperse from there within the larger population of 
                                                      
184Panel Report, para. 2.42 (quoting IRA, Part B, p. 19). 
185Panel Report, paras. 2.42 and 2.43 (re ferring to IRA, Part B, p. 19). 
186Panel Report, para. 2.43 (referring to IRA, Part B, p. 23). 
187Panel Report, para. 2.44 (referring to IRA, Part B, p. 25). 
188Panel Report, para. 2.45 (referring to IRA, Part B, pp. 28 and 29). 
189Panel Report, para. 2.45 (referring to IRA, Part B, p. 27). 
190Panel Report, para. 7.381 (quoting IRA, Part B, p. 27).  See also IRA, Part B, p. 85. 
191Panel Report, para. 2.51;  IRA, Part B, pp. 31-33.  WT/DS367/AB/R 
 Page 53 
 
 
susceptible hosts (spread).192  The IRA considered various factors in order to estimate the probability 
of establishment193 and the probability of spread194, explaining that, in doing so, it was following 
international guidelines for risk analysis.195 
142. Lastly, the IRA generated an overall estimate of  the annual probability of entry, establishment 
and spread by combining the various probability valu es that it had assigned to the various steps, along 
with the estimated volume of apples, in a computer program called @Risk (Palisade 
Corporation, 2007).196 
(ii) Assessment for Arthropods (Including ALCM) 
143. With regard to arthropod pests, the methodol ogy used to assess the probability of entry, 
establishment and spread differed slightly from that used for pathogens, to take account of the fact 
that such pests are mobile and that a mating pair would be needed to establish a population.197  
Accordingly, the IRA focused on the number of infested  apples that could be at a particular location at 
the same time rather than, as it had done for pa thogens, on following individual apples through the 
distribution chain.  The assessment of the probability of entry, establishment and spread of arthropods 
involved five steps:  steps one and two were esti mations of the probability of importation and of the 
                                                      
192Panel Report, para. 2.47;  IRA, Part B, pp. 17 and 29. 
193Probability of establishment was derived from a comparative assessment of:  availability of suitable 
hosts, alternate hosts and vectors in the pest risk analysis  area;  suitability of the environment;  cultural practices 
and control measures;  and other characteristics of the pest  relevant to the probability of establishment. (Panel 
Report, para. 2.48 (referring to IRA, Part B, p. 30)) 
194Probability of spread was derived from a comparative assessment of:  suitability of the natural and/or 
managed environment for natural spread of the pest;  pr esence of natural barriers;  the potential for movement 
with commodities or conveyances;  intended use of the commodity;  potential vectors of the pest in the pest risk 
analysis area;  and potential natural en emies of the pest in the pest risk analysis area. (Panel Report, para. 2.49 
(referring to IRA, Part B, p. 31)) 
195International Standards for Phytosanitary Measures ("ISPM"s) are adopted by the Commission on 
Phytosanitary Measures, which governs the International Plant Protection Convention (the "IPPC").  The IPPC 
is an international treaty to secure action to prevent th e spread and introduction of pests of plants and plant 
products, and to promote appropriate measures for their control.  Two ISPMs, Pest risk analysis for quarantine 
pests, including analysis of environmental risks and living modified organisms , 2004 (ISPM No. 11, FAO, 
Rome (Panel Exhibit AUS-6) ("ISPM No. 11"), together with Framework for pest risk analysis , 2007 
(ISPM No. 2, FAO, Rome) ("ISPM No. 2"), present the general framework for conducting a pest risk 
assessment. (Panel Report, paras. 2.69 and 2.71) 
196According to the Panel: 
A Monte Carlo stochastic (random) simulation model was used with @Risk, 
based on random sampling from the set of values.  The @Risk software 
selected a number from within each pr obability range, taking into account the 
shape of the range, to represent the likelihood of an event occurring;  it did 
this thousands of times to produce an output in the form of a distribution representing the annual probability of entry, establishment and spread.  
The 5 per cent, median and 95 per cent values of the range were included in 
the [IRA].  
(Panel Report, para. 2.64 (referring to Australia's first wr itten submission to the Panel, paras. 90 and 106;  and 
New Zealand's first written submission to the Panel, para . 4.190).  See also IRA, Part B, pp. 35 and 97) 
197Panel Report, para. 2.50;  IRA, Part B, pp. 33-35. WT/DS367/AB/R 
Page 54  
 
distribution of infested apples to utility points, which were the same as in the analysis for pathogens.  
In step three, called a "scenario analysis", the IRA estimated the number of infested apples that could 
be at a particular location at the same time.
198  In step four, the estimated numbers obtained in step 
three were combined with the pest's ability to est ablish and spread, and the IRA estimated the partial 
probability of entry, establishment and spread for each combination of a utility point and an exposure 
group, resulting in 20 partial probabilities of entry, establishment and spread.199  Step five, the process 
of combining these partial probabilities using the @Risk program, was similar to that used for 
pathogens. 
(c) Assessment of Consequences 
144. The IRA assessed the potential biological, economic, social, and environmental effects of a 
pest by dividing such effects into two categories:  direct criteria200;  and indirect criteria.201  For each 
criterion, the IRA estimated the impact of a pest or disease at four levels—local, district, regional, and 
national—and described such impact in qualitative terms—"unlikely to be discernible", "of minor 
significance", "significant", or "highly significant".202  The IRA then used a correspondence table to 
convert those qualitative terms into impact scores, ranging from the least significant consequences, "A", to the most significant consequences, "G".
203  Individual impact scores were then 
evaluated based on certain "decision rules" set forth in the IRA204, to arrive at an overall conclusion 
on the potential biological and economic conseque nces.  The overall conclusion was expressed in 
qualitative terms, namely, "negligible", "very lo w", "low", "moderate", "high", or "extreme".205 
(d) Combining the Estimated Probability of Entry, Establishment and 
Spread with the Estimate of Consequences 
145. As indicated above, the IRA combined a quantita tive assessment of the probability of entry, 
establishment and spread with a qualitative assessm ent of potential consequences, which Australia 
describes as a "semi-quantitative approach".206 
                                                      
198Panel Report, para. 2.50 (quoting IRA, Part B, p. 33). 
199Panel Report, para. 2.50;  IRA, Part B, pp. 34 and 35. 
200The direct criteria were:  plant life or health;  human life or health;  an d any other aspects of 
environmental effects. (Panel Report, para . 2.53 (quoting IRA, Part B, p. 36)) 
201The indirect criteria were:  control or eradica tion;  domestic trade and international trade; 
environment;  and communities. (Panel Report, para. 2.54 (quoting IRA, Part B, p. 37)) 
202Panel Report, para. 2.55;  IRA, Part B, pp. 38 and 39. 
203Panel Report, para. 7.458. 
204IRA, Part B, pp. 39 and 40. 
205Panel Report, para. 2.55 (quoting IRA, Part B, pp. 39 and 40). 
206Panel Report, para. 2.61 (quoting IRA, Part B, p. 11).  WT/DS367/AB/R 
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146. When assigning quantitative values to the likeli hoods associated with the importation steps 
and the factors relating to proximity, exposure, establishment and spread, the IRA used both point 
values (a single number) and, more freque ntly, probability intervals or ranges.207  These were based 
on the scientific evidence and resources, as well as  on the IRA expert judgement.  Three types of 
probability distributions were used in connection wi th the probability intervals:  uniform, triangular, 
and pert.208  All three distributions have a maximum and a minimum value.  Triangular and pert 
distributions also have a third parameter:  a most likely value.209  In a uniform distribution, in contrast, 
each value in the continuous range between the se minimum and maximum values occurs with equal 
probability.  The IRA states that uniform dist ribution was used where there was insufficient 
information to determine a most likely value.210 
147. To combine the quantitative estimates of the ove rall probability of entry, establishment and 
spread with the qualitative description of the pot ential overall consequences of the pest, the IRA 
established a correspondence between the quantitativ e values and qualitative likelihood ratings, as set 
out in the "nomenclature" table reproduced below.  The IRA then used a "risk estimation matrix" to 
combine the resulting qualitative likelihood rating wi th the qualitative consequences rating to yield an 
overall determination of the "unrestricted risk"211 associated with each pest if apples from 
New Zealand were imported into Australia for 12 months without any phytosanitary measures.212  
This matrix generates one of six possible results:  negligible risk, very low risk, low risk, moderate 
risk, high risk, or extreme risk. 
                                                      
207In most cases, the IRA selected an interval from a set of six pre-defined quantitative ranges 
suggested in Biosecurity Australia's 2001 draft Guidelines for import risk analysis , although the IRA team was 
not constrained to do so. (Panel Report, para. 2.65 (referring to IRA, Part B, p. 42;  and Guidelines for import 
risk analysis  (Draft, Canberra, September 2001) (Panel Exhibit AUS-17)))  These interval s are the ones set out 
in the third column of Table 12 at page 43 of Part B of the IRA, reproduced infra , para. 147 of this Report. 
208Panel Report, para. 2.66 (referring to IRA, Part B, p. 42). 
209The triangular distribution is not necessarily symmetric, but can be skewed by placing the most 
likely value towards either minimum or maximum value and was used when information on the most likely 
value was available.  Like the triangular distribution, the pert distribution has minimum and maximum values 
and a most likely value.  However, unlike the triangular distribution, "[t]he [p]ert distribution generates a 
smooth distribution curve that ... places progressively more emphasis on values  close to the most likely value." 
The pert distribution was used only to model the projected volume of New Zealand apples imported to Australia. (Panel Report, paras. 2.66 (referring to IRA, Part B, p. 42) and 7.493 (referring to Dr. Schrader's 
response to Panel Question 135, Panel Report, Annex B-1, para. 783)) 
210Panel Report, para. 2.66 (referring to IRA, Part B, p. 42). 
211The IRA defines risk as "a function of the likelihoods of an event occurring and the consequences or 
impact resulting from that event". (IRA, Part B, p. 40) 
212Panel Report, para. 2.56 (quoting IRA, Part B, p. 40). WT/DS367/AB/R 
Page 56  
 
Nomenclature for Qualitative Likelihoods Used by the IRA  
Likelihood Qualitative descriptors Probability  interval Midpoint (if uniform 
distribution) 
High The event would be very likely 
to occur 0.7 → 1 0.85 
Moderate The event would occur with an 
even probability 0.3 → 0.7 0.5 
Low The event would be unlikely to 
occur 5 × 10-2 → 0.3 0.175 
Very low The event would be very 
unlikely to occur 10-3 → 5 × 10-2 2.6 × 10-2 
Extremely low The event would be extremely 
unlikely to occur 10-6 → 10-3 5 × 10-4 
Negligible The event would almost 
certainly not occur 0 → 10-6 5 × 10-7 
Source : Australia's appellant's submission, para. 42;  IRA, Part B, Table 12, p. 43. 
 
Risk Estimation Matrix Used by the IRA213 
 
High Negligible 
risk Very low
risk Low risk Moderate 
risk High risk Extreme 
risk 
Moderate Negligible 
risk Very low
risk Low risk Moderate 
risk High risk Extreme 
risk 
Low Negligible 
risk Negligible 
risk Very low
risk Low risk Moderate 
risk High risk 
Very low Negligible 
risk Negligible 
risk Negligible 
risk Very low 
risk Low risk Moderate 
risk 
Extremely 
low Negligible 
risk Negligible 
risk Negligible 
risk Negligible 
risk Very low 
risk Low risk  
Likelihood of entry, 
establishment  and spread 
Negligible Negligible 
risk Negligible 
risk Negligible 
risk Negligible 
risk Negligible 
risk Very low 
risk 
  Negligible Very low Low Moderate High Extreme 
  Consequences of entry, establishment and spread  
Source : Australia's appellant's submission, para. 45;  IRA, Part B, Table 11, p. 41. 
 
 
2. Pest Risk Management  
148. According to the IRA, risk management is the process of identifying and implementing 
measures to mitigate risks of the pest so as to ach ieve Australia's appropria te level of protection.214  
                                                      
213Australia's appropriate level of protection of "very low risk" is indicated in white. 
214Panel Report, para. 2.58 (quoting IRA, Part B, p. 41).  WT/DS367/AB/R 
 Page 57 
 
 
The IRA expresses Australia's appropriate level of protection as "providing a high level of sanitary or 
phytosanitary protection aimed at reducing risk to a very low level, but not to zero".215  Thus, if the 
unrestricted risk identified through the risk estima tion matrix was "negligible" or "very low", it did 
not exceed Australia's appropriate level of protection, and risk management measures were not required.  In contrast, if the unrestricted risk was "low", "moderate", "high", or "extreme", it exceeded Australia's appropriate level of protection, and thus risk management measures would be required.
216  
In such circumstances, the IRA used the same risk assessment me thodology to assess the effects of, 
and risk associated with, potential risk management measures.217 
D. The IRA's Conclusions on Fire Blight 
1. Pest Risk Assessment  
(a) Assessment of Probability of En try, Establishment and Spread 
149. The IRA assigned an importation step value of 1 (100 per cent) to importation steps 1 and 8, 
and importation step values based on probability inte rvals and triangular distribution to the other six 
importation steps.218  Inserting these values into the ten different importation scenarios, the IRA 
estimated the overall probability of importation of apples infested with Erwinia amylovora  to 
be 3.9 per cent of the total number of apples th at would be imported from New Zealand annually.219 
150. With regard to proximity220, the IRA estimated the likelihood, for each exposure group, that a 
utility point is sufficiently close to a susceptible host plant for there to be some likelihood of transfer 
of Erwinia amylovora .  In considering the combinations of  five utility points and four exposure 
groups221, the IRA determined, for the combination of orchard wholesalers and commercial fruit 
crops, that the proportion of utility points sufficiently  close to susceptible host plants in the exposure 
group is 1 (100 per cent), whereas, for the other 19 combinations, the IRA determined probability 
intervals, with various minimum and maximum valu es, all of which were combined with uniform 
                                                      
215Panel Report, para. 2.59 (quoting IRA, Part B, p. 4). 
216Panel Report, para. 2.59 (referring to IRA, Part B, p. 41). 
217IRA, Part B, p. 41. 
218Panel Report, paras. 7.255, 7.266, 7.283, 7.298, 7.311, 7.326, 7.338, and 7.347 (referring to IRA, 
Part B, pp. 54, 65, 71, 77, 79, and 80). 
219More specifically, having inserted its probability estimates into the risk simulation model, the 
probability of importation was estimated by the IRA as "3.9 × 10-2 (mean), 2.2 × 10-2 (5th percentile) 
and 5.6 × 10-2 (95th percentile)". (Panel Report, para. 7. 353 (quoting IRA, Part B, p. 80)) 
220As described above, proximity is the likelihood that major handlers and users of apples (utility 
points) would be located sufficiently close to pest hosts (exposure groups) for transfer of pests from imported apples to host plants to take place. 
221Panel Report, paras. 2.44 and 2.45 (referring to IR A, Part B, pp. 24-29).  The five utility points and 
four exposure groups are described supra , para. 139 of this Report. WT/DS367/AB/R 
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distribution.
222  The IRA further considered two alterna tive scenarios regarding proximity.  Under the 
first scenario, 70 to 100 per cent of imported appl es would be distributed to orchard packing houses 
and the remainder to urban wholesalers, while under the second scenario, only 0.1 to 5 per cent of 
imported apples would be distributed to orchard packing houses.223   
151. With regard to exposure224, the IRA assigned, to each of the 20 combinations of five utility 
points and four exposure groups, an exposure value fo r an individual apple consisting of a range with 
a minimum value of 0 and a maximum value of 10-6, using uniform distribution.225  T h e  I R A  
explained that this range was based on the IRA's views on both mechanical226 and insect mediated227 
transmission, and explicitly ac knowledged "that in some circumstances the chances of exposure 
would be zero".228 
152. The IRA then estimated the partial probability of establishment and the partial probability of 
spread for each of the four exposure groups.  A ll eight partial probabilities—four for establishment 
and four for spread—were described as a proba bility interval with a uniform distribution.229  
Subsequently, using the @Risk program, the IRA co mbined the partial probability of establishment, 
the partial probability of spread, the probability of importation, and the estimated volume of apples, so 
as to calculate the overall probability of entry, establishment and spread.230  Using the two scenarios 
regarding proximity described above231, the IRA generated two probability values232, both of which 
fell within the category of "very low" in the IRA's nomenclature.233 
(b) Assessment of Consequences 
153. The IRA assigned the following impact scores in  its assessment of the potential consequences 
of the entry, establishment and spread of fire blight  in Australia:  (i) for the direct consequences, the 
                                                      
222Panel Report, para. 7.377 (referring to IRA, Part B, p. 85). 
223Panel Report, para. 7.377 (referring to IRA, Part B, pp. 25, 26, and 97). 
224As described above, exposure is the likelihood of transfer of a pest from an infested apple to a 
susceptible host plant. 
225Panel Report, para. 7.381. 
226Mechanical transmission refers to  transmission through, for exam ple, exposure of workers and 
equipment to the pest. (Panel Report, para. 7. 398 (quoting IRA, Part B, pp. 87 and 88)) 
227Insect mediated transmission refers to a transfer of bacteria to a susceptible host plant by insects that 
have browsed on discarded apples. (Panel Report, para. 7. 398 (quoting IRA, Part B, pp. 87 and 88)) 
228Panel Report, para. 7.381 (quoting IRA, Part B, p. 90). 
229Panel Report, para. 7.426 (referring to IRA, Part B, pp. 95-97). 
230Panel Report, para. 7.427 (referring to IRA, Part B, p. 97). 
231Supra , para. 150 of this Report. 
232The 5 per cent, median, and 95 per cent values generated were:  9.1 × 10-3, 4.5 × 10-2, and 0.18, 
under the first scenario, and 8.7 × 10-3, 4.4 × 10-2, and 0.18 under the second scenario.  The Panel described 
these two sets of probability values as "almost identical".  (Panel Report, para. 7.432;  IRA, Part B, Table 21, 
p. 97) 
233Panel Report, para. 7.427 (referring to IRA, Part B, p. 97).  WT/DS367/AB/R 
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IRA assigned an "F"234 to the effects on plant life or health, and an "A"235 to the effects on human life 
or health and on any other aspects of the environment236;  and (ii) for the indirect consequences, the 
IRA assigned an "E"237 to control and eradication, and to impact on the domestic industry, a "D"238 to 
the effects on international trade and on commun ities, and an "A" to effects on the environment.239  
The IRA applied its decision rules240 in combining those allocated impact scores to arrive at the 
outcome that the overall potential biological and ec onomic consequences of fire blight were "high".241 
(c) Combining the Estimated Probability of Entry, Establishment and 
Spread with the Estimate of Consequences 
154. At the end of its assessment of risk, the IR A combined the overall probability of entry, 
establishment and spread ("very low") with the estimate of consequences ("high") using the risk 
estimation matrix.  In accordance with the matrix, the IRA concluded that the unrestricted risk of fire 
blight was "low".242 
2. Pest Risk Management  
155. Since the unrestricted risk of fire blight was "low" and thus exceeded Australia's appropriate 
level of protection, the IRA proceeded to the stage of risk management.  Because the IRA considered 
that the unrestricted risk was influenced by, in partic ular, the number of infested or infected apples at 
importation steps 2, 3, 4, and 5, the IRA focu sed on measures that could reduce the likelihood 
allocated to these steps.243  Using its risk assessment methodology, the IRA considered four risk 
mitigation options:  (i) sourcing apples for export from individual orchards free from fire blight 
disease symptoms;  (ii) chlorine or other suitable disi nfection treatment;  (iii) cold storage of apples 
for six weeks prior to export;  and (iv) systems appr oaches, that is, combinations of two or more of 
                                                      
234"F" means "significant" with regard to national consequences, and "highly significant" with regard to 
regional, district, and local consequences. (IRA, Part B, p. 39)  
235"A" means "unlikely to be discernible" with regard to all national, regional, district, and local 
consequences. (IRA, Part B, p. 39)  
236Panel Report, para. 7.459 (referring to IRA, Part B, p. 100). 
237"E" means "minor" with regard to national consequences, "significant" with regard to regional 
consequences, and "highly sign ificant" with regard to district and lo cal consequences. (IRA, Part B, p. 39) 
238"D" means "unlikely to be discernible" with regard to national consequences, "minor" with regard to 
regional consequences, "significant" with regard to district consequences, and "highly significant" with regard to 
local consequences. (IRA , Part B, p. 39)  
239Panel Report, para. 7.460 (referring to IRA, Part B, pp. 100-104). 
240The IRA has preset conversion criteria.  In the anal ysis for fire blight, the IRA applied the rule that, 
where the consequences of a pest with respect to a singl e criterion are "F" and the consequences of a pest with 
respect to remaining criteria are not unanimously "E", th e overall consequences are considered to be "high". 
(IRA, Part B, p. 40) 
241Panel Report, para. 7.461 (referring to IRA, Part B, p. 104). 
242Panel Report. para. 7.462 (referring to IRA, Part B, pp. 104 and 105). 
243Panel Report, para. 2.106;  IRA, Part B, pp. 105-107. WT/DS367/AB/R 
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these options.
244  The IRA concluded that none of the individual options would sufficiently reduce 
risk by itself, but that the combination of sourci ng apples from orchards free of fire blight symptoms 
and disinfection would reduce the risk to "very low", that is, within Australia's appropriate level of 
protection.245 
E. The IRA's Conclusions on ALCM 
1. Pest Risk Assessment  
(a) Assessment of Probability of En try, Establishment and Spread 
156. The IRA assigned an importation step value of 1 (100 per cent) to importation steps 1 and 8, 
and an importation step value of zero to importati on steps 5 and 7.  For the other four importation 
steps, importation step values were determined as probability intervals, two with triangular 
distribution and two with uniform distribution.246  Using these values, the IRA estimated the overall 
probability of importation of apples infested with ALCM to be 4.1 per cent of the total number of 
apples that would be imported from New Zealand annually.247  In addition to this estimation of the 
likelihood of importation (the "ori ginal estimation") for ALCM, the IRA also used an alternative 
method to estimate the overall probability of importa tion, which was based on data submitted by 
New Zealand to Biosecurity Australia in 2005 (the  "August 2005 data").  Using these figures, the IRA 
calculated the likelihood of importation of infested  apples as 0.13 per cent of the total number of 
apples that would be imported from New Zealand annually.248  In the subsequent steps of its analysis, 
the IRA considered both sets of data. 
157. With regard to proximity, the IRA again consid ered each of the combinations of five utility 
points and four exposure groups.249  The IRA determined, for the combination of orchard wholesalers 
and commercial fruit crops, that the proportion of ut ility points sufficiently close to susceptible host 
plants in the exposure group was 1 (100 per cent), whereas, for the other 19 combinations, the IRA 
determined probability intervals with various mi nimum and maximum values, all of which were 
                                                      
244IRA, Part B, p. 106. 
245IRA, Part B, pp. 114-116;  see also Panel Report, para. 2.91. 
246IRA, Part B, pp. 159-166. 
247More specifically, having inserted its probability estimates into the risk simulation model, the 
probability of importation was estimated as "4.1 × 10-2 (mean), 2.1 × 10-2 (5th percentile) and 6.5 × 10-2 
(95th percentile)". (IRA, Part B, p. 165;  see also Panel Report, para. 7. 1360) 
248More specifically, the IRA approximated the information provided by New Zealand as a triangular 
distribution with a minimum value of 10-3, a most likely value of 1.3 × 10-3, and a maximum value of 3.8 × 10-3. 
(IRA, Part B, p. 166) 
249Panel Report, paras. 2.44 and 2.45 (referring to IRA, Part B, pp. 25-29).  WT/DS367/AB/R 
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combined with uniform distribution.250  Here, the IRA specifically mentioned that the estimated 
likelihoods were determined  by IRA expert judgement.251 
158. With regard to the transfer of ALCM to host plants from the utility point, the IRA noted that 
only adult insects' flight enables transfer of the pest from the fruit or packaging to the environment 
surrounding a utility point.252  The IRA further explained that a successful transfer of ALCM from 
infested fruit to a host plant requires that a female , after having emerged from her cocoon, attracts and 
mates with a male, and lays her eggs on a susceptible  host plant during her short lifespan;  and that a 
sufficient number of those eggs survive and hatch.253 
159. To calculate the number of infested fruit arriving at each combination of a utility point and an 
exposure group, the IRA made two se ts of estimates for the 20 combina tions of five utility points and 
four exposure groups, one set based on its origin al estimation and the other on the August 2005 
data.254  In addition, as it did with fire blight, the IR A further considered two scenarios relating to the 
proportion of imported apples that would be  distributed to orchard packing houses.255 
160. The IRA then estimated, for each of the 20 co mbinations of five utility points and four 
exposure groups, a partial probability of entry, est ablishment and spread.  The IRA again generated 
two data sets using, for the likelihood of importati on, both its original estim ation and the August 2005 
data.  All forty probabilities were presented as intervals combined with uniform distribution.256 
161. Using @Risk, the IRA combined the partial pr obabilities of entry, establishment and spread 
so as to calculate the overall probability of entr y, establishment and spread based on the original 
estimation and the August 2005 data, respectively.  The probability ranges generated for the two 
scenarios corresponded to a qualitative likelihood of  entry, establishment and spread of "high"257 
(using the original estimation) and "moderate"258 (using the August 2005 data) in the IRA's 
nomenclature. 
                                                      
250IRA, Part B, p. 168. 
251Panel Report, para. 7.803 (referring to IRA, Part B, p. 167). 
252IRA, Part B, p. 171. 
253IRA, Part B, p. 171. 
254IRA, Part B, pp. 171-174. 
255Supra , para. 150 of this Report. 
256IRA, Part B, p. 179.  The IRA states that "[t]hese estimates are based on expert opinion taking into 
account" the factors identified in its analysis, and discusses issues and evidence relevant to the likelihoods, both 
in general and for specific utility points. ( Ibid., p. 178) 
257The 5 per cent, median, and 95 per cent values generated were:  0.56, 0.73, and 0.89. (IRA, Part B, 
p. 183) 
258The 5 per cent, median, and 95 per cent values generated were:  0.33, 0.51, and 0.68. (IRA, Part B, 
p. 183) WT/DS367/AB/R 
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(b) Assessment of Consequences 
162. The IRA assigned the following impact scores in  its assessment of the potential consequences 
of the entry, establishment and spread of ALCM in Australia:  (i) for the direct consequences, the IRA 
assigned a "D"
259 to the effects on plant life or health, and an "A"260 to the effects on human life or 
health and on any other aspects of the environment261;  and (ii) for the indirect consequences, the IRA 
assigned a "D" to the effects on control and eradi cation, on domestic industry, and on international 
trade262, and a "B"263 to the effects on the environment and on communities.264  The IRA applied its 
decision rules265 to the combination of those allocated impa ct scores, and concluded that the overall 
potential biological and economic conseque nces associated with ALCM were "low".266 
(c) Combining the Estimated Probability of Entry, Establishment and 
Spread with the Estimate of Consequences 
163. Finally, the IRA combined the overall probability of entry, establishment and spread with the 
estimate of consequences using the risk estima tion matrix.  The overall probability of entry, 
establishment and spread of ALCM was "high" (usi ng the original estimation) and "moderate" (using 
the August 2005 data), and the estimate of conse quences was "low".  Based on these ratings, the IRA 
concluded that the overall unrestricted risk of ALCM was "low" for both data sets.267 
2. Pest Risk Management  
164. Since the unrestricted risk of ALCM was "l ow" and thus exceeded Au stralia's appropriate 
level of protection, the IRA proceeded to the stag e of risk management.  The IRA focused on two 
principal options to reduce risk:  (i) inspection of apples coupled with remedial action when the 
inspection finds pests;  and (ii) mandatory treatment of all apples.  Noting that ALCM is highly visible, and that fumigation is assumed to be 100 pe r cent effective in killing it, the IRA considered 
                                                     
 
259As described above, "D" means "unlikely to be discernible" with regard to national consequences, 
"minor" with regard to regional consequences, "significant" with regard to district consequences, and "highly 
significant" with regard to local consequences. (IRA, Part B, p. 39) 
260As described above, "A" means "unlikely to be discernible" with regard to all national, regional, 
district, and local consequenc es. (IRA, Part B, p. 39) 
261IRA, Part B, pp. 184 and 185. 
262Panel Report, para. 7.883;  IRA, Part B, pp. 185 and 186. 
263"B" means "unlikely to be discernible" with regard  to national, regional, and district consequences, 
and "minor" with regard to local co nsequences. (IRA, Part B, p. 39) 
264IRA, Part B, pp. 186 and 187. 
265In the analysis for ALCM, the IRA applied the rule  that, where the consequences of a pest with 
respect to one or more criteria are "D", the overall conseque nces are considered to be "low". (IRA, Part B, p. 40) 
266Panel Report, para. 7.878 (quoting IRA, Part B, p. 187). 
267IRA, Part B, pp. 187 and 188.  WT/DS367/AB/R 
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whether an inspection of 600 fruit from each lot268, followed by fumigation or destruction of lots or 
consignments found to contain ALCM, would sufficiently reduce the risk.269  The IRA recalculated 
the probability of entry, establishmen t and spread for this restricted risk scenario, using the data relied 
upon for its original estimation of likelihood of im portation, and concluded that the measure would 
reduce this likelihood to "extremely low".  When  combined with "low" consequences in the risk 
estimation matrix, the overall risk associated with th is measure was determined to be "negligible", 
that is, within Australia's a ppropriate level of protection.270  The IRA also noted that this analysis 
predicted that ALCM will be detected in "practica lly every" lot, which would result in fumigation of 
every lot.  The IRA went on to consider the efficacy of this risk management measure at different pest 
infestation rates.  In particular, the IRA consid ered a "worst case" scenario in which, with an 
infestation rate of 0.17 per cent, inspection of a 600-fruit sample would allow lots to pass undetected, 
meaning that the overall likelihood of importation of infested apples would be 0.06 per cent.  When 
this number was used in the overall calculation, the result was that the restricted risk would exceed 
Australia's appropriate level of protection.271  Noting that this "worst case" infestation level fell within 
the range of the August 2005 data provided by New Zealand, the IRA tested the relationships between 
sample sizes and infestation rates at the high and lo w ends of the data provided by New Zealand.  On 
the basis of this analysis, the IR A then considered an inspection of  3000 fruit from each lot, and 
concluded that the combination of a 3000-fruit inspec tion and suitable treatment or rejection of lots 
where ALCM was found would reduce the risk to "ver y low", within Australia's appropriate level of 
protection.272  The IRA also identified an alternative risk  management measure that would sufficiently 
reduce the risk, namely, treatment (fumigation) of all lots to kill ALCM273, combined with a 600-fruit 
inspection.274 
                                                      
268The IRA defines "lot" as "all apple fruit packed for export to Australia each day by a registered 
packing house" and, thus, the Panel noted that "a 'lot' is not a fixed quantity". (Panel Report, para. 7.1347 
(quoting IRA, Part B, p. 342))  However, when considering the risk management measures for ALCM, the IRA 
referred to a lot size of 20,000 fruit and mentioned that variations in lot size had made very little difference to 
the probabilities that an infested apple remains infested af ter inspection and fumigation. (IRA, Part B, p. 188)  
269Panel Report, para. 7.1301 (quoting IRA, Part B, p. 188). 
270Panel Report, para. 7.1301 (quoting IRA, Part B, p. 190);  IRA, Part B, p. 189. 
271Panel Report, para. 7.1302 (quoting IRA, Part B, p. 190). 
272Panel Report, para. 7.1303 (quoting IRA, Part B, p. 191). 
273Panel Report, para. 7.1305 (quoting IRA, Part B, p. 192). 
274This inspection is to check for pests other than ALCM. (IRA, Part B, p. 321) WT/DS367/AB/R 
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V. Annex A(1) to the SPS Agreement :  "SPS Measure" 
165. Australia's first ground of appeal relates to the Panel's finding that: 
[t]he 16 measures at issue in the cu rrent dispute, both as a whole and 
individually, constitute SPS measures within the meaning of Annex A(1) and are covered by the SPS Agreement.
275 
166. Australia appeals this finding, at least in part.  Australia accepts that all of the measures at 
issue constitute SPS measures when taken as a whole or "grouped appropriately".276  However, 
Australia takes issue with the Panel's finding that  the 16 measures at issue constitute SPS measures 
not only as a whole, but also individually.  Australia argues that the Panel's finding that 
the 16 measures at issue all have a purpose that corresponds to Annex A(1) to the SPS Agreement  is 
not sufficient for each of them individually to amount  to an SPS measure.  Australia alleges that the 
Panel failed to assess whether the 16 measures at issue individually meet the requirements of 
Annex A(1) to the SPS Agreement . 
167. According to Australia, there are not 16 separate SPS measures, but only four SPS measures, 
namely, two principal risk management measures relating to fire blight, one principal risk 
management measure relating to European canker,  and one principal risk management measure 
related to ALCM.  Australia maintains that several  of what New Zealand had identified as "measures" 
were merely "ancillary"277 requirements that could not individuall y give rise to a violation of the 
relevant obligations and therefore could not be challenged individually.  In Australia's submission, the 
ancillary requirements are meaningless and ine ffective if considered individually as they are 
dependent on, and merely serve to  implement or maintain, the principal risk management measures.278 
168. New Zealand responds that the Panel did not err in finding that the 16 measures constitute 
SPS measures both as a whole and individually.  New Zealand disagrees with Australia's conception 
of "principal" and "ancillary" measures and submits that an SPS regime may be made up of multiple 
interlinked measures.  The fact that one measure is linked to another measu re does not disqualify it 
from being an SPS measure in its own right.279  New Zealand also points ou t that the last sentence of 
Annex A(1) lists, as examples of SPS measures, the very types of measures that Australia argues are 
"ancillary" and therefore not in themselves SPS measures.280 
                                                      
275Panel Report, para. 8.1(b);  see also para. 7.172. 
276Australia's appellant's submission, para. 60.  
277Australia's appellant's submission, para. 67. 
278Australia's first written submission to the Panel, paras. 135-144.  See also Australia's responses to 
Panel Questions after the first Panel meeting, Annex A. 
279New Zealand's appellee's submission, para. 2.30. 
280New Zealand's appellee's submission, para. 2.28.  WT/DS367/AB/R 
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169. The question before us, therefore, is whet her the 16 measures individually constitute SPS 
measures, or whether they constitute SPS measures on ly when taken as a whole or grouped together.  
To answer this question, we first consider th e proper interpretation of the relevant text of 
Annex A(1)(a) to the SPS Agreement  in accordance with the custom ary rules of interpretation of 
public international law.  We then assess whet her the Panel misinterpreted or misapplied the 
definition of an SPS measure in Annex A(1)(a). 
A. Interpretation of Annex A(1) to the SPS Agreement 
170. A unique feature of the SPS Agreement  is that it defines the measures that are subject to its 
disciplines.  Annex A(1) to the SPS Agreement  provides that an SPS measure is defined as follows: 
ANNEX A 
DEFINITIONS 
1. Sanitary or phytosanitary measure  - Any measure applied: 
(a) to protect animal or plant life or health within the territory of 
the Member from risks arising from the entry, establishment or spread of pests, diseases, disease-carrying organisms or disease-causing organisms; 
(b) to protect human or animal life or health within the territory 
of the Member from risks arisi ng from additives, contaminants, 
toxins or disease-causing orga nisms in foods, beverages or 
feedstuffs; 
(c) to protect human life or health within the territory of the  
Member from risks arising from diseases carried by animals, plants 
or products thereof, or from the entry, establishment or spread of 
pests;  or 
(d) to prevent or limit other damage within the territory of the  
Member from the entry, establishment or spread of pests. 
Sanitary or phytosanitary measures in clude all relevant laws, decrees, 
regulations, requirements and procedures including, inter alia , end 
product criteria;  processes and production methods;  testing, 
inspection, certification and approval procedures;  quarantine treatments including relevant requirements associated with the transport of animals or plants, or with the materials necessary for their survival during transport;  provisions on relevant statistical 
methods, sampling procedures and me thods of risk assessment;  and 
packaging and labelling requirements di rectly related to food safety. 
(footnote omitted) WT/DS367/AB/R 
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171. Although Annex A(1) refers to "any measure", neither the SPS Agreement  nor the DSU 
contains a definition of the term "measure".  The concept of "measure", however, is a key concept for 
dispute settlement and has been addressed by the Appe llate Body in several cases.  Having regard to 
Article 3.3 of the DSU, the Appellate Body has held that, in principle, any act or omission attributable 
to a WTO Member can be a measure of that Member  for purposes of dispute settlement proceedings.  
The acts or omissions that are so attributable are, in the usual case, the acts or omissions of the organs 
of the State.
281 
172. A fundamental element of the definition of "SPS me asure" set out in Annex A(1) is that such 
a measure must be one "applied to protect" at least one of the listed interests or "to prevent or limit" 
specified damage.  Subparagraph (a ) brings within the scope of th e definition measures applied to 
protect animal or plant life or health within the Me mber's territory from specified risks related to pests 
and diseases.  The word "to" in adverbial relation w ith the infinitive verb "protect" indicates a purpose 
or intention.282  Thus, it establishes a required link between the measure and the protected interest.  In 
that sense, the Appellate Body in Australia – Salmon  referred to a Member's  "appropriate level of 
protection" and explained that this level is an objective , and that the SPS measure is an instrument 
chosen to attain or implement that objective.283  We note, in addition, that the word "applied" points to 
the application of the measure and, thus, suggests th at the relationship of the measure and one of the 
objectives listed in Annex A(1) must be manifest in the measure itself or otherwise evident from the circumstances related to the application of the meas ure.  This suggests that the purpose of a measure 
is to be ascertained on the basis of objective considerations.
284 
173. We consider that the meaning that has been attr ibuted to the phrase "applied ... so as to afford 
protection" in the context of Article III:1 of the GATT 1994 may provide some assistance to the interpretative task before us.
285  The language of Annex A(1)(a) to the SPS Agreement  is similar to 
Article III:1 of the GATT 1994, to the extent that bot h provisions use the word "applied", and in both 
provisions this word is followed by the infinitive of purpose, namely, "to protect" or "to afford 
protection", respectively.  With regard to Artic le III of the GATT 1994, the Appellate Body has 
opined that, although the purpose of a measure is not easily ascertained, it ca n often be discerned from 
                                                      
281Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review , para. 81. 
282Shorter Oxford English Dictionary , 6th edn, A. Stevenson (ed.) (Oxford University Press, 2007), 
Vol. 2, p. 3280. 
283Appellate Body Report, Australia – Salmon , para. 200. 
284See, to similar effect, Panel Report, EC – Approval and Marketing of Biotech Products , para. 7.2558. 
285Whilst we are mindful that caution must be exercised when referring to similar words and phrases in 
other provisions of the covered agreements for the purpose of determining the meaning of a particular word or phrase (Appellate Body Report, EC – Asbestos , para. 89), we also note that, because Annex A(1) to the 
SPS Agreement and Article III:1 of the GATT 1994 form part of the same treaty by virtue of Article II:2 of the 
WTO Agreement , each constitutes context relevant to the interpretation of the other.  WT/DS367/AB/R 
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the measure's design, architecture, and structure.286  A similar approach is called for under 
Annex A(1)(a) to the SPS Agreement .  Whether a measure is "applie d ... to protect" in the sense of 
Annex A(1)(a) must be ascertained not only from the objectives of the measure as expressed by the 
responding party, but also from the text and st ructure of the relevant measure, its surrounding 
regulatory context, and the way in which it is desi gned and applied.  For any given measure to fall 
within the scope of Annex A(1)(a), scrutiny of su ch circumstances must reveal a clear and objective 
relationship between that measure and the sp ecific purposes enumerated in Annex A(1)(a). 
174. We now turn to the last sentence of Annex A(1), which provides: 
Sanitary or phytosanitary measures in clude all relevant laws, decrees, 
regulations, requirements and procedures including, inter alia , end 
product criteria;  processes and production methods;  testing, 
inspection, certification and approval procedures;  quarantine 
treatments including relevant requirements associated with the transport of animals or plants, or with the materials necessary for their survival during transport;  provisions on relevant statistical methods, sampling procedures and me thods of risk assessment;  and 
packaging and labelling requirements directly related to food safety. 
175. We note that this last sentence of Annex A(1) fo llows, and relates to, all of the first sentence, 
including all of the purposes enumer ated in subparagraphs (a) through (d).  The first part of this 
sentence contains a list of legal instruments linked by the conjunction "and" ("laws, decrees, 
regulations, requirements and procedures").  This li st is modified by the words "include" and "all 
relevant".  The word "relevant" is, in our view, a ke y element within this sentence.  We see "relevant" 
as a reference back to the preceding sentence in Anne x A(1), that is, to the list of specific purposes 
that are the defining characteristic of every SPS measure.  The words "include" and "all", which also introduce the list of instruments, suggest that th e list is both illustrative and expansive.  Taken 
together, the words "include" and "all relevant" therefore suggest that measures of a type not 
expressly listed may nevertheless constitute SPS measu res when they are "relevant", that is, when 
they are "applied" for a purpose that corresponds to one of those listed in subparagraphs (a) 
through (d).  Conversely, the fact that an instru ment is of a type listed in the last sentence of 
Annex A(1) is not, in itself, sufficient to brin g such an instrument within the ambit of the 
SPS Agreement . 
176. Turning to the second part of the last sentence, we note that this provision introduces a list of 
instruments with the words "including, inter alia ".  The use of both "including" and " inter alia " 
                                                     
 
286Appellate Body Report, Japan – Alcoholic Beverages II , p. 29, DSR 1996:I, 97, at 120. WT/DS367/AB/R 
Page 68  
 
emphasizes that the list is only indicative.
287  The list itself covers a broad range of measures that are 
identified with varying degrees of specificity.  To us , it is a list of examples of measures that may fall 
within the definition of an SPS measure, provided always that the measure manifests a clear and 
objective relationship with (is "applied" for) at least  one of the purposes set out in subparagraphs (a) 
through (d).  The list thus serves to illustrate, through  a set of concrete examples, the different types of 
measures that, when they exhibit the appropriate  nexus to one of the specified purposes, will 
constitute SPS measures and, accordingly, be subject to the disciplines set out in the SPS Agreement . 
B. Application of Annex A(1) to the Measures at Issue 
177. With these considerations in mind, we turn to  the particularities of Australia's appeal.  
Australia alleges that the Panel's finding that the 16 measures individually meet the requirements of 
Annex A(1) was in error because the Panel did not properly apply the requireme nts of Annex A(1) to 
each measure individually. 
178. We recall that the Panel based its conclusion on  two elements.  First, the Panel assessed the 
purpose of the measures.  It observed that Australia's Quarantine Act 1908 , which constitutes the 
legislative basis for the IRA and, thus, for the 16 measures at issue, defin es quarantine measures as 
"having as their object the prevention or control of  the introduction, establishment and spread of 
diseases or pests that will or could cause significant damage to human beings, animals, plants, other 
aspects of the environment or economic activities".288  The Panel also referred to a section of the IRA 
providing that the purpose of the measures is to prot ect the health of people, animals, and plants.289  
The Panel then concluded that, because the 16 measu res are spelt out in the IRA, each of them 
pursues these general objectives290 and is therefore related to risks arising from the entry, 
establishment and spread of pests, in the sense  of subparagraph (a) of  Annex A(1) to the 
SPS Agreement .291  In addition, the Panel identified the purpose of each of the individual measures, as 
set out in the IRA, and found a "close linkage"292 between those purposes and managing risks.  
Second, the Panel analyzed whether the 16 measures fell within the list of examples of SPS measures 
set out in the last sentence of Annex A(1).  The Panel found that each of the 16 measures prescribes a 
                                                      
287We recall, in this connection, the Appell ate Body's consideration of the term " inter alia " in 
Article 2.2 of the Agreement on Technical Barriers to Trade  in EC – Sardines .  Referring to the third sentence 
of that provision, which sets out a list introduced  by the phrase "[s]uch legitimate objectives are, inter alia :", the 
Appellate Body considered that the use of the term " inter alia " indicated that the objectives covered by the term 
"legitimate objectives" extend beyond the objectives specifically mentioned in Article 2.2. (Appellate Body 
Report, EC – Sardines , para. 286) 
288Subsection 4(1) of the Quarantine Act 1908 , as quoted in IRA, Part B, p. 1. (footnote omitted) 
289Panel Report, para. 7.127 (quoting IRA, Part B, p. 5;  and Import Risk Assessment Handbook  
(Biosecurity Australia, 2003) (Panel Exhibit AUS-10), p. 5). 
290Panel Report, para. 7.129. 
291Panel Report, para. 7.139. 
292Panel Report, para. 7.141.  WT/DS367/AB/R 
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particular way of doing something that needs to be  followed if New Zealand apples are to be imported 
into Australia.293  The Panel classified the 16 measures as regulations, requirements, or procedures.  
Consequently, the Panel concluded that the 16 measu res, both as a whole and individually, constitute 
SPS measures in the sense of Annex A(1) to the SPS Agreement .294 
179. We see no merit in Australia's allegation that the Panel failed to assess whether 
the 16 measures at issue individually meet the requireme nts of Annex A(1).  It is correct that the Panel 
inferred that "[s]ince the 16 measures are spelt out in the IRA, each of them pursues the [same] 
general objectives [as the IRA]".295  However, as we see it, the Panel' s analysis was not limited to this 
finding.  The Panel also assessed the purpose of the various measures individually, as spelt out in the 
IRA.  In paragraph 7.141 of its Re port, the Panel reviewed the meas ures individually and analyzed the 
purpose of each measure or small subset of measure s.  The Panel noted, for instance, that, according 
to the explanations in the IRA, Measures 2 to 5 ar e concerned with "risk reduction", Measure 6 relates 
to "mitigat[ing] the risk of fire blight", and th e stated purpose of Measure 7 is "[p]revention of 
contamination".296  As we see it, the Panel considered that this disaggregated analysis provided further 
support for its conclusion that the 16 measures at i ssue are related to risks arising from the entry, 
establishment and spread of pests, in the sense of A nnex A(1)(a).  We are therefore of the view that, 
contrary to what Australia alleges, the Panel di d indeed assess whether the 16 measures at issue 
individually meet the requirements of Annex A(1) to the SPS Agreement . 
180. Australia further contends that the individua l measures are not SPS measures because they do 
not require "some action or course of action (inclu ding an identifiable omission) that a Member may 
put into practical operation for the purpose of protecting against some relevant risk."297  Australia 
maintains that activities or requirements, such as ad ministrative processes or procedures that have no 
operation other than to enhance the efficacy of some  active mechanism for protecting animal or plant 
life or health from risk, should not be identified as separate SPS measures, but instead as ancillary 
requirements.  Australia submits that ancillary re quirements and the principal measures to which they 
relate should be identified collectively as amounting to a "single composite or enhanced SPS measure".
298  Australia illustrates this point by referring to what New Zealand identified as Measure 3.  
This "measure" requires that an orchard inspec tion methodology be developed and approved that 
addresses issues such as:  visibility of symptoms in the tops of trees;  the inspection time required and 
the number of trees to be inspected to meet the efficacy level;  and training and certification of 
                                                      
293Panel Report, para. 7.163. 
294Panel Report, para. 7.172. 
295Panel Report, para. 7.129. 
296Panel Report, para. 7.141 (quoting IRA, Part B, p. 318). 
297Australia's appellant's submission, para. 58. 
298Australia's appellant's submission, para. 58. WT/DS367/AB/R 
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inspectors.
299  Australia argues that, taken alone, this requirement would be meaningless and 
ineffective for achieving any protection from risk, and that it would only have meaning insofar as it is 
ancillary to the principal measure requiring that apples be sourced from areas free from fire blight 
disease symptoms. 
181. We see no support in the text of Annex A(1) to the SPS Agreement  for the distinction between 
"ancillary" and "principal" measures proposed by Aust ralia.  That provision refers to "any measure";  
it does not distinguish between ancillary measures and principal measures or contain the notion of 
"composite" or "enhanced" SPS measures.  As we have set out above, the Appellate Body has 
interpreted the word "measure" in a broad sense, an d rejected the notion that only certain types of 
measures could be challenged in dispute settlement proceedings.300  Nothing in the text of Annex A(1) 
suggests a more restrictive interpretation of the word "measure" in the context of the SPS Agreement . 
In addition, the Appellate Body has held that the pa rties, and, in particular, the complainant, and the 
panel enjoy a certain latitude in defining the relevant measure.301  Furthermore, the last sentence of 
Annex A(1) refers to laws, decrees, regulations, re quirements, and procedures in general, without in 
any respect limiting the scope of these instruments or  carving out particular types of measures.  We 
note that Australia does not object to the Panel' s classification of the "measures" identified by 
New Zealand as regulations, requirements, or pro cedures.  In fact, Australia itself calls them 
"[a]ctivities or requirements, such as administrative processes or procedures".302 
182. Finally, Australia argues that its reading of the definition of an SPS measure in Annex A(1) 
would be consistent with the definition of  the term "phytosanitary measure" in the Glossary of 
Phytosanitary Terms  contained in ISPM No. 5303, and endorses the distinction that the glossary draws 
between a "phytosanitary measure" and a "phytosanitary procedure".304  Australia does not explain 
whether or how it considers these definitions to be relevant to an interpreta tion of Annex A(1)(a) to 
the SPS Agreement , other than to point out that its suggested  interpretation of Annex A(1)(a) would be 
consistent with these definitions.  We recall that the Panel found that the SPS Agreement  contains "no 
such distinction between phytosanitary  measures, actions and procedures".305  We agree with the 
Panel and we consider that the answer to th e question of whether ISPM No. 5 categorizes 
                                                      
299See supra , para. 125 of this Report. 
300Appellate Body Report, US – Corrosion-Resistant Steel Sunset Review , para. 88. 
301See Appellate Body Report, Brazil – Retreaded Tyres , paras. 123-127. Such latitude may 
nevertheless be circumscribed when, as in EC – Asbestos , undue atomization of a measure would affect the 
applicability of relevant disciplines and/or may affect the substance of a panel's findings. (Appellate Body Report, EC – Asbestos , paras. 63-65)  Yet Australia does not allege, and we do not see, that this would be the 
case in the present dispute.  
302Australia's appellant's submission, para. 58. 
303See supra , footnote 45 of this Report. 
304Australia's appellant's submission, para. 59. 
305Panel Report, para. 7.182.  WT/DS367/AB/R 
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Australia's 16 requirements as measures or procedures does not answer the question of whether or not 
these 16 requirements are measures falling w ithin the scope of Annex A(1) to the SPS Agreement . 
183. We have found that, contrary to what Aust ralia alleges, the Panel did assess whether 
the 16 measures at issue individually meet the requirements of Annex A(1) to the SPS Agreement  and 
we have rejected the distinction between ancillary  and principal measures proposed by Australia.  We, 
therefore, see no error in the Panel's finding th at the 16 measures at issue, both as a whole and 
individually, constitute SPS measures within the meaning of Annex A(1) and are covered by the SPS 
Agreement . 
C. Conclusion 
184. Accordingly, we uphold  the Panel's finding, in paragraphs  7.172 and 8.1(b) of the Panel 
Report, that the 16 measures at issue, both as a whole and individually, constitute SPS measures within the meaning of Annex A(1) to the SPS Agreement . 
VI. Articles 5.1, 5.2, and 2.2 of the SPS Agreement  
185. We turn next to Australia's appeal of the Pa nel's findings that Australia's SPS measures at 
issue regarding fire blight and ALCM, as well as the "general" measures linked to these pests, are 
inconsistent with Articles 5.1 and 5.2 of the SPS Agreement  and, by implication, also inconsistent 
with Article 2.2 of the SPS Agreement .  We first provide a brief overview of the IRA's structure and 
reasoning followed by a summary of the relevant Pa nel findings.  This is followed by an overview of 
the claims and arguments raised on appeal.  We then  analyze the specific issues raised by Australia's 
appeal against the Panel findings under Articles 5.1, 5.2, and 2.2 of the SPS Agreement .  Finally, we 
set out our conclusion. 
A. IRA Structure and Panel Findings 
186. The Panel found that Australia's SPS measures rega rding fire blight and ALCM, as well as the 
"general" measures linked to these pests, are in consistent with Articles 5.1 and 5.2 of the 
SPS Agreement , and, by implication, with Article 2.2 of the SPS Agreement .
306 
187. The Panel reached these conclusions having found that, with respect to the analysis of the 
likelihood of entry, establishment and spread of fire blight and of ALCM, and of the potential 
consequences associated with the entry, establishment or spread of  these pests in Australia, the IRA 
was not a proper risk assessment within the meaning of Article 5.1 and Annex A(4) to the
                                                      
306Panel Report, paras. 7.906 and 8.1(c).  See also paras. 7.472, 7.510, 7.887, and 7.905. WT/DS367/AB/R 
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SPS Agreement , and that the flaws that the Panel had f ound in the IRA also constituted a failure, 
under Article 5.2 of the SPS Agreement , to take adequately into account factors such as the available 
scientific evidence, the relevant processes and pr oduction methods in New Zealand and Australia, and 
the actual prevalence of fire blight and viable ALCM.
307 
188. As explained supra , in subsection IV.C of this Report, in respect of fire blight and ALCM, the 
IRA included pest risk assessments for the importa tion of mature apple fruit free of trash, either 
packed or sorted and graded from New Zealand.   The IRA combined a quantitative assessment of 
entry (importation, proximity, exposure), estab lishment and spread factors with a qualitative 
assessment of the potential biological and econom ic consequences associat ed with the entry, 
establishment and spread of the pests at issu e.  The IRA assigned quantitative values to the 
probabilities under the different importation steps308 and establishment and spread factors and then 
aggregated and combined these probabilities to dete rmine an overall value for the annual probability 
of entry, establishment and spread.  This overall quantitative value was converted into a qualitative 
likelihood rating, based on the IRA's own "nomencl ature", and this likelihood rating was combined 
with a qualitative assessment of the pote ntial biological and economic consequences309 in the IRA's 
"risk estimation matrix" to yield an overall determination of the "unrestricted risk".310 
189. In the various quantitative steps of its analysis, the IRA assigned numeric point estimates or 
probability ranges, based on the scientific evidence it reviewed.  In situations that, according to the 
IRA team, presented scientific uncertainty, conclu sions were reached and a quantitative value was 
assigned through the exercise of IRA expert judgemen t.  Probability values were assigned based on 
mathematical distribution models.  Pert and triang ular distribution were u sed to assign "most likely 
values".  Uniform distribution was used and the me an value was assigned when there was not enough 
information to determine a "most likely value". 
190. In assessing New Zealand's claims under Articles 5.1 and 5.2 of the SPS Agreement  with 
respect to fire blight, the Panel reviewed the IR A's analysis of:  (i) the eight importation steps; 
 
                                                      
307Panel Report, paras. 7.471, 7.886, and 7.904.  With respect to ALCM, the Panel also referred to the 
IRA's failure to adequately take into account relevant environmental conditions.  
308Eight importation steps are combined in ten different importation scenarios as to how an apple may 
become infected or infested during the process of importation into Australia. ( Supra , para. 138 of this Report) 
309The IRA assigned qualitative impact scores to specified direct and indirect criteria to determine the 
potential biological and economic consequences of fire blight and ALCM.  These impact scores were combined to determine the overall rating assigned to the po tential biological and economic consequences. ( Supra , 
para. 144 of this Report) 
310See supra , para. 147 of this Report.  WT/DS367/AB/R 
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(ii) proximity311;  (iii) exposure312;  (iv) establishment;  (v) spread;  and (vi) associated potential 
biological and economic consequences;  and also examined (vii) certain alleged methodological flaws 
in the IRA. 
191. On four out of eight importation steps, the Panel concluded that: 
... the IRA's estimation that Erwinia amylovora  will be always 
present in the source orchards in [N]ew Zealand (importation step 1);  that fruit coming from an infected or infested orchard is infected or infested with Erwinia amylovora  (importation step 2);  that clean 
fruit from infected or infested orchards is contaminated with Erwinia 
amylovora  during picking and transport to the packing house 
(importation step 3);  and that clean fruit is contaminated by Erwinia 
amylovora  during processing in the packing house (importation 
step 5);  do not find sufficient support in the scientific evidence relied 
upon and, accordingly, are not coherent and objective.
313 
192. The Panel observed that the IRA calculated the overall probability of importation as a sum of 
the probabilities associated with ten individual im portation scenarios and did not provide any separate 
justification or evidence regarding the estimated overall likelihood of importation.  In the light of 
these findings, the Panel noted, but did not decide, the issue of whether this methodology was flawed 
in and of itself.  The Panel reasoned that if, unde r such methodology, the estimations of one or more 
of the individual likelihoods are questionable,  then the overall figure necessarily becomes 
questionable.314  Because the Panel found that some of th e individual likelihoods were flawed, it 
determined that the IRA's estimation of the ove rall probability of importation was not supported by 
adequate scientific evidence and, accord ingly, was not coherent and objective.315 
193. With respect to fire blight, the Panel also found that a significant part of the IRA's analysis of 
exposure, establishment and spread was based on a number of assumptions and qualifications that 
were not convincing, leading to reasonable dou bts about the evaluation made by the risk assessor.316  
The Panel, therefore, concluded that the reasoning ar ticulated in the IRA with respect to the likelihood 
of entry, establishment and spread of fire blight , including the IRA's estimation of the values for the 
                                                      
311Proximity is the likelihood that major handlers and users of apples (utility points) would be located 
sufficiently close to susceptible host plants (exposure groups) for the transfer of pests from imported apples to 
host plants to take place. ( Supra , paras. 137 and 139 of this Report) 
312Exposure is the likelihood of transfer  of a pest from an infected ap ple to a susceptible host plant. 
(Supra , paras. 137 and 140 of this Report) 
313Panel Report, para. 7.447. 
314Panel Report, para. 7.355. 
315Panel Report, para. 7.447. 
316Panel Report, para. 7.448. WT/DS367/AB/R 
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respective probabilities, did not rely on adequate  scientific evidence and, accordingly, was not 
coherent and objective.
317 
194. Regarding the potential biological and economic consequences associated with fire blight, the 
Panel discussed certain testimony of its appointed experts, including th at it is impossible to predict the 
economic consequences of the introduction of fire blight into a new area and that the IRA has a 
tendency to overestimate the severity of the consequen ces of fire blight in certain aspects.  The Panel, 
therefore, found that the IRA's evaluation of the po tential consequences associ ated with the entry, 
establishment or spread of fire blight into Australia  did not rely on adequate scientific evidence and, 
accordingly, was not coherent and objective.318 
195. In the light of the above, the Panel found that, with  respect to its analysis of the fire blight 
risk, the "IRA is not a proper risk assessment with in the meaning of Article 5.1 and paragraph 4 of 
Annex A to the SPS Agreement".319  The Panel also found that the IRA contained certain 
methodological flaws  that magnified the risk assessed and was,  for that reason too, not a proper risk 
assessment within the meaning of Article 5.1 of the SPS Agreement .320  The Panel found, accordingly, 
that Australia's requirements rega rding fire blight on New Zeala nd apples are inconsistent with 
Articles 5.1, 5.2, and 2.2 of the SPS Agreement .321 
196. With respect to ALCM, in ass essing New Zealand's claims under Articles 5.1 and 5.2 of the 
SPS Agreement , the Panel reviewed the IRA's analysis of:  (i) the viability of ALCM cocoons;  (ii) the 
effects of parasitism on ALCM viability;  (iii) the ALCM flight range;  (iv) the period of emergence 
of ALCM;  (v) the climatic conditions for the spread  of ALCM in Australia;  and (vi) the mode of 
trade.  The Panel found that the IRA's reasoning was not objective and coherent in respect of a 
number of these factors, which could have a major impact on the assessment of this particular risk, in particular:  the viability of ALCM in occupied cocoons;  the impact of parasitism on cocoon 
occupancy;  the protracted period of emergence of ALCM adults relative to their short lifespan, which 
diminishes the chances of mating;  the climatic c onditions for the establishment and spread of ALCM 
in Australia;  and the likely mode of trade.
322  The Panel found that, cumulatively, the IRA's failure to 
take these factors into account was enough to creat e reasonable doubts about the risk assessment with 
respect to its evaluation of the likelihood of entr y, establishment and spread of ALCM.  The Panel, 
therefore, concluded that due to these flaws, the IRA's analysis of the likelihood of entry, 
                                                      
317Panel Report, para. 7.448. 
318Panel Report, para. 7.470. 
319Panel Report, para. 7.471. 
320Panel Report, para. 7.510. 
321Panel Report, paras. 7.472 and 7.510. 
322Panel Report, para. 7.870.  WT/DS367/AB/R 
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establishment and spread of ALCM could not be found to be supported by coherent reasoning and 
sufficient scientific evidence and thus was not objectively justifiable.323 
197. The Panel found that the IRA had a tendency to overestimate the severity  of the consequences 
of ALCM in certain aspects, and that it did not ad equately consider the existence of the climatic 
conditions necessary for the establishment and spread of ALCM in Australia.  The Panel, therefore, 
concluded that the IRA's evaluation of the pot ential consequences associated with the entry, 
establishment or spread of ALCM into Australia di d not rely on adequate scientific evidence and, 
accordingly, was not coherent and objective.324 
198. In the light of the above, the Panel found that, w ith respect to its analysis of the ALCM risk, 
the IRA is not a proper risk assessment within th e meaning of Article 5.1 and Annex A(4) to the 
SPS Agreement325, and found, accordingly, th at Australia's inspection and treatment requirements 
regarding ALCM on New Zealand apples are inconsis tent with Articles 5.1, 5.2, and 2.2 of the 
SPS Agreement .326 
199. With respect to the general measures, the Pane l also found that the IRA is not a proper risk 
assessment, "[c]onsidering the link in the IRA betw een the 'general' measures ... and the specific 
requirements regarding fire blight ... and ALCM, as well as the lack of any separate justification for 
these 'general' measure s in the IRA ...".327  Thus, the Panel found that these measures, too, are 
inconsistent with Articles 5.1 and 5.2 a nd, by implication, Article 2.2 of the SPS Agreement .328 
B. Claims of Error and Arguments on Appeal 
200. On appeal, Australia argues that the Panel erre d in its interpretation of Article 5.1 of the 
SPS Agreement  and misapplied the criteria elaborated by the Appellate Body in US/Canada – 
Continued Suspension  for a panel's review of a risk assessment under Article 5.1 of the 
SPS Agreement . 
201. Australia claims that the Panel erred in its re view of the IRA both for fire blight and ALCM, 
because it misapplied the standards of scientific "sufficiency"329 and "objectivity and coherence".330  
According to Australia, as regards the IRA's inte rmediate conclusions, the Panel should have asked
                                                      
323Panel Report, para. 7.871. 
324Panel Report, para. 7.885. 
325Panel Report, para. 7.886. 
326Panel Report, para. 7.887. 
327Panel Report, para. 7.904. 
328Panel Report, para. 7.905. 
329Australia's appellant's submission, para. 92. 
330Australia's appellant's submission, paras. 93 and 103. WT/DS367/AB/R 
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only whether they were "within a range that could be considered legitimate by the standards of the 
scientific community".
331  Australia adds that the standard of objectivity and coherence set out in 
paragraph 591 of the Appellate Body reports in US/Canada – Continued Suspension  applies only to 
"the particular conclusion ultimately r eached" by a Member assessing the risk.332  Australia also 
claims that the Panel wrongly required the IRA to  contain an explanation of precisely how the IRA 
team reached the expert judgements it ma de at intermediate steps in the IRA333 and failed to assess the 
materiality of the faults it found with par ticular expert judgements made in the IRA.334  Australia 
claims that these legal errors undermine the Panel's analysis of certain importation steps, exposure, establishment and spread, as well as of the associat ed potential biological and economic consequences 
of fire blight and ALCM.
335  At the oral hearing, Australia confirmed that its appeal of the Panel's 
findings on the general measures depends on its appeal  of the pest-specific measures and that we must 
rule on the general measures in the same wa y as we rule on the pest-specific measures. 
202. New Zealand responds that Australia's two main  assertions, that the standard of objectivity 
and coherence in US/Canada – Continued Suspension  should apply "only to 'conclusions ultimately 
reached'", and that a panel should review only whether expert judgements fall "within a range 
considered legitimate by the standards of the scien tific community", are "designed to shelter the IRA 
from effective review".336  New Zealand argues that the criteria identified in US/Canada – Continued 
Suspension —that reasoning in a risk assessment be "obj ective and coherent" and that "conclusions 
drawn find sufficient support in the scientific ev idence"—apply equally to reasoning and conclusions 
that are based in part on the application of expert judgement.337  New Zealand also contests Australia's 
assertions that the Panel imposed an unduly onerous  duty of explanation on the IRA in connection 
with its use of expert judgement , and failed to assess the materia lity of the flaws in the IRA.  
According to New Zealand, these assertions are "based on a misreading of the Panel Report".338 
203. Before reviewing Australia's claims that the Pane l erred in its interpretation and application of 
Articles 5.1, 5.2, and 2.2 of the SPS Agreement , we consider the meaning and content of the 
obligations set out in these provisions. 
                                                      
331Australia's appellant's submission, para. 95. 
332Australia's appellant's submission, paras. 76 and 77. 
333Australia's appellant's submission, paras. 96 and 97. 
334Australia's appellant's submission, paras. 84-90 and 122. 
335Australia's appellant's submission, paras. 100-123. 
336New Zealand's appellee's submission, paras. 2.39 and 2.40 (quoting Australia's appellant's 
submission, paras. 76 and 77). 
337New Zealand's appellee's submission, paras. 2.44 and 2.45. 
338New Zealand's appellee's submission, para. 2.40.  WT/DS367/AB/R 
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C. The Panel's Assessment of the IRA 
1. Articles 5.1, 5.2, and 2.2 of the SPS Agreement  
204. Article 5.1 of the SPS Agreement  requires that sanitary or phytosanitary measures be based on 
a "risk assessment".  Article 5.1 provides that: 
Members shall ensure that their sanitary or phytosanitary measures 
are based on an assessment, as appropriate to the circumstances, of the risks to human, animal or plan t life or health, taking into account 
risk assessment techniques develope d by the relevant international 
organizations. 
205. "Risk assessment" for pests is defined in Annex A(4) to the SPS Agreement  as: 
[t]he evaluation of the likelihood of entry,  establishment or spread of 
a pest or disease within the territory of an importing Member 
according to the sanitary or phytosanitary measures which might be applied, and of the associated potential biological and economic consequences; ... 
206. Article 5.2 of the SPS Agreement  contains a list of factors that must be taken into account in a 
risk assessment: 
In the assessment of risk s, Members shall take into account available 
scientific evidence;  relevant processes and production methods;  relevant inspection, sampling and testing methods;  prevalence of specific diseases or pests; existen ce of pest- or disease-free areas; 
relevant ecological and environmen tal conditions;  and quarantine or 
other treatment. 
207. Science plays a central role in risk assessment a nd, therefore, a risk assessment is "a process 
characterized by systematic, disciplined and objective enquiry and analysis, that is, a mode of 
studying and sorting out facts and opinions".
339  Moreover, the list of factors that Members shall take 
into account in a risk assessment set out  in Article 5.2 is not a "closed list"340, and it does not a priori 
exclude factors that are not susceptible of quantita tive analysis by the empirical or experimental 
laboratory methods commonly associat ed with the physical sciences. 
208. Thus, Article 5.2 requires a risk assessor to take into account the available scientific evidence, 
together with other factors.  Whether a risk asses sor has taken into account the available scientific 
evidence in accordance with  Article 5.2 of the SPS Agreement  and whether its risk assessment is a 
proper risk assessment within the meaning of Artic le 5.1 and Annex A(4) mu st be determined by 
                                                      
339Appellate Body Reports, US/Canada – Continued Suspension , para. 527 (quoting Appellate Body 
Report, EC – Hormones , para. 187). 
340Appellate Body Report, EC – Hormones , para. 187.  WT/DS367/AB/R 
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assessing the relationship between the conclusions of  the risk assessor and the relevant available 
scientific evidence. 
209. In EC – Hormones , the Appellate Body clarified that Artic le 5.1 is a "specific application of 
the basic obligations contained in Article 2.2 of the SPS Agreement " and that "Articles 2.2 and 5.1 
should constantly be read together".
341  Article 2.2 focuses on the need for an SPS measure to be 
based on scientific principles and sufficien t scientific evidence.  It provides: 
Members shall ensure that any sanita ry or phytosanitary measure is 
applied only to the extent necessary to protect human, animal or plant 
life or health, is based on scientific  principles and is not maintained 
without sufficient scientific evid ence, except as provided for in 
paragraph 7 of Article 5. 
210. We observe that, in its decisions under Articles 2.2 and 5.1 of the SPS Agreement , the 
Appellate Body has identified the role of a panel assessing compliance with these provisions as an 
inquiry into whether there is a "rational or obj ective relationship" between the SPS measures and the 
scientific evidence and between the SPS measures and the risk assessment.342 
211. The standard of review in proceedings under the SPS Agreement  "must reflect the balance 
established in that Agreement between the jurisdictional competences conceded by the Members to the WTO and the jurisdictional competences retained by the Members for themselves".
343  The applicable 
standard of review is set out in Article 11 of the DSU, which states in relevant part: 
[A] panel should make an objective assessment of the matter before 
it, including an objective assessment of the facts of the case and the applicability of and conformity  with the relevant covered 
agreements ... . 
212. In EC – Hormones , the Appellate Body clarified that this standard of review requires that a 
panel reviewing a risk assessment under Article 5.1 of the SPS Agreement  neither undertake a de novo  
review, nor give "total deference"  to the risk assessment it reviews.
344 
213. In US/Canada – Continued Suspension , the Appellate Body further clarified the standard of 
review that applies to a panel reviewing the co nformity of a measure with Article 5.1 of the 
                                                      
341Appellate Body Report, EC – Hormones , para. 180.  The Appellate Body also clarified that "[t]he 
requirement that an SPS measure be 'b ased on' a risk assessment is a subs tantive requirement that there be a 
rational relationship between the measure and the risk assessment".  ( Ibid., para. 193) 
342In Japan – Agricultural Products II , the Appellate Body stated that "the obligation in Article 2.2 that 
an SPS measure not be maintained with out sufficient scientific evidence re quires that there be a rational or 
objective relationship between the SPS measure and th e scientific evidence". (Appellate Body Report, Japan – 
Agricultural Products II , para. 84)  See also Appellate Body Report,  Japan – Apples , paras. 162 and 163. 
343Appellate Body Report, EC – Hormones , para. 115. 
344Appellate Body Report, EC – Hormones , para. 117.  WT/DS367/AB/R 
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SPS Agreement .  The Appellate Body stated that, under this  provision, a panel's task is to review a 
WTO Member's risk assessment and not to substitute its  own scientific judgement for that of the risk 
assessor.  A panel should not, therefore, determine whether the risk assessment is correct, but rather 
"determine whether that risk assessment is supporte d by coherent reasoning and respectable scientific 
evidence and is, in this sense, objectively justifiable".345 
214. More specifically, at paragraph 591 of its reports in US/Canada – Continued Suspension , the 
Appellate Body stated that, with respect to the scientific basis underlying an SPS measure, a panel 
should verify whether it "comes from a respected  and qualified source" and has "the necessary 
scientific and methodological rigour to be consider ed reputable science".  The Appellate Body 
explained that, "while the correctness of the view s need not have been accepted by the broader 
scientific community, the views must be consider ed to be legitimate sc ience according to the 
standards of the relevant scientific community."  Wi th respect to the reasoning of the risk assessor, the 
Appellate Body observed in the same paragraph of the US/Canada – Continued Suspension  reports 
that: 
[a] panel should also assess whether the reasoning articulated on the 
basis of the scientific evidence is objective and coherent.  In other words, a panel should review whether the particular conclusions drawn by the Member assessing the risk find sufficient support in the scientific evidence relied upon. 
215. Thus, in its discussion of the standard of revi ew that applies to a panel reviewing a risk 
assessment under Article 5.1 of the SPS Agreement , the Appellate Body identified two aspects of a 
panel's scrutiny of a risk assessment, namely, scr utiny of the underlying scientific basis and scrutiny 
of the reasoning of the risk assessor based upon such underlying science.  With respect to the first 
aspect, the Appellate Body saw the panel's role as limited to reviewing whether the scientific basis 
constitutes "legitimate science accord ing to the standards of the rele vant scientific community".  The 
Appellate Body perceived the second aspect of a panel's review as involving an assessment of 
whether the reasoning of the risk assessor is objectiv e and coherent, that is, whether the conclusions 
find sufficient support in the scientific eviden ce relied upon.  Having done so, the panel must 
determine whether the results of the risk asse ssment sufficiently warrant the challenged SPS 
measures.
346  We consider that this reasoning of the Appe llate Body is consistent with the overarching 
requirement in Article 2.2 and reflected in Articles 5.1 and 5.2 of the SPS Agreement  that there be a 
"rational or objective relationship" between  the SPS measures and th e scientific evidence. 
                                                      
345Appellate Body Reports, US/Canada – Continued Suspension , para. 590. 
346Appellate Body Reports, US/Canada – Continued Suspension , para. 591 (referring to Appellate 
Body Report, EC – Hormones , para. 193). WT/DS367/AB/R 
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216. In the light of the above, we review below Australia 's claims that the Panel:  (i) misinterpreted 
and misapplied the standard of review applicable to its review of the IRA under Article 5.1 of the 
SPS Agreement ;  (ii) erred in its assessment of the use of  IRA expert judgement;  and (iii) failed to 
assess the materiality of the faults it found with the reasoning in the IRA. 
2. The Standard of Review Used by the Panel in Its Review of the IRA under 
Article 5.1 of the SPS Agreement  
217. Australia claims that in finding that the in termediate conclusions in the IRA were not 
supported by adequate or sufficient scientific eviden ce and were thus not objective and coherent, the 
Panel misapplied the standard of review articulated by the Appellate Body in US/Canada – Continued 
Suspension .347  Australia argues that the standard of re view applicable to intermediate expert 
judgements made in the IRA in the light of scientific uncertainty "ought be no different from the 
standard recognised in US/Canada – Continued Suspension ... as that required for the scientific 
evidence itself:  each need do no more  than fall within a range that c ould be considered 'legitimate by 
the standards of the scientific community'".348  Australia further contends that the standard of 
objectivity and coherence does not re late to the quality of reasoning per se , but to the quality of the 
"particular conclusion ultimately reached".349 
218. New Zealand responds that Australia's assertion that a panel should assess whether an 
intermediate conclusion in a risk assessment is with in a range that could be considered legitimate by 
the standards of the scientific community would est ablish a lower threshold for a panel reviewing a 
risk assessment than the threshold cl arified by the Appellate Body in US/Canada – Continued 
Suspension , and that such a lower threshold would elim inate the need to assess the link between the 
scientific evidence and the conclusi ons reached in a risk assessment.350 
219. We start by observing that, in US/Canada – Continued Suspension , the Appellate Body did 
not set out a series of steps that a panel must mechanically follow in the evaluation of a risk 
assessment under Article 5.1 of the SPS Agreement .  Rather, the Appellate Body suggested a way for 
a panel to verify the consistency of a risk assessment with Article 5.1 of the SPS Agreement  that is 
centred on the notion that the risk assessment should be evaluated in the light of the scientific evidence on which it relies.  In this respect, the reports in US/Canada – Continued Suspension  
confirm the interpretation provided by  the Appellate Body in its earlier decisions under Article 2.2 of 
the SPS Agreement —that a panel should verify the existence of a "rational or objective relationship" 
                                                     
 
347Australia's appellant's submission, paras. 92 and 93. 
348Australia's appellant's submission, para. 77. 
349Australia's appellant's submission, paras. 76 and 77.  See also para. 103. 
350New Zealand's appellee's submission, paras. 2.61 and 2.62.  WT/DS367/AB/R 
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between the SPS measures and the risk assessment, on the one hand, and the scientific evidence, on 
the other hand—and provides some practical guidance as to how this might be done.351 
220. As we have already observed, in US/Canada – Continued Suspension , the Appellate Body 
identified two aspects of a panel's review of  a risk assessment under Article 5.1 of the SPS Agreement :  
(i) a determination that the scientific basis of  the risk assessment comes from a respected and 
qualified source and can accordingly be considered "legitimate science"  according to the standards of 
the relevant scientific community;  and (ii) a determination that the reasoning of the risk assessor is 
objective and coherent and that, therefore, its c onclusions find sufficient support in the underlying 
scientific basis.  A panel should first determine wh ether the scientific basis relied upon by the risk 
assessor is "legitimate" before reviewing whether the reasoning and the conclusions of the risk 
assessor that rely upon such a scientif ic basis are objective and coherent. 
221. We note that the first aspect, the panel's review of the scientific basis of the risk assessment, 
may be particularly relevant in cases where the im porting Member has relied on minority scientific 
opinions in conducting a risk assessment.  In such cases, the question whether such opinions 
constitute "legitimate" science from respected and qua lified sources according to the standards of the 
relevant scientific community may have greater pr ominence.  In this appeal, we have not been 
requested to decide whether the Panel properly assessed the underlying scientific basis that was used 
by the IRA to support its reasoning and conclusions on the risks relating to fire blight and ALCM. 
222. As far as the second aspect is concerned, the Pa nel found in several instances that the IRA's 
conclusions were not objective and coherent because they exaggerated or overestimated certain risks 
and consequences and did not find sufficient support in  the scientific evidence relied upon.  In this 
respect, the Panel's approach to reviewing the IRA' s reasoning and conclusions is consistent with the 
Appellate Body reports in US/Canada – Continued Suspension , as well as with its previous decisions 
that have required panels to verify the existen ce of a rational or objective relationship between the 
SPS measures and the risk assessment, on the one ha nd, and the scientific evidence, on the other 
hand.352 
223. We consider, therefore, that the Panel did not err in reviewing whether the IRA's intermediate 
reasoning and conclusions were objective and cohe rent, that is, whether the conclusions found 
sufficient support in the scientific evidence relied upon.  We do not accept Australia's contention that 
the Panel's analysis should have been limited to  a simple review of wh ether the intermediate 
                                                      
351See Appellate Body Report, EC – Hormones , para. 193;  Appellate Body Report, Japan – 
Agricultural Products II , para. 84;  and Appellate Body Report, Japan – Apples , para. 162. 
352See Appellate Body Report, EC – Hormones , para. 193;  Appellate Body Report, Japan – 
Agricultural Products II , para. 84;  and Appellate Body Report, Japan – Apples , para. 162. WT/DS367/AB/R 
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conclusions reached by the IRA "fall within a rang e that could be considered legitimate by the 
scientific community". 
224. In our view, by arguing that the Panel's task in reviewing the IRA's in termediate conclusions 
should be limited to ensuring that these "fall within a range that could be considered legitimate by the 
scientific community", Australia is suggestin g that a panel should assess the reasoning and 
conclusions reached by a risk asse ssor and the scientific evidence relied upon in the same way.  We 
observe, however, that a distinction should be dr awn between, on the one hand, the scientific evidence 
relied upon by the risk assessor and, on the other hand, the reasoning employed and the conclusions reached by the risk assessor on the basis of that scient ific evidence.  In this dispute, the scientific and 
technical works reviewed in the IRA on fire blight and ALCM and on the analysis of risk fall within 
the first category.  In contrast, the IRA's reasoning,  intermediate conclusions on the various steps and 
factors, as well as its overall conclusions, fall within the second category, even where expert 
judgement was exercised by the IRA to address allege d scientific uncertainty.  As we consider further 
below, when the exercise of expert judgement forms an integral part of the risk assessor's analysis, 
then it should be subject to the same type of scrutiny by the panel as all other reasoning and 
conclusions in the risk analysis. 
225. In US/Canada – Continued Suspension , the Appellate Body considered that the manner of 
scrutinizing the underlying scientific evidence differs from the manner of scrutinizing the reasoning of 
the risk assessor.  This is because a panel is not well suited to conduct scientific research and 
assessments itself
 353, and should not substitute its judgement for that of a risk assessor.354  A panel, 
however, must be able to review whether the co nclusions of the risk assessor are based on the 
scientific evidence relied upon and are, accordingly,  objective and coherent.  Whether or not the 
requisite rational or objective relationship exists  can only be ascertained through the examination of 
how the scientific evidence is used and relied upon to r each particular conclusions.  In this respect, the 
reasoning employed by the risk assessor plays an im portant role in revealing whether or not such a 
relationship exists. 
226. Regarding the distinction Australia draws between "intermediate" conclusions and 
conclusions "ultimately reached" in the IRA, we observe that in US/Canada – Continued Suspension  
the Appellate Body did not make such a distincti on, but required a review of whether the reasoning 
itself is "objective and coherent" so as to determine whether the " particular conclusions  drawn by the 
Member assessing the risk find sufficient s upport in the scientific evidence relied upon".355  The 
                                                      
353Appellate Body Report, EC – Hormones , para. 117. 
354Appellate Body Reports, US/Canada – Continued Suspension , para. 590. 
355Appellate Body Reports, US/Canada – Continued Suspension , para. 591. (emphasis added)  WT/DS367/AB/R 
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Appellate Body did not reserve this test for the ultimate conclusions  reached by the risk assessor.  In 
this respect, we observe that it is not possible to review the ultimate conclusions reached by the risk 
assessor in isolation from the reasoning and the inte rmediate conclusions that lead up to them.  A 
panel needs to understand how certain conclusions  were reached and thei r relationship with the 
underlying scientific basis in order to be in a position to assess whether the requisite objective and 
rational relationships between the science, the ri sk assessment, and the r esulting SPS measures exist. 
227. It is through the reasoning of the risk assessor th at it should be possible to understand whether 
the risk assessment is based on the scientific eviden ce and whether in turn the proposed SPS measures 
are based on the scientific evidence and on the risk as sessment.  This is also recognized by the ISPM 
under the International Plant Protection Conventi on ("IPPC").  In particular, ISPM No. 2 and 
ISPM No. 11 specify that the entire risk analys is process, including risk assessment, should be 
sufficiently documented "so that when a review or  a dispute arises, the sources of information and 
rationale used in reaching the management decision can be clearly demonstrated".356 
228. We further note that, in this case, the reasoni ng in the IRA is articulated on the basis of 
importation steps and scenarios, along with establishment and spread factors, that are then aggregated 
and combined to arrive at an overall probability of entry, establishment and spread.  A similar 
structure is used for the qualitativ e assessment of the potential biolog ical and economic consequences.  
No separate reasoning, however, is developed fo r the IRA's ultimate conclusions.  According to 
Australia, the relevant conclusions are the conclu sions on the assessment of risk contained in the 
IRA's sections and tables on "unrestricted risk" and "restricted risk" for fire blight and ALCM.357  The 
Panel's analysis of the IRA follows the IRA's own stru cture and, therefore, consists of reviews of steps 
and factors and the methodology by which they are a ggregated and combined.  In so doing, the Panel 
adhered to the standard of review applicable to a panel's review of a risk assessment under Article 5.1 
of the SPS Agreement , which requires a panel to review the c onclusions of a risk assessor, not to 
undertake its own risk assessment. 
229. In these circumstances, if the Panel had b een prevented from assessing the objectivity and 
coherence of the intermediate c onclusions and reasoning of the IRA,  it would have been left with 
virtually no basis upon which to assess the consistency of the IRA with Article 5.1 of the 
SPS Agreement .  The Panel was, therefore, correct to assess whether the IRA's intermediate
                                                      
356ISPM No. 11, supra , footnote 195 of this Report, Section 4.1;  see also ISPM No. 2, supra , 
footnote 195 of this Report, Section 3.3.2.  ISPM No. 11, together with ISPM No. 2, present the general 
framework for conducting a pest risk assessme nt. (Panel Report, paras. 2.69 and 2.71) 
357Australia's response to questioning by the Appellate Body at the oral hearing (referring to IRA, 
Part B, Table 23, p. 104 (unrestricted risk for fire blight );  Table 31, p. 116 (restricted risk for fire blight);  
Table 49, p. 187 (unrestricted risk for ALCM);  and Table 56, p. 191 (restricted risk for ALCM)). WT/DS367/AB/R 
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conclusions on the intermediate steps and factors were objective and coherent , considering that it was 
at these intermediate steps that the IRA reasoned a nd explained the relationshi p between the scientific 
evidence and its conclusions. 
230. In the light of the above, we do not see that the Panel erred in its review of the IRA under the 
applicable standard of review.  In particular, we consider that the Panel correctly reviewed whether 
the intermediate conclusions the IRA reached on the likelihood of importation, on the likelihood of 
entry, establishment and spread, and on the poten tial biological and economic consequences of fire 
blight and ALCM, found sufficient support in the scientific evidence and were, accordingly, objective 
and coherent. 
231. For the reasons explained above, we dismiss Australia's claim that the Panel erred in 
reviewing whether the IRA's conclusions in respect of fire blight on importation steps 1, 2, 3, 5, and 7, 
exposure, establishment, spread, and potential biol ogical and economic consequences were objective 
and coherent, and whether the IR A's methodology was objective and coherent, rather than asking 
whether these "intermediate" conclusions were "wit hin a range that could be considered legitimate" 
according to the standards of the scientific community.
358  For the same reasons, we also dismiss 
Australia's claim that the Panel erred in reviewing whether the IRA's conclusions in respect of ALCM 
on importation, establishment, spread, and potent ial biological and economic consequences were 
objective and coherent rather than "within a range th at could be considered legitimate" according to 
the standards of the scientific community.359 
3. The Panel's Assessment of the Use of IRA Expert Judgement  
232. Australia also appeals the Panel's evaluation of  the use of IRA expert judgement to reach 
conclusions regarding several intermediate steps and f actors in the risk assessment.  In this respect, we 
recall that the IRA team exercised this judgement in situations where it determined that there was 
scientific uncertainty.360  Australia explained to the Panel that  this IRA expert judgement was "used 
when there [was] limited eviden ce or where the underlying biological process is naturally highly 
variable".361 
                                                      
358Australia's appellant's submission, paras. 103, 105,  107, and 113.  See also paras. 13, 77, 78, 93, 
and 95. 
359Australia's appellant's submission, paras. 118 and 122.  See also paras. 13, 77, 78, 93, and 95. 
360Australia confirmed at the oral hearing that expe rt judgement in the IRA was exercised collectively 
by the six members of the IRA team.  For instance, on pr oximity for ALCM, the IRA explicitly states that "[t]he 
estimated likelihoods were determined by expert judgement taking into consideration relevant stakeholder 
comments". (See IRA, Part B, p. 167)  In several other instances regarding fire blight and ALCM, the IRA reached conclusions based on IRA expe rt judgement, alth ough it did not explicitly refe r to "expert judgement". 
361Panel Report, para. 7.438 (quoting Australia's respon se to Panel Question 30 after the first Panel 
meeting).  See also paras. 7.433 and 7.746;  and IRA, Part B, p. 167.  WT/DS367/AB/R 
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233. The Panel expressed a number of concerns with respect to the use of IRA expert judgement 
throughout the IRA to estimate the probability of entry, establishment and spread of fire blight.  The 
Panel found that little informati on was provided in the IRA on how  the extensive discussion and 
review of different factors associated with the entry,  establishment and spread w as then translated into 
quantitative estimates.362  The Panel reasoned that, while "expert  judgement may be an important tool 
for the risk assessor, it is not a substitute for sci entific data, especially for the purpose of estimating 
the likelihood of entry, establishment and spread of a pest".363  According to the Panel, Australia was 
required, but failed, to demonstrate that the ex ercise of IRA expert judgement was documented, 
transparent, and based on the relevant reliable scien tific information, even when such information was 
limited.364 
234. Australia claims that the phrase "as appropriate to the circumstances" in Article 5.1 of the 
SPS Agreement  provides a measure of flexibility in terms of how a risk assessment is conducted when 
there is little available scientific evidence.365  Australia also argues that the Panel erred in requiring 
that the IRA explain precisely how the IRA expert j udgement was reached at intermediate steps in the 
IRA.  In Australia's view, no such obligation exists in Article 5.1 of the SPS Agreement .366 
235. New Zealand responds that the phrase "as appropria te to the circumstances" in Article 5.1 
provides for some flexibility regarding the nature of  a risk assessment, but does not allow deviation 
from the substantive obligations un der Article 5.1.  New Zealand c ontends the Panel did not require 
Australia to explain how each expert judgement w as reached.  Rather, according to New Zealand, the 
Panel correctly rejected the concep t that the mere recourse to expert judgement requires a panel to 
disregard the criteria elaborated in US/Canada – Continued Suspension  and uphold the conclusions 
reached through that expert judgement.367 
236. We have already expressed the view that if a risk assessor reaches certain conclusions based 
on its expert judgement, having determ ined that there is a certain degree of scientific uncertainty, this 
does not preclude a panel from assessing whether th ose conclusions are objective and coherent and 
have a sufficient basis in the available scientific evidence.  We have also stressed the difference 
between the underlying scientific evidence, on the one  hand, and the reasoning and conclusions of the 
risk assessor based on this scientific  evidence and, where necessary, on expert judgement, on the other 
hand.  In this case, as we have already observed, wh at Australia refers to as expert judgement forms 
                                                      
362Panel Report, para. 7.432. 
363Panel Report, para. 7.440. 
364Panel Report, paras. 7.440 and 7.811. 
365Australia's appellant's submission, para. 73. 
366Australia's appellant's submission, para. 97. 
367New Zealand's appellee's submission, para. 2.73. WT/DS367/AB/R 
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an integral part of the reasoning of the risk assesso r and should, therefore, have been subject to the 
same scrutiny by the Panel as other parts of the IRA. 
237. Regarding Australia's allegation that, in its tr eatment of the IRA expert judgement, the Panel 
failed to give meaning to the phrase "as appropriate  to the circumstances" in Article 5.1 of the 
SPS Agreement , we observe that, in US/Canada – Continued Suspension , the Appellate Body found 
that this phrase, while suggesting that account mu st be taken of methodological difficulties, does not 
excuse a risk assessor from properly performing the risk assessment.
368  We recall, too, that in 
Australia – Salmon , the Appellate Body stated that th e existence of "unknown and uncertain 
elements" does not relieve a risk assessor from co mplying with the requirements of Articles 5.1 
and 5.2 of the SPS Agreement .369 
238. We observe that, if a Member chooses to base SPS measures on a risk assessment, it must 
have made the preliminary determination that the re levant scientific evidence is sufficient to perform 
a risk assessment.  If, however, the Member consider s that scientific evidence is insufficient to 
perform a risk assessment, it may instead c hoose to take provisional SPS measures based on 
Article 5.7 of the SPS Agreement . 
239. In this respect, we recall that, in Japan – Apples , the Appellate Body stated that the relevant 
scientific evidence will be considered "insuffici ent" for purposes of Article 5.7 "if the body of 
available scientific evidence does not allow, in qua ntitative or qualitative terms, the performance of an 
adequate assessment of risks as required unde r Article 5.1 and as defined in Annex A to 
the SPS Agreement ."370  I n  US/Canada – Continued Suspension , the Appellate Body added that 
"where the relevant scientific evidence is suffici ent to perform a risk assessment, as defined in 
Annex A to the SPS Agreement , a WTO Member may take an SPS measure only if it is 'based on' a 
risk assessment in accordance with Article 5.1 and that  SPS measure is also subject to the obligations 
in Article 2.2."371 
240. Therefore, when the relevant scientific evid ence is sufficient to perform a risk assessment 
under Article 5.1 of the SPS Agreement , a risk assessor should rely on the available scientific 
evidence, even if the risk assesso r is faced with a certain degree of scientific uncertainty, and decides,
                                                      
368Appellate Body Reports, US/Canada – Continued Suspension , para. 562.  The Panel in EC – 
Approval and Marketing of Biotech Products  also found that the phrase "as ap propriate to the circumstances" in 
Article 5.1 of the SPS Agreement , while providing some flexibility in terms of how a risk assessment is 
performed, does not relieve a Member from the requirements of Article 5.1 of the SPS Agreement . (Panel 
Report, EC – Approval and Marketing of Biotech Products , para. 7.3053) 
369Appellate Body Report, Australia – Salmon , para. 130. 
370Appellate Body Report, Japan – Apples , para. 179. 
371Appellate Body Reports, US/Canada – Continued Suspension , para. 674.  WT/DS367/AB/R 
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as Australia did in the IRA, that it must use expert  judgement as part of its assessment of the relevant 
risk.  In this case, we understand the Panel to have  accepted that Australia could resort to expert 
judgement in the presence of scientific uncertain ty.  The Panel, however, questioned the IRA's 
repeated use of expert judgement in situations where scientific evid ence was available, as well as the 
IRA's non-reliance on that available scientific evid ence, and the absence of reasoning as to why such 
an approach was used. 
241. The fact that Australia performed a risk asse ssment and based its SPS measures on this risk 
assessment suggests that Australia considered the relevant scientific  evidence to be sufficient to 
perform a risk assessment.  This is also highlighted by the fact that Australia  chose a semi-quantitative 
methodology for its risk assessment, suggesting a de gree of confidence in the available scientific 
evidence.  On several occasions, however, as identified and discussed in the Panel Report372, the IRA 
resorted to the IRA expert judgement to estimate the quantitative probability of certain events, even 
where scientific evidence was available.373  Such recourse to the IRA expert judgement is not in itself 
objectionable, but it must be reasoned and explaine d consistently with Articles 5.1 and 5.2 of the 
SPS Agreement  so that the risk assessment can still be considered a scientif ic process that is based on 
the "available scientific evidence". 
242. We do not consider, therefore, that the phrase " as appropriate to the circumstances" prevents a 
panel from assessing the coherence and objectivity of a risk assessment under Article 5.1 of the 
SPS Agreement  in situations that present some degree of scientific uncertainty and where a risk 
assessor has reached conclusions on the basis of expert judgement. 
243. According to Australia, the flexibility to adap t risk assessment methodologies as a function of 
the available scientific evidence is further reinfo rced by the reference in Article 5.1 of the 
SPS Agreement  to the risk assessment techniques developed by international standards organizations.  
In this respect, Australia notes that the relevant risk assessment techniques identified in ISPM No. 2 
and ISPM No. 11 recognize the need for expert judg ement at every stage of a risk assessment, in case 
of scientific uncertainty.374  Moreover, in Australia's view, th e standards of "documentation" and 
"transparency" set forth in ISPM No. 2 and ISPM No. 11 only require identification of where expert 
judgement has been used and an explanation of what  scientific uncertainty has given rise to the need 
                                                      
372Panel Report, paras. 7.432-7.440. 
373In its opening statement at the Panel's second subs tantive meeting with the parties, Australia stated 
that, while the IRA "did not rely on 100% expert judgment", "it is true that certain steps in the pathways 
assessed were better supported by evidence than others" and that, "[i]n those latter cases, expert judgment was employed". (Australia's opening statement at the second Panel meeting, para. 12;  see also Panel Report, 
para. 7.803) 
374Australia's appellant's submission, para. 74. WT/DS367/AB/R 
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for that expert judgement to be made, but do not  suggest any need for an explanation of how a 
particular expert judgement was reached.
375 
244. As observed above, the phrase "as appropriate to  the circumstances" in Article 5.1 of the 
SPS Agreement  should not be interpreted as authoriz ing a risk assessor to deviate from the 
requirements of Articles 5.1 and 5.2 or to ignore th e available scientific evid ence, even where expert 
judgement is used.  A degree of scientific unc ertainty does not justify a departure from the 
requirements of Articles 5.1 and 5.2 and, in partic ular, the requirement that the available scientific 
evidence be taken into account in the risk assessment.  Generally, doc umentation and transparency in 
the use of expert judgement are instrumental in  the determination of whether the overall risk 
assessment, even when it is conduc ted in the face of some scientific uncertainty, relies on the 
available scientific evidence and is consistent with the SPS Agreement . 
245. Article 5.1 also requires Members performing risk assessments to take "into account risk 
assessment techniques developed by the relevant international organizations".  According to 
Annex A(3)(c) to the SPS Agreement , the international standards, guidelines, and recommendations 
relevant for plant health are those developed unde r the auspices of the IPPC in cooperation with 
regional organizations operating with in the framework of the IPPC.  Among the roles of the IPPC is 
the development of ISPMs.  The two ISPMs Austra lia relies on are ISPM No. 2 and ISPM No. 11.  
ISPM No. 2 provides a framework describing the pest risk analysis process.  ISPM No. 11 provides 
details for the conduct of pest risk analysis to de termine if pests are quarantine pests and describes the 
integrated processes to be used for risk assessment, as well as the selection of risk management 
options.376 
246. We note that, while Article 5.1 directs a Memb er conducting a pest risk assessment to take 
into account internationally developed risk assessmen t techniques, this does not mean that a risk 
assessment must be based on or conform to such te chniques.  Nor does it imply that compliance with 
such techniques alone suffices to demonstrate co mpliance with a Member's obligations under the 
SPS Agreement .  However, reference by the risk assessor to su ch techniques is useful both to the risk 
                                                      
375Australia's appellant's submission, para. 97. 
376Together, ISPM No. 2 and ISPM No. 11 present th e general framework for conducting a pest risk 
assessment. (See supra , footnote 195 of this Report;  and Panel Report, paras. 2.69 and 2.71)  WT/DS367/AB/R 
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assessor, should a dispute arise in relation to the ri sk assessment, and to the panel that is called upon 
to review the consistency of that risk assessment with the provisions of the SPS Agreement .377 
247. We are not persuaded by Australia's argument that ISPM No. 2 and ISPM No. 11 only require 
identification of where expert judgement has been us ed and not of how it has been used.  We observe 
that both ISPM No. 2 and ISPM No. 11 elaborate the transparency and documentation requirements 
for the entire risk assessment pro cess from initiation to pest risk mana gement, not excluding the use of 
expert judgement in situations of scientific uncer tainty.  It is clear from a complete reading of 
ISPM No. 2 and ISPM No. 11 that, in addition to  the sections on "uncertainty" that call for the 
transparency and documentation of the nature and degree of uncertainty378, the general sections on 
"documentation" specify that the entire pest risk analysis process should be sufficiently 
documented.379 
248. In the light of the above, we consider that the Panel did not err in expressing the view that the 
IRA did not sufficiently document its use of expert  judgement and that the IRA should have explained 
how it arrived at the expert judgements it made at inte rmediate steps.  We also consider that the Panel 
did not err in requiring that the IRA base its conc lusions, including those that were reached through 
the exercise of expert judgement, on the available scientific evidence and that, therefore, the Panel 
correctly assessed whether the reasoning in the IRA rev ealed the existence of an objective and rational 
link between the conclusions reach ed and the scientific evidence. 
4. The Materiality of the Faults the Pane l Found with the Reasoning of the IRA  
249. Australia claims that the Panel erred in failing to assess the materiality of the faults it found in 
the intermediate conclusions reached in the IR A.  Australia, relying on the panel report in Australia – 
Salmon (Article 21.5 – Canada) , maintains that the Panel should ha ve asked, but erroneously failed to 
ask, whether any of the alleged flaws in the IRA's reasoning was "so serious" as to undermine 
                                                      
377We observe that the panel in Japan – Apples  found that, while the language in Article 5.1 does not 
require that a risk assessment be "based on" or "in conformity with" risk assessment techniques of international 
organizations, it suggests that "reference to these risk assessment techniques can provide very useful guidance as 
to whether the risk assessment at issue constitutes a proper risk assessment within the meaning of Article 5.1." (Panel Report, Japan – Apples , para. 8.241) 
378See ISPM No. 2, supra , footnote 195 of this Report, Section 3.1;  and ISPM No. 11, supra , 
footnote 195 of this Report, Section 2.4. 
379See ISPM No. 2, supra , footnote 195 of this Report, Section 3.3.2, which states that "the entire 
process from initiation to pest risk management should be sufficiently documented so that the sources of information and rationale for management decisions can be clearly demonstrated", and includes among the main 
elements to be documented, the "nat ure and degree of uncertainty and measures envisaged to compensate for 
uncertainty".  Similarly, Section 4.1 of ISPM No. 11, supra , footnote 195 of this Report, requires that "[t]he 
whole process from initiation to pest risk management should be sufficiently documented so that when a review 
or a dispute arises, the sources of information and rationale used in reaching the management decision can be 
clearly demonstrated." WT/DS367/AB/R 
Page 90  
 
"reasonable confidence"
380 in the risk assessment as a whole.  New Zealand rejects Australia's 
contention and argues that the Panel did focus on  the materiality of the flaws it found in the 
intermediate steps of the IRA and that it prope rly assessed the cumulative effect of these flaws. 
250. We start by observing that the panel in Australia – Salmon (Article 21.5 – Canada)  did not 
purport to establish any general standard as to when i ndividual flaws in a risk assessment will taint the 
risk assessment as a whole.  In th at specific case, the panel simply found that certain methodological 
flaws identified by the complainant were not ser ious enough for the panel to no longer have 
reasonable confidence in the risk assessment.381  The panel reached the overall conclusion that it had 
reasonable confidence in the risk asse ssment at issue in that dispute based on all the other evidence it 
reviewed and on the advice of the experts that it had consulted. 
251. We also note that, as already discussed, the Pane l appears to have followed the suggestions 
made by the Appellate Body in US/Canada – Continued Suspension  to review whether the reasoning  
articulated on the basis of the scientific evid ence is objective and coherent and whether the particular 
conclusions  drawn by the Member find sufficient support in the scientific evidence relied upon.382  
Whether a panel adopts this approach to review di screte steps in a risk assessment or whether it also 
reviews the overall justification may depend on the struct ure of the risk assessment at issue.  This is 
consistent with the standard of review applicable to a panel reviewing claims under Article 5.1 of the 
SPS Agreement , according to which a panel's task is to review the risk assessment, not to itself 
perform the risk assessment.383 
252. With respect to fire blight, the Panel followed the structure of the IRA and reviewed the eight 
individual importation steps, as well as the factors re lating to entry, establishment and spread of the 
pest.  The Panel made specific findings on the interm ediate steps and factors because, as it noted in its 
conclusions on entry, establishment and spread of fi re blight, there was no "separate justification and 
evidence in the IRA regarding the estimat ed overall likelihood of importation".384 
253. The Panel found that for four importation steps (1, 2, 3, and 5) out of eight, the IRA's 
estimation of the probability of importation of fire  blight did not find sufficient support in the 
scientific evidence relied upon and, accordingly, was not coherent and objective.385  In respect of two 
importation steps (4 and 6), the Panel found that New Zealand had failed to make a prima facie  case 
                                                      
380Australia's appellant's submission, para. 90 (quoting Panel Report, Australia – Salmon (Article 21.5 – 
Canada) , para. 7.57). 
381Panel Report, Australia – Salmon (Article 21.5 – Canada) , para. 7.57. 
382Appellate Body Reports, US/Canada – Continued Suspension , para. 591. 
383Appellate Body Reports, US/Canada – Continued Suspension , para. 590. 
384Panel Report, para. 7.447. 
385Panel Report, paras. 7.259, 7.275, 7.290, and 7.320.  WT/DS367/AB/R 
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that the IRA's estimation of the likelihood of  importation was not coherent and objective.386  Only in 
respect of one importation step (7) did the Panel find that the IRA's estimation of the likelihood of 
importation appeared to be coherent and objective.  The Panel subsequently found, however, that the 
IRA's choice of the probability interval 0 to 10-6 for events with a "negligible" likelihood of occurring, 
which was the interval assigned to this importation step, was not coherent and objective.387  The Panel 
also found that the IRA's analysis of exposure, of est ablishment, and of spread of fire blight rested on 
a number of assumptions and qualifications that le d to reasonable doubts about the evaluation made, 
and that the IRA had "not properly considered a number of factors that could have [had] a major 
impact on the assessment of this particular risk".388 
254. Regarding the potential biological and economic co nsequences of fire blight, the Panel found 
that the IRA had a tendency to overestimate th e severity of the consequences of fire blight, 
particularly in respect of the criteria concerning plant life or health, and domestic trade or industry, 
which had been assigned the most severe scores of "F" and "E", respectively.  The Panel therefore concluded that the IRA's evaluation of the pot ential consequences associated with the entry, 
establishment or spread of fire blight in Australia did not rely on adequate scientific evidence and, 
accordingly, was not coherent and objective.
389 
255. Moreover, the Panel found that the IRA c ontained certain methodological flaws that 
magnified the risk assessed and that, because of th ese flaws, the IRA was not a proper risk assessment 
within the meaning of Article 5.1 of the SPS Agreement . 
256. With respect to ALCM, the Panel found that th e IRA's analysis of the likelihood of entry, 
establishment and spread contained flaws that were enough to create reasonable doubts about the 
evaluation made, and that the IRA had "not properly considered a number of factors that could have 
[had] a major impact on the assessment of this particular risk".390  According to the Panel, the IRA's 
failures to take properly into account ALCM viabil ity, the impact of parasitism, ALCM's period of 
emergence, climatic conditions, and mode of trade, were "enough to cumulatively create reasonable 
doubts about the risk assessment with respect to its evaluation of the likelihood of entry, establishment and spread of ALCM".
391 
                                                      
386Panel Report, paras. 7.306 and 7.331. 
387Panel Report, para. 7.342.  In respect of importation step 8, New Zealand did not question the IRA's 
estimation that the likelihood that Erwinia amylovora  survives and remains with the fruit after on-arrival border 
procedures is 1 (100 per cent). (Panel Report, paras. 7.347-7.349) 
388Panel Report, para. 7.448. 
389Panel Report, paras. 7.469 and 7.470. 
390Panel Report, para. 7.868. 
391Panel Report, para. 7.871. WT/DS367/AB/R 
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257. Regarding the potential biological and economic  consequences of ALCM, the Panel found 
that the IRA had a tendency to overestimate the sev erity of the consequences of ALCM, particularly 
in respect of the criteria concerning plant life or health, control or eradication, domestic trade or 
industry, and international trade, which had all been  assigned the most severe score of "D".  The Panel 
also found that the IRA's analysis of potential c onsequences did not adequately consider the issues of 
geographic range and climatic c onditions necessary for ALCM establishment.  The Panel therefore 
concluded that the IRA's evaluation of the pot ential consequences associated with the entry, 
establishment or spread of ALCM into Australia di d not rely on adequate scientific evidence and, 
accordingly, was not coherent and objective.
392 
258. In our view, the Panel's analysis reveals that it considered that the faults it found with the 
IRA's reasoning on the importation steps and the fact ors relating to entry, establishment and spread 
were numerous and serious enough to render th e IRA inconsistent with Article 5.1 of the 
SPS Agreement .  As we have explained above, we do not c onsider that a panel is required to establish 
whether each fault it finds with a risk assessment is , in itself, serious enough to undermine the entire 
risk assessment.  A comprehensive analysis of all th e steps and factors reviewed may be sufficient to 
determine whether various flaws are, when taken t ogether, serious enough to render a risk assessment 
one that does not constitute a proper risk assessme nt within the meaning of Article 5.1 of the 
SPS Agreement .  Moreover, whether a panel reviews the risk assessment as a whole, or whether it 
bases its overall conclusions on the analyses of the i ndividual steps and factors reviewed, will depend 
on the type and structure of risk assessment revi ewed, and possibly on how a complainant presents 
and develops its claims.  In this case, and in par ticular in the light of the way in which the IRA 
conducted its analysis, the approach ad opted by the Panel was appropriate. 
259. The Panel reached its conclusions based on a co mprehensive analysis of all the steps and 
factors it reviewed and also indicated that the IRA fa iled to consider properly a number of factors that 
could have a major  impact on the assessment of risk for fire blight and ALCM.393  Although the Panel 
did not in its reasoning explicitly analyze the relativ e gravity, or magnitude, of the flaws that it found 
at each relevant importation step or each factor rela ting to the entry, establishment and spread of fire 
blight and ALCM, the Panel clearly indicated that taken together these faults were enough to mean 
that the IRA did not constitute a proper risk asse ssment within the meaning of Article 5.1 of the 
SPS Agreement .  Therefore, in the light of the above, we  consider that the Panel properly assessed 
whether the IRA is a risk assessment with in the meaning of Article 5.1 of the SPS Agreement , based 
on a comprehensive analysis of the individua l steps and factors analyzed in the IRA. 
                                                      
392Panel Report, paras. 7.883-7.885. 
393Panel Report, paras. 7.448 and 7.868.  WT/DS367/AB/R 
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260. For these reasons, we dismiss Australia's claim that the Panel erred in not assessing the 
materiality of the faults it found in the intermediate conclusions reach ed in the IRA in respect of fire 
blight and ALCM. 
D. Conclusion 
261. In the light of the above, we consider that the Panel did not err in finding that the IRA is not a 
proper risk assessment within the meaning of Article 5.1 and Annex A(4) to the SPS Agreement  and 
that the flaws that the Panel found in the IRA al so constituted a failure, under Article 5.2 of the 
SPS Agreement , to take sufficiently into account factors su ch as the available sci entific evidence, the 
relevant processes and production methods in New Zealand and Australia, and the actual prevalence 
of fire blight and viable ALCM.394 
262. For these reasons, we uphold  the Panel's finding, in paragraphs 7.906 and 8.1(c) of the Panel 
Report, that Australia's SPS measures regarding fi re blight and ALCM, as well as the "general" 
measures linked to these pests, are inconsistent with Articles 5.1 and 5.2 of the SPS Agreement , and 
that, by implication, these measures are also  inconsistent with Article 2.2 of the SPS Agreement .395 
VII. Article 11 of the DSU 
263. We now turn to Australia's claim that the Pane l failed to fulfil its duty under Article 11 of the 
DSU to make an objective assessment of the matter be fore it, and Australia's consequent request that 
we reverse the Panel's findings that its measures for fire blight and ALCM, as well as the "general" measures that are linked to these pests, are incons istent with Articles 5.1, 5.2, and 2.2 of the 
SPS Agreement . 
264. Australia asserts that the Panel failed to make an objective assessment of the matter, as 
required by Article 11 of the DSU, because it disreg arded critical aspects of the appointed experts' 
testimony that were favourable to Australia.  Austra lia also argues that the Panel acted inconsistently 
with Article 11 of the DSU because its conclusi ons were based upon a fundamental misunderstanding 
of a significant aspect of Austra lia's risk assessment methodology. 
265. We have already concluded that the Panel did not misinterpret or misapply Articles 5.1, 5.2, 
and 2.2 of the SPS Agreement , and that it employed the correct standard of review in its assessment of 
the conformity of the IRA with these provisions.  In this section, we consider, first, whether the Panel
                                                     
 
394Panel Report, paras. 7.471, 7.510, 7.886, and 7.904. 
395See also Panel Report, paras. 7.472, 7.510, 7.887, and 7.905. WT/DS367/AB/R 
Page 94  
 
committed an error under Article 11 of the DSU, because it disregarded expert testimony that was 
relevant to Australia's case, and second, whethe r the Panel misunderstood the methodology employed 
in the IRA to perform the risk assessment. 
A. The Panel's Treatment of Testimony by Its Appointed Experts 
266. Australia highlights that a panel's duty to make  an objective assessment of the matter includes 
a requirement that the panel engage with all of the important evidence before it that is relevant to the 
matter.
396  In Australia's view, a panel errs when it fa ils to give significant evidence proper, genuine, 
and realistic consideration and assess its significance.397  Australia contends that the Panel disregarded 
critical aspects of its appointed experts' testimony that were favourable to Australia.  Australia relies 
on the Appellate Body reports in US/Canada – Continued Suspension  to argue that if, in that dispute, 
the panel erred by merely reproducing testimony and not assessing its significance, the Panel in the 
present dispute committed an even more serious error because, in several instances, it entirely 
overlooked testimony that was favourable to Australia's case.398  Australia claims that merely 
reproducing testimony without discussing it, or disreg arding it entirely, constitutes a failure to make 
an objective assessment of the fact s, and stresses the importance of  the overlooked testimony to its 
case.399 
267. New Zealand responds that a panel enjoys discretion in assessing whether a given piece of 
evidence is relevant for its reasoning, and is not re quired to discuss, in its report, each and every piece 
of evidence.400  New Zealand highlights the differences between the circumstances of this case and 
those of US/Canada – Continued Suspension .  New Zealand points out that, in the latter case, there 
were justifiable doubts as to the independence or im partiality of the two e xperts on whom the panel 
relied extensively, whereas the experts relied upon by  the Panel in this case are clearly independent 
and impartial.401 
268. We begin by recalling that the text of Article 11 of the DSU states in relevant part that: 
... a panel should make an objective assessment of the matter before 
it, including an objective assessment of the facts of the case and the applicability of and conformity with  the relevant covered agreements, 
and make such other findings as will assist the DSB in making the 
recommendations or in giving the rulings provided for in the covered 
agreements. 
                                                     
 
396Australia's appellant's submission, para. 128. 
397Australia's appellant's submission, para. 130. 
398Australia's appellant's submission, para. 133. 
399Australia's appellant's submission, para. 130. 
400New Zealand's appellee's submission, para. 2.207. 
401New Zealand's appellee's submission, para. 2.209.  WT/DS367/AB/R 
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269. In EC – Hormones , the Appellate Body stated that "[t]he duty to make an objective assessment 
of the facts is, among other things, an obligation to consider the evidence presented to a panel and to 
make factual findings on the basis of that evidence".402  Accordingly, the "deliberate disregard of" or 
"refusal to consider" evidence is incompatible with a panel's duty to make an objective assessment of the 
facts.  In US – Continued Zeroing , the Appellate Body found that the duty to make an objective 
assessment of the facts of the case "requires a panel to  consider evidence before it in its totality, which 
includes consideration of submitted evid ence in relation to other evidence".403 
270. In US/Canada – Continued Suspension , the Appellate Body further clarified that a panel 
should not disregard and has a duty to engage with ev idence that is relevant to the case of one of the 
parties.404  The Appellate Body also found that a panel may rely on the advice of experts to review a 
Member's SPS measures, and that in doing so th e panel must respect the due process rights of the 
parties and its limited role of review.405  How a panel treats the evid ence that is presented to it, 
including expert testimony, may affect the parties' substantive rights in a dispute as well as their rights 
to due process.  A panel's choice not to discuss a piece of evidence that on its face appears to be 
favourable to the arguments of one of the parties mi ght suggest bias or lack of even-handedness in the 
treatment of the evidence by the panel406, even if in fact the panel is making an objective assessment 
of the facts. 
271. The Appellate Body has, however, also clarified that, as the "trier of facts", a panel enjoys a 
margin of discretion in the assessment of the f acts, including the treatment of evidence.  In EC –  
Hormones , the Appellate Body found that " it is generally within the discre tion of the [p]anel to decide 
which evidence it chooses to utilize in making findings",  and that a "[p]anel cannot realistically refer to 
all statements made by the expert s advising it and should be allowed a substantial margin of discretion 
as to which statements are useful to refer to explicitly".407  I n  EC – Asbestos , the Appellate Body 
recognized that a panel enjoys a margin of discre tion in assessing the value of and the weight to be 
ascribed to the evidence and that a panel is "entitled, in the exercise of its discretion, to determine that 
certain elements of evidence should be acco rded more weight than other elements".408  In US – Wheat 
Gluten , the Appellate Body also stated that "in view of the distinction between the respective roles of 
the Appellate Body and panels ... we will not inte rfere lightly with the panel's exercise of its 
discretion".409  More recently, in Brazil – Retreaded Tyres , the Appellate Body further clarified that 
                                                      
402Appellate Body Report, EC – Hormones , para. 133. 
403Appellate Body Report, US – Continued Zeroing , para. 331. 
404Appellate Body Reports, US/Canada – Continued Suspension , paras. 553 and 615. 
405Appellate Body Reports, US/Canada – Continued Suspension , para. 592. 
406Appellate Body Report, US – Upland Cotton (Article 21.5 – Brazil) , paras. 292-295. 
407Appellate Body Report, EC – Hormones , paras. 135 and 138. 
408Appellate Body Report, EC – Asbestos , para. 161. 
409Appellate Body Report, US – Wheat Gluten , para. 151. WT/DS367/AB/R 
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"[a] panel enjoys discretion in assessing whether a given piece of evidence is relevant for its 
reasoning, and is not required to discuss, in  its report, each and every piece of evidence."
410 
272. The panel's discretion as the trier of facts, however, finds its limitations in the applicable 
standard of review of Article 11 of the DSU.  In making "an objective assessment of the facts of the case" under Article 5.1 of the SPS Agreement , a panel cannot use the evidence, including the 
testimony of its appointed experts, to conduct its own risk assessment.  Rather, the panel must use 
such evidence to review the risk  assessment of the WTO Member. 
273. In arguing that the Panel violated Article 11 of the DSU, Australia relies on the Appellate 
Body reports in US/Canada – Continued Suspension .  In that dispute, the Appellate Body found that 
by reproducing but not assessing the significance of  the testimony of some experts, the panel 
effectively disregarded evidence that was potentially rele vant to the case of one of the parties, and this 
was one of the bases for the Appellate Body's fi nding that the panel in those disputes had acted 
inconsistently with Article 11 of the DSU.
411 
274. We observe that the passage in US/Canada – Continued Suspension  relied upon by Australia 
is part of the Appellate Body's broader findings re garding the panel's application of the standard of 
review under Article 11 of the DSU.412  In those disputes, the Appellate Body found that the panel, 
instead of reviewing the European Communities' ri sk assessment in accordan ce with the applicable 
standard of review, "conducted a survey of the a dvice presented by the scientific experts and based its 
decisions on whether the majority of the experts ... agreed with the conclusion drawn in the European 
Communities' risk assessment".413  The panel's disregard of certain testimony relevant to the European 
Communities was thus only one element that the A ppellate Body considered in the panel's overall 
"assessment of the facts", the others being the pane l's use of the experts' testimony to effectively 
conduct its own risk assessment and the panel's undue reliance on the view  of the majority within the 
scientific community, while ignoring views that were favourable to the European Communities.414 
275. Regarding the Panel's treatment of the evidence, we  consider that its role as the trier of facts 
requires it to review and consider all the eviden ce that it receives from the parties or that it seeks 
pursuant to Article 13 of the DSU.  Noneth eless, as the Appellate Body explained in EC – Hormones , 
a panel cannot be expected to refer to all th e statements made by the experts it consulted.415  T o  
reproduce every statement made by the experts in the report is neither a necessary nor a sufficient 
                                                      
410Appellate Body Report, Brazil – Retreaded Tyres , para. 202. (footnote omitted) 
411Appellate Body Reports, US/Canada – Continued Suspension , para. 615. 
412Appellate Body Reports, US/Canada – Continued Suspension , paras. 585-616. 
413Appellate Body Reports, US/Canada – Continued Suspension , para. 598. 
414Appellate Body Reports, US/Canada – Continued Suspension , paras. 597 and 598. 
415Appellate Body Report, EC – Hormones , para. 138.  WT/DS367/AB/R 
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condition for a panel to perform its function in acco rdance with Article 11 of the DSU.  Article 11 
requires a panel, in its reasoning on a given issue, to weigh and balance all the relevant evidence, 
including testimony by the experts.  A panel may re produce the relevant statements by the experts, but 
still fail to make an objective assessment of the fact s under Article 11 if it then fails to properly assess 
the significance of these statements in its reasoning, as the Appellate Body found in US/Canada – 
Continued Suspension .  Conversely, a panel that does not expressly reproduce certain statements of its 
appointed experts may still act consistently with Article 11, especially when the panel's reasoning 
reveals that it has nevertheless assessed the signifi cance of these statements or that these statements 
are manifestly not relevant to the panel's objec tive assessment of the facts and issues before it. 
276. Whether a panel reproduces and discusses certain testimony in the report depends on factors 
such as the relevance of the testimony to the pa nel's reasoning and objective assessment on a given 
issue, the context in which the statement was made, as well as the importance attached by the parties 
to the testimony.  Moreover, a panel's failure to  reproduce and discuss one statement by one expert 
will in itself rarely, if ever, be enough to invalidate th at panel's overall assessment of the facts of a 
case.  As was the case in US/Canada – Continued Suspension , a panel's disregard of certain experts' 
testimony may be evidence of a more systematic fault in the standard of review applied by that panel 
in its overall assessment of the facts of the case. 
277. In this dispute, we have already found that the Panel did not err in its application of the 
standard of review in its assessment of the IRA under Article 5.1 of the SPS Agreement .  We now 
consider whether the Panel's treatment of the expe rts' testimony amounts to a failure to make an 
objective assessment of the facts under Article 11 of the DSU. 
278. In addressing Australia's appeal concerning the Panel's treatment of expert testimony, we 
review the individual statements Australia alleges th at the Panel disregarded.  We then consider the 
context in which each such statement was made, as well as the importance that Australia attached to 
these statements in the proceedings before the Panel.   We next consider whether the Panel in fact 
failed to reproduce and discuss a certain statement in  the Report, whether that statement was clearly 
pertinent and significant to the Panel's reasoning, a nd, if so, whether the reasoning reveals that the 
Panel nonetheless took that statement into consider ation.  Finally, after reviewing the Panel's 
treatment of the individual statements, we cons ider whether in its overall treatment of expert 
testimony the Panel failed to make an objective ass essment of the facts under Article 11 of the DSU. 
279. We start by recalling that, in addressing the matter in this dispute, the Panel sought the advice 
of seven experts in four different fields (fire blight, European canker, ALCM, and pest risk assessment).  The Panel selected and appointed:  Dr. Tom Deckers and Dr. Jean-Pierre Paulin in the WT/DS367/AB/R 
Page 98  
 
field of fire blight;  Dr. Bernardo Latorre and Dr. Te rence Swinburne in the field of European canker;  
Dr. Jerry Cross in the field of ALCM;  and Dr. Gritta Schrader and Dr. Ricardo Sgrillo in the field of 
pest risk assessment.
416 
280. In its appeal against the Panel's treatment of expert testimony, Australia challenges the Panel's 
treatment of certain statements by the appointed expe rts, which were allegedly favourable to its case, 
in six different areas.  Specifically, Australia cha llenges the Panel's treatment of:  (i) a statement by 
Dr. Deckers on the overall probability of importation ;  (ii) a statement by Dr. Deckers on exposure ;  
(iii) a statement by Dr. Deckers and a statement by Dr. Paulin on the potential consequences of fire 
blight ;  (iv) a statement by Dr. Deckers on the limitation of exports to mature, symptomless apples ;  
(v) a statement by Dr. Schrader on the use of uniform distribution ;  and (vi) a statement by Dr. Cross 
on the potential consequences of ALCM . 
281. Regarding (i) the overall probability of importation  of apples infested or infected with fire 
blight, Australia argues that the Panel failed to consider Dr. Deckers' statement that he "[did not] feel that there was an exaggeration of the est imation there in the importation steps".
417  Australia contends 
that this statement qualifies significantly Dr. Deck ers' earlier statement, upon which the Panel did 
rely, that the probability of importation "could be" overestimated.418 
282. New Zealand responds that Dr. Deckers' oral statement concerning the overall probability of 
importation does not support Australia's position becau se Dr. Deckers considered that the likelihoods 
assessed under importation steps 2, 3, and 5, which we re aggregated as parts of the overall probability 
of importation, were overestimated.419 
283. We observe that the Panel did not reproduce Dr. Deckers' oral statement, or expressly refer to 
it as part of its discussion of the other statements  by Dr. Deckers and by the other experts on the 
probability of importation through the eight impor tation steps and on the overall probability of 
importation of fire blight.  The Panel does, however, include a cross-reference to this oral statement 
by Dr. Deckers in a footnote to its discussion of Dr. Deckers' written statement that the IRA's overall 
probability of importation value could be overestimat ed, which states:  "But see, Dr. Deckers's reply 
in Transcript of the Panel's m eeting with experts, para. 259".420 
                                                      
416Panel Report, para. 1.33. 
417Transcript of the Panel's meeting with the scientific experts, Panel Report, Annex B-2, Dr. Deckers, 
para. 259. 
418Australia's appellant's submission, para. 137 (quo ting Dr. Deckers' response to Panel Question 34, 
Panel Report, Annex B-1, para. 237). 
419New Zealand's appellee's submission, para. 2.221. 
420Panel Report, footnote 1595 to para. 7.356.  WT/DS367/AB/R 
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284. Dr. Deckers' statement that the probability of importation could be overestimated is part of 
Dr. Deckers' written reply to Panel Question 34.421  In contrast, Dr. Deckers' statement that he did not 
think that there was an exaggeration of the estimat ion in the importation steps was part of an oral 
reply provided by Dr. Deckers to a question posed  by the Panel at the meeting with the experts.422  
This testimony must be understood in the contex t of the discussion that preceded and followed it.  
Moreover, the purpose of the meeting between the Pa nel and the experts was to "allow the experts to 
elaborate and clarify the written responses submitted to  the questions that were posed by the Panel, 
and to respond to the comments made to those responses by the Parties".423  Therefore, the statements 
made by the experts at the meeting with the Panel should not be assessed in isolation, but in the light 
of the written responses that the meeting was intended to clarify and elaborate. 
285. We observe that, in making his oral statemen t that he did not think that there was an 
exaggeration, Dr. Deckers was answering a ques tion posed by one of the panelists about the 
relationship between the estimation of the indivi dual importation steps and the overall probability of 
importation of fire blight.  Specifically, the panelis t had asked the experts to comment on Australia's 
view that there was sufficient support from the e xperts for the IRA's reasoning on certain individual 
importation steps to suggest that "any purported exa ggeration of the probability range is not a serious 
flaw".424  It would appear, therefore, that in Dr. Deck ers' reply that there was no "exaggeration of the 
estimation there  in the importation steps", the word "there" refers to those importation steps that the 
experts, including himself, had found to be based on scientific evidence, not to those steps he had 
found to be overestimated or to the overall probabilit y of importation.  In this respect, we recall that 
Dr. Deckers had testified that the values assigned by  the IRA to importation steps 2, 3, and 5 were 
                                                      
421Dr. Deckers' response to Panel Question 34, Panel Report, Annex B-1, para. 237. 
422Transcript of the Panel's meeting with the scientific experts, Panel Report, Annex B-2, Dr. Deckers, 
para. 259. 
423Transcript of the Panel's meeting with the scientific experts, Panel Report, Annex B-2, Chairman of 
the Panel, para. 14. 
424Paragraphs 257 and 259 of the Transcript of the Pa nel's meeting with the sc ientific experts, Panel 
Report, Annex B-2, read: 
Kirsten Hillman 257. ... Australia argues that while the experts expressed some doubts 
about the overall probability of importation of E amylovora , this conclusion 
should be weighed against the specific support for individual importation steps, that is support from the experts.  In Australia's view, there is sufficient 
support for the detail of the IRA team's reasoning to suggest that "any 
purported exaggeration of the probability ra nge is not a serious flaw".  So we 
would like the experts to comment on this statement by Australia and if it 
adequately reflects your view on the matter. Dr Deckers 
259. As far as I have understood in this area, I don't feel that there was an 
exaggeration of the estimation there in the importation steps.  I think there is a real risk present that should be estimate d as good as possible.  For me it was 
not an exaggerated situation here.  I think you are right to take the estimation 
in this way. WT/DS367/AB/R 
Page 100  
 
overestimated, and that the overall probabilit y of importation of 3.9 per cent could be 
overestimated.
425 
286. We also note New Zealand's argument that Dr. D eckers' oral statement that he did not think 
that there was an exaggeration should be underst ood as referring to the IRA's methodology based on 
ten importation scenarios, rather than to the in dividual steps or to th e overall probability of 
importation, which he had characterized as "overest imated" in other testimony.  In other words, 
New Zealand understands that, in making this oral  statement, Dr. Deckers was expressing the view 
that the aggregation and combination of the diffe rent importation steps and importation scenarios by 
the IRA did not result in an exaggerated estimate beyond  the overestimation that he had already 
indicated that he considered existed w ith certain individual importation steps. 
287. We consider, therefore, that, under either of the interpretations reviewed above, the oral 
statement by Dr. Deckers can be read to be consiste nt with his views, expressed in his written replies, 
that importation steps 2, 3, and 5 were overestimat ed and the overall probability of importation could 
be overestimated.426  In any event, Dr. Deckers' statement is not without ambiguity and does not 
clearly support Australia's argument. 
288. For the reasons explained above, we consider th at Australia has not established that the Panel 
disregarded any apparent contradictions in the t estimony of Dr. Deckers on the IRA's estimations of 
the probability of importation of fire blight.  It ap pears from a careful reading of the Panel Report that 
the Panel did not "effectively disregard" relevant testimony in its assessment of the IRA's estimation 
of the overall probability of importation.  While the Panel could have provided some explicit 
reasoning as to why it chose to rely on the other writte n statements that Dr. Deckers made on the same 
issue, we do not consider that its failure to do so, in the circumstances of this dispute, amounts to 
disregarding or failing to engage with significant evidence that was relevant to Australia's case. 
289. Regarding (ii) exposure , Australia argues that in its analysis of this factor the Panel relied on 
Dr. Deckers' initial written testimony that the ch ance of epiphytic fire blight bacteria being 
transmitted from an imported apple to the susceptible  organs of a host plant at the appropriate moment
                                                      
425In response to specific questions on the IRA's estimation of the likelihoods of importation for 
importation steps 2, 3, and 5, Dr. Deckers replied that the value assigned to importation step 2 was "a quite high 
rate";  that for importation step 3 the "overall chance of 1% seems to be rather high";  and that the estimation for 
importation step 5 was not "sufficiently  in accordance with the standards of the scien tific community". (See 
Dr. Deckers' responses to Panel Questions 24, 26, and 30, Panel Report, Annex B-1, paras. 173, 186, and 215, 
respectively) 
426We note that, at the Panel's meeting with the scien tific experts, Australia did not ask Dr. Deckers to 
elaborate or clarify his stat ement that he did not think that there was an exaggeration of the estimation in the 
importation steps.  Nor did Australia raise this issue at the second substantive meeti ng of the parties with the 
Panel.  WT/DS367/AB/R 
 Page 101 
 
 
to realize an infection was "rather small", without reproducing or assessing the significance of 
Dr. Deckers' clarifying oral testimony that he th ought the IRA's estimation of the probability of 
exposure as 0 to 10-6 was "very low" and thus "true".427 
290. The Panel does not reproduce Dr. Deckers' oral statement, or expressly refer to it as part of its 
discussion of the other statements by Dr. Decker s and by the other experts on the probability of 
exposure.  However, we consider that the Pa nel's reasoning on exposure reflects Dr. Deckers' 
statement that the probability value of 0 to 10-6 assigned by the IRA for exposure is "very low" and, 
therefore, "true". 
291. We first observe that in his written statemen t on exposure Dr. Deckers reached the conclusion 
that the chance of transfer by insects was "rather small" having observed that "[f]eeding of insects on 
discarded apple fruits is not described in the biological cyclus of [ Erwinia amylovora ] as a factor for 
the spread of the disease" and that "[a]n insect feed ing on a discarded fruit is not considered to be a 
normal way of spreading the disease between an  infected fruit and an other host plant".428 
292. We recall that the Panel concluded that the IRA's overall analysis of exposure was not 
coherent and objective.  At the same time, the Pa nel appeared to accept the IRA's reasoning regarding 
the possibility of transfer through browsing insects.   The Panel found that, "[t]he browsing insects 
scenario ... is based on events that cannot be comple tely dismissed" and that "[i]n any event, the 
probability value assigned to such event should be commensurate to the extremely low likelihood of 
transmission through the browsing insects scenario."429  According to the Panel, "[t]he IRA's 
conclusions on the transfer mechanisms are not s upported by scientific eviden ce, most especially for 
the proposed mechanical transmission mechanism".430  However, the Panel also stated that transfer by 
browsing insects, "while not totally unreasonabl e, seems to correspond to a highly unlikely 
scenario".431  In this respect, we observe that Dr. Decker s' reply that the value assigned by the IRA to 
exposure was "very low" and thus "true" was an elaboration on his written reply that the chance of 
transmission by browsing insects was "rather small".432 
                                                      
427Australia's appellant's submission, para. 139 (quoting Dr. Deckers' response to Panel Question 35, 
Panel Report, Annex B-1, para. 240;  and Transcript of the Panel's meeting with the scientific experts, Panel 
Report, Annex B-2, Dr. Deckers, para. 297). 
428Dr. Deckers' response to Panel Question 35, Panel Report, Annex B-1, para. 240. 
429Panel Report, para. 7.403. 
430Panel Report, para. 7.417. 
431Panel Report, para. 7.417. 
432We note that, at the Panel's meeting with the scien tific experts, Australia did not ask Dr. Deckers to 
clarify or further elaborate on his statement on exposure in relation to his written response that the chance of 
transmission by browsing insects was very small.  Nor di d Australia raise this issue at the second substantive 
meeting of the parties with the Panel. WT/DS367/AB/R 
Page 102  
 
293. In the light of the above, we do not consider th at Australia has estab lished that the Panel's 
failure to reproduce or discuss Dr. Deckers' statemen t that a "very low" value is correct for the IRA's 
assigned probability of exposure amounted to disreg arding or failing to engage with significant 
evidence that was relevant to Australia's case. 
294. Regarding (iii) the potential biological and economic consequences of fire blight , Australia 
argues that the Panel relied exclusively on certain t estimony by Dr. Paulin to the effect that certain 
individual impact scores in the assessment of con sequences "could be exaggerated", but failed to 
reproduce or assess the significance of favourable testimony given by Dr. Deckers and Dr. Paulin, both of whom rated the overall potential biological and economic consequences of fire blight as 
"high".
433 
295. New Zealand responds that the Panel chose to rely primarily on Dr. Paulin's views because 
they were more comprehensive and detailed on this  issue than those of Dr. Deckers, and because 
Dr. Deckers' response to Panel Question 11 and his testimony were of limited assistance in considering whether the IRA's evaluation of the potential consequences associated with the entry, 
establishment and spread of fire blight was coherent and objective.
434 
296. The Panel found that, according to the experts it had consulted, the IRA had a tendency to 
overestimate the severity of the consequences of fire b light, particularly on plant life or health and on 
domestic trade.435  The Panel relied on the testimony of Dr. Paulin that the most severe individual 
impact scores assigned by the IRA to certain criteria were too high, exaggerated, or unrealistic.  The 
Panel concluded that the IRA's evaluation of the po tential consequences associated with the entry, 
establishment or spread of fire blight into Australia  did not rely on adequate scientific evidence and, 
accordingly, was not coherent and objective.436 
297. The Panel, however, did not reproduce or discuss Dr. Deckers' testimony on the potential 
consequences of fire blight437, although this testimony is cross- referenced in a footnote to the 
paragraph where the Panel discusses Dr. Paulin's testimony.438  Nor did the Panel reproduce or discuss 
Dr. Paulin's general statement that he considered the qualification of "high" for the impact of fire 
blight to be appropriate, based on the possibl e international consequences of fire blight.439 
                                                      
433Australia's appellant's submission, paras. 142 and 145. 
434New Zealand's appellee's submission, para. 2.228. 
435Panel Report, para. 7.469. 
436Panel Report, para. 7.470. 
437Dr. Deckers' response to Panel Question 11, Panel Report, Annex B-1, para. 85. 
438Panel Report, footnote 1796 to para. 7.465. 
439Dr. Paulin's response to Panel Question 11, Panel Report, Annex B-1, para. 94.  WT/DS367/AB/R 
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298. We start by observing that Dr. Deckers' and Dr. Paulin's general statements that the 
consequences of fire blight can be classified as "hi gh" may appear on their face to be inconsistent with 
the Panel's finding that the IRA's evaluation of the potential consequences of fire blight does not rely 
on adequate scientific evidence and it is not objectiv e and coherent, given that the IRA also estimated 
the potential biological and economic consequences of  fire blight as "high".  We observe that under 
Article 5.1 of the SPS Agreement  a panel is called to review the objectivity and coherence of the risk 
assessment, not whether the results of the risk assessment are correct and correspond to the results the 
panel itself would reach based on the advice of the a ppointed experts.  To the contrary, a panel must 
not use the experts to second-guess th e risk assessor by conducting its own risk assessment;  rather, it 
has to review the risk assessment and verify that it is objective and coherent, that is, sufficiently based 
on the relevant scientific evidence. 
299. The general statements by Dr. Deckers and Dr. Pau lin that the consequences of fire blight can 
be classified as "high" were not determinative of  the Panel's assessment of whether the reasoning in 
the IRA on the potential consequences of fire blight  was objective and coherent.  The Panel expressly 
recognized, in this regard, that "[i]t is not the Pane l's role to reassess the impact scores assigned by the 
IRA to specific criteria and propose different scores".440  The Panel chose to rely on the testimony by 
Dr. Paulin that explained why certain impact sco res assigned by the IRA to individual direct and 
indirect criteria were not based on the scientific evidence, and considered that this cast doubt on the 
objectivity and coherence of the IRA's conclusions on the potential consequences of fire blight.441  
The Panel, therefore, correctly used the appointed experts to review the IRA's risk assessment, not to 
conduct a de novo review. 
300. We further note that Australia quotes only the first part of Dr. Deckers' testimony on the 
potential consequences of fire blight.  However, in  the same written response to the question by the 
Panel, Dr. Deckers qualifies his appreciation of the po tential consequences of fire blight as "high", by 
stating that the consequences depend also on the su ccessful establishment and spread of fire blight 
within Australia, that the different regions in Aust ralia will not have all the appropriate climatological 
conditions for an optimal infection and development of fire blight, and that there will be differences in 
disease development from one year to another.442  Moreover, Australia relies on Dr. Paulin's statement 
that he considers the qualification of "high" for the impact of fire blight to be appropriate, without 
accounting for the fact that Dr. Paulin states that  his view is based on the possible "international 
consequences" of fire blight introduction, not on the possible consequences in Australia. 
                                                      
440Panel Report, para. 7.468. 
441Panel Report, para. 7.470. 
442Dr. Deckers' response to Panel Question 11, Panel Report, Annex B-1, para. 86. WT/DS367/AB/R 
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301. It appears, therefore, that Australia focuses on the parts of Dr. Deckers' and Dr. Paulin's 
testimony that it considers favourable to its case, while leaving aside aspects of the same testimony 
that appear to confirm the Panel's finding that the IRA's conclusions on the potential biological and 
economic consequences of fire blight  were not objective and coherent. 
302. On balance, we do not consider that Australia has established that the Panel disregarded the 
general statements by Dr. Deckers and Dr. Paulin that  the consequences of fire blight can be classified 
as "high", because the Panel did not set out to, and did not, decide whether the IRA's qualification of 
the potential consequences of fire blight as "hi gh" was right or wrong, but instead assessed whether 
the IRA's conclusions were objective and coherent, th at is, based on the scientif ic evidence.  Again, 
however, the fact that on their face these statements appear to contradict the Panel's findings that the 
IRA's analysis of the potential consequences of fire  blight was not objective and coherent means that 
the Panel's reasoning would have been clearer if it had explained its treatment of these two statements 
and their relationship to its conclusions. 
303. Australia further argues that the Panel, in its assessment of the potential biological and 
economic consequences, failed to engage with or  refer to the evidence of actual production losses 
caused by outbreaks of fire blight at Hawkes Bay, New Zealand, in 1998, and in Michigan, 
United States, in 2000. 
304. The fact that the Panel did not explicitly review  specific instances of fire blight outbreaks and 
relevant economic losses is consistent with the Pane l's conclusion, based on Dr. Paulin's testimony, 
that "it is just not possible ... that fire blight w ould be devastating to the same degree in every place 
and on every plant as soon as introduced in a new area".
443  As we have considered above, while a 
panel should review all the evidence that is presente d to it, it is not required to discuss in its report 
each piece of evidence that is submitted to it and enjoys discretion in assessing whether a given piece 
of evidence is more relevant for its reasoning than anot her.  In this context, we consider that Australia 
has not established that the Panel disregarded or fa iled to engage with significant evidence merely 
because the Panel did not, in its Report, refer to the evidence of actual production losses caused by 
outbreaks of fire blight at Hawkes Bay and in Michigan. 
305. Regarding (iv) the limitation of exports to mature, symptomless apples , Australia contends 
that the Panel reproduced, but dismissed without expl anation, the testimony given by Dr. Deckers that 
                                                      
443Panel Report, para. 7.465.  WT/DS367/AB/R 
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"[t]he limitation of apple exports to mature sy mptomless apples is not enough to achieve Australia's 
ALOP".444 
306. The Panel reproduced and discussed this testimony  by Dr. Deckers in the Article 5.6 section 
of its Report, considering that the statement con cerned New Zealand's proposed alternative measure.  
The Panel noted that "Dr Deckers is sceptical wh ether New Zealand's alternative measure would 
achieve Australia's ALOP on its own", but relied on Dr. Deckers' explanation that "apple fruit are not 
considered an important way of spreading the fire blight disease and thus the trade in apple fruit in 
Europe is not subject to fi re blight control measures".445 
307. The Panel explained that, in spite of Dr. Deckers' statement expressing scepticism about 
New Zealand's alternative measure, it reached a di fferent conclusion based on other testimony of 
Dr. Deckers and Dr. Paulin showing "that they c onsider the overall risk of fire blight entry, 
establishment and spread through mature, symptomle ss apples imported from New Zealand to be very 
low – both overall and in regard to specific key points in the import scenario assessed by the IRA."446  
In the light of this, we do not think that Australia  has established that the Panel disregarded or failed 
to engage with Dr. Deckers' testimony about the suitability of New Zealand's alternative measure to 
meet Australia's appropriate level of protection. 
308. Regarding (v) the use of uniform distribution , Australia claims that the Panel's finding that the 
use of this model was unjustified emphasized Dr. Sgrillo's testimony that the IRA should have used a triangular distribution and the part of Dr. Schrader's testimony that stated that uniform distribution is 
the least realistic of the three distributions.  Au stralia, however, alleges that the Panel failed to 
reproduce or assess the significance of Dr. Schrader's statement that uniform distribution is useful in 
situations presenting "a high degree of uncertainty" and where there is insufficient information to 
determine the most likely value.
447 
309. As a preliminary matter, we note that we do not read the Panel Report as denying the 
usefulness of uniform distribution per se .  Rather, the Panel found that the use of uniform distribution 
in combination with the IRA's "negligible" interval (0 to 10-6) results in an overestimation of the 
likelihood of occurrence of events described as ones that "would almost certainly not occur".448  
Moreover, the Panel discussed the different types of distribution and concluded that "uniform 
                                                      
444Dr. Deckers' response to Panel Question 15, Panel Report, Annex B-1, para. 117. 
445Panel Report, para. 7.1191. 
446Panel Report, paras. 7.1191 and 7.1192.  See also infra , footnote 575 of this Report. 
447Australia's appellant's submission, paras. 147 a nd 148 (quoting Dr. Schrader's response to Panel 
Question 135, Panel Report, Annex B-1, para. 781). 
448See the IRA's "nomenclature" table, supra , para. 147 of this Report. WT/DS367/AB/R 
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distribution is the simplest, but in the circumstances of this case  ... it tends to generate less realistic 
samples".
449 
310. We consider that the Panel was not required to discuss Dr. Schrader's testimony about the 
usefulness of uniform distribution in a situation wh ere it had concluded that the conditions for the use 
of this type of distribution were not present.  In  this respect, the Panel's reliance on the testimony of 
Dr. Sgrillo—suggesting the use of a triangular di stribution for the modelling of events with a 
negligible likelihood of occurring—is not inconsis tent with Dr. Schrader's testimony on uniform 
distribution and falls within the Panel's discretion in  the weighing and balancing of the evidence.  In 
the circumstances, Australia has not established that, by not reproducing or assessing part of 
Dr. Schrader's testimony about the usefulness of uniform distribution, the Panel disregarded or failed to engage with evidence that Australia claims was relevant to its case. 
311. Regarding (vi) the potential biological and economic consequences of ALCM , Australia 
argues that the Panel reproduced Dr. Cross' testimony opining that certain individual impact scores assigned by the IRA were too severe and that a more credible score could have been assigned, but failed to reproduce or assess the significance of Dr. Cr oss' testimony that, even assuming that the most 
severe scores were reassigned, this would not r esult in a change of the rating of the overall 
consequences as "low" and that, in this respect, "t he conclusion of Australia's analysis was objective 
and credible".
450 
312. In the case of ALCM, we observe that the Pane l based its conclusions with respect to the 
potential consequences also on the fact that the IRA failed to analyze the issue of the existence of 
climatic conditions necessary for establishment an d spread of ALCM within Australia or the 
geographic range of these conditions.  Dr. Cross had st ated, in respect of the entry, establishment and 
spread of ALCM, that the IRA had failed to es tablish the geographic and climatic limits for 
establishment and spread of ALCM and that a "climatic analysis would also have given a better 
assessment of the likely impact of ALCM in different areas of Australia".451  Therefore, Dr. Cross' 
overall appraisal of consequences should be qualified by the views on geographic and climatic factors 
that he had expressed in respect of the entry, establishment and spread of ALCM. 
313. We have stated above that we do not consider the Panel to have disregarded evidence because 
it did not discuss the general statements by Dr. Deck ers and Dr. Paulin that the consequences of fire 
blight can be classified as "high".  According to  the applicable standard of review, the Panel was 
                                                      
449Panel Report, para. 7.492. (emphasis added) 
450Australia's appellant's submission, paras. 149 (q uoting Dr. Cross' response to Panel Question 96, 
Panel Report, Annex B-1, para. 561) and 150. 
451Dr. Cross' response to Panel Question 117, Panel Report, Annex B-1, para. 677.  WT/DS367/AB/R 
 Page 107 
 
 
required to verify that the IRA's conclusions on th e potential consequences of the pests were objective 
and coherent, not that they were correct.  It follo ws that the general statements by the appointed 
experts on the overall qualification of the consequences of pests were not determinative of the Panel's 
reasoning and objective assessment of the facts on th is issue.  Moreover, we have observed that 
Dr. Deckers' statement on the consequences of fire blight was qualified by his view on the presence of the conditions for establishment and spread of fire bli ght in Australia and that Dr. Cross' statement on 
ALCM consequences was qualified by his other testim ony.  It follows that we do not consider that 
Australia has established that the Panel disregar ded or failed to engage with evidence by not 
discussing Dr. Cross' statement that he would not change the overall qualification of "low" assigned 
by the IRA to the potential consequences of ALCM.  As in the case of the Panel's analysis of the 
potential consequences of fire blight, however, the Panel's reasoning could have been clearer on this 
issue had the Panel discussed this testimony and expl ained why it was not relevant to the conclusions 
it was reaching. 
314. We have considered that, in its treatment of th e individual statements by experts in the above 
mentioned six different areas, the Panel did not disr egard or fail to engage with significant evidence 
that was favourable to Australia's case.  While the Panel did not reproduce or discuss some of the 
experts' statements that Australia has identified on  appeal, we are satisfied that the Panel addressed 
the significance of these statements in its analysis of the six issues identified above.  We have also 
noted that Australia extracts some of the statem ents it argues are favourable to its case out of the 
broader context in which the Panel properly assessed them. 
315. Therefore, in the light of the above, we do not consider that the Panel failed to make an 
objective assessment of the facts under Article 11 of the DSU in its treatment of the experts' 
testimony. 
B. The Panel's Characterization of the Methodology Employed in the IRA 
316. Australia argues that the Panel acted inconsiste ntly with Article 11 of the DSU because it 
failed to understand the risk assessment methodology employed in the IRA and, in particular, the 
choice of a probability interval of 0 to 10
-6 (zero to one in one million), and a midpoint (if uniform 
distribution is used) of 5 × 10-7 (0.5 in one million) for events with a "negligible" likelihood of 
occurring.  Australia claims that the IRA team was not constrained by the intervals suggested by the 
nomenclature and that the defined correspondence between a so-called "negligible" event and a 
probability interval of 0 to 10-6 was, in and of itself, inevitably ar bitrary.  According to Australia, the 
Panel should have determined whethe r the estimate for a given step or factor was "within a range that 
might be considered legitimate according to the st andards of the scientific community, not whether WT/DS367/AB/R 
Page 108  
 
the definitional correspondence between th e range and the label was justified".
452  Australia also 
argues that the Panel erred in finding that the me thodological flaws constituted an independent basis 
for the invalidity of the IRA, considering that the interval 0 to 10-6 was used at just two points 
(importation step 7 and exposure) and in combin ation with uniform distribution only for exposure.453 
317. New Zealand responds that the Panel was correct  to focus on the definitional correspondence, 
because Table 12 of the IRA sets out a series of likelihood labels, corresponding to quantitative 
probability intervals, and defines "negligible" as an  event that "almost certainly would not occur".454  
New Zealand argues that the Panel was correct in findi ng that the interval and distribution used in the 
IRA for "negligible" events were not appropriate fo r modelling events that almost certainly would not 
occur and that the methodological flaws were seri ous enough to constitute an  independent basis for 
the IRA's invalidity.  New Zealand asserts that, if, for example, the IRA had used an interval 
of 0 to 10-8 instead of 0 to 10-6, then, if all else remained the same, including the estimated annual 
import volume of 150 million apples, the IRA would ha ve predicted the likelihood of a fire blight 
outbreak occurring approximately once every 2, 220 years instead of once every 22 years.455 
318. The IRA assigned quantitative point estimates or probability intervals to each importation 
step and factor relating to entry, establishment a nd spread.  Each probability interval was associated 
with one of three mathematical distribution models .  Uniform distribution, unlike triangular and pert 
distribution, does not have a most likely value, but only two parameters, a maximum and a minimum 
value, and each value in the continuous range between these two limits occurs with the same 
probability.456  The probability interval of 0 to 10-6, with a midpoint (if uniform distribution is used) 
of 5 × 10-7, corresponds in the IRA nomenclature to the qualitative likelihood "negligible" and to the 
qualitative descriptor "[t]he event w ould almost certainly not occur".457 
319. The Panel found that because of methodological fl aws that magnify the risk assessed, the IRA 
is not a proper risk assessment within the meaning of Article 5.1 of the SPS Agreement .458  One of the 
two methodological flaws the Panel found concerns the IRA's choice of probability interval for events 
with a "negligible" likelihood of occurring.459  The Panel found that the choice of a probability
                                                      
452Australia's appellant's submission, para. 155. 
453Australia's appellant's submission, para. 158. 
454New Zealand's appellee's submission, para. 2.268.  This table is reproduced supra , para. 147 of this 
Report. 
455New Zealand's appellee's submission, footnote 466 to para. 2.274. 
456Supra , para. 146 of this Report. 
457IRA, Part B, Table 12, p. 43, reproduced supra , para. 147 of this Report. 
458Panel Report, para. 7.510. 
459The Panel also found that the IRA's use of uniform distribution to model the likelihood of negligible 
events "would tend to result in an additional overestimatio n of the likelihood of such 'negligible events'". (Panel 
Report, para. 7.508)  WT/DS367/AB/R 
 Page 109 
 
 
interval of 0 to 10-6 for events with a "negligible" likelihood of occurring was not properly justified in 
the IRA and led to an overestimation of the probabilit y of entry, establishment and spread of the pests 
at issue.460 
320. We are not persuaded that, as Australia ar gues, the Panel misunderstood the methodology 
used in the IRA.  The Panel disagreed with the IRA's assignment of a probability interval covering 
events that would occur with relative frequency to events that, based on the scientific evidence, would 
almost certainly not occur.  The IRA adopted a semi-quantitative methodology and used a 
correspondence ("nomenclature") to convert quantita tive probability intervals into qualitative ratings 
and descriptors.461  Like the Panel, we believe that, in a semi-quantitative risk ass essment such as the 
IRA, the objectivity of the correspondence is funda mental to the objectivity and coherence of the 
results of the risk assessment.  If, as the Panel found462, the quantitative value that is assigned to the 
qualitative likelihood "negligible" is too high, this  will have repercussions  on the overall probability 
of entry, establishment and spread and ultimat ely on the assessment of  unrestricted risk. 
321. We observe that the IRA assigned quantitative values (point estimates or probability 
intervals) to individual steps and factors, ofte n selecting one of six pre-defined quantitative ranges463, 
the lowest of which was the probability interval 0 to 10-6.464  These quantitative values were then 
combined, in accordance with  the IRA's methodology, and using th e @Risk program, to determine an 
overall value for the annual probability  of entry, establishment and spread.465  This value was 
converted into a qualitative rating that was co mbined with the qualitative rating assigned to the 
potential biological and economic consequences in the "risk estimation matrix" to determine the 
"unrestricted risk".466  Under such a methodology, a flawed correspondence in the nomenclature may 
result in a distortion in the estimation of unrestricted risk. 
322. For instance, in the case of "e xposure" to fire blight, the IRA assigned the quantitative value 
of 0 to 10-6 (with uniform distribution) for an individual apple to all 20 combinations of the five utility 
points and four exposure groups.  This probability interval corresponds to a qualitative likelihood of 
"negligible" in the IRA's "nomenclature" table, and to the qualitative descriptor "[t]he event would 
almost certainly not occur".467  The decision to assign this interval was based on the IRA team's views 
                                                      
460Panel Report, para. 7.508. 
461See supra , para. 147 of this Report. 
462Panel Report, para. 7.484. 
463Supra , footnote 207 of this Report. 
464See the third column of the "nomenclature" table, supra , para. 147 of this Report. 
465See supra , para. 142 of this Report. 
466See supra , para. 147 of this Report. 
467See the table reproduced, supra , para. 147 of this Report. WT/DS367/AB/R 
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on both mechanical
468 and insect mediated transmission469, "explicitly acknowledg[ing] that in some 
circumstances the chances of exposure would be zero".470 
323. The quantitative values assigned to exposure were  then combined with the values assigned to 
the probabilities of importation, proximity, establis hment and spread using the @Risk program, to 
generate an estimate of the annual probability of en try, establishment and spread for fire blight.  The 
quantitative value estimated for this latter probabilit y was converted, based on the nomenclature, into 
the qualitative rating "very low".471  This qualitative rating "very low"  was paired with the "high" 
rating assigned to the potential consequences of fire blight in the "risk estimation matrix"472 to 
determine an estimate of unrestricted annual risk of "low" for fire blight, which is above Australia's 
appropriate level of protection of "very low". 
324. Based on this example, it is evident that, if th e correspondence in the IRA nomenclature is not 
objectively justifiable, this could have had an im pact on the overall result of the risk assessment.  
Specifically, assigning a probability value that does not objectively correspond to the IRA's own definition of "negligible", that is, an event that "w ould almost certainly not occur", has the effect of 
inflating the overall probability of importation and ma y result in the overestimation of the unrestricted 
annual risk.  This, in our view, also demonstrates th at, insofar as the methodolog ical flaws in the IRA, 
and notably the choice of the probability interval of 0 to 10
-6 for events with a negligible likelihood of 
occurring, magnify the risk assessed, the Panel correctly found that they constituted an independent 
basis for the inconsistency of Australia's SPS me asures with Articles 5.1, 5.2, and 2.2 of the 
SPS Agreement . 
325. Finally, we note New Zealand's argument that the IRA does not explain why intervals that 
were developed in a different cont ext were appropriate in the context of apples, which are traded in 
hundreds of million units per year.473  In this respect, we observe th at, when combined with uniform 
distribution, a quantitative interval that is used to  estimate risk based on an annual volume of imported 
units will produce very different r esults depending on whether the produc t at issue is imported in very 
large or more modest numbers of units per year. 
                                                      
468Mechanical transmission refers to  a transmission through, for exam ple, exposure of workers and 
equipment to the pest. ( Supra , footnote 226 of this Report) 
469Insect mediated transmission refers to a transfer of bacteria to a susceptible host plant by insects that 
have browsed on discarded apples. ( Supra , footnote 227 of this Report) 
470Supra , para. 151 of this Report. 
471In fact, using the two alternative measures rega rding proximity, the IRA generated two probability 
values, both of which fell within the category of "very low" in the IRA's nomenclature. ( Supra , para. 152 and 
footnote 232 of this Report) 
472Reproduced supra , para. 147 of this Report. 
473New Zealand's appellee's submission, para. 2.273.  WT/DS367/AB/R 
 Page 111 
 
 
326. In the light of the above, we do not consider  that the Panel misunderstood the methodology 
used in the IRA.  Accordingly, Australia has not established that th e Panel acted inconsistently with 
Article 11 of the DSU in its assessment of  Australia's risk assessment methodology. 
C. Conclusion 
327. For the reasons stated above, we find that Austra lia has not established that the Panel failed to 
make an objective assessment of the facts under Article  11 of the DSU in its treatment of the experts' 
testimony or of the IRA's risk assessment methodology. 
VIII.  Article 5.6 of the SPS Agreement  
328. We turn next to Australia's appeal of the Pa nel's finding that Australia's measures regarding 
fire blight and ALCM are more trade restrictive than required and, therefore, inconsistent with 
Article 5.6 of the SPS Agreement .474  At the outset of its analysis of New Zealand's claim under this 
provision, the Panel stated that, to prove a violati on of Article 5.6, a comp lainant must demonstrate 
that an alternative measure:  (i) is reasonably available taking into account technical and economic 
feasibility;  (ii) achieves the importing Member's appropriate level of sanitary or phytosanitary 
protection;  and (iii) is significantly less restrictiv e to trade than the SPS measure(s) at issue in the 
dispute.475  The Panel viewed these three elements as cumulative in nature and noted the parties' 
agreement to that effect.476 
329. With respect to the burden of proof, the Pa nel stated that, in order to establish an 
inconsistency with Article 5.6,  a complainant must establish a prima facie  case that there is an 
alternative measure that meets all three elements under  Article 5.6.  Thus, the Panel stated that it was 
for New Zealand to demonstrate that all three conditions of the Article 5.6 test are fulfilled.477 
330. As an alternative measure to limit the risk of fire  blight, the Panel considered the restriction of 
imports from New Zealand to mature, symptomless apples.478  As an alternative measure to limit the 
risk of ALCM, the Panel considered requiring insp ection of a 600-fruit sample of each import lot with 
                                                      
474Panel Report, paras. 7.1403 and 8.1(e);  see also paras. 7.1197 and 7.1266 (with respect to fire 
blight);  and paras. 7.1328 and 7.1365 (with respect to ALCM). 
475Panel Report, para. 7.1098 (quoting Appellate Body Report, Australia – Salmon , para. 194;  and 
Appellate Body Report, Japan – Agricultural Products II , para. 95). 
476Panel Report, para. 7.1098. 
477Panel Report, paras. 7.1104 and 7.1105. 
478The Panel noted that New Zealand had pointed to possible additional alternative measures, but had 
immediately discounted these alterna tives because they were based on th e incorrect assumption that mature, 
symptomless apples are vectors for fire blight and that New Zealand had not developed arguments for the additional alternatives with respect to all three conditions of Article 5.6 of the SPS Agreement .  The Panel 
therefore restricted its Article 5.6 analysis with respect to fire blight to the sole alternative of restricting imports 
of apples to mature and symptomless fruit. (Panel Report, paras. 7.1109-7.1118) WT/DS367/AB/R 
Page 112  
 
appropriate treatment or rejection of the lot in  the event that ALCM is found in the sample.
479  We 
note that New Zealand's proposed alternative measur e for fire blight—to limit imports of apples to 
mature, symptomless apples—is the same as the " unrestricted risk" scenario assessed by the IRA.480  
Although the wording used by the IRA in describing the "starting point" of its analysis was slightly different from the wording used by New Zealand to describe its alternative measure, the participants 
confirmed at the oral hearing in this a ppeal that the two are in essence the same.
481  Furthermore, 
New Zealand's alternative measure relating to ALCM  is the same as the first option of Measure 14, 
except that the sample  size in New Zealand's alte rnative measure (600 fruit) is  smaller than the sample 
size in the first option of Measure 14 (3000 fruit).482 
331. Applying the three-pronged test under Article 5.6 to the alternative measure proposed by 
New Zealand to limit the risk of fire blight, th e Panel found that the restriction of imports from 
New Zealand to mature, symptomless apples fulfilled th is test.  First, the Panel found that Australia 
did not directly contest that the alternative measur e would be reasonably available, taking into account 
technical and economic feasibility.483  Second, the Panel found that New Zealand had raised a 
"sufficiently convincing presumption" that rest ricting imports from New Zealand to mature, 
symptomless apples would meet Australia 's appropriate level of protection484, namely, "providing a 
high level of sanitary or phytosanitary protection aimed at reducing risk to a very low level, but not to 
zero".485  Third, the Panel found that restricting impor ts to mature, symptomless apples is significantly 
less trade restrictive than Australia 's fire blight measures at issue.486  In the light of these findings, the 
                                                      
479The Panel noted that New Zealand had argued that one of the additional alternative measures it had 
suggested for fire blight would also be an alternative measure with respect to ALCM.  The Panel restricted its 
assessment to only one alternative meas ure, namely, the inspection of a 60 0-fruit sample from each import lot. 
(Panel Report, paras. 7.1267-7.1284) 
480The scope of the IRA is the importation of mature New Zealand apples free of  trash.  In addition, 
standard commercial agronomic practice forms the basis for consideration of risk management measures.  One 
of the features of standard commercial agronomic practice is that fruit be free of fire blight symptoms.  Because 
production procedures and pest management practices in apple orchards, as well as packing house processes used in New Zealand, are intended to ensure that apples for export are free from visible symptoms of fire blight 
and trash and meet commercial export  standards, this forms the starting point for the consideration of risk 
management measures in the IRA. (See IR A, Part B, p. 105;  see also p. 9) 
481Australia said "[d]efinitely, yes.  In substance, th ey are the same things".  New Zealand stated that 
"there is not a significant difference between the two" an d that both refer to "the apples that New Zealand would 
actually export to Australia". (Reponses by Australia and New Zealand to questioning at the oral hearing) 
482The participants confirmed, at th e oral hearing in this appeal, that under New Zealand's proposed 
alternative measure, with a 600-unit sample size, det ection of any live quarantinea ble arthropod would also 
result in appropriate treatment  or rejection for export. 
483Panel Report, paras. 7.1257 and 7.1258. 
484Panel Report, para. 7.1197. 
485Panel Report, paras. 7.1121 and 7.1136. 
486Panel Report, para. 7.1265.  We recall that Aust ralia's measures concerning fire blight are 
Measures 1-8, as set out supra , para. 125 of this Report.  WT/DS367/AB/R 
 Page 113 
 
 
Panel concluded that New Zealand had demonstrated th at its alternative measure regarding fire blight 
fulfils the three cumulative conditions of Article 5.6.487 
332. The Panel then applied the same test to the alternative measure proposed by New Zealand to 
limit the risk of ALCM, and found that requiring in spection of a 600-fruit sample of each import lot 
with appropriate treatment or rejection of the lot in  the event that ALCM is found in the sample also 
fulfilled the three conditions of the Article 5.6 test.  The Panel found that Australia did not contest that 
the alternative measure would be reasonably ava ilable, taking into account technical and economic 
feasibility.488  The Panel further found that New Zealand had successfully raised a prima facie  case 
that requiring inspection of a 600-fruit sample of each import lot would meet Australia's appropriate 
level of protection.489  In addition, the Panel found that requiring inspection of a 600-fruit sample 
from each import lot is significantly less trade restri ctive than Australia's ALCM measure at issue.490  
In the light of these findings, the Panel conclude d that New Zealand had demonstrated that its 
alternative measure regarding ALCM fulfils th e three cumulative conditions of Article 5.6.491   
333. On the basis of this analysis, the Panel conc luded that Australia's measures regarding fire 
blight and ALCM are more trade restrictive than re quired and therefore inconsistent with Article 5.6 
of the SPS Agreement .492 
334. Australia appeals the Panel's overall finding of inconsistency with Article 5.6.  Australia's 
appeal is confined to the Panel's findings that the alternative measures put forward by New Zealand 
meet Australia's appropria te level of protection.493  Australia argues that the Panel erred in law, 
particularly in finding that New Zealand had ra ised a sufficiently convincing presumption that 
restricting imports of New Zealand apples to mature, symptomless apples was an alternative measure with respect to fire blight that would meet  Australia's appropriate  level of protection
494;  and in finding 
that New Zealand had made a prima facie  case that the inspection of  a 600-fruit sample of each 
                                                      
487Panel Report, para. 7.1266. 
488Panel Report, paras. 7.1335 and 7.1336. 
489Panel Report, para. 7.1328. 
490Panel Report, para. 7.1364.  We recall that Austra lia's measure concerning ALCM is Measure 14, as 
set out supra , para. 125 of this Report. 
491Panel Report, para. 7.1365. 
492Panel Report, paras. 7.1403 and 8.1(e);  see also 7. 1197 and 7.1266 (with respect to fire blight);  and 
paras. 7.1328 and 7.1365 (with respect to ALCM).  The Panel also found, in paragraphs 7.1252 and 7.1266 of its 
Report, that Australia's measures regarding European canker were inconsistent with Article 5.6.  In addition, the 
Panel found, in paragraph 7.1402 of its Report, that New Zealand had not demonstrated that Australia's "general" measures are incons istent with Article 5.6. 
493Australia has not appealed the Panel's findings rega rding the first and third conditions in Article 5.6, 
that is, regarding the availability of New Zealand's proposed alternative measures or their relative trade-restrictiveness.  Australia has also not appealed the Panel's findings under Article 5.6 of the 
SPS Agreement  with respect to the measures  concerning European canker. 
494Panel Report, para. 7.1197. WT/DS367/AB/R 
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import lot would be an alternative measure with respect to ALCM that would meet Australia's 
appropriate level of protection.
495 
335. Australia raises several claims with respect to these findings of the Panel.  Australia argues 
that the Panel's overall finding under Article 5.6 should be reversed c onsequentially upon a reversal of 
the Panel's findings under Articles 5.1, 5.2, and 2.2.  Australia further alleges that the Panel misinterpreted the requirements of Article 5.6 a nd misapplied the rules governing the burden of proof 
by requiring New Zealand to demonstrate only that  its proposed alternativ e measures "might" or 
"may" achieve Australia's appropria te level of protection, instead of requiring a demonstration that 
they "would" do so.  Australia also alleges that the Panel failed to assess whether a "proper" risk 
assessment would necessarily have concluded th at the alternative measures "would" achieve 
Australia's appropriate level of protection.  Australia  also contends that the Panel misinterpreted the 
words "appropriate level of sanitary or phytosanitary  protection" in Article 5.6, because it focused its 
analysis of the alternative measures only on the likel ihood of entry, establishment and spread of a pest 
and failed to consider the "associated poten tial biological and economic consequences". 
A. Article 5.6 and Footnote 3 
336. Article 5.6 of the SPS Agreement  and footnote 3 thereto provide:   
Without prejudice to paragraph 2 of Article 3, when establishing or 
maintaining sanitary or phytosanitary measures to achieve the appropriate level of sanitary or phytosanitary protection, Members 
shall ensure that such measures ar e not more trade-restrictive than 
required to achieve their appr opriate level of sanitary or 
phytosanitary protection, taking into account technical and economic 
feasibility.
3 
3For purposes of paragraph 6 of Article 5, a measure is not more trade-
restrictive than required unless ther e is another measure, reasonably 
available taking into account techni cal and economic feasibility, that 
achieves the appropriate level of sanitary or phytosanitary protection and is significantly less restrictive to trade. 
337. In Australia – Salmon , the Appellate Body found that Ar ticle 5.6 and, in particular, the 
footnote to this provision, set out a three-pronged t est for inconsistency with Article 5.6.  Such a 
violation will be established when there is a measure, other than the contested measure, that: 
(i) is reasonably available taking into account technical and economic feasibility; 
(ii) achieves the Member's appropriate level of  sanitary or phytosanitary protection;  and 
                                                      
495Panel Report, para. 7.1328.  WT/DS367/AB/R 
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(iii) is significantly less restrictive to  trade than the SPS measure contested.496 
These three conditions are cumulative, meaning that a ll of them must be met in order to establish an 
inconsistency with Article 5.6.  If any one of them  is not fulfilled, the measure in dispute will be 
consistent with Article 5.6.497  In determining whether the firs t two of these conditions have been 
satisfied, a panel must focus its assessment on the pr oposed alternative measure.  Only in examining 
whether the third condition is fulfilled will a panel need to compare the proposed alternative measure 
with the contested SPS measure. 
338. Article 2 of the SPS Agreement , entitled "Basic Rights and Obligations", provides context 
relevant to the meaning of Article 5.6.  In particular, Article 2.2 provides that: 
Members shall ensure that any sanita ry or phytosanitary measure is 
applied only to the extent necessary to protect human, animal or plant 
life or health, is based on scientific  principles and is not maintained 
without sufficient scientific evid ence, except as provided for in 
paragraph 7 of Article 5. 
339. The Appellate Body has observed that Article 2.2 "informs"498, "impart[s] meaning to"499, and 
"is made operative in"500, other provisions of the SPS Agreement , including certain of the more 
specific obligations set out in Article 5, which  is entitled "Assessment of Ri sk and Determination of 
the Appropriate Level of Sanitary or Phytosanitary Protection".  Thus, in EC – Hormones , the 
Appellate Body stated that "Articles 2.2 and 5.1 should  constantly be read toge ther.  Article 2.2 informs 
Article 5.1:  the elements that define the basic obligation set out in Article 2.2 impart meaning to 
Article 5.1."501  The same type of relationship exists  between Articles 2.2 and 5.2 and between 
Articles 2.2 and 5.6.  In this connection, we take pa rticular note of the si milarities between the 
requirement in Article 2.2 that Members apply th eir SPS measures "only to the extent necessary to 
protect", and the requirement in Article 5.6 that  SPS measures be "no more trade-restrictive than 
required to achieve" the relevant objectives. 
340. The Appellate Body has also held that ther e is a one-way, dependent relationship in law 
between the more specific provisions of Article 5. 1 or Article 5.2, on the one hand, and the more 
general provisions of Article 2.2, on the other ha nd.  Thus, the Appellate Body has ruled that a 
                                                      
496Appellate Body Report, Australia – Salmon , para. 194. 
497Appellate Body Report, Australia – Salmon , para. 194. 
498Appellate Body Report, EC – Hormones , para. 180. 
499Appellate Body Report, EC – Hormones , para. 180. 
500Appellate Body Reports, US/Canada – Continued Suspension , para. 674. 
501Appellate Body Report, EC – Hormones , para. 180.  Similarly, with respect to the relationship 
between Article 2.3 and Article 5.5 of the SPS Agreement , the Appellate Body found that Article 5.5 must be read 
in the context of Article 2.3, and that Article 5.5 may be seen as marking out and elaborating a particular route 
leading to the same destination set out in Article 2.3. (Appellate Body Report, EC – Hormones , para. 212) WT/DS367/AB/R 
Page 116  
 
violation of Article 5.1 or Article 5.2 can be presume d to imply a violation of Article 2.2, but that the 
reverse does not hold true—that is, a violation of Ar ticle 2.2 does not imply a violation of Article 5.1 
or Article 5.2.
502  Whether a similar relationship exists betw een Article 2.2 and Article 5.6 has not yet 
been squarely decided, and is not an issue that is raised in this appeal503, although it has been 
suggested that just such a relationship does exist.504 
341. While several aspects of these relationships—bet ween the basic rights and obligations set out 
in Article 2, in particular its second paragraph, on the one hand, and the more specific elaborations of 
these basic obligations in Article 5, on the other ha nd—have thus been clarified, the relationships 
between the various paragraphs within Article 5 re main relatively unexplored.  As a general matter, 
we see the various paragraphs of Article 5 as se tting out distinct legal obligations with which 
Members must comply.  For example, Article 5.1 se eks to ensure that a Me mber's SPS measure has an 
appropriate scientific basis, whereas Article 5.6 seek s to ensure that appropriate limits are placed on 
the trade-restrictiveness of a Member's SPS measure .  A complainant may challenge the consistency 
of a specific SPS measure with either or both of  these obligations.  When a complainant seeks to 
establish violations of both obligations, some of th e factual circumstances that it chooses to rely upon 
to establish a violation of one obligation may also be  relevant to, and appropria tely form part of, the 
evidence upon which it relies to establish a violation of  the other, separate, obligation.  However, the 
obligations in Article 5.1 and Article 5.6 are not de pendent upon each other.  Thus, the legal analysis 
of an SPS measure's consistency w ith Article 5.1 is separate and distinct from the legal analysis of 
that measure's consistency with Article 5.6.  Violation of one obligation does not, without more, 
imply the violation of the other.  As the Appellate Body opined in Australia – Salmon , an SPS 
measure that is consistent with Article 5.1 may none theless be inconsistent with either Article 5.5 or 
Article 5.6, or with both.505 
                                                      
502Appellate Body Report, Australia – Salmon , para. 138. 
503The Panel found a violation of Article 5.1 and, therefore, of Article 2.2.  Having also found a 
violation of Article 5.6, the Panel exercised judicial economy with respect to New Zealand's additional claim 
that, " because  they are more trade restrictiv e than required, the measures al so breach the requirement in 
Article 2.2 that measures be 'applied only to the extent  necessary to protect human, animal or plant life or 
health.'" (Panel Report, paras. 7.1404 (quoting New Z ealand's first written submission to the Panel, para. 4.540 
(emphasis added)), 7.1409, and 7.1410)  Neither partic ipant has appealed the Pane l's decision to exercise 
judicial economy on this claim. 
504After pointing to the phrase "only to the extent necessary" in Article 2.2 of the SPS Agreement , the 
Appellate Body observed, in a footnote in its report in Australia – Salmon , that: 
[t]he establishment or maintenance of an SPS measure which implies or 
reflects a higher level of protection than the appropriate level of protection 
determined by an importing Member, could constitute a violation of the necessity requirement of Article 2.2. 
(Appellate Body Report, Australia – Salmon , footnote 166 to para. 213) 
505Appellate Body Report, Australia – Salmon , para. 224.  WT/DS367/AB/R 
 Page 117 
 
 
342. This appeal concerns the second condition in Artic le 5.6, namely, that an alternative measure 
must meet the importing Member's appropriate level of protection.  The phrase "appropriate level of 
sanitary or phytosanitary protection" is defined in Annex A(5) to the SPS Agreemen t as "[t]he level of 
protection deemed appropriate by the Member establishing a sanitary or phytosanitary measure to protect human, animal or plant life or health within  its territory."  The note to Annex A(5) explains 
that the concept of the appropriate level of protec tion is also referred to as the "acceptable level of 
risk".  The Appellate Body has he ld that it is the "prerogative"
506 of a WTO Member to set the level of 
protection it deems appropriate507, and has explained that the establis hment of "the level of protection 
is an element in the decision-making process whic h logically precedes and is separate from the 
establishment or maintenance of the SPS measure".508 
343. The Appellate Body has also found that the SPS Agreement contains an implicit obligation for 
a WTO Member maintaining an SPS measure to est ablish and articulate its appropriate level of 
protection.509  Otherwise, and especially in assessing whet her an SPS measure is consistent with 
Article 5.6, it would be impossible to examine wh ether alternative measures achieve the appropriate 
level of protection.510  While there is no obligation to set the appropriate level of protection in 
quantitative terms, a Member is not free to establish its level with such vague ness or equivocation as 
to render impossible the application of the relevant disciplines of the SPS Agreement , including the 
obligation set out in Article 5.6.511 
344. Under Article 5.6, in order to assess whether a significantly less trade-restrictive alternative 
measure that would meet the appropria te level of protection is available, we consider that a panel must 
identify both the level of protection that the importing Member has set as its a ppropriate level, and the 
level of protection that would be achieved by the alternative measure put forth by the complainant.512  
Thereupon the panel will be able to  make the requisite comparison between the level of protection 
that would be achieved by the alternative measure and the importing Member's appropriate level of 
protection.  If the level of protection achieved by the proposed alternative meets or exceeds the 
appropriate level of protection, then (assuming that the other two conditions in Article 5.6 are met) the 
                                                      
506Appellate Body Report, Australia – Salmon , para. 199. (emphasis omitted) 
507While it is a WTO Member's prerogative to choose its level of protection, the SPS Agreement 
provides for certain disciplines that a Member must respect when it has done so. (See Appellate Body Reports, 
US/Canada – Continued Suspension , footnote 1088 to para. 523) 
508Appellate Body Report, Australia – Salmon , para. 203. (emphasis omitted) 
509Appellate Body Report, Australia – Salmon , para. 206.  The Appellate Body based its reasoning, in 
part, on the text of Articles 5.3 and 5.4 of the SPS Agreement .  Article 5.3 refers to "determining the measure to 
be applied for achieving the appropriate le vel of sanitary or phytosanitary protection", and Article 5.4 requires that 
"Members should, when determining the appropriate level of sanitary or phytosanitary protection, take into 
account the objective of minimi zing negative trade effects." 
510Appellate Body Report, Australia – Salmon , para. 205.  
511Appellate Body Report, Australia – Salmon , para. 206. 
512Appellate Body Report, Australia – Salmon , para. 208. WT/DS367/AB/R 
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importing Member's SPS measure is more trade restri ctive than necessary to achieve its desired level 
of protection. 
B. Australia's Appeal 
1. Whether the Panel's Finding under Artic le 5.6 was Consequential upon Its 
Findings under Articles 5.1, 5.2, and 2.2 of the SPS Agreement  
345. Australia requests the Appellate Body to rever se the Panel's finding that Australia's measures 
regarding fire blight and ALCM are inconsistent with Article 5.6, c onsequentially upon reversal of the 
Panel's findings under Articles 5.1, 5.2, and 2.2 of the SPS Agreement .  Australia asserts that the Panel 
made its finding under Article 5.6 largely conse quentially upon its finding that the IRA was not a 
valid risk assessment within the meaning of Article 5.1.513  Thus, Australia contends that, if the 
Appellate Body reverses the Panel's findings under Ar ticles 5.1, 5.2, and 2.2, then the basis for the 
Panel's finding relating to Article 5.6 would fall b ecause that finding could not be sustained on its own 
terms.  
346. We have upheld the Panel's findings unde r Articles 5.1, 5.2, and 2.2 of the SPS Agreement .514  
Thus, there is no basis for a consequential reversal of the Panel's finding under Article 5.6.  In any 
event, we are not convinced that as a matter of pr inciple a reversal of the Panel's findings under 
Articles 5.1, 5.2, and 2.2 would necessarily require reversal of the Panel's finding under Article 5.6.  
As set out above, the obligations in Article 5.1 a nd Article 5.6 are not dependent upon each other.  
The violation of one obligation does not, without more, imply the violati on of the other.  Thus, even if 
we were to reverse the Panel's findings under Articl es 5.1 and 5.2, which we do not, this would not 
necessarily require reversal of the Panel's finding under Article 5.6. 
347. At the same time, when a complainant mak es claims that the same SPS measure is 
inconsistent with both Article 5.1 and Article 5.6, factual elements relevant to the analysis under one 
provision may also be relevant to the analysis un der the other provision.  As explained below, we 
understand many of the arguments put forth by Australia in support of its appeal of the Panel's finding 
under Article 5.6 of the SPS Agreement  to relate to such factual elements, and to how the Panel dealt 
with them. 
                                                      
513Australia's appellant's submission, para. 165. 
514See supra , para. 262 of this Report.  WT/DS367/AB/R 
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2. The Alleged Errors in the Panel's Analysis of New Zealand's Article 5.6 
Claim  
348. In addition to its request for consequential reve rsal of the Panel's finding under Article 5.6, 
Australia also contends that the Panel's Article 5.6 finding should be revers ed due to a number of 
alleged errors of misinterpretation and misapplicat ion of Article 5.6.  According to Australia, in 
tackling New Zealand's Article 5.6 claim, the Pane l asked the wrong legal question and, due to its 
"anxiety" to avoid conducting an impermissible de novo review, failed to satisfy itself "affirmatively 
on the basis of the evidence and arguments advanced  by New Zealand that the alternative measures 
'would achieve'" Australia's a ppropriate level of protection.515  Australia submits that the Panel should 
have assessed whether a proper risk assessment would necessarily have concluded that the alternative 
measures would achieve Australia's a ppropriate level of protection.  Australia alleges that, instead, the 
Panel relied upon its finding under Article 5.1 as to the inadequacy of the IRA in order to find that 
New Zealand's Article 5.6 claim was established.516  According to Australia, any invalidity affecting 
the IRA entitled the Panel to conclude, at most, that New Zealand's Article 5.6 claim was not 
foreclosed, not that it had been established.  The Panel, therefore, wrongly asked whether the 
alternative measures "could" or "might" achieve the appropriate level of  protection, and wrongly 
relied upon evidence that "suggests" or "leaves open"  the inconsistency of, or "casts doubt upon" the 
consistency of, Australia's measures with the SPS Agreement .517  Furthermore, according to Australia, 
the Panel failed to make the affirmative factual finding that would have been necessary to find a 
violation of Article 5.6, namely, that the altern ative measures proposed by New Zealand would meet 
Australia's appropriate level of protection. 
349. As such, Australia's allegations relate to the ove rall analytical approach taken by the Panel in 
assessing New Zealand's claim under Article 5.6.  Ther efore, we address first the Panel's analytical 
approach to Article 5.6. 
(a) The Panel's Analytical Approach to Article 5.6 of the SPS Agreement 
350. The Panel's analysis of whether New Zealand had established a prima facie  case that its 
proposed alternative measures would meet Australia's  appropriate level of protection proceeded in 
two steps.  The Panel explained its two-step approach as follows: 
[T]he Panel will assess first whether New Zealand has demonstrated 
that Australia's calculation of the risk resulting of the importation of New Zealand apples is exaggerated.  If New Zealand is successful in making this case, it would cast doubt  on whether the risk would 
                                                     
 
515Australia's appellant's submission, para. 180. (emphasis omitted) 
516Australia's appellant's submission, para. 181. 
517Australia's appellant's submission, para. 169. WT/DS367/AB/R 
Page 120  
 
exceed Australia's ALOP to the ex tent calculated by the IRA, and 
warrant as strict risk management measures as those developed by the IRA.  Further, it would cast doubt on whether the risk of the three pests at issue necessarily exceeds Au stralia's ALOP and warrants risk 
management measures at all.  Since risk management measures are 
necessary only if the risk exceeds the ALOP, in case there is doubt  
that the risk exceeds the ALOP  to the extent calculated, or doubt  that 
it exceeds the ALOP at all, then it is appropriate for the Panel to go 
on to consider whether the less strict alternative measure suggested 
by New Zealand may meet Australia's ALOP.  
Second , the Panel will assess more directly  whether, assuming that 
risk management measures are necessary, the alternative measures properly identified by New Zealand might sufficiently reduce the risk to, or below, Australia's ALOP.  Obviously, the Panel cannot conduct a de novo  risk assessment.  The Panel's task is to assess whether New 
Zealand has raised a presumption, not successfully rebutted by 
Australia, that the alternative measures have a sufficient risk reduction effect.  The Panel will analyse whether New Zealand has advanced sufficient indices for such a risk reduction effect, and consider what the experts say about such an effect.  The Panel will also assess whether the IRA evaluate d the alternatives identified by 
New Zealand, and—if they were evaluated—whether their eventual 
rejection by the IRA was justified.
518 (emphasis and underlining 
added) 
351. Furthermore, as regards the Panel's approach to  analyzing the second condition of Article 5.6, 
the Panel stated that it must not conduct a de novo review519 and that it had to be careful not to "slip 
into conducting a de novo  review".520 
352. In response to questioning at the oral heari ng, New Zealand stated that it considered the 
two-step approach to be "sensible" in the circumstan ces of the present dispute.  Australia allowed that 
the two-step approach was "correct", insofar as it r ecognized that if Australia had, in a valid risk 
assessment, found that the alternative measures di d not meet Australia's appropriate level of 
protection, then this would have foreclosed a finding of violation of Article 5.6.  The European Union, 
Japan, and the United States responded that it was not  necessary for the Panel to undertake the first 
step. 
353. The participants were also asked whethe r they understood the last sentence of 
paragraph 7.1143 of the Panel Repor t (underlined in the above quotation) to mean that the Panel 
considered that it could only proceed to the second step  of its analysis once it had found a violation of 
Article 5.1.  Australia understood the Panel to be of  the view that it could only proceed to the second
                                                      
518Panel Report, paras. 7.1143 and 7.1144. 
519Panel Report, para. 7.1134. 
520Panel Report, para. 7.1193.  WT/DS367/AB/R 
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step of its analysis once it had found a violation of  Article 5.1, and stated that this was correct.  
New Zealand understood the Panel simply to have  raised the question of whether Australia's 
assessment of risk was exaggerated and to have answ ered that question by referring to factual findings 
that it had already made in its analysis of New Zeal and's Article 5.1 claim.  The European Union read 
the sentence as implying that the only way to reach th e second step was to first complete the first step, 
and found this questionable.  Japan contended that the Panel's statement coul d be considered as setting 
forth a general rule for an Article 5.6 analysis, which Japan considered to be problematic.  The 
United States did not understand the Panel to have stated that it could proceed to the second step of its 
analysis only because of its finding of  inconsistency under Article 5.1. 
354. We see a number of problems with the Panel' s approach under Article 5.6.  Beginning with 
the "two-step" approach, we find no basis in Article 5.6 for requiring a complainant pursuing a claim 
under that provision to establish that the importing Member has, in its risk assessment, overestimated 
the risk associated with the imported product or  has erred in concluding that SPS measures are 
necessary at all.  We disagree with the Panel's suggestion that a "direct" analysis of whether a 
complainant has succeeded in proving that its  proposed alternative measure meets the second 
requirement of Article 5.6 may be undertaken only once the complainant has "cast doubt" upon the 
importing Member's risk assessment.521  As we have already stated, the obligations set out in 
Article 5.1 and Article 5.6 are dis tinct and legally independent of each  other.  Accordingly, the Panel 
was required to undertake its own analysis of th e question of whether the alternative measures 
proposed by New Zealand would achieve Aust ralia's appropriate level of protection.522  I n  f a c t ,  a  
complainant is free to challenge the consistency of  a measure with Article 5.6 without, at the same 
time, alleging a violation of Article 5.1.  In that  event, as well as in the present dispute, a panel's 
Article 5.6 analysis must stand on its own feet. 
                                                      
521We recognize that two specific circumstances of this dispute may have drawn the Panel to adopt 
such an approach, especially in its assessment of New Zealand's proposed a lternative measure for fire blight.  
First, New Zealand's proposed alternative measure for fire blight—to limit the import of apples to mature, 
symptomless apples—is the same as the "unrestricted risk" scenario assessed by the IR A.  Although the wording 
used by the IRA in describing the "starting point" of its analysis was slightly different from the wording used by 
New Zealand to describe its alternative measure, the particip ants confirmed at the oral he aring in this appeal that 
the two are in essence the same.  As such, the IRA was assessing the risk resulting from the importation of mature, symptomless apples.  Second, Australia's only de fence to New Zealand's Article 5.6 claim was that the 
IRA had already considered the alternative measures put forward by New Zealand, and found that they did not 
meet Australia's appropriate level of protection.  In other words, Australia's defence was that the IRA had 
already assessed New Zealand's proposed alternatives  and rejected them as failing to meet Australia's 
appropriate level of protection.  Confronted with these particular factual circumstances, the Panel may have felt that, as a "first" or preliminary st ep, it should check whether the answer given by the IRA to the question of 
whether the alternative measures meet Australia's appropriate level of protection could affect whether the Panel 
could go on to answer the same question itself. 
522We note that New Zealand relied on largely the same facts and evidence in the context of its claims 
under both Article 5.1 and Article 5.6.  However, the Panel should not have taken that to mean that the legal 
analyses under the two provisions should overlap. WT/DS367/AB/R 
Page 122  
 
355. The Panel was required to assess, itself, whether the alternative measures (not the SPS 
measures at issue) meet the appropriate level of protection.  The Panel's task was not to review a 
determination made by a national authority on that question or any other, but to rule on whether the 
alternative measures proposed by New Zealand w ould achieve Australia's appropriate level of 
protection.  It could only conclude that this was so on the basis of affirmative findings that 
New Zealand had made out its case, rather than on negative findings, such as that New Zealand had 
"cast doubt" upon Australia's risk assessment.  More over, in making its own assessment of the case 
presented by New Zealand, the Panel was free, within the limits of its duty to make an objective assessment, to structure its analysis as it deemed a ppropriate.  Thus, it was not obliged, in considering 
the risk associated with the alternative measure, to adopt the same methodology or structure as that 
employed by the IRA in its pest risk analysis. 
356. In considering further the Panel's approach to analyzing whether New Zealand's proposed 
alternative measures meet Australia's appropriate leve l of protection, we note that the Panel repeatedly 
stated that it had to be careful not to "slip into conducting a de novo  review".
523  The Panel's caution 
was, however, misplaced.  Caution not to conduct a de novo review is appropriate where a panel 
reviews a risk assessment conducted by the impor ting Member's authorities in the context of 
Article 5.1.  However, the situation is different in  the context of an Article 5.6 claim.  The legal 
question under Article 5.6 is not whether the aut horities of the importing Member have, in conducting 
the risk assessment, acted in accord ance with the obligations of the SPS Agreement .  Rather, the legal 
question is whether the importing Member could have  adopted a less trade-restrictive measure.  This 
requires the panel itself to objectively assess, inter alia , whether the alternative measure proposed by 
the complainant would achieve the importing Member's appropriate level of protection.  The fact that, 
in the present case, the alternative measures proposed  by New Zealand in the context of its claim 
under Article 5.6 had also been assessed in the IRA di d not alter the nature of the Panel's task under 
Article 5.6. 
357. The Panel's flawed two-step approach is ma nifest throughout the Panel's analysis of 
New Zealand's Article 5.6 claim.  For instance, with r espect to fire blight, at the outset of its analysis 
of the alternative measure proposed by New Zealand,  the Panel devoted multiple pages to the "first 
step" of its analysis, engaging in a lengthy re-capitu lation of the various findings that it had made in 
its Article 5.1 analysis524 before concluding that "for the purposes of its Article 5.6 claim 
New Zealand has made the case that Australia's IRA overestimates the fire blight risk  resulting from 
                                                      
523Panel Report, para. 7.1193;  see also paras. 7.1134 and 7.1135.  Similarly, in the context of its 
Article 5.6 analysis with regard to ALCM, the Panel stated that it "need[ed] to review Australia's IRA".  ( Ibid., 
para. 7.1330) 
524See Panel Report, paras. 7.1145-7.1153.  WT/DS367/AB/R 
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imports of New Zealand apples".525  Yet whether the IRA  had overestimated the fire blight risk was 
not a constituent element of New Zealand's Article 5.6 claim, and was not responsive to the question 
of whether New Zealand had affirmatively established that its alternative measure  would achieve 
Australia's appropriate level of protection.  Furthe rmore, throughout the "second step" of its analysis, 
the Panel repeatedly referred to, and couched its analysis in terms similar to those that it had used in, 
its analysis under Article 5.1.  For example, the Pane l recalled that it had, in its Article 5.1 analysis, 
examined the IRA's assessment of whether mature , symptomless apples from New Zealand can carry 
fire blight and found that the IRA "does not find su fficient support in the scientific evidence relied 
upon and, accordingly, is not coherent and objective".526  Similarly, the Panel surveyed a variety of 
statements by its appointed experts, most of wh ich called into question th e IRA's assessment of 
various risks, before finding that "the experts di d not consider that the IRA contains any adequate 
scientific evidence to support the proposition that the introduction of fire blight via mature apple fruit 
has occurred or could occur."527  The structure of the Panel's analysis of the proposed alternative 
measure for ALCM is similar.  At the conclusion of  that analysis, the Panel states that, "[i]n assessing 
the second condition of the Article 5.6 test, the Pane l had to review whether New Zealand has made a 
prima facie case that its alternative measure wo uld achieve" Australia's appropriate level of 
protection.528  The Panel then states, in the next sentence,  that "[i]n this dispute the Panel needs to 
review Australia's IRA, not conduct its own risk assessment".529  To us, this statement reveals the 
fundamental flaw in the Panel's approach, namely, that the Panel seems to have assumed that, because 
it could not conduct its own risk assessment, the only way that it could evaluate New Zealand's 
Article 5.6 claim was by relying upon its review of the IRA.  This was an incorrect understanding of 
its task. 
358. For all these reasons, we consider that the Panel' s approach to its analysis of New Zealand's 
Article 5.6 claim was in error. Because the Pa nel unduly relied on findings that it had made in 
reviewing the IRA under Article 5.1 and failed to fi nd affirmatively that New Zealand's alternative 
measures would meet Australia's appr opriate level of protection, the Pa nel's Article 5.6 finding lacks a 
proper legal basis.  We therefore find that the Panel erred in concludi ng that New Zealand had raised a 
                                                      
525Panel Report, para. 7.1153. (emphasis added)  The Panel seems to have considered that this first step 
was necessary because, "if the [IRA's] a ssessment of risk is exaggerated, ther e may be reason to believe that the 
measures that are designed to prot ect against that risk [(that is, th e contested measures)] may also be 
exaggerated—or too strict". ( Ibid., para. 7.1142)  Thus, the Panel appears to have viewed the first step as a 
different way of testing the trade-restrictiveness of Australia's fire blight measures.  However, Article 5.6 of the 
SPS Agreement prescribes a specific means for testing the trad e-restrictiveness of a contested SPS measure, 
namely, through an analysis of possibl e alternative measures that are apt to  achieve the same objectives, that is, 
by testing whether there is a reasonably available, significantly less trade-restrictive alternative.  
526Panel Report, para. 7.1157. 
527Panel Report, para. 7.1186. 
528Panel Report, para. 7.1329. 
529Panel Report, para. 7.1330. WT/DS367/AB/R 
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presumption that restricting imports of New Zealand apples to mature, symptomless apples was an 
alternative measure with respect to fire blight that would meet Australia's appropriate level of 
protection
530;  and erred in concluding that New Zealand had made a prima facie  case that the 
inspection of a 600-fruit sample of each import lot w ould be an alternative m easure with respect to 
ALCM that would meet Australia's  appropriate level of protection.531 
359. Accordingly, we reverse  the Panel's finding, in paragraphs  7.1403 and 8.1(e) of its Report, 
that Australia's measures at issue regarding fire blig ht and ALCM are inconsistent with Article 5.6 of 
the SPS Agreement .  Having reversed this finding, we must consider whether, in order to promote the 
prompt settlement of this dispute, we are able to  complete the analysis and rule on New Zealand's 
claim under Article 5.6. 
(b) Completion of the Analysis 
360. At the outset, we recall that under Article 5.6 of the SPS Agreement it is for the complainant 
to establish a prima facie  case that there is an alternative measure  that satisfies all three applicable 
conditions.532  Accordingly, a complainant must demonstr ate that a proposed alternative measure to 
the measure at issue:  (i) is reasonably ava ilable taking into account technical and economic 
feasibility;  (ii) achieves the Member's appropriate le vel of sanitary or phyto sanitary protection;  and 
(iii) is significantly less restrictive to  trade than the contested SPS measure.533 
361. The Panel found that the first condition and the th ird condition were met for both fire blight 
and ALCM.  These findings are not appealed.  Ther efore, the only question before us is whether 
New Zealand's alternative measures would achieve Australia's appropriate level of protection. 
362. Australia asserts that a complainant can only be found to have satisfied the second condition 
under Article 5.6 when the evidence that it has addu ced establishes that a "p roper" risk assessment, 
conducted by the importing Member, "would necessarily have concluded that the alternative measure 
would achieve" that Member's a ppropriate level of protection.534 
                                                      
530Panel Report, para. 7.1197.  See also para. 7.1266. 
531Panel Report, para. 7.1328.  See also para. 7.1365. 
532Appellate Body Report, Japan – Agricultural Products II , para. 126. 
533Panel Report, para. 7.1098 (referring to Appellate Body Report, Australia – Salmon , para. 194;  and 
Appellate Body Report, Japan – Agricultural Products II , para. 95). 
534Australia's appellant's submission, para. 179.  WT/DS367/AB/R 
 Page 125 
 
 
363. We have difficulties accepting this formulati on of the burden of proof that applies under 
Article 5.6.  In contrast to Article 5.1, which expressly provides that an SPS measure must be based 
on a risk assessment, Article 5.6 contains no explicit re ference to or requirement for a risk assessment.  
Moreover, while Article 5.1 directly concerns th e actual SPS measure, Article 5.6 addresses that SPS 
measure via a comparison with a hypothetical alterna tive measure.  The function of Article 5.6 is to 
ensure that SPS measures are not more trade rest rictive than necessary to  achieve a Member's 
appropriate level of protection.  Compliance with this requirement is tested through a comparison of 
the measure at issue to possible alternative m easures.  Such alternatives, however, are mere 
conceptual tools for the purpose of the Article 5. 6 analysis.  A demonstration that an alternative 
measure meets the relevant Member's appropriate leve l of protection, is reasonably available, and is 
significantly less trade restrictive than the existing me asure suffices to prove th at the measure at issue 
is more trade restrictive than necessary.  Yet this does not imply that the importing Member must 
adopt that alternative measure or that the alterna tive measure is the only option that would achieve the 
desired level of protection. 
364. This, too, is consistent with the view that a complainant pursuing a claim under Article 5.6 is 
not required  to undertake or furnish a risk assessment rela ting to the alternative measure proposed.  At 
the same time, we cannot conceive of how a comp lainant could satisfy its burden of demonstrating 
that its proposed alternative measure would meet the appropriate level of protection under Article 5.6 
without  relying on evidence that is scientific in natu re.  The objective of ensuring protection against 
risks to human, animal or plant life or health is key to SPS measures, to a Member's appropriate level 
of protection, and to the SPS Agreement as a whole.  Furthermore, the basic obligations set out in 
Article 2—which inform the more specific obliga tions in Article 5—include the stipulation in 
Article 2.2 that SPS measures must be based on sci entific principles and not maintained without 
sufficient scientific evidence.  Th is implies that evidence demonstr ating that a proposed alternative 
measure takes adequate account of these key characteristics of SPS measures will necessarily form 
part of a complainant's attempt to prove that a contested SPS measure fails to meet the requirements 
of Article 5.6.  In our view, this is also reinfor ced by the important role that science plays throughout 
the SPS Agreement in maintaining "the delicate and car efully negotiated balance in the 
SPS Agreement  between the shared, but sometimes competi ng, interests of promoting international 
trade and of protecting the life and health of human beings."535 
365. Thus, although a complainant is not required  to do so, it is free to rely upon a risk assessment 
as a source of evidence relevant to its proposed altern ative measure, if such a risk assessment exists.  
Moreover, elements of the importing Members' risk assessment as well as other factual elements 
                                                      
535Appellate Body Report, EC – Hormones , para. 177. WT/DS367/AB/R 
Page 126  
 
outside that risk assessment may be relevant in seek ing to establish that an alternative measure meets 
the appropriate level of protection.
536 
366. Overall, the totality of the evidence identified a nd/or adduced by the complainant will have to 
be sufficient to establish a presumption that the alternative measure would meet the appropriate level of protection.  Whether such evidence su ffices to meet the burden of establishing a prima facie  case 
will necessarily vary fro m measure to measure and from case to case.
537  A panel's assessment of 
whether this burden has been met is a matter of legal characterization and not a scientific assessment 
of risk that must conform to the first three paragraphs of Article 5. 
(i) Whether the Appellate Body can complete the analysis with 
respect to New Zealand's alternative measure for fire blight 
367. We now turn to the question of whether, using the correct approach to the analysis under 
Article 5.6, we can complete the analysis of New Zealand's claim that Australia's measures 
concerning the risk of fire blight are inconsistent with Article 5.6.  When the factual findings of the 
panel and the undisputed facts in the panel record provide the Appellate Body with a sufficient basis 
for its own analysis, the Appellate Body may comple te the analysis with a view to facilitating the 
prompt settlement of the dispute.538 
368. In keeping with this approach, we must ascer tain whether the factual findings made by the 
Panel and undisputed facts in the record demonstr ate that New Zealand h as established that its 
proposed alternative measure would meet Australia's a ppropriate level of protection.  In particular, we 
must ascertain whether the Panel made relevant factual findings or whether there are sufficient 
undisputed facts on the Panel record that would allow us to:  (i) identify the level of protection that Australia has set as its appropriate level;  (ii) determine what level of protection would be achieved by 
New Zealand's alternative measure;  and (iii) determ ine whether the level of protection that would be 
achieved by the alternative measure would satisfy Australia's appropriate level of protection. 
369. With these considerations in mind, we turn to examine relevant factual findings made by the 
Panel with respect to the risk associ ated with the alternative measure of restricting imports of apples 
to mature, symptomless fruit.  We note first that the Panel has made factual findings identifying the 
level of protection set by Australia, namely, that  Australia's appropriate level of protection is
                                                     
 
536Appellate Body Report, Australia – Salmon , paras. 209-213. 
537Appellate Body Report, US – Wool Shirts and Blouses , p. 14, DSR 1997:I, 323, at 335. 
538See Appellate Body Report, Australia – Salmon , paras. 209, 212, 241, and 255;  Appellate Body 
Report, Korea – Dairy , para. 102;  Appellate Body Report, Canada – Autos , paras. 133 and 144;  Appellate Body 
Report, Korea – Various Measures on Beef , para. 128;  and Appellate Body Report, US – Continued Zeroing , 
para. 189.  WT/DS367/AB/R 
 Page 127 
 
 
expressed in qualitative terms, and that it is identifie d in the IRA as "providing a high level of sanitary 
or phytosanitary protection aimed at reducing risk to a very low level, but not to zero".539  We recall, 
in this regard, that Annex A(5) to the SPS Agreement equates the appropriate level of protection with 
the "acceptable level of risk".  Australia's appropr iate level of protection refers to both concepts, 
describing the level of protection sought as "high", and the acceptable level of risk as "very low".  
Australia's risk estimation matrix, which the IRA su ggests is representative of  Australia's policy on its 
acceptable level of protection540, makes clear that Australia's tole rance for "very low" risk is a 
standard that is stricter than standards that woul d tolerate "moderate", "hi gh", or "extreme" risk, but 
not as strict as standards that would tolerate only "negligible" risk. 
370. Second, we consider whether the Panel made rele vant factual findings or if there are sufficient 
undisputed facts on the Panel record that would allo w us to determine whether New Zealand has made 
a prima facie case with respect to the level of protecti on that would be achieved by its proposed 
alternative measure and, if so, whether Australia has successfully rebutted that presumption.  In this 
context, we recall that the alternative measure proposed  by New Zealand with respect to fire blight is 
the same as what the IRA considered "unrestricted  risk", namely, imports of mature, symptomless 
apples.541 
371. New Zealand submitted before the Panel that mature, symptomless apples do not provide a 
pathway for transmitting fire blight, and that, theref ore, the risk that mature, symptomless apples 
would transmit fire blight is negligible.542  In particular, New Zealand adduced evidence in support of 
the following propositions: 
                                                      
539Panel Report, paras. 7.963, 7.1121, and 7.1136.  The Panel referred to the description of this 
appropriate level of protection in the Import Risk Analysis Handbook  (2003) (Panel Exhibit AUS-10), p. 5, and 
the Import Risk Analysis Handbook  (2007), p. 8 and Annex 3, and also observed that, in connection with its 
former, "similar qualitative ALOP", the AQIS had explai ned that Australia's quarantine policy is based on the 
concept of the management of risk to an acceptably lo w level. (Panel Report, f ootnote 2552 to  para. 7.963 
(quoting 1998 AQIS Import Risk Analysis Process Handbook , p. 11)) 
540The IRA rejected the submission by a stakeholde r that the IRA's risk estimation matrix and 
associated methodology does not repres ent Australia's policy on its acceptable le vel of risk, and observed, in this 
respect, that governmental discussion of this issue had produced agreement that the "policy framework 
surrounding ALOP, including practical guidelines for risk analysis which illustrate the concept of a risk estimation matrix, adequately meets Australia's present needs". (IRA, Part B, pp. 4 and 5)  Australia's risk 
estimation matrix is reproduced at paragraph 147 of this Report. 
541See supra , footnote 481 to  para. 330 of this Report. 
542New Zealand's first written submissi on to the Panel, para. 4.8.  New Zealand made this submission 
in the context of its claim under Article 2.2 and referred back to it in the context of its claim under Article 5.6 at 
para. 4.499. WT/DS367/AB/R 
Page 128  
 
− Fire blight bacteria are not found internally in mature, symptomless apples;  they are 
only rarely found externally and then only in limited quantities.
543 
− Any fire blight bacteria found externally on mature, symptomless apples are unlikely 
to survive post-harvest hand ling, storage, and transportation in quantities sufficient to 
initiate infections.544 
− Fruit would not be contaminated with fire  blight during harvest, handling, storage, 
and transportation.545 
− Even if external fire blight bacteria su rvived handling, processing, and transport of 
New Zealand apples to Australia, they would not be transmitted to a susceptible host 
in Australia.546 
372. Before the Panel, New Zealand also emphasized that the panel in Japan – Apples  reviewed 
the relevant scientific literature  and found that the risk of mature, symptomless apples transmitting 
fire blight was negligible.547 
                                                      
543New Zealand's first written submission to the Panel, paras. 4.11-4.16 (referring to R.G. Roberts, 
"Evaluation of buffer zone size and inspection number reduction on phytosanitary risk associated with fire 
blight and export of mature apple fruit" (2002) 590 Acta Horticulturae  47-53 (Panel Exhibit NZ-20);  C.N. Hale, 
E.M. McRae, and S.V. Thomson, "Occurrence of Erwinia amylovora  on apple fruit in New Zealand" (1987) 217 
Acta Horticulturae  33-40 (Panel Exhibit NZ-21);  R.G. Roberts, C.N. Hale, T. van der Zwet, C.E. Miller, and 
S.C. Redlin, "The potential for spread of Erwinia amylovora  and fire blight via commercial apple fruit;  a 
critical review and risk assessment" (1998) 17(1) Crop Protection  19-28 (Panel Exhibit NZ-22);  R.K. Taylor, 
C.N. Hale, W.R. Henshall, J.L. Armstrong, and J.W. Marshall, "Effect of inoculum dose on infection of apple 
(Malus domestica ) flowers by Erwinia amylovora " (2003) 31 New Zealand Journal of Crop and Horticultural 
Science  325-333 (Panel Exhibit NZ-23);  J. Dueck, "Survival of E. amylovora  in association with mature apple 
fruit" (1974) 54 Canadian Journal of Plant Science  349-351 (Panel Exhibit NZ-96);  and R.G. Roberts, 
S.T. Reymond, and R.J. McLaughlin, "Evaluation of mature apple fruit from Washington State for the presence 
of E. amylovora " (1989) 73 Plant Disease  917-921 (Panel Exhibit NZ-97)). 
544New Zealand's first written submission to the Panel,  paras. 4.17-4.19 (referring to C.N. Hale and 
R.K. Taylor, "Effect of co ol storage on survival of Erwinia amylovora  in apple calyxes" (1999) 489 Acta 
Horticulturae  139-143 (Panel Exhibit NZ-24);  and R.K. Taylor and C.N. Hale, "Cold storage affects survival 
and growth of Erwinia amylovora  on the calyx of apple" (2003) 37(4) Letters in Applied Microbiology  340-343 
(Panel Exhibit NZ-25)). 
545New Zealand's first written submission to the Panel,  paras. 4.20 and 4.21 (re ferring to S.C. Ockey 
and S.V. Thomson, "Influence of rain on transient populations of Erwinia amylovora on leaf surfaces" (2006) 
704 Acta Horticulturae  113-119 (Panel Exhibit NZ-26)). 
546New Zealand's first written submission to the Panel,  paras. 4.22-4.26 (referring to C.N. Hale, 
R.K. Taylor, and R.G. Clark, "Ecology and epidemiology of fire blight in New Zealand" (1996) 411 Acta 
Horticulturae  79-85 (Panel Exhibit NZ-27);  R.K. Taylor, C.N. Hale, F.A. Gunson, and J.W. Marshall, 
"Survival of the fire blight pathogen, Erwinia amylovora , in calyxes of apple fruit discarded in an orchard" 
(2003) 22 Crop Protection  603-608 (Panel Exhibit NZ-28);  and R.G. Roberts and A.J. Sawyer, "An updated 
pest risk assessment for spread of Erwinia amylovora  and fire blight via commercial apple fruit" (2008) 27 Crop 
Protection  362-368 (Panel Exhibit NZ-29)). 
547New Zealand's first written submission to the Pa nel, para. 4.9 (referring to Panel Report, Japan – 
Apples , para. 8.153).  WT/DS367/AB/R 
 Page 129 
 
 
373. Australia, on the other hand, contended befo re the Panel that New Zealand's proposed 
alternative measure, the restriction of imports to  mature, symptomless apples, had already been 
factored into the IRA's assessment, and that th e IRA had nevertheless concluded that the risk 
associated with this scenario was "low", which is  in excess of Australia's appropriate level of 
protection of "very low".548  Australia asserted that the IRA was a valid risk assessment within the 
meaning of Article 5.1, and that, therefore, the Panel must find that a requirement to limit imports to 
mature, symptomless apple fruit would not achieve Au stralia's appropriate level of protection without 
further risk management measures.  Australia also  emphasized that the Panel's two appointed experts 
on fire blight, Dr. Paulin and Dr. Deckers, had bot h expressed the view that restricting imports to 
mature, symptomless apples would not be sufficient to  reduce the risk to a level that would achieve 
Australia's appropriate level of protection.549  Australia therefore contended that New Zealand had 
failed to show that the restriction of imports to  mature, symptomless apples would achieve Australia's 
appropriate level of protection in respect of fire blight.  Australia also asserted that the Panel's 
appointed experts had confirmed that Australia's  principal measures for fire blight—symptomless 
orchards and disinfection—are warranted.550  In response to New Zealand's reference to the findings 
of the panel in Japan – Apples , Australia contended that there are significant differences in the present 
dispute relating to the appropriate level of protection, climatic co nditions, native flora, potential host 
plants, the pest and disease status of the impor ting and exporting Members, and the volume and mode 
of trade.551 
374. New Zealand responded that Australia had misrepr esented the experts' responses, and that the 
experts had in fact confirmed the lack of scientif ic evidence for the pathwa ys at issue and for the 
conclusions in the IRA.  In particular, New Zeal and contended that the e xperts had confirmed that 
several of the main importation steps in the IRA lacked scientific evidence and that Australia's 
conclusion as to the percentage of New Zealand apples that will be contaminated with fire blight was 
unjustified.  New Zealand further submitted that th e experts confirmed that there is no scientific 
evidence of the transfer of the fire blig ht pathogen from apples to susceptible hosts.552  In addition, 
New Zealand pointed out that many of the experts'  comments were directed at reducing the likelihood 
of apples being imported into Australia with fire bl ight bacteria on them, but that this component of 
risk was not the most relevant one.  Instead, New Zealand argued that the expert testimony did not 
provide "general support" for Australia's fire blight measures in relation to the overall  risk, namely, 
                                                      
548Australia's first written submission to the Panel, para. 1084 (referring to IRA, Part B, pp. 104, 105, 
and 150). 
549Australia's second written submission to the Panel, paras. 451 and 452. 
550Australia's closing statement at the seco nd Panel meeting, paras. 30 and 31. 
551Australia's first written submission to the Panel, para. 26. 
552New Zealand's response to Panel Question 126 after the second Panel meeting, para. 203. WT/DS367/AB/R 
Page 130  
 
the risk of entry, establishment and spread of  fire blight combined with an assessment of 
consequences.
553 
375. In seeking to complete the analysis of wh ether New Zealand successfully established a prima 
facie case that the level of protection achieved by the alternative measure would meet the appropriate 
level of protection, we must assess whether the Pane l made findings with respect to the substance of 
the four propositions raised by New Zealand.  To the extent that the Panel made findings regarding 
the testimony of the Panel's experts, the analysis in  the IRA, or scientific studies considered in the 
IRA, it may be appropriate to take such findi ngs into account for the purpose of assessing whether 
New Zealand has made out a prima facie case and whether Australia has rebutted that prima facie  
case. 
376. We note that the Panel record contains numerous pieces of evidence relating to the risk of fire 
blight, including scientific studies, the IRA's anal ysis and the evidence it refers to, as well as the 
testimony of the Panel's appointed experts.  Although New Zealand presented to the Panel various 
pieces of evidence in support of its contention that the risk associated with th e alternative measure of 
restricting imports of apples to mature, symptomless fruit is negligible, the Panel referred, in passing, 
to only a few of these pieces of evidence, and did not make express findings regarding this evidence 
in its analysis of whether New Zealand had succes sfully raised a presumption that the alternative 
measure concerning the risk of fire blight would meet Australia's appropriate level of protection. 
377. The first proposition put forward by New Zealand was that fire blight bacteria are not found 
internally in mature, symptomless apples, and that they are rarely found externally and then only in 
limited quantities.  Australia accepted that, when  dealing with mature, symptomless apples, the 
primary risk is with external (epiphytic) infestati on rather than with internal (endophytic) fire blight 
infection.554  Thus, the Panel focused on the question of exte rnal (epiphytic) fire blight infestation in 
mature, symptomless apples.  The Panel quoted from the expert testimony of Dr. Deckers and 
Dr. Paulin on this question, which it understood to indicate that "fire blight is not a truly epiphytic 
bacteria, and would be present on apple surfac es only in residual populations, diminishing over 
time".555  It seems that, in pointing to this testimony , the Panel was inclined to accept New Zealand's 
first proposition that fire blight bacteria are not f ound internally in mature, symptomless apples, and 
that they are rarely found externally and then onl y in limited quantities.  However, the Panel made no 
explicit finding to that effect. 
                                                      
553New Zealand's response to Panel Question 126 after the second Panel meeting, para. 205. 
554The Panel also reproduced testimony from Dr. Deckers and Dr. Paulin explaining that 
endophytically infected fruit could not develop into mature, symptomless apples. (Panel Report, paras. 7.1160 
and 7.1161) 
555Panel Report, para. 7.1164.  WT/DS367/AB/R 
 Page 131 
 
 
378. Second, New Zealand contended that any residua l fire blight bacteria found externally on 
mature, symptomless apples are unlikely to survive post-harvest handling, storage, and transportation 
in quantities sufficient to initiate infections.  We note that the Panel found in the context of its analysis 
under Article 5.1 that evidence cited by the IRA conf irms that disinfection—a routine procedure in 
the packing house—can have a significant impact on reducing bacterial population556, and that its 
appointed experts agreed that disinfection would result in "strongly"557 reducing the risk of survival of 
the epiphytic population and a "sharp"558 decrease in the level of bacterial population.  However, it is 
not clear to us whether, or to what extent, this di sinfection is part of standard post-harvest, storage, 
and transportation procedures.  While the Panel's appointed experts agreed that disinfection would 
result in strongly decreasing bacterial population, th e Panel did not make a finding on whether all 
apples for export from New Zealand are disinfected. 
379. Third, New Zealand maintained that fruit would not be contaminated with fire blight during 
harvest, handling, storage, and transportation.  In that respect, we note that the Panel quoted from Dr. Paulin's testimony to the effect that , due to the poor epiphytic properties of Erwinia amylovora , 
the likelihood that apples entering packing houses fre e of the bacterium would become contaminated 
during processing was "very unlikely in practical conditions" or "negligible"
559, and that the likelihood 
of clean fruit being contaminated during palletiza tion, quality inspection, containerization, and 
transportation was "nil ... for symptomless mature apples".560  It seems that, in pointing to this 
testimony, the Panel was inclined to accept New Zealand's third proposition that fruit would not be 
contaminated with fire blight during harvest, hand ling, storage, and transportation.  However, the 
Panel made no explicit finding to that effect. 
380. Fourth, New Zealand submitted that, even if ex ternal fire blight bacteria survived the 
handling, processing, and transport of New Zealand apples to Australia, they would not be transmitted 
to a susceptible host in Australia.  In this regard, we note that the Panel reviewed various statements 
by Dr. Deckers and Dr. Paulin regarding th e potential for transfer and spread of Erwinia amylovora .  
The experts characterized this in various ways, including "extremely low"561, "hard to imagine", "a 
difficulty impossible for the bacteria  to tackle in natural conditions"562, "very low"563, "difficult to 
                                                      
556Panel Report, para. 7.303. 
557Panel Report, para. 7.302 (quoting Dr. Deckers' response to Panel Question 28, Panel Report, 
Annex B-1, para. 204). 
558Panel Report, para. 7.302 (quoting Dr. Paulin's response to Panel Question 28, Panel Report, 
Annex B-1, para. 206). 
559Panel Report, para. 7.1167. 
560Panel Report, para. 7.1168. 
561Panel Report, paras. 7.1171 and 7.1176. 
562Panel Report, para. 7.1172. 
563Panel Report, paras. 7.1171 and 7.1173. WT/DS367/AB/R 
Page 132  
 
prove"
564, "rather low"565, "questionable"566, and "rather exceptional".567  The Panel understood these 
responses to "indicate that the likelihood of fire b light spreading through mature, symptomless apples 
is very low ".568 
381. The Panel went on to quote a number of othe r statements by these two experts downplaying 
the risk associated with mature, sy mptomless apples relative to other wa ys of transmitting fire blight.  
The Panel then found that, overall, Dr. Deckers' and Dr. Paulin's testimony demonstrates that they 
consider the overall risk of entry, establishment and spread of fire blight through mature, symptomless 
apples imported from New Zealand to be "very low".569  It seems that the Panel may have agreed with 
this assessment, although it did not affirmatively say so. 
382. Finally, with respect to associated poten tial biological and economic consequences, 
New Zealand argued before the Panel that, in ranki ng the consequences of establishment and spread 
of fire blight as "high", the IRA overestimated these consequences.  According to New Zealand, a 
more realistic assessment, relying on the actual expe rience of countries where fire blight is present, 
would have resulted in the overa ll consequences being "very low".570  Subsequently, New Zealand 
recognized that fire blight can have serious con sequences.  In New Zealand's view, however, "the 
important thing to bear in mind is that the di sease is not spread by exports of mature fruit".571 
383. In this respect, the Panel reviewed Dr. Paulin's and Dr. Deckers' expert testimony and 
observed that, according to these experts, the IRA "h as a tendency to overestimate the severity of the 
consequences of fire blight", in particular with r espect to the criteria of plant life or health and of 
domestic trade or industry, to which the IRA as signed the most severe scores of "F" and "E".572  The 
Panel concluded in the light of that assessment by the experts, that the IRA's evaluation of the 
potential consequences associated with the unrestrict ed risk scenario (that is, the import of mature, 
symptomless apples) did not rely on adequate scientific evidence.573  The Panel did not, however, 
make any finding or express any view of its own on the consequences associated with the entry, 
establishment and spread of fire blight in Australia. 
                                                      
564Panel Report, para. 7.1174. 
565Panel Report, para. 7.1176. 
566Panel Report, para. 7.1177. 
567Panel Report, para. 7.1178. 
568Panel Report, para. 7.1181. (emphasis added) 
569Panel Report, para. 7.1192. 
570New Zealand's first written submission to the Panel, para. 4.264. 
571Panel Report, para. 7.452 (quoting New Zealand's res ponse to Panel Question 67 after the first Panel 
meeting, para. 141).  See also New Zealand's second wr itten submission to the Panel, paras. 2.455 and 2.456. 
572Panel Report, para. 7.469. 
573Panel Report, para. 7.470.  WT/DS367/AB/R 
 Page 133 
 
 
384. We note that the Panel also specifically asked  the experts the question whether restricting 
imports to mature, symptomless apples would achie ve Australia's appropriate level of protection.574  
We have certain reservations about the Panel having done so, given that this was the ultimate question 
that the Panel was charged with answering pursuant  to Article 5.6.  Experts may assist a panel in 
assessing the level of risk associated with SPS m easures and potential alternative measures, but 
whether or not an alternative measure's level of  risk achieves a Member's appropriate level of 
protection is a question of legal characterization, the answer to which will determine the consistency 
or inconsistency of a Member's measure with its  obligation under Article 5.6.  Answering this 
question is not a task that can be delegated to sc ientific experts.  We also have more practical 
concerns, namely, that the Panel did not identify Au stralia's appropriate level of protection in its 
question to the experts, or clarify or explain what it understood the content of that level to be.  Nor did 
the experts, in their replies, elaborate their understa nding of Australia's appropria te level of protection.  
In such circumstances, and irresp ective of the propriety of the question, the answers provided by the 
experts can be of only limited utility.575 
385. In the light of the above, we find that there is a sufficient basis in the Panel record to find that 
Australia's appropriate level of protection is "p roviding a high level of sanitary or phytosanitary 
protection aimed at reducing risk to a very low level, but not to zero".576  Turning to the issue of the 
risk associated with New Zealand's proposed altern ative measure, we have observed that the Panel 
reviewed a fair amount of evidence relevant to th is issue.  Ultimately, however, the Panel discussed 
but did not make findings on much of this evid ence, nor on the specific propositions put forward by 
New Zealand, nor on New Zealand's contention that the relevant risk was "negligible".  There are 
some suggestions that the Panel may have considered  certain elements of the risk associated with the
                                                      
574Panel Question 15, Panel Report, Annex B-1. 
575In reviewing the responses of the experts to its que stion, the Panel understood the various statements 
made by Dr. Paulin to mean that he considered that th e proposed alternative measure "renders the risk extremely 
low and akin to the risk of the bacteria making its way from New Zealand to Australia on air jet or some other 
mode of transport not connected to trade in apples".  (Panel Report, para. 7.1190)  In addition, although 
Dr. Deckers responded that the proposed alternative m easure was not enough to meet  Australia's appropriate 
level of protection, the Panel found that , overall, Dr. Deckers' and Dr. Paulin 's testimony demonstrates that they 
consider the overall risk of entry, establishment and spread of fire blig ht through mature, symptomless apples 
imported from New Zealand to be very low—both overall and in regard to specific key points in the import 
scenario assessed by the IRA. ( Ibid., para. 7.1192)  The Panel explained why it considered that Dr. Deckers' 
statement supported the conclusion that the proposed alternative measure was sufficient to meet Australia's 
appropriate level of protection, even though Dr. Deckers said it would not.  The Panel, however, did not explain 
why it read Dr. Paulin's statement to suggest that the risk of fire blight entry, establishment and spread 
associated with the alternativ e measure was "very low", when Dr. Paulin ha d stated he considered the risk to be 
"extremely low". 
576Panel Report, paras. 7.963, 7.1121, and 7.1136. WT/DS367/AB/R 
Page 134  
 
importation of mature, symptomless apples to be "very low".  The Panel also reproduced extensive 
testimony from its appointed experts suggesting th at the certain risks were of a much smaller 
magnitude than "very low".  However, we cannot  read any of these suggestions as affirmative 
findings.  What is more, there is no indication as to what the Panel considered to be the overall  risk 
associated with the alternative measu re for fire blight proposed by New Zealand, that is, the risk of 
entry, establishment and spread, as well as potential biological and economic consequences.  We are, 
therefore, unable to identify suffi cient uncontested facts or factual fi ndings by the Panel to enable us 
to make a finding on the level of risk associated with New Zealand's alternative measure for fire 
blight.  It follows that we cannot make the n ecessary comparison between the level of protection 
offered by New Zealand's alternative measure and Aust ralia's appropriate level of protection, and thus 
cannot complete the legal analysis with respect to the second condition of Article 5.6 of the 
SPS Agreement.  
(ii) Whether the Appellate Body can complete the analysis with 
respect to New Zealand's alternative measure for ALCM 
386. We now turn to the question of whether we can complete the analysis of New Zealand's claim 
that Australia's ALCM measure is in consistent with Article 5.6.  In keeping with the approach set out 
above, we must ascertain whether the factual findi ngs made by the Panel and undisputed facts on the 
record demonstrate that New Zealand's proposed alternative measure for ALCM satisfies the second 
condition of Article 5.6.  In particular, we must ascertain if there are re levant Panel findings and 
sufficient undisputed facts on the Panel record to en able us to determine what level of protection 
would be achieved by the alternative measure , and whether New Zealand has made out a prima facie 
case that the level of protection that would be ach ieved by the alternative measure would meet 
Australia's appropriate level of protection and, if  so, whether Australia h as successfully rebutted that 
presumption. 
387. We recall that Australia's appropriate level of protection is "providing a high level of sanitary 
or phytosanitary protection aimed at reducing risk to a very low level, but not to zero".
577  We next 
consider what level of protection would be ach ieved by the alternative measure proposed by 
New Zealand.  We recall, in this connection, that  the Australian measure alle ged to be inconsistent 
with Article 5.6 is Measure 14, which c onsists of two options.  These options are either  the inspection 
of each lot of apples on the basis of a 3000-fruit  sample for ALCM, with detection of any live
                                                      
577Panel Report, paras. 7.963, 7.1121, and 7.1136.  WT/DS367/AB/R 
 Page 135 
 
 
quarantineable arthropod resulting in appropria te treatment or rejection for export;  or the option of 
mandatory appropriate treatment (fumigation) of all lots plus inspection of each lot on the basis of a 
600-fruit sample.578 
388. The alternative measure proposed by New Zeal and consists of inspection of a 600-fruit 
sample from each import lot and treatment (fumigation) in the event that ALCM is found.  Thus, New Zealand's alternative was the same as the first option of Australia's Measure 14, except that the 
sample size in New Zealand's alternative measure ( 600 fruit) was smaller than the sample size in the 
first option of Measure 14 (3000 fruit).
579  We note that the IRA expressly considered this alternative 
measure as a possible risk management option, follo wing its determination that the unrestricted risk 
exceeded Australia's appropriate level of protection.580  Further, the IRA assumed that fumigation 
would be 100 per cent effective in killing the ALCM present on fruit.581 
389. Regarding the question of what level of prot ection could be achieved by the alternative 
measure, we note that New Zealand submitted before the Panel that there is a negligible risk of 
transmission and establishment of ALCM with insp ection of a 600-fruit sample (and remedial action 
where appropriate).  In particular, New Zeal and adduced evidence relating to the following 
propositions582: 
− The level of infestation of viable AL CM cocoons on New Zealand apples is not 
biologically significant.583 
− Fruit would not become contaminated with ALCM during harvest, handling, and 
transportation to the packing house.584 
                                                      
578This inspection is to check for pests other than ALCM. (IRA, Part B, p. 321) 
579The participants confirmed, at th e oral hearing in this appeal, that under New Zealand's proposed 
alternative measure with a 600-unit sample size, detecti on of any live quarantineable arthropod would also result 
in appropriate treatment or rejection for export. 
580See supra , para. 164 of this Report. 
581IRA, Part B, p. 188. 
582New Zealand adduced this evidence in the context of its claim under Article 2.2 and referred back to 
it in the context of its claim under Artic le 5.6 at paragraph 4.517 of its fi rst written submission to the Panel. 
583New Zealand's first written submissi on to the Panel, paras. 4.107-4. 111 (referring to A.R. Tomkins, 
D.J. Wilson, S.O. Hutchings, and S. June, "A survey of Apple Leafcurling Midge ( Dasyneura mali ) 
management in Waikato Orchards", Proceedings of the 47th New Zealand Plant Protection Conference  (1994) 
(Panel Exhibit NZ-43), pp. 346-349;  and D.H. Todd, "The Apple Leafcurling Midge, Dasyneura mali Kieffer, 
Seasonal History, Varietal Susceptibility and Parasitism" (1959) 2 New Zealand Journal of Agricultural 
Research , 859-869 (Panel Exhibit NZ-44). 
584New Zealand's first written submission to the Panel,  paras. 4.112-4.115 (referring to IRA, Part B, 
p. 163). WT/DS367/AB/R 
Page 136  
 
− Any infestation of New Zealand apples will be at so low a level that the establishment 
of ALCM in Australia is extremely unlikely.
585 
390. In response, Australia contended that the IR A had assessed the altern ative measure proposed 
by New Zealand, but found that a 600-fruit inspection system alone would not reduce the risks associated with ALCM sufficien tly to achieve Australia's a ppropriate level of protection.
586  Australia 
also relied upon aspects of testimony of the Panel's appointed ALCM expert, Dr. Cross, as supporting 
the IRA's views:  (i) with respect to the infesta tion rates and the limited data  available regarding the 
occupancy and viability of cocoons on New Zealand apples;  (ii) that whether a particular infestation 
level would be enough to initiate a colony depende d on a sufficient number of imported apples being 
simultaneously located within sufficient proximity to apple trees;  (iii) that the period of emergence is 
variable and not necessarily as long as claimed by New Zealand;  and (iv) that the flight ranges of 
ALCM identified in the IRA were reasonable.587  Australia also considered that the Panel's experts 
largely endorsed the IRA's reco mmended risk management measures and, with respect to ALCM, 
recognized that the best existing data indicated  that the 600-unit inspection sample proposed by 
New Zealand, because it was insuffici ently sensitive, would not reduce th e risk to a level that would 
meet Australia's appropria te level of protection.588 
391. In response, New Zealand took issue with the IR A's analysis of the level of unrestricted risk 
of ALCM and the effect of a 600 -fruit sample inspection, highligh ting flaws in the methodology of 
the IRA, as well as the IRA's failure to consider th e factors of cocoon viability, ALCM flight range, 
and normal trade practices.589  New Zealand further responded that  Australia had misrepresented the 
experts' responses, and that the Panel's experts had in  fact confirmed the lack of scientific evidence for 
the pathways at issue and for the conclusions in th e IRA.  In particular, New Zealand contended that 
Dr. Cross did not express the view that the intensity of any inspection would need  to be determined by 
reference to more reliable data with respect to fact ors such as viability.  He explained that the sample 
size for inspection should be selected on the basis of the appropriate level of protection, rather than 
                                                      
585New Zealand's first written submission to the Panel,  paras. 4.116-4.132 (referring to IRA, Part B, 
p. 171);  D.M. Suckling, J.T.S. Walker, P.W.  Shaw, L. Manning, P. Lo, R. Wallis, V. Bell, 
W.R.M. Sandanayaka, D.R. Hall, J.V. Cross, and A.M. El-Sayed, "Trapping Dasineura mali  (Diptera: 
Cecidomyiidae) in  Apples" (2007) 100(3) Journal of Economic Entomology  745-751 (Panel Exhibit NZ-15);  
and R.T. Baker, J.M. Cowley, D.S. Harte, and E.R. Frampton, "Development of a Maximum Pest Limit for Fruit 
Flies (Diptera: Tephritidae) in Produce Im ported into New Zealand" (1990) 83(1) Journal of Economic 
Entomology  13-17 (Panel Exhibit NZ-46)). 
586Australia's first written submission to the Panel, paras. 1089-1098 (referring to IRA, Part B, 
pp. 188-190;  and Methodologies for sampling of consignments  (2008) (ISPM No. 31, FAO, Rome) (Panel 
Exhibit AUS-30)). 
587Australia's second written submission to the Panel, paras. 624, 625, 633, 635, 636, 644, 657, 658, 
and 673. 
588Australia's closing statement at the seco nd Panel meeting, paras. 30 and 32. 
589New Zealand's second written submission to the Panel, para. 2.899.  WT/DS367/AB/R 
 Page 137 
 
 
being adjusted to fit the infestation rate.  New Z ealand further submitted that Dr. Cross also confirmed 
that this was not the approach used  in the IRA.  The IRA used the in festation level, rather than an 
identified tolerance level, as the key determinant th at led to selection of a risk management measure 
that would result in fumigation of virtually ever y apple, effectively taking a zero-risk approach.590 
392. We note that New Zealand presented to the Pane l various pieces of evidence in support of its 
proposition that the risk associated with the altern ative measure of requiring inspection of a 600-fruit 
sample from each import lot is negligible.  Thus, th e relevant evidence before the Panel consisted of 
evidence presented by New Zealand, testimony of the appointed experts, the IRA, and evidence 
discussed in the IRA.  
393. In seeking to complete the analysis of wh ether New Zealand successfully established a 
prima facie case that the level of protection achieved by the alternative measure would meet the 
appropriate level of protection, we must assess whether the Panel made findings with respect to the 
substance of the three propositions raised by New Zealand. 
394. First, New Zealand argued that the level of infestation of viable ALCM cocoons on 
New Zealand apples is not biologically significant.   More specifically, New Zealand argued that 
seasonal population development results in a low numbe r of occupied cocoons and that the parasitic 
wasp Platygaster demades negatively affects ALCM in New Zealand resulting in a high number of 
cocoons that are empty or contain dead pupae.  The Panel criticized th e IRA for assessing the 
likelihood that picked apple fruit is infested w ith ALCM based on the estimated number of apples 
with cocoons.591  In doing so, the Panel referred to Dr. Cro ss' statement that "[i]f only 25% of cocoons 
contain viable ALCM then the values should be 4 times smaller".592  The Panel also referred to 
Dr. Cross' statement that, in order to arrive at  the actual infestation rate when calculating the 
appropriate sample size for inspection for ALCM, the "infestation rate would [have to] be reduced by 
a factor 0.5 × 0.7 for reduced viability and parasitism and probably by a further factor of 0.1 – 0.5 for 
the protracted emergence relative to the short life span".593  The Panel further relied on Dr. Cross' 
statement that, based on the above values, "actual e ffective infestation rates of 0.1% or even 0.05% 
would be more realistic".594  In addition, the Panel found that "New Zealand has made a prima facie  
case that an infestation rate more in the ra nge found in the August 2005  data would be more 
                                                      
590New Zealand's response to Panel Question 126 after the second Panel meeting, paras. 209 and 210. 
591Panel Report, para. 7.801. 
592Panel Report, para. 7.801 (quoting Dr. Cross' response to Panel Question 109, Panel Report, 
Annex B-1, para. 650). 
593Panel Report, para. 7.1325 (quoting Dr. Cross' response to Panel Question 104, Panel Report, 
Annex B-1, paras. 624-627). 
594Panel Report, para. 7.1325 (quoting Dr. Cross' response to Panel Question 104, Panel Report, 
Annex B-1, paras. 624-627). WT/DS367/AB/R 
Page 138  
 
realistic"
595 than the infestation rate originally estimated by the IRA, in the light of the various factors 
that the IRA did not properly take into account.596 
395. Having reviewed the above statements of the Pa nel and references to its appointed experts' 
testimony, it is not clear to us what significance the Panel attached to this evidence.  It seems that, in 
pointing to Dr. Cross' testimony, and his statement that the infestation rate should be reduced by a 
factor of "0.5 × 0.7 ... and probably by a further fact or of 0.1 – 0.5", the Panel may have been inclined 
to accept New Zealand's first proposition that the le vel of infestation of viable ALCM cocoons on 
New Zealand apples is not biologically significant.   Yet it made no express finding on this issue. 
396. Second, New Zealand submitted that fruit w ould not become contaminated with ALCM 
during harvest, handling, and transportation to the p acking house, because at the time of harvest, there 
are few young and actively growing leaves (norma lly associated with ALCM), ALCM eggs will 
already have hatched, and mo st larvae will be in cocoons.597  The Panel made no findings with respect 
to this proposition.598 
397. Third, New Zealand contended that any infesta tion of New Zealand apples will be at so low a 
level that the establishment of ALCM in Austra lia is extremely unlikely.  More specifically, 
New Zealand argued that most New Zealand apples w ill be consumed or decay before the emergence 
of ALCM pupae, because cold storage of apples afte r packaging mimics environmental conditions in 
autumn and winter, and any pupae attached to apples  would enter into a delayed developmental stage 
of diapause and would emerge only when the climatic conditions n ecessary for emergence have been 
met.  Even if ALCM did emerge in the harvest  period, there would be no young, actively growing 
apple leaves available on which to lay eggs.599 
398. The Panel appeared to accept New Zealand's contention that Australia's packing house 
practices make it "highly unlikely" that a large nu mber of deposited apples w ould be left uncovered, 
as well as Dr. Cross' statement that ALCM are "weak  fliers [and] it seems unlikely that [they] would 
have a very long range of dispersal".600  Thus, the Panel found that New Zealand had demonstrated 
that with the "worst case" infestation level, several thousand apples (15,000-19,000 apples) imported 
from New Zealand would need to be deposited uncove red for a sufficiently long period of time for
                                                      
595The two data sets used by the IRA in assessing the risk associated with ALCM are explained supra , 
para. 156 of this Report. 
596Panel Report, para. 7.1360. 
597New Zealand's first written submission to the Panel, para. 4.114. 
598This proposition is not listed among the ones assessed by the Panel in paragraph 7.788 of its Report.  
The Panel's review of the expert testimony in the co ntext of Article 5.6 also makes no reference to it. 
599New Zealand's first written submission to the Panel, paras. 4.117-4.120. 
600Panel Report, para. 7.1313.  WT/DS367/AB/R 
 Page 139 
 
 
any ALCM transmission to occur.  The Panel found that New Zealand had made a "convincing case" 
that this situation would "probably almost never occur".601  It is not clear to us what level of 
probability the Panel is referring to in using th e terms "will probably almost never occur".  The 
Panel's finding could perhaps be read as accep ting New Zealand's third proposition, that the 
establishment of ALCM in Australia is "extremely  unlikely".  However, as the Panel qualifies its 
finding in two different ways, using the terms "pr obably" and "almost", and does not mention the term 
"extremely unlikely", we are not confident that  this is, in fact, what the Panel found. 
399. We note that the Panel also specifically asked  the experts a question concerning the IRA's 
conclusion that the alternative measure of requiring  inspection of a 600-fruit sample from each import 
lot would not achieve Australia's appropriate level of protection.602  We have already expressed 
certain reservations about such questions by the Panel.603  In any event, the sp ecific question asked by 
the Panel was a composite one containing various elem ents.  Neither the Panel, in its question, nor the 
experts, in their responses, identified Australia's appr opriate level of protection or clarified what they 
understood to be the content of that standard.  The experts' responses also contained a number of 
different elements, and it is not read ily apparent which parts of them go to the issue of the relationship 
between the alternative measure and Austra lia's appropriate level of protection.  
400. In any event, the Panel reviewed the responses of the experts to this question.  The Panel 
made reference to Dr. Cross' statement that the IRA's flawed risk analysis should be recalculated 
taking into account the factors that it had not proper ly considered, that some of these factors were 
crucial for establishing the appropriate sample size  for the inspection requirement and that, once this 
was done, it might be found that the unrestricted risk estimates "fall [ ] below" Australia's appropriate 
level of protection.604  Furthermore, the Panel noted that Dr. Deckers was s ceptical about the need for 
fumigating all New Zealand apples for ALCM.605  However, for the reasons set out above, we do not 
think that it was appropriate for the Panel to attach  significance to these particular statements by the 
experts. 
401. With respect to the potential biological a nd economic consequences associated with ALCM, 
New Zealand argued that the IRA's analysis overstates the likely consequences of ALCM.606  I n
                                                      
601Panel Report, para. 7.1312. 
602Panel Question 120, Panel Report, Annex B-1. 
603Supra , para. 384 of this Report. 
604Panel Report, paras. 7.1323 and 7.1324 (quoting Dr . Cross' response to Panel Question 120, Panel 
Report, Annex B-1, paras. 684-687;  and Transcript of the Panel's meeting with the scientific experts, Panel 
Report, Annex B-2, Dr. Cross, para. 663). 
605Panel Report, para. 7.1326. 
606Panel Report, para. 7.872 (referring to New Z ealand's second written submission to the Panel, 
paras. 2.768 and 2.784). WT/DS367/AB/R 
Page 140  
 
New Zealand's view, "Australia's purported analys is of the 'associated potential biological and 
economic consequences' of ALCM constitutes no thing more than a listing of unsubstantiated 
assumptions."
607  The Panel reviewed the testimony of its appointed experts and, in particular, quoted 
Dr. Cross' statement that "some of the terms us ed [in Australia's methodology for assessing impacts] 
are relativistic and are not clearly defined".608  The Panel also noted that Dr. Cross considered that 
effects of ALCM infestation on skin finish and fru it quality set out in the IRA had not been reported 
elsewhere and were "extraordinary".609  The Panel found that the IRA, which classified the overall 
biological and economic consequences of ALCM  as "low", had a tendency to overestimate the 
severity of ALCM consequences.610 
402. In the light of the above, we observe that th e Panel reviewed a fair amount of evidence 
relating to the issue of the risk associated with  New Zealand's proposed alternative measure.  
Ultimately, however, the Panel discussed, but did no t clearly make findings on much of this evidence 
nor on the specific propositions put forward by New Z ealand in support of its claim under Article 5.6.  
The Panel seems to have considered that, under th e alternative measure of requiring inspection of a 
600-fruit sample from each import lot, transmission of ALCM to a susceptible host plant would 
"probably almost never occur".  The Panel also reproduced testimony from its appointed experts 
suggesting that certain other risks were difficult to cal culate, or had not been calculated.  However, we 
cannot read any of these suggestions as affirmative fi ndings.  In addition, there is no indication as to 
what the Panel considered to be the overall  risk associated with the alternative measure relating to 
ALCM proposed by New Zealand, that is, the risk of entry, establishment and spread of ALCM, as 
well as the associated potential biological and economic consequences.  We are, therefore, unable to 
identify sufficient uncontested facts or factual finding s by the Panel to enable us to make a finding on 
the level of risk associated with New Zealand's al ternative measure for ALCM.  It follows that we 
cannot make the necessary comparison between the level of protection offered by New Zealand's 
alternative measure and Australia's appropriate level of protection.  We therefore cannot complete the 
legal analysis with respect to the second condition of Article 5.6 of the SPS Agreement.   
3. Australia's Remaining Allegations of Error  
403. As we have reversed the Panel's finding that Au stralia's measures regarding fire blight and 
ALCM are inconsistent with Article 5.6 of the SPS Agreement , there is no need for us to consider the
                                                      
607Panel Report, para. 7.872 (quoting New Zealand's first written submission to the Panel, para. 4.377). 
608Panel Report, para. 7.879 (quoting Dr. Cross' response to Panel Question 96, Panel Report, 
Annex B-1, para. 556). 
609Panel Report, para. 7.881 (quoting Dr. Cross' response to Panel Question 96, Panel Report, 
Annex B-1, para. 560). 
610Panel Report, para. 7.883.  WT/DS367/AB/R 
 Page 141 
 
 
other arguments put forth by Australia in support of its appeal of these Panel findings, namely:  
(i) that the Panel misapplied the rules governing th e burden of proof by requiring New Zealand to 
demonstrate only that its proposed alternative measures "might" or "may" achieve Australia's 
appropriate level of protection, instead of requiri ng New Zealand to demonstrate that they "would" do 
so;  (ii) that the Panel misinterpreted the word s "appropriate level of sanitary or phytosanitary 
protection" in Article 5.6, because it assessed only th e likelihood of entry, establishment and spread of 
a pest and failed to assess the " associated potential biological and economic consequences";  and (iii) 
that the Panel failed to make an objective assessment  of the matter before it in the context of its 
analysis of Article 5.6 of the SPS Agreement .611 
404. We nevertheless make the following observations.  First, with respect to the issue of burden 
of proof, we consider—as, indeed, does Australia—t hat the Panel properly articulated the relevant 
burden of proof when it stated that it would "assess whether New Zeala nd has adduced sufficient 
evidence to raise a presumption that the proposed alternative measure would achieve Australia's 
ALOP".612  Where the Panel erred, as we have expl ained above, was in importing reasoning and 
findings relating to deficiencies in the IRA's reasoni ng from its analysis of New Zealand's Article 5.1 
claim rather than undertaking an independent an alysis of New Zealand's Article 5.6 claim and 
assessing the arguments and evidence before it in accordance with that burden of proof. 
405. Second, we tend to agree with Australia that th e concept of "appropriate level of protection", 
also referred to as the "acceptable level of risk", is informed by the meaning of "risk" in the phrase 
"risk assessment" in Annex A(4), namely, an assessment  of "the likelihood of entry,  establishment or 
spread of a pest or disease within the territory of  an importing Member according to the sanitary or 
phytosanitary measures which might be applied, and of the associated potential biological and 
economic consequences".  In other words, we accept that the "risk" associated  with a pest or disease 
may encompass "consequences".  In any event, it is certainly the case that Australia has included 
consequences in the appropriate level of prot ection that it has established, as evidenced by, inter alia , 
its risk estimation matrix (reproduced supra , at paragraph 147 of this Report) and that, therefore, any 
assessment of whether an alternative measure meets that appropriate level of protection must, to the 
extent relevant, take account of the potential c onsequences associated with the entry, establishment 
and spread of a pest. 
406. Third, Australia asserts that the Panel failed to make an objective assessment of the matter 
before it in the context of its analysis of Article 5.6 of the SPS Agreement613 and suggests that a panel 
                                                      
611Australia's appellant's submission, paras. 178 and 188(3). 
612Australia's appellant's submission, para. 170 (quoting Panel Report, para. 7.1137). 
613Australia's appellant's submission, paras. 178 and 188(3). WT/DS367/AB/R 
Page 142  
 
must, consistently with its "limited mandate" unde r Article 11 of the DSU, refrain from conducting its 
own risk assessment to determine whether the altern ative measure would achieve the appropriate level 
of protection.
614  We are unsure precisely what Australia is claiming in invoking Article 11 in this 
manner, and Australia does not present any arguments in  support of this allegation.  As the Appellate 
Body has held, a challenge under Article 11 of the DS U must stand by itself and be substantiated with 
specific arguments, rather than merely being put fort h as a subsidiary argument or claim in support of 
a claim of a panel's failure to construe or a pply correctly a particular provision of a covered 
agreement.615 
C. Conclusion 
407. In the light of the above, we reverse  the Panel's finding, in paragraphs 7.1403 and 8.1(e)616 of 
the Panel Report, that Australia's measures at issue regarding fire blight and ALCM are inconsistent 
with Article 5.6 of the SPS Agreement .  We are, however, unable to complete the legal analysis of 
New Zealand's claim under Article 5.6 of the SPS Agreement . 
IX. New Zealand's Other Appeal – Annex C(1)(a) and Article 8 of the SPS Agreement617 
408. We now turn to New Zealand's other appeal.  New Zealand requests us to reverse the Panel's 
finding that "New Zealand's claim under Annex C(1) (a) ... and its consequential claim under Article 8 
of the SPS Agreement are outside of the Pane l's terms of reference in this dispute".618  New Zealand 
further requests us to complete the analysis with regard to its claims of undue delay.619 
409. New Zealand contends that the Panel erred in finding that New Zealand's claims under 
Annex C(1)(a) and Article 8 of the SPS Agreement  were outside of the terms of reference.  In 
particular, New Zealand argues that the Panel erred in  finding that the measure at issue in the context 
of a claim of violation of the "undue delay" oblig ation in Annex C(1)(a) must necessarily be the 
"procedure" referred to in the chapeau of Annex C(1)(a).620  The reference to "approval procedures" in 
Annex C(1)(a) does not mean, according to New Zeal and, that such "approval procedures" must be 
                                                      
614Australia's appellant's submission, para. 178. 
615Appellate Body Report, US – Steel Safeguards , para. 498. 
616See also Panel Report, paras. 7.1197 and 7.1266 (with respect to fire blight), and paras. 7.1328 
and 7.1365 (with respect to ALCM). 
617We refer to "17" measures only in our analysis of the measures that New Zealand identified in its 
panel request. (See infra , paras. 411 through 426 of this Report)  However, when completing the legal analysis 
and, ultimately, making our findings on this section of ou r Report, we refer to the "16" measures that are in 
dispute since, as explained supra  at paragraph 126 of this Report, the parties reached an agreement regarding 
Measure 12 and New Zealand notified the Panel that it would no longer pursue its claims in relation to this 
measure. 
618Panel Report, para. 8.1(f). 
619New Zealand's other appellant's submission, para. 29. 
620New Zealand's other appellant's submission, para. 23.  WT/DS367/AB/R 
 Page 143 
 
 
identified as the measures at issue in the request for the establishment of a panel621 nor, in 
New Zealand's view, is there a requirement in the c overed agreements that the measure at issue must 
directly cause the violation of the relevant obligations.622  In finding that only those "procedures" 
referred to in the chapeau of Annex C(1)(a) can be the measure at issue, the Panel improperly limited 
the measures at issue by reference to the specifi c obligation being challenged, thus blurring the 
distinction between measures and claims in Article 6. 2 of the DSU.  In New Zealand's view, however, 
the 17 measures were an appropriate target for its  Annex C(1)(a) and Article 8 claims because those 
measures were not develo ped without undue delay.623 
410. Australia, for its part, agrees with the Panel's ultimate finding that New Zealand's 
Annex C(1)(a) and Article 8 claims fall outside the Pane l's terms of reference.  In particular, Australia 
considers that the Panel correctly found that the object of New Zealand's claims, namely, the "IRA 
process", was not identified in the panel request and that the "IRA process" is a measure distinct from 
the 17 measures challenged by New Zealand.624 
A. Whether the Panel Erred in Finding that New Zealand's Claims under Annex C(1)(a) 
and Article 8 of the SPS Agreement were  Outside Its Terms of Reference 
411. The Panel began its analysis by examining wh ether the measures relating to New Zealand's 
claims under Annex C(1)(a) and Article 8 of the SPS Agreement  fell within its terms of reference.625  
In answering this jurisdictional question, the Panel fi rst noted that the text of Annex C(1)(a) refers to 
"procedures to check and ensure the fulfilment of SPS measures"626, and that the "IRA process" is the 
type of procedure that, if unduly delayed, "mi ght infringe Annex C(1)(a) of the SPS Agreement".627 
412. The Panel then turned to th e issue of whether New Zealand had identified a relevant 
procedure in its panel request.  The Panel noted  that the identified measures were limited to 
the 17 measures listed in the bullet points in New Zeal and's panel request.  Yet, the Panel was of the 
view that New Zealand did not intend to challenge the content of the 17 measures "as such" but, 
rather, that the target of New Zealand's claims w as the alleged delay in the "procedure leading to the 
adoption of these 17 requirements".628  Since New Zealand's panel request did not specifically refer to 
this procedure, the Panel concl uded that New Zealand had "not properly iden tified the measure at 
                                                      
621New Zealand's other appellant's submission, para. 17. 
622New Zealand's other appellant's submission, paras. 9-12. 
623New Zealand's other appellant's submission, para. 21. 
624Australia's appellee's submission, paras. 10 and 11. 
625Panel Report, para. 7.1443. 
626Panel Report, para. 7.1463. (original emphasis) 
627Panel Report, para. 7.1465. 
628Panel Report, para. 7.1468.  WT/DS367/AB/R 
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issue in its panel request in the cont ext of its Annex C(1)(a) and Article 8"
629 claims, and that, 
accordingly, these claims fell outside its terms of reference.630 
413. We recall that earlier in the proceedings the Pane l had, in response to a request by Australia,  
issued a preliminary ruling in which the Panel determined that the 17 measures identified by 
New Zealand in its panel request were within the Pa nel's terms of reference and that no other measure 
had been properly identified in the panel request.  The Panel also found in its preliminary ruling that, 
although it "would ideally have prefe rred a more explicit explanation of how or why the measures at 
issue are considered by New Zealand to be viola ting the identified provisions of the SPS Agreement", 
New Zealand had—based on the language used in th e panel request and on the specific content of the 
provisions invoked—provided "enough information to  adequately inform the responding party and 
other WTO Members on the nature of the compla int and to allow the responding party to begin 
preparing its defence".631  The Panel subsequently declined to make a second preliminary ruling 
requested by Australia on the specific issue of whether New Zealand's cl aims under Annex C(1)(a) 
and Article 8 of the SPS Agreement  were outside the Panel's terms of reference.632   
414. Therefore, it seems  that the preliminary ruling of the Panel determined that:  the measures at 
issue  in this dispute were the 17 measures listed in the bullet points in New Zealand's panel request, 
and nothing else; and that the relevant claims  were the provisions cited by New Zealand in its panel 
request, which include Article 8 and Annex C(1)(a) to the SPS Agreement .  We observe that neither 
party has appealed the Panel's preliminary ruling or its decision not to issue a second preliminary 
ruling. 
415. Against this backdrop, we begin our analysis w ith the text of Article 6.2 of the DSU, which 
provides, in relevant part: 
The request for the establishment of a panel shall ... identify the 
specific measures at issue and provide a brief summary of the legal basis of the complaint sufficient to present the problem clearly. 
416. Article 6.2 of the DSU serves a pivotal function in WTO dispute settlement and sets out two 
key requirements that a complainant must satisfy in  its panel request, namely, the "identification of 
the specific measures at issue, and the provision of a brief summary of the legal basis of the complaint 
                                                     
 
629Panel Report, para. 7.1474. 
630Panel Report, paras. 7.1477 and 8.1(f). 
631Preliminary Ruling of the Panel, 6 June 2008, Panel Report, Annex A-2, para. 11. (original 
emphasis)  We are puzzled, therefor e, by the Panel's statement at paragraph 7.1474 of its Report that 
"New Zealand did not ... provide a brief summary of why and how these provisions could be infringed by 
the 17 specific requirements at  issue". (original emphasis) 
632Panel Report, paras. 1.15 and 1.16.   WT/DS367/AB/R 
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(or the claims)".633  Together, these two elements constitute the " matter  referred to the DSB"634, so 
that, if either of them is not properly identified, the matter would not be within the panel's terms of 
reference.  Fulfilment of these requirements is not a mere formality.  Rather, as the Appellate Body 
has previously held, the elements that must be id entified serve a twofold purpose, namely:  (i) they 
form the basis for the terms of reference of panels , in accordance with Article 7.1 of the DSU;  and 
(ii) they ensure due process by informing the respondent and third participants of the matter brought 
before a panel.635 
417. Moreover, the two requirements in Article 6.2 of the DSU are distinct and "should not be 
confused".636  In Guatemala – Cement I , the Appellate Body indicated that, because the panel read the 
word "measure" in Article 6.2 of the DSU "as synonymous with allegations of violations " of the 
covered agreements, the panel in that dispute had "blur[red] the distinction between a 'measure' and 
'claims' of nullification or  impairment of benefits".637  Similarly, in EC – Selected Customs Matters , 
the Appellate Body determined that the panel—by read ing the term "measure at issue" in Article 6.2 
in the light of the obligation allegedly violated —had blurred the distinction between measures and 
claims.638  Accordingly, the measure at issue and th e claim are two distinct elements that a 
complainant must identify in order to bring a matter properly within the terms of reference of a panel.  
In checking that a complainant has complied "with both the letter and th e spirit of Article 6.2 of the 
DSU"639, a panel must satisfy itself that both of these elements have been properly identified in the 
panel request. 
418. It is also well established that compliance with the requirements of Article 6.2 must be 
determined on the face of the request for the establis hment of the panel and that "[d]efects [therein] 
cannot be 'cured' in the subsequent submissions  of the parties during the panel proceedings".640  Such 
submissions may be used only to confirm the meaning of the words used  in the panel request and in 
assessing whether there has been prej udice to the responding Member's ability to prepare its defence. 
419. We have two main concerns with the Panel's appr oach to its analysis of New Zealand's claims 
under Annex C(1)(a) and Article 8 of the SPS Agreement . 
                                                      
633Appellate Body Report, US – Carbon Steel , para. 125. (emphasis omitted) 
634Appellate Body Report, US – Carbon Steel , para. 125. (emphasis added) 
635See Appellate Body Report, US – Zeroing (Japan) (Article 21.5 – Japan) , para. 108;  Appellate 
Body Report, US – Continued Zeroing , para. 161;  Appellate Body Report, US – Carbon Steel , para. 126;  and 
Appellate Body Report, EC – Bananas III , para. 142. 
636Appellate Body Report, EC – Selected Customs Matters , para. 132. 
637Appellate Body Report, Guatemala – Cement I , para. 69. (original emphasis) 
638Appellate Body Report, EC – Selected Customs Matters , para. 132. 
639Appellate Body Report, EC – Bananas III , para. 142. 
640Appellate Body Report, US – Carbon Steel , para. 127 (referring to Appellate Body Report, EC – 
Bananas III , para. 143).  WT/DS367/AB/R 
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420. First, it appears to us that the Panel has conf lated the requirement to identify the measure at 
issue with the requirement to identify the legal basis of the complaint (the claim).  The Panel began its 
analysis by formulating the question before it as whether the measures  relating to New Zealand's 
claims under Annex C(1)(a) and Article 8 were  within the Panel's terms of reference.
641  The Panel 
further considered that the 17 requirements, on th e one hand, and "their development", on the other 
hand, are separate measures.642  The Panel explained that its findings regarding the measures within 
the Panel's terms of reference did not cover "t he procedure through which the requirements were 
developed in the IRA process".643  The Panel then considered ways in which New Zealand could have 
identified the measure  alleged to infringe the obligation in  Annex C(1)(a) and Article 8 of the 
SPS Agreement .644  However, having focused its analysis entirely on which measures  were or should 
have been identified by New Zealand, the Panel we nt on to find that "New Zealand's Annex C(1)(a) 
claim  and its consequential claim  under Article 8 of the SPS Agreement are outside of the Panel's 
terms of reference in this dispute".645 
421. As previously noted, measures  and claims  are distinct, and Article 6.2 sets out separate 
requirements that must each be satisfied in a panel request in order for a matter to form part of a 
panel's terms of reference.  The Panel failed to take proper account of this key distinction between 
measures  and claims  by, on the one hand, undertaking an analysis as to whether New Zealand had 
identified the specific measure at issue  in its panel request and, on the other hand, finding that it was 
New Zealand's claims , not the measure , that were outside the Panel's terms of reference. 
422. Second, we have concerns about the way in which the Panel analyzed  whether New Zealand 
had satisfied the requirement of identifying the specific measure at issue in its panel request.  The 
Panel described its approach as follows: 
whether the 17 specific requirements at issue can violate  
Annex C(1)(a) of the SPS Agreement,  or alternatively, whether the 
measure that could allegedly infring e Annex C(1)(a) is different from 
these 17 specific requirements, and hence not properly identified in 
New Zealand's panel request.646 (underlining added) 
423. The Panel further asked " what does New Zealand challenge under Annex C(1)(a)?  What , 
according to New Zealand, causes the violation  of Annex C(1)(a)?"647  The Panel, therefore, seems to 
have understood that the question of whether th e 17 measures identified in the panel request can 
                                                      
641Panel Report, para. 7.1443. 
642Panel Report, para. 7.1469. 
643Panel Report, para. 7.1473. 
644Panel Report, para. 7.1475. 
645Panel Report, paras. 7.1477 and 8.1(f). (emphasis added) 
646Panel Report, para. 7.1453. 
647Panel Report, para. 7.1459. (original italics;  underlining added)  WT/DS367/AB/R 
 Page 147 
 
 
violate , or cause the violation  of, the obligation in Annex C(1)(a) and Article 8 of the SPS Agreement  
was a jurisdictional question.  We disagree with this approach by the Panel.  For a matter to be within 
a panel's terms of reference—in the sense of Articles 6.2 and 7.1 of the DSU—a complainant must 
identify "the specific measures at issue" and the "leg al basis of the complaint sufficient to present the 
problem clearly".  Moreover, "a complaining Member enjoys certain discretion in the identification of 
the specific measure at issue"648 and "[a]s long as the specificity requirements of Article 6.2 are met, 
[there is] no reason why a Member should be preclude d from setting out in a panel request 'any act or 
omission' attributable to another Member as the measure at issue".649  Article 6.2 of the DSU does not 
impose any additional requirement, as the Panel's anal ysis implies, that a complainant must, in its 
request for establishment of a panel, demonstr ate that the identifi ed measure at issue causes the 
violation  of, or can violate , the relevant obligation. 
424. In this dispute, the Panel's analysis under Article 6.2 should have been confined to 
determining what New Zealand had identified as the specific measures at issue and, separately, what 
New Zealand had identified as the legal basis for its complaint (its claims).650  The Panel had already 
found in its preliminary ruling that New Zealand' s panel request identified the 17 measures, and 
Annex C(1)(a) and Article 8 of the SPS Agreement  as the basis for New Zealand's claims, and that, 
therefore, this matter was within  the Panel's terms of reference.651 
425. By contrast, the question of whether the measures identified in the panel request can violate , 
or cause the violation  of, the obligation in Annex C(1)(a) and Article 8 is a substantive issue to be 
addressed and resolved on the merits.  Yet the Panel stopped its analysis at the jurisdictional stage.  
The Panel never proceeded to an analysis of whether New Zealand had made a prima facie  case that 
the 17 measures, as identified by New Zealand in  its panel request, were inconsistent with 
Annex C(1)(a) and Article 8 of the SPS Agreement.  
426. In the light of the above considerations, we conclude that the Panel erred in finding, at 
paragraphs 7.1477 and 8.1(f) of its  Report, that New Zealand's cl aim under Annex C(1)(a) and its 
consequential claim under Article 8 of the SPS Agreement  are outside the Panel's terms of reference in 
this dispute.  Accordingly, we reverse  this finding. 
                                                      
648Appellate Body Report, EC – Selected Customs Matters , para. 149. 
649Appellate Body Report, EC – Selected Customs Matters , para. 133.  See also Appellate Body Report, 
US – Upland Cotton , para. 263, where, in the context of the requ est for consultations, the Appellate Body held 
that "requesting Members should enjoy a degree of discretion to identify, in their request for consultations under Article 4.2, matters relating to the covered ag reements for discussion in consultations". 
650We have difficulty understanding why the Panel considered it useful to engage in an abstract 
analysis of "what kind of precise language would have been appropriate for New Zealand to use" to identify, in its panel request, a measure other than the measures that  New Zealand did identify. (Panel Report, para. 7.1475) 
651We also note the Panel's recognition at paragraph 11 of its preliminary ruling that New Zealand's 
panel request did not prejudice "Australia's ability to de fend itself in the course of  the Panel's proceedings". WT/DS367/AB/R 
Page 148  
 
B. Completion of the Legal Analysis 
427. New Zealand requests us to "complete the an alysis of New Zealand's undue delay claim".
652  
Although New Zealand does not identify precisely what ruling it is seeking to obtain from us, 
New Zealand does indicate that it "has challenged,  under Annex C(1)(a), the undue delay in the 
development of the [16] requirements specified in the IRA [as] set out in New Zealand's panel request".
653  New Zealand adds that it "does not consider  that Annex C(1)(a), properly interpreted, 
precludes such a challenge, or requires that the measure at issue must necessarily be the expired IRA process."
654 
428. As a legal matter, we understand New Zealand's re quest for completion of the analysis to be 
based on the following three propositions:  (i) there is no requirement in the SPS Agreement that "for 
every obligation, the measure at issue mu st necessarily directly cause the violation"655;  (ii) the 16 SPS 
measures at issue "are inextricably linked to the pr ocess by which they were developed;  they were 
not developed without undue  delay, and they conti nue to impair benefits"656;  and (iii) delay is 
"undue" when it "exceeds the time that is reasonably needed to check and ensu re the fulfilment of its 
relevant SPS requirements".657 
429. New Zealand also points to the following "key factual matters", which it asserts "are 
uncontested", in support of its request for completion of the analysis658:  (i) the eight-year period it 
took to complete the IRA659;  (ii) letters sent by AQIS shortly after the initiation of the IRA process 
indicating that "the risk analysis will take approxi mately twelve months to complete", and that it 
would conduct a routine process "based on considerati on that this proposal is technically less complex 
and does not require assessment of significantly grea ter or different risks than those ... previously 
examined"660 by Australia's quarantine service;  (iii) the recognition, in an Australian Government-
                                                      
652New Zealand's other appellant's submission, para. 27;  see also paras. 4 and 29. 
653New Zealand's other appellant's submission, para. 3. 
654New Zealand's other appellant's submission, para. 3. 
655New Zealand's other appellant's submission, para. 11. 
656New Zealand's other appellant's submission, para. 21. 
657New Zealand's other appellant's submission, para. 28 (quoting Panel Report, EC – Approval and 
Marketing of Biotech Products , para. 7.1499). 
658New Zealand's other appellant's submission, para. 28. 
659New Zealand's other appellant's submission, para . 28 (referring to Panel Report, paras. 2.31 
and 2.32;  and Annex I of Australia's first written submission to the Panel). 
660New Zealand's other appellant's submission, para. 28.  See Letter from AQIS to New Zealand's 
Ministry of Agriculture and Forestry, dated 25 February 1999;  and additional letters to stakeholders regarding 
the IRA, dated 15 April 1999 and 28 June 1999 (Panel Exhibit NZ-104).  WT/DS367/AB/R 
 Page 149 
 
 
mandated review of Australia's quarantine system , that "the delay is 'difficult to justify'"661;  and 
(iv) the absence of any explanation of or justification for this delay by Australia. 
430. In response, Australia argues that New Zealand's "substantive undue delay claim is based on a 
misinterpretation of Annex C(1)", because the ordinary meaning of a procedure that checks and ensures the fulfilment of SPS measures, within th e meaning of Annex C(1)(a), cannot be "the 
equivalent of a procedure which 'develops' SPS me asures"—since the 16 measures at issue "were 
adopted following  and as a result of the IRA process".
662  Australia states that the Panel correctly 
found that the object of New Zealand's challe nge under Annex C(1)(a) and Article 8 was the 
"unjustifiably delayed development and a doption of the [16] SPS measures at issue"663, and that the 
development of the 16 measures at issue "was conceptually distinct"664 from the SPS measures 
themselves.  Consequently, Australia concludes, th e 16 measures at issue do not correspond either to 
the "procedure", or to the "SPS measures" re ferred to in the chapeau of Annex C(1)(a).665 
431. Australia submits, in any event, that the A ppellate Body should not complete the legal 
analysis given the "absence of any relevant fact ual findings made by the Panel" on this matter.666  In 
particular, New Zealand's argument that there was no explanation or justifi cation for this delay was 
refuted in Australia's first written submission.  As  for New Zealand's reliance upon certain statements 
from the domestic review of Australia's quarantin e system, Australia notes that it explained to the 
Panel the context in which these statements were made.667 
432. We turn, accordingly, to examine these provisions.  Article 8 of the SPS Agreement  states: 
Members shall observe the provisions  of Annex C in the operation of 
control, inspection and approval procedures, including national 
systems for approving the use of additives or for establishing tolerances for contaminants in f oods, beverages or feedstuffs, and 
otherwise ensure that their procedures are not inconsistent with the provisions of this Agreement. 
                                                     
 
661New Zealand's other appellant's submission, para. 28.  See New Zealand's second written submission 
to the Panel, para. 2.935 (quoting One Biosecurity: A Working Partnership, the Independent Review of 
Australia's Quarantine and Biosecurity Arrangements, Report to the Australia Government , 30 September 2008, 
p. 100). 
662Australia's appellee's submission, paras. 16 and 18. (original emphasis) 
663Australia's appellee's submission, para. 12 (quoting Panel Report, para. 7.1459). 
664Australia's appellee's submission, para. 13. 
665Australia's appellee's submission, para. 19. 
666Australia's appellee's submission, para. 20. 
667Australia's appellee's submission, para. 20 (referring to Australia's response to Panel Question 127 
after the second Panel meeting). WT/DS367/AB/R 
Page 150  
 
433. Annex C(1)(a) to the SPS Agreement  provides, in relevant part: 
ANNEX C 
CONTROL, INSPECTION AND APPROVAL PROCEDURES
7 
1. Members shall ensure, with respect to any procedure to 
check and ensure the fulfilment of sanitary or phytosanitary 
measures, that:   
(a) such procedures are undertaken and completed without 
undue delay and in no less favourable manner for imported 
products than for like domestic products; 
_______________________________________________________ 
7 Control, inspection and approval procedures include, inter alia , procedures 
for sampling, testing and certification. 
434. Article 8 of the SPS Agreement establishes an obligation to comply with the provisions  
contained in Annex C regarding "the operation of control, insp ection and approval procedures".  
Annex C to the SPS Agreement , thus, gives meaning and content to Artic le 8, and, by the terms of that 
Article, a violation of the obligations in Anne x C will also entail a violation of Article 8.668 
435. Many provisions of the SPS Agreement , such as Articles 2 and 5.1, focus directly on SPS 
measures, as such.  In contrast, the obligations of  Annex C(1) and Article 8 are expressed as relating 
to procedures .  The text of Annex C(1) identifies the ty pes of procedures in respect of which the 
obligations contained in subparagr aphs (a) through (i) apply, namely , "any procedure to check and 
ensure the fulfilment of sanitary or phytosanitary measures".669  Paragraph 1 of Annex C thus 
establishes that there must be a link between the re levant "procedures" and "sanitary or phytosanitary 
measures".  The title to Annex C and the text of Article  8 shed further light on the types of procedures 
that are subject to the various obligations set out in subparagraphs (a) through (i), by referring to 
control , inspection , and approval procedures .  Moreover, footnote 7 to the title of Annex C, as well as 
Article 8, provide specific examples of such procedures.  Footnote 7 mentions "procedures for 
                                                      
668Panel Report, EC – Approval and Marketing of Biotech Products , para. 7.1569;  Panel Report, US – 
Poultry (China) , paras. 7.393-7.395. 
669These obligations contained in Annex C(1) are:  (a) that procedures be undertaken and completed 
without undue delay and in a no less favourable manner than for like domestic products;  (b) that processing of 
applications be prompt and that processing periods be published;  (c) that requests for information be limited to 
what is necessary;  (d) that confidentiality of informa tion be treated in a no less favourable manner than for 
domestic products;  (e) that requirements for control, inspection, and approval of individual specimens of a 
product be limited to what is reasonable and necessary;  ( f) that fees associated with the procedures be equitable 
in relation to fees charged on domestic products and be not higher than the actual cost of the service;  (g) that 
the same criteria be used in the siting of facilities used  in the procedures and the selection of samples of 
imported products as for domestic products;  (h) that for products modified subsequent to control and inspection, the procedure be limited to what is necessary to determin e whether there is adequate confidence that the product 
still meets the regulations concerned;  and (i) that a procedure exist to review complaints concerning the 
operation of such procedures and to take co rrective action when a complaint is justified.   WT/DS367/AB/R 
 Page 151 
 
 
sampling, testing and certification", and Article 8 refe rs to "national systems for approving the use of 
additives or for establishing tolerances for contamin ants in foods, beverages or feedstuffs". 
436. Furthermore, Article 8 refers to "the operation of  control, inspection and approval 
procedures", and subparagraph (a) of Annex C(1) requires relevant procedures to be undertaken  and 
completed  without undue delay.  Since the procedures refe rred to in Annex C(1) are those that check 
and ensure fulfilment of SPS measures, th is suggests that such measures exist prior to  the operation, 
undertaking, or completion of, the relevant pro cedures, as the latter seek to check and ensure 
fulfilment with the former.  As explained further be low, the particular circumstances of this case make 
it unnecessary for us to identify more comprehensiv ely the "SPS measures" and the "procedures" in 
respect of which the obligations set out  in Annex C(1) and Article 8 apply.670 
437. Annex C(1)(a) contains an obligation that re levant procedures be undertaken and completed 
"without undue delay".  In this regard, the ordinary meaning of the word "delay" relates to "(a period 
of) time lost by inaction or inability to proceed".671  The term "undue" means something "that ought 
not to be or to be done, inappr opriate, unsuitable, improper, unri ghtful, unjustifiable" or "going 
beyond what is warranted or natu ral;  excessive, disproportionate".672  Thus, Annex C(1)(a) requires 
Members to ensure that relevant procedures are unde rtaken and completed with appropriate dispatch, 
that is, that they do not involve periods of time that are unwarranted, or otherwise excessive, disproportionate or unjustifiable.
673  Whether a relevant procedure has been unduly delayed is, 
therefore, not an assessment that can be done in the abstract, but one which requires a case-by-case 
                                                      
670We observe, in this regard, that the Panel consid ered that "the 'SPS measure' referenced in the 
language of Annex C(1)(a) may be a requirement to conduct an import risk assessment prior to allowing for the 
importation of goods that might pose sanitary or phytosanitary risks" and that, in such circumstances, "the actual 
import risk assessment conducted for a specific good might constitute the procedure to check and ensure the fulfilment of this 'SPS measure'." (Panel Report, para. 7. 1463)  Thus, reasoned the Panel, "if unduly delayed, an 
SPS approval procedure like the IRA process might in fringe Annex C(1)(a) of the SPS Agreement". ( Ibid., 
para. 7.1465 (referring to Panel Report, EC – Approval and Marketing of Biotech Products , para. 7.1336))  The 
Panel did not, in its analysis, speci fically identify the relevant "SPS m easure" with which the IRA process 
"check[ed] and ensur[ed] approval", although it did summarize the arguments of the parties, made on the 
assumption that the IRA process (the relevant procedure) checked and ensured the fulfilment of Australia's quarantine regime relating to the importation of fres h fruit and vegetables (the  relevant SPS measure). ( Ibid., 
paras. 7.1431 and 7.1436)  Due to the manner in whic h New Zealand presented its claims and identified the 
measures at issue, it is unnecessary for us to decide whether the IRA process and Australia's quarantine regime could constitute an "approval procedure" and an "SPS  measure", respectively, within the meaning of 
Annex C(1).  Accordingly, we neither endorse, nor reje ct, the approach that the Panel seems to have been 
inclined to accept. 
671Shorter Oxford English Dictionary , 6th edn, A. Stevenson (ed.) (Oxford University Press, 2007), 
Vol. 1, p. 635. 
672Shorter Oxford English Dictionary , 6th edn, A. Stevenson (ed.) (Oxford University Press, 2007), 
Vol. 2, p. 3431. 
673Panel Report, EC – Approval and Marketing of Biotech Products , para. 7.1495.  That panel appears 
to have adopted a similar interpretation of "without undue delay" by stating that the obligation in Annex C(1)(a) 
dictates that "approval procedures be undertaken and completed with no unjustifiable loss of time ". (emphasis 
added) WT/DS367/AB/R 
Page 152  
 
analysis as to the reasons for the alleged failure to  act with appropriate dispatch, and whether such 
reasons are justifiable. 
438. New Zealand's claims, in this case, raise the issue of what measures  may violate the 
obligation, set out in Annex C(1)(a) and Article 8,  to undertake and complete relevant procedures 
without undue delay.  As we have seen, the obligation in Annex C(1)(a) requires Members to 
commence, and to complete, specific procedures  without undue delay.  Thus, procedures are the 
direct target of the relevant obligation and t hose procedures may themselves be the measure in 
violation of that obligation.  Yet, it does not follow that other types of measures are precluded, 
a priori , from being an appropriate target of a clai m of inconsistency with Annex C(1)(a) and 
Article 8.  In our view, the obligation to ensure that relevant procedures ar e undertaken and completed 
without undue delay may be infringed through measu res other than the control, inspection, and 
approval procedures themselves, such as actions that  prohibit, prevent, or impede undertaking and 
completing such procedures "without undue delay", or  omissions in the form of a failure to act 
"without undue delay".
674  Such measures, even when they are not, themselves, procedures, could 
equally give rise to a violation of  Annex C(1)(a) and Article 8.  
439. Accordingly, the question before us is wh ether the 16 measures, both as a whole and 
individually, are inconsistent with the oblig ation in Annex C(1)(a) and Article 8 of the 
SPS Agreement .  The 16 measures at issue constitute speci fic requirements that New Zealand must 
satisfy when exporting apples to the Australian mark et.  All 16 measures possess a substantive content 
and specify actions that New Zealand apple produ cers, exporters, and authorities must undertake and 
comply with so that apples can be imported into Au stralia.  However, it seems to us that, for purposes 
of its claims under Annex C(1)(a) and Article 8,  New Zealand does not challenge the substantive 
content of the 16 measures at issue but, rather, the development of such measures.  Yet the measures 
themselves do not identify or specify the process lead ing to their adoption, or any steps in that 
process.  We do not see how, as New Zealand suggests, a simple reference to the 16 measures at issue, 
in and of itself, can be read as a refere nce to the development of such measures. 
                                                      
674We note that, in previous disputes involving claims under Annex C(1)(a) and Article 8, panels have 
been faced with measures other than procedures .  In EC – Approval and Marketing of Biotech Products , the 
panel dealt with a general de facto moratorium consisting of the suspension of consideration of applications for 
approval, and a failure to consider specific applications for appr oval. (Panel Report, EC – Approval and 
Marketing of Biotech Products , para. 7.47)  In US – Poultry (China) , the measure at issue was a legislative 
provision prohibiting any use of funds to allow for the importation of poultry products from China that, thereby, 
impeded the undertaking and completion of a procedure that was "a prerequisite for the importation of [poultry] 
products". (Panel Report, US – Poultry (China) , paras. 7.92 and 7.152)  WT/DS367/AB/R 
 Page 153 
 
 
440. New Zealand also argues that "there is no re quirement ... that for every obligation, the 
measure at issue must necessarily directly cause the violation".675  We consider that the issue of 
whether the measure at issue can "indirectly" cau se the violation of an obligation requires a case-
specific examination of the relevant obligation, as we ll as of whether the elements of the measure at 
issue, or its effects, are capable of violating the obl igation invoked.  As we have already explained, we 
believe that the measures that may violate the ob ligation in Annex C(1)(a ) and Article 8 include 
relevant "approval, control and in spection procedures", governmental actions that impede or prevent 
the undertaking or completion of such procedures, as well as failures to undertake or complete such 
procedures with appropriate dispatch.  New Zealan d has not argued that the 16 measures at issue are 
any such type of measure and has not provided an y other arguments in support of its assertion that 
these 16 measures, individually or as a whole, "dir ectly" or "indirectly" violate the "without undue 
delay" obligation in Annex C(1)(a) and Article 8.   Consequently, we do not see how the 16 measures 
alone "directly" or "indirectly" are inconsistent with Annex C(1)(a) and Article 8.  Nor are we 
convinced that the links between the 16 measures at  issue and the process through which they were 
developed implies, as New Zealand contends, that th e process forms part of the 16 relevant measures. 
441. We recognize that, in ordinary circumstances, eight years is a very long period of time to 
complete a risk assessment.  We also agree with the panel in EC – Approval and Marketing of Biotech 
Products  that "a lengthy delay for which no adequa te explanation is provided might in some 
circumstances permit the infere nce that the delay is 'undue'".676  Yet, while the evidence to which 
New Zealand points bears on the question of whethe r the "IRA process" was unduly delayed, such 
"IRA process" is not a measure at issue in this disp ute.  This evidence, therefore, does not establish 
that the 16 measures at issue have not been undertaken  or completed without undue delay, or that they 
prevented or impeded the undertaking or completi on of other relevant procedures without undue 
delay. 
442. In the light of the above, we find that New Zealand has not established that the 16 measures at 
issue are inconsistent with Australia's obligation under Annex C(1)(a) and Article 8 to undertake and 
complete procedures that check and ensure fu lfilment with SPS measures "without undue delay". 
C. Conclusion 
443. For all of the above reasons, we reverse  the Panel's finding in paragraphs 7.1477 and 8.1(f) of 
the Panel Report that New Zealand's claim under Annex C(1)(a) and its c onsequential claim under 
Article 8 of the SPS Agreement  fall outside of the Panel' s terms of reference;  but find that 
                                                      
675New Zealand's other appellant's submission, para. 11. 
676Panel Report, EC – Approval and Marketing of Biotech Products , para. 7.1496. WT/DS367/AB/R 
Page 154  
 
New Zealand has not established that the 16 measures at issue are inconsistent with Annex C(1)(a) 
and Article 8 of the SPS Agreement . 
X. Findings and Conclusions 
444. For the reasons set out in this Report, the Appellate Body: 
(a) upholds
 the Panel's finding, in paragraphs 7.172 and 8.1(b) of the Panel Report, that 
the 16 measures at issue, both as a whole and individually, constitute SPS measures 
within the meaning of Annex A(1) to the SPS Agreement ; 
(b) upholds  the Panel's finding, in paragraphs 7.90 6 and 8.1(c) of the Panel Report, that 
Australia's measures regarding fire blight  and ALCM, as well as the general measures 
relating to these pests, are inconsistent with Articles 5.1 and 5.2 of the SPS 
Agreement , and that, by implication, these measures are also inconsistent with 
Article 2.2 of the SPS Agreement ; 
(c) finds  that Australia has not established that the Panel acted inconsistently with its 
duty to conduct an objective assessment of th e matter before it, within the meaning of 
Article 11 of the DSU; 
(d) reverses  the Panel's finding, in paragraphs 7.1403  and 8.1(e) of the Panel Report, that 
Australia's measures at issue regarding fire  blight and ALCM are inconsistent with 
Article 5.6 of the SPS Agreement ;  but is unable to complete the legal analysis of 
New Zealand's claim under that provision;  and 
(e) reverses  the Panel's finding, in paragraphs 7.14 77 and 8.1(f) of the Panel Report, that 
New Zealand's claim under Annex C(1)(a) a nd its consequential claim under Article 8 
of the SPS Agreement  fall outside the Panel's term s of reference;  but finds  that 
New Zealand has not established that the 16 measures at issue are inconsistent with Annex C(1)(a) and Article 8 of the SPS Agreement . 
445. The Appellate Body recommends
 that the DSB request Australia to bring its measures, found 
in this Report and in the Panel Report as modified  by this Report, to be inconsistent with the 
SPS Agreement , into conformity with its oblig ations under that Agreement. 
  WT/DS367/AB/R 
 Page 157 
 
 
ANNEX I(a) 
 
 WORLD TRADE  
ORGANIZATION  WT/DS367/13 
3 September 2010 
 (10-4561) 
 Original:   English 
   
AUSTRALIA – MEASURES AFFECTING THE IMPORTATION 
OF APPLES FROM NEW ZEALAND 
 
 Notification of an Appeal by Australia   under Article 16.4 and Article 17 of the 
Understanding on Rules and Proce dures Governing the Settlement of  Disputes (DSU),  and under 
Rule 20(1) of the Working Procedures for Appellate Review  
   The following notification, dated 31 August 2010,  from the Delegation of Australia, is being 
circulated to Members.  
_______________ 
 
 1. Pursuant to Article 16.4 and Article 17 of the Understanding on Rules and Procedures 
Governing the Settlement of Disputes  (DSU) and Rule 20 of the Working Procedures for Appellate 
Review , Australia hereby notifies its decision to appeal  to the Appellate Body certain issues of law 
covered in the report of the Panel entitled Australia – Measures Affecting the Importation of Apples 
from New Zealand (WT/DS367/R) (Panel Report) and certain legal interpretations developed by the 
Panel.  2. Australia seeks review by the Appellate B ody of the following errors of law and legal 
interpretation contained in the Panel Report: 
 
(a) In ultimately finding in the Panel Report at [8.1](b) that the 16 measures at issue, both 
as a whole and individually, constitute SPS measures, the Panel erred in its 
interpretation and application of the defin ition of "sanitary or phytosanitary measure" 
in Annex A(1) to the Agreement on the Application of Sanitary and Phytosanitary 
Measures  (SPS Agreement).  The error appears at [7.113]-[7.187] of the Panel 
Report. 
(b) In ultimately finding in the Panel Report at [8.1](c) that the measures imposed by 
Australia for fire blight and apple leafcu rling midge (ALCM), as well as the general 
measures, are inconsistent with the requirements of Arts 5.1 and 5.2 (and 
consequently Art 2.2) of the SPS Agreement,  the Panel erred in its interpretation and 
application of what constitutes a proper "risk assessment".  The errors appear at [7.240-7.472], [7.473-7.510], [7.782-7.887] and [7.898-7.906] of the Panel Report. 
(c) In ultimately finding in the Panel Report at [8.1](c) that the measures imposed by 
Australia for fire blight and ALCM, as well as the general measures, are inconsistent 
with the requirements of Arts 5.1 and 5. 2 (and consequently Art 2.2) of the SPS WT/DS367/AB/R 
Page 158  
 
Agreement, the Panel failed in the performan ce of its duty under Art 11 of the DSU to 
make an "objective assessment of the matte r".  The errors appear at [7.240-7.472], 
[7.473-7.510], [7.782-7.887] and [7.898-7.906] of the Panel Report. 
(d) In ultimately finding in the Panel Report at [8.1](d) that the measures imposed by 
Australia for fire blight and ALCM are inc onsistent with the requirements of Art 5.6 
of the SPS Agreement, the Panel relied upon its erroneous findings against the risk 
assessments for fire blight and ALCM unde r Arts 5.1 and 5.2 (and consequently 
Art 2.2) of the SPS Agreement in concluding  that New Zealand's alternative measures 
would achieve Australia's appropr iate level of protection (ALO P).  In addition to or in 
the alternative, the Panel erred in its inte rpretation and application of Art 5.6, and 
failed to make an "objective assessment of the matter" as required by Art 11 of the 
DSU, in concluding that New Zealand' s alternative measures would achieve 
Australia's ALOP.  The errors appear at [7.1133-7.1197] and [7.1286-7.1331] of the Panel Report. 
_______________ 
 
  WT/DS367/AB/R 
 Page 159 
 
 
ANNEX I(b) 
 
 WORLD TRADE  
ORGANIZATION  WT/DS367/13/Corr.1 
27 September 2010 
 (10-4894) 
 Original:   English 
   
AUSTRALIA – MEASURES AFFECTING THE IMPORTATION 
OF APPLES FROM NEW ZEALAND 
 
 Notification of an Appeal by Australia under Article 16.4 and Article 17 of the Understanding 
on Rules and Procedures Governing the Settlement of  Disputes (DSU), and under Rule 20(1) of the 
Working Procedures for Appellate Review 
 
Corrigendum
 
   By letter of 16 September 2010, Australia re quested authorization from the Appellate Body, 
pursuant to Rule 18(5) of the Working Procedures for Appellate Review , to amend its Notice of 
Appeal dated 31 August 2010.  No objections to Au stralia's request were received from New Zealand, 
the third parties or the third participants.  On  23 September 2010, the Division hearing the appeal 
authorized Australia to amend its Notice of Appeal.  
 Consequently, the reference to "[8.1](d)" in  the first line of paragraph 2(d) should read 
"[8.1](e)".  
_______________ 
 
 WT/DS367/AB/R 
Page 160  
 
ANNEX II 
 
 
WORLD TRADE  
ORGANIZATION  WT/DS367/14 
15 September 2010  
 
(10-4653) 
 Original:   English 
   
AUSTRALIA – MEASURES AFFECTING THE IMPORTATION OF 
APPLES FROM NEW ZEALAND 
 
Notification of an Other Appeal by New Zealand
 
under Article 16.4 and Article 17 of the Understanding on Rules  
and Procedures Governing the Settlement of Disputes (DSU),  
and under Rule 23(1) of the Working Procedures for Appellate Review  
   The following notification, dated 13 Septembe r 2010, from the Delegation of New Zealand, is 
being circulated to Members. 
 
_______________ 
 
 1. Pursuant to paragraph 4 of Ar ticle 16 and Article 17 of the Understanding on Rules and 
Procedures Governing the Settlement of Disputes  ("DSU") and Rule 23(1) of the Working 
Procedures for Appellate Review , New Zealand hereby notifies its decision to appeal to the 
Appellate Body certain issues of law covered in the Panel Report in Australia – Measures 
Affecting the Importation of Apples from New Zealand (WT/DS367/R) ("Panel Report") and 
certain legal interpretations  developed by the Panel. 
2. New Zealand seeks review by the Appellate Body of the Panel's legal conclusion that 
New Zealand's claim under Annex C(1)(a) and its  consequential claim under Article 8 of the 
Agreement on the Application of Sanitary and Phytosanitary Measures ("SPS Agreement ") 
are outside of the Pane l's terms of reference.
1  This conclusion is in error and is based on an 
erroneous interpretation and appli cation of Annex C(1)(a) of the SPS Agreement  and 
Article 6.2 of the DSU.2 
 
_______________ 
 
 
                                                      
1Panel Report, para. 8.1(f). 
2Panel Report, paras. 7.1443 to 7.1490.  WT/DS367/AB/R 
 Page 161 
 
 
ANNEX III 
 
ORGANISATION MONDIALE   ORGANIZACIÓN MUNDIAL  
    DU COMMERCE   DEL COMERCIO  
 
WORLD TRADE ORGANIZATION  
 
APPELLATE BODY 
 
 
Australia – Measures Affecting the Importation of Apples from New Zealand 
 
AB-2010-2 
  
Procedural Ruling
 
  
1. On 1 September 2010, the Appellate Body Divi sion hearing this appeal received a joint 
request from Australia and New Zealand to allow obser vation by the public of the oral hearing in the 
above appellate proceedings.  The par ticipants argued that nothing in the Understanding on Rules and 
Procedures Governing the Settlement of Disputes  (the "DSU") or the Working Procedures for 
Appellate Review  (the " Working Procedures ") precludes the Appellate Body from authorizing public 
observation of the oral hearing.  The participants al so relied on the rulings by the Appellate Body in 
five previous proceedings authorizing public observation of the oral hearing.
1   
2. Australia and New Zealand consider that public  observation of the oral hearings in past 
appellate proceedings has strengthened the credib ility and legitimacy of the WTO dispute settlement 
system, and that there should be continuation of this  practice in circumstance s where the participants 
in the appeal so agree.  They also maintain that  public observation has operated smoothly, and that the 
rights of third participants who did not want their or al statements to be subject to public observations 
have been fully protected.  Australia and New Zeal and also indicated that their request was being 
made on the understanding that any information that  was designated as confidential in the documents 
filed in the Panel proceedings would be adequately protected in the course of the hearing.  Australia 
and New Zealand considered that their proposed mo dality for the observation of the hearing by the 
public, which accords with past practice of the A ppellate Body, would allo w for the protection of 
information designated as confidential. 
3. On 2 September 2010, we invited the third par ticipants to comment in writing on the request 
of the participants.  We received comments on 7 September 2010 from the European Union, the 
Separate Customs Territory of Taiwan, Penghu, Ki nmen and Matsu, and the United States.  These 
third participants expressed their support for the request of the participants.  Chile, Japan, and 
Pakistan did not submit comments on the request. 
                                                      
1These proceedings are:  United States – Continued Suspension of Obligations in the EC – Hormones 
Dispute  (WT/DS320/AB/R) and Canada – Continued Suspension of Obligations in the EC – Hormones Dispute 
(WT/DS321/AB/R);  European Communities – Regime for the Importation, Sale and Distribution of Bananas – 
Second Recourse to Article 21.5 of the DSU by Ecuador (WT/DS27/AB/RW2/ECU) and European 
Communities – Regime for the Importation, Sale and Distribution of Bananas – Recourse to Article 21.5 of the 
DSU by the United States  (WT/DS27/AB/RW/USA);  United States – Continued Existence and Application of 
Zeroing Methodology (WT/DS350/AB/R);  United States – Laws, Regulations and Methodology for Calculating 
Dumping Margins ("Zeroing") – Recourse to Article 21.5 of the DSU by the European Communities  
(WT/DS294/AB/RW);  and United States – Measures Relating to Zeroing and Sunset Reviews – Recourse to 
Article 21.5 of the DSU by Japan  (WT/DS322/AB/RW).   WT/DS367/AB/R 
Page 162  
 
4. We recall that requests to allow public observati on of the oral hearing have been made, and 
have been authorized, in five previous appeals.
2  In its rulings, the Appellate Body has held that it has 
the power to authorize such requests by the partic ipants, provided that this does not affect the 
confidentiality in the relationship between the third pa rticipants and the Appellate Body, or impair the 
integrity of the appellate process.  The Appellate Body has reasoned that: 
(a) The confidentiality rule in the first sentence of Article 17.10 of the DSU must be read 
in the light of its context, particularly Article 18.2 of the DSU, which does not preclude a participant from foregoing confidentiality and, instead, disclosing statements of its own positions to the public .  The third sentence of Article 18.2 states 
that "Members shall treat as confidential information submitted by another Member 
to the panel or the Appellate Body wh ich that Member has designated as 
confidential."  This provision would be redunda nt if Article 17.10 were interpreted to 
require absolute confidentiality in respect of all elements of appellate proceedings, 
and thus suggests that the confidentia lity rule in Article 17.10 has limits. 
(b) The confidentiality requirement in Article 17.10 operates in a relational manner.  
Different sets of relationships are implicated  in appellate proceedings, including:  (i) a 
relationship between the participants and th e Appellate Body;  and (ii) a relationship 
between the third participants and the A ppellate Body.  The requirement that the 
proceedings of the Appellate Body be conf idential affords protection to these separate 
relationships and is intended to safeguard the interests of  the participants and third 
participants, as well as the adjudicative functi on of the Appellate Body, so as to foster 
the system of dispute settlement under conditions of fairness, impartiality, 
independence and integrity.  When partic ipants request to forego confidentiality 
protection for their communications with the Appellate Body at the oral hearing, the right to confidentiality of third participan ts vis-à-vis the Appellate Body is not 
implicated, because such request does not extend to any communications, nor touch 
upon the relationship, between the third participants and the Appellate Body. 
(c)  Pursuant to Rule 27 of the Working Procedures , the Appellate Body has the power to 
exercise control over the conduct of the oral hearing, including authorizing the lifting of confidentiality at the request of the participants provided that this does not 
adversely affect the rights and interests of th e third participants or the integrity of the 
appellate process.  The active participation of  third participants in oral hearings has 
been fostered in the Working Procedures  and in practice;  yet the rights of third 
participants are distinct from those of the pa rticipants in an appellate proceeding.   
(d)  Although certain elements of conf identiality are incapable of derogation
3, the 
confidentiality of statements by participants at  an oral hearing in an appeal is not of 
such a nature. 
5. We note that public observation in previous cases operated smoothly, and that the rights of 
third participants who did not wish to have their oral statements made subject to public observation 
have been fully protected. 
6. In this appeal, Australia and New Zealand ha ve suggested that the Appellate Body allow 
observation by the public of the oral hearing by  means of simultaneous closed-circuit television 
                                                      
2See supra , footnote 1. 
3For example, derogation from the situation contempl ated in the second sent ence of Article 17.10, 
which provides that "[t]he reports of the Appellate Body  shall be drafted without the presence of the parties to 
the dispute and in the light of the information provided  and the statements made", would impair the exercise, 
integrity and independence of the Appellate Body's adjudicative function.  WT/DS367/AB/R 
 Page 163 
 
 
broadcasting.  They have further suggested that pr ovision be made for transmission to be turned off 
should the participants find it necessary to discuss issu es that involve information that was designated 
as confidential by either participant in the documen ts filed with the Panel.  We agree that such 
modalities would operate to protect confidential informa tion in the context of a hearing that is open to 
public observation, and would not have an adverse im pact on the integrity of the adjudicative function 
performed by the Appellate Body. 
7. For these reasons, the Appellate Body Division hearing this appeal authorizes the public 
observation of the oral hearing in these proceedi ngs on the terms set out below.  Accordingly, 
pursuant to Rule 16(1) of the Working Procedures , we adopt the following additional procedures for 
the purpose of this appeal: 
(a) The oral hearing will be open to public ob servation by means of simultaneous closed-
circuit television broadcast, shown in a separate room to which duly registered delegates of WTO Members and members of  the general public will have access.  
(b) Oral statements and responses to questions by the third participants that have 
indicated their wish to maintain the conf identiality of their submissions, as well as 
any discussion of information that the pa rticipants designated as confidential in 
documents submitted to the Panel, will no t be subject to public observation. 
(c) Any request by a third participant wishing to  maintain the confidentiality of its oral 
statements and responses to questions s hould be received by the Appellate Body 
Secretariat no later than 12:30 p.m. Ge neva time on Thursday, 7 October 2010
. 
(d) An appropriate number of seats will be reserved for delegates of WTO Members in 
the room where the closed-circuit television broadcast will be shown.  WTO 
delegates wishing to observe the oral hearing are requested to register in advance with the Appellate Body Secretariat. 
(e) Notice of the oral hearing will be provided to the general public on the WTO website.  
Members of the general public wishing to ob serve the oral hearing will be required to 
register in advance with the Appellate Body Secretariat, in accordance with the 
instructions set out in the WTO website notice. 
 
Geneva, 14 September 2010 
__________