WORLD TRADE  
ORGANIZATION  RESTRICTED 
WT/DSB/M/315 
27 June 2012 
 (12-3420) 
Dispute Settlement Body 
24 April 2012  
 
 
 
MINUTES OF MEETING 
 
Held in the Centre William Rappard 
on 24 April 2012 
 
Chairman:  Mr. Shahid Bashir (Pakistan) 
 
  Prior to the adoption of the Agenda, the Chairm an welcomed the new Director of the Council 
and TNC Division, Mr. Victor do Prado, and wish ed him every success in his new responsibilities.  
  Subjects discussed: Page 
 
1.  Surveillance of implementation of recommendations adopted by the DSB ......................... 2  
(a)  United States – Section 211 Omnibus Appropr iations Act of 1998:  Status report by 
the United States ............................................................................................................. ............ 2 
(b)  United States – Anti-dumping measures on certain hot-rolled steel products from 
Japan:  Status report by the Unite d States ................................................................................... 5 
(c)  United States – Section 110(5) of the US Copyright Act:  Status report by 
the United States ............................................................................................................. ............ 5 
(d)  European Communities – Measures affecting the approval and marketing of biotech 
products:  Status report by the European Union ......................................................................... 6  
(e)  China – Measures affecting trading righ ts and distribution services for certain 
publications and audiovisual entertainment products:  Status report by China .......................... 7  
(f)  United States – Anti-dumping administrative reviews and other measures related to 
imports of certain orange juice from Brazil:  Status report by the United States ....................... 7  
(g)  United States – Definitive anti-dumping and countervailing duties on certain products 
from China:  Status report by the United States .......................................................................... 8  
(h)  Thailand – Customs and fiscal measures on cigarettes from the Philippines:  Status 
report by Thailand ............................................................................................................ ........... 9 
2.  United States – Continued Dumping and Subsidy Offset Act of 2000:  
Implementation of the recommenda tions adopted by the DSB .......................................... 10  
(a)  Statements by the European Union and Japan .......................................................................... 10  
3.  United States – Measures affecting the cross border supply of gambling and 
betting services .............................................................................................................. .......... 11 
(a)  Statement by Antigua and Barbuda re garding the implementation of the 
recommendations and ruling s adopted by the DSB .................................................................. 11  
4.  United States – Measures affecting the pr oduction and sale of clove cigarettes ............... 14  
(a)  Report of the Appellate Body and Report of the Panel ............................................................. 14  WT/DSB/M/315 
Page 2  
 
5.  Proposed nomination for the indicative list of governmental and 
non-governmental panelists ................................................................................................... 17 
6.  Appointment of Appellate Body members ............................................................................ 18  
(a)  Statement by th e Chairman ..................................................................................................... .. 18 
 
 
1. Surveillance of implementation of recommendations adopted by the DSB 
 
(a) United States – Section 211 Omnibus Appr opriations Act of 1998:  Status report by 
the United States (WT/DS176/11/Add.113) 
 
(b) United States – Anti-dumping measures on certain hot-rolled steel products from Japan:  
Status report by the United States (WT/DS184/15/Add.113) 
 (c) United States – Section 110(5) of the US Copyright Act:  Status report by the United States 
(WT/DS160/24/Add.88) 
 (d) European Communities – Measures affecting the approval and marketing of  biotech products:  
Status report by the European Union (WT/DS291/37/Add.51) 
 (e) China – Measures affecting trading rights and distribution services for certain publications 
and audiovisual entertainment products:  Status report by China (WT/DS363/17/Add.15) 
 (f) United States – Anti-dumping administrative revi ews and other measures related to imports of 
certain orange juice from Brazil:  Status report by the United States (WT/DS382/10/Add.4) 
 
(g) United States – Definitive anti-dumping a nd countervailing duties on certain products from 
China:  Status report by the United States (WT/DS379/12/Add.3) 
 (h) Thailand – Customs and fiscal measures on ciga rettes from the Philippines:  Status report by 
Thailand (WT/DS371/15) 
 
 
1. The Chairman recalled that Article 21.6 of the DSU required that unless the DSB decided 
otherwise, the issue of implementation of the re commendations or rulings shall be placed on the 
Agenda of the DSB meeting after six months follo wing the date of establis hment of the reasonable 
period of time and shall remain on the DSB's Agenda  until the issue was resolved.  He proposed that 
the eight sub-items under Agenda item 1 be considered separately.  
(a) United States – Section 211 Omnibus Appropr iations Act of 1998:  Status report by 
the United States (WT/DS176/11/Add.113) 
2. The Chairman drew attention to document  WT/DS176/11/Add.113, which contained the 
status report by the United States on progress in th e implementation of the DSB's recommendations in 
the case concerning US Section 211 Om nibus Appropriations Act of 1998. 
3. The representative of the United States said that  his country had provided a status report in 
this dispute on 12 April 2012, in accordance with Ar ticle 21.6 of the DSU.  Legislative proposals had 
been introduced in the current 112th US Congress to  implement the recommendations and rulings of 
the DSB.  The US Administration would continue to work on solutions to implement the DSB's recommendations and rulings.   WT/DSB/M/315 
 Page 3 
 
 
4. The representative of the European Union said th at the EU wished to thank the United States 
for its most recent status report.  The EU hoped that the US authorities would very soon take steps 
towards implementing the DSB's ruling and resolve this matter. 
5. The representative of Cuba said that, for more th an a decade, the US failure to comply with 
the DSB's recommendations and rulings in the Sec tion 211 dispute had been discussed at regular DSB 
meetings:  i.e. once a month.  She recalled that in  February 2002, Section 211 had been found to be 
inconsistent with the TRIPS Agreement and the Pari s Convention.  Since then, Section 211 continued 
to be in force despite the fact that it violated WT O rules, and was applied retroactively to the Havana 
Club trademark, preventing that trademark from be ing renewed by the company Cubaexport.  This 
unjust and arbitrary measure was under review in th e US courts where one could see to what extent 
the hostile and archaic anti-Cuban US policy was decisive  in the rulings issued to date.  This irrational 
policy prevailed over the most basic rules of international intellectual property law, including US precedent on the retroactive application of a law.   
6. Under those circumstances, it was disgraceful to  hear, time and again, the same status reports 
promising that "the US Administration will continue  to work on a solution that would resolve this 
matter".  Cuba wondered how and when this wo uld happen:  perhaps once the United States had 
definitively deprived the owner of a Cuban trademark in  Cuba of a right held for more than 30 years.  
It was unacceptable for the United States to proc eed in this way.  The United States should be 
reminded, once again, that according to Article 21.6 of the DSU, status reports must refer to "progress" in the implementation of the DSB's recommendations and rulings.  To submit the same report year after year not only showed a lack of respect, but also violated  the rules of the WTO 
dispute settlement system.  As a result of the illegal Section 211, the American company, Bacardi, 
continued to market a line of rum by misusing the Havana Club trademark.  In other words, Bacardi was blatantly taking advantage of what was a well-known Cuban rum trademark.   
7. As all knew, the US violations of the inte llectual property rights of Cuban owners, on the 
basis of the illegal economic, financial and co mmercial blockade against Cuba, went beyond 
Section 211.  However, even the DSB, under the current DSU provisions, was not able to ensure 
compliance by the United States with the recommendati ons and to put an end to this measure.  The 
United States claimed to "comply strictly with in tellectual property rules" and drew up lists of 
sanctions for countries that allegedly failed to comply with their obligations, including WTO 
Members.  Thus, it was no wonder that the irrespons ible and decadent behaviour of this "great power" 
was being rejected with increasing force in a number of forums, and on the international scene in 
general.   
8. At the recent VI Summit of the Americas, certain Latin American representatives had 
repeatedly pointed out that the US policy on Cuba was "anchored in the Cold War" and 
"anachronistic".  All 32 countries condemned the "criminal blockade of the United States against 
Cuba" which for some, like the President of Paragua y, was a practice that:  "violated principles of 
international law which, in all of our multilateral and regional organizations, we are defending and 
trying to guarantee".  Once again, Cuba wished to  stress that the United States was just another WTO 
Member with equal rights and obligations.  As long as the United States failed to comply with its 
WTO obligations in a number of disputes, it was in a state of illegality.  This could not be disregarded 
in the framework of the WTO ne gotiations where the United States often took a hard line although it 
was not in compliance with its obligations and vi olated the same rules it was negotiating.  Cuba 
wished to reaffirm its request that the United Stat es repeal Section 211 as this was the only solution to 
this dispute.  Cuba urged the United States to act rapidly and to stop delaying the adoption of the legislative measures necessary to co mply with the DSB's decisions.  WT/DSB/M/315 
Page 4  
 
9. The representative of the Bolivarian Republic of  Venezuela said that, once again, her country 
wished to point out that the most recent US status report contained the same information as the 
previous status reports submitted by the United St ates.  The only changes made were the date and 
document symbol.  In Venezuela's view, this amount ed to "action without results".  Venezuela noted 
that Section 211 remained in force despite having been found to be inconsistent with the TRIPS 
Agreement and the principles of national treatme nt and most-favoured-nation treatment.  This 
undermined the dispute settlement system, which was considered to be one of the great achievements 
of the Uruguay Round.  Venezuela was disappointed th at, for the past ten years, the United States had 
failed to implement the Appellate Body's ruling.   As it had done on numerous occasions, Venezuela 
called on the United States to end its policy of ec onomic, commercial and fina ncial blockade against 
Cuba and reminded the United States of its obliga tion to comply with the DSB's recommendations. 
10. The representative of Zimbabwe said that his count ry thanked the United States for its status 
report.  Zimbabwe supported the statements made by  Cuba and Venezuela and, once again, urged the 
United States to comply with the DSB's rulings and recommendations in the Section 2011 dispute.   
11. The representative of Brazil said that his country thanked the United States for its status 
report but noted that, once again, the United Stat es reported lack of progress.  Brazil remained 
concerned about this situation of non-complianc e with the DSB's recommendations and urged the 
United States to bring its measures into conformity with WTO rules. 
12. The representative of Uruguay said that his country thanked the United States for its status 
report.  Uruguay shared the systemic concerns expr essed by previous speakers and, once again, called 
on the parties to this dispute to intensify their effo rts to end this dispute by  complying with the DSB's 
recommendations of more than ten years ago.  
13. The representative of China said that her country  thanked the United States for its status 
report and statement made at the present meeting.   The prolonged situation of non-compliance was 
highly incompatible with the principle of prom pt and effective implementation required under the 
DSU provisions, in particular when the interests of a developing-country Member were affected.  
Thus, China urged the United States to implemen t the DSB's rulings and recommendations without 
further delay. 
14. The representative of Angola said that her count ry thanked the United States for its status 
report.  Once again, Angola regretted that no conc rete progress had been made in the implementation 
of the DSB's decision and the Appellate Body's findings of February 2002, that Section 211 was 
inconsistent with WTO rules and principles.  The delay in the implementation of the DSB's 
recommendations affected the efficient functioning  of the multilateral trading system and set a 
negative precedent for other cases.  Angola hoped th at concrete actions w ould be undertaken to 
resolve this matter, which would send a positive signal of respect for WTO rules. 
15. The representative of Ecuador said that his c ountry supported the statement made by Cuba.  
Once again, Ecuador noted that Article 21 of the DSU referred specifically to prompt compliance with 
the DSB's recommendations and rulings, in particul ar where the interests of a developing-country 
Member were affected.  Ecuador hoped that the Un ited States would step up its efforts to ensure 
prompt compliance with the DSB's recommendations and rulings by fully repealing Section 211. 
16. The representative of Nicaragua said that her c ountry thanked the United States for its status 
report in this dispute.  Nicaragua noted that the status report did not contain any new information and 
was the same like the previous status reports submitted  by the United States.  This showed the lack of 
will on the part of the United States to comply with the DSB's recommendations and rulings.  
Nicaragua supported Cuba's statement, had confiden ce in the multilateral trading system and wished 
to strengthen that system.  However, the non- compliance with the DS B's recommendations and  WT/DSB/M/315 
 Page 5 
 
 
rulings undermined the credibility of the system  and affected Cuba's economic and commercial 
interests.  Nicaragua, once again, urged the United States to comply with the DSB's recommendations.   
17. The representative of the Dominican Republic said that her country thanked the United States 
for its status report on Section 211, which had been  found to be inconsistent with Article 42 of the 
TRIPS Agreement.  The Dominican Republic, once again, urged the United States to speed up its 
internal procedures in order to comply with the DSB's recommendations.  The long period of time that 
had passed with no implementation undermined th e credibility of the WTO and its decisions.   
18. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
(b) United States – Anti-dumping measures on certain hot-rolled steel products from Japan:  
Status report by the United States (WT/DS184/15/Add.113) 
19. The Chairman drew attention to document  WT/DS184/15/Add.113, which contained the 
status report by the United States on progress in th e implementation of the DSB's recommendations in 
the case concerning US anti-dumping measures on certain hot-rolled steel products from Japan. 
20. The representative of the United States said that  his country had provided a status report in 
this dispute on 12 April 2012, in accordance with Arti cle 21.6 of the DSU.  As of November 2002, the 
US authorities had addressed the DSB's recommendations  and rulings with resp ect to the calculation 
of anti-dumping margins in the hot-rolled steel anti-dumping duty investigation at issue in this dispute.  With respect to the recommendations an d rulings of the DSB that had not already been 
addressed by the US authorities, the US Administ ration would work with the US Congress with 
respect to appropriate statutory measures that would resolve this matter.  
21. The representative of Japan said that his country  thanked the United States for its statement 
and its most recent status report.  Japan took note  of the US report that the United States had taken 
certain measures to implement part of the DSB' s recommendations in November 2002.  Japan hoped 
that the United States would soon be in a position to report to the DSB on more tangible progress with respect to the implementation of the remaining part  of the DSB's recommendations.  Full and prompt 
implementation of the DSB's recommendations and ru lings was "essential to the effective functioning 
of the WTO and the maintenance of a proper bala nce of the rights and obligations of Members".
1  
Japan called on the United States to fully implement the DSB's recommendations in this long-standing 
dispute without further delay. 
22. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
(c) United States – Section 110(5) of the US Copyright Act:  Status report by the United States 
(WT/DS160/24/Add.88) 
23. The Chairman drew attention to document WT/D S160/24/Add.88, which contained the status 
report by the United States on progress in the impl ementation of the DSB's recommendations in the 
case concerning Section 110(5) of the US Copyright Act. 
24. The representative of the United States said that  his country had provided a status report in 
this dispute on 12 April 2012, in accordance with Article 21.6 of the DSU.  The US Administration 
would continue to confer with the EU, and to work  closely with the US Congress, in order to reach a 
mutually satisfactory resolution of this matter.  
                                                      
1 Article 3.3 of the DSU. WT/DSB/M/315 
Page 6  
 
25. The representative of the European Union said that the EU noted and thanked the 
United States for its status report.  As it had stated  many times in the past, the EU remained keen to 
resolve this dispute. 
26. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
(d) European Communities – Measures affecting the approval and marketing of biotech products:  
Status report by the European Union (WT/DS291/37/Add.51) 
27. The Chairman drew attention to document WT/D S291/37/Add.51, which contained the status 
report by the European Union on progress in the implementation of the DSB's recommendations in 
the case concerning its measures affecting the approval and marketing of biotech products. 
28. The representative of the European Union said that  the EU hoped that it could continue on the 
constructive path of dialogue with  the United States.  Two technical  meetings had taken place in 2011 
and in March 2012.  The meetings had offered a good opportunity to discuss directly issues of 
concern for both sides and to follow up closely on de velopments in the biotech field.  In 2012, the 
Commission had already authorized three more GMOs2 and had renewed the aut horization of a fourth 
one.3  Two of those decisions4 had been adopted only six months  after the relevant EFSA opinions 
had been published.  Furthermore, on 15 February 2012, EFSA had issued its opinion on the safety of 
a GM soybean for food and feed uses.  This  would be submitted fo r a vote on 2 May 2012.5  
Regarding the concerns expressed by the United States on the backlog of approvals, the EU once 
again recalled that its approval system was not c overed by the DSB's recommendations and rulings.  
The EU underlined that the GMO regulatory regi me was working normally as evidenced by the 
approval decisions just mentioned.  The functi oning of the GMO regime should not be rigidly 
assessed purely quantitatively and in the abstract, in terms of the number of authorizations per year, 
since this was dependent on various product and case-specific elements and in particular on the 
quality of applications and on the time needed by applicants to answer requests from EFSA on 
additional scientific information. 
29. The representative of the United States said that  his country thanked the EU for its status 
report and for its statement made at the present meeti ng.  As the United States had explained at past 
meetings of the DSB, the United States said that it continued to have substa ntial concerns regarding 
EU measures affecting the approval of biotech pro ducts.  The EU measures, including delays in 
approvals, had resulted in substantia l restrictions on the importation of US agricultural products.  The 
affected products included US corn, corn gluten feed, and distillers dried grain from the current US 
growing season.  The United States would also recall the DSB findings that EU member State bans on 
the corn variety Mon810 were inconsistent w ith the EU's obligations under the SPS Agreement.6  In 
that regard, the United States noted its concern th at in March 2012, France had renewed its member 
State ban affecting that corn variety.  The ban had been adopted despite the fact that Mon810 had 
been cultivated for 17 years around the world, a nd had long been approved in the EU.  The 
United States urged the EU to fix the ongoing probl ems with its measures affecting the approval of 
biotech products.  
30. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
                                                      
2 A5547-127 soybean, 356043 soybean, MON87701 soybean. 
3 40-3-2 soybean. 
4 Authorization decision for 356043 and MON87701 soybeans. 
5 MON87701×MON 89788. 
6 Panel Report, "European Communities – Measures Affecting the Approval a nd Marketing of Biotech 
Products", WT/DS291/R, adopted 21 November 2006, paras. 8.24, 8.28.  WT/DSB/M/315 
 Page 7 
 
 
(e) China – Measures affecting trading rights and distribution services for certain publications 
and audiovisual entertainment products:  Status report by China (WT/DS363/17/Add.15) 
31. The Chairman drew attention to document WT/D S363/17/Add.15, which contained the status 
report by China on progress in the implementation of the DSB's recommendations in the case 
concerning China's measures affecting trading rights and distribution services for certain publications 
and audiovisual entertainment products. 
32. The representative of China said that her country had provided a status report in this dispute 
on 12 April 2012, in accordance with Article 21.6 of the DSU.  China had made tremendous efforts to 
implement the DSB's rulings and recommendations , and had completed amendments to most 
measures at issue.  Through those steps, China had ensured full implementation of the DSB's 
recommendations and rulings, except those concerning film  for theatrical release.  With regard to the 
measures concerning film for theatrical release, Ch ina had been discussing with the United States and 
had recently reached an agreement towards resolving this matter.  The agreement would be signed and 
notified to the DSB soon. 
33. The representative of the United States said that his country thanked China for its status report 
and its statement made at the present meeting.  As noted at the March meeting of the DSB, the 
United States and China had reached agreement on a Memorandum of Unders tanding regarding films 
for theatrical release.  The United States said that  it looked forward to the formal signing of the MOU 
soon.  In response to China's statements in its status report, and again at the present meeting, 
regarding products other than films for theatrical  release, the United States noted that it would 
continue to review China's measures relating to reading materials, audiovisual home entertainment 
products, and sound recordings to assess whether the steps taken by China in fact implement the DSB 
rulings and recommendations.  At the present time, th e United States was not in a position to conclude 
that China had fully implemented the recommendations and rulings in this dispute as China had claimed for all areas other than for films for theatri cal release.  The United States would continue to 
review the steps that China had taken in those areas.  
34. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
(f) United States – Anti-dumping administrative review s and other measures related to imports of 
certain orange juice from Brazil:  Status report by the United States (WT/DS382/10/Add.4) 
35. The Chairman drew attention to document WT /DS382/10/Add.4, which contained the status 
report by the United States on progress in the impl ementation of the DSB's recommendations in the 
case concerning US anti-dumping administrative reviews and other measures related to imports of 
certain orange juice from Brazil. 
36. The representative of the United States said that  his country had provided a status report in 
this dispute on 12 April 2012.  The United States said that it would like to highlight important 
developments covered in the status report, as well as to inform the DSB of additional developments 
that had occurred after 12 April.  On 14 Februa ry 2012, the US Department of Commerce had 
published a modification to its procedures in or der to implement the DSB's recommendations and 
rulings regarding the use of "zeroing" in anti-dum ping reviews.  The modification applied to all 
products from all Members, including the products of Br azil covered in this dispute.  On 3 April 2012, 
Brazil and the United States had en tered into an agreement regarding procedures under Articles 21 
and 22 of the DSU.  The agreement, which ha d been circulated to Members in document 
WT/DS382/11, was designed to facilitate a final resolutio n of this dispute.  In the prior month, the US 
International Trade Commission (ITC) had made a determination to revoke the anti-dumping duty 
order in its five-year "sunset" review of the orde r on orange juice from Brazil.  On 13 April 2012, the 
ITC had published in the US Federal Register its fo rmal determination in the sunset review.  In WT/DSB/M/315 
Page 8  
 
accordance with the ITC determination, on 20 Apr il 2012, the US Department of Commerce had 
issued a notice revoking the anti-dumping duty order on the products covered in this dispute.  The revocation of the order was effective as of 9 Marc h 2011.  As a result of the revocation, imports of 
orange juice from Brazil entered on or after 9 Marc h 2011 were not subject to anti-dumping duties.  
All anti-dumping duty cash deposits on entries on or after that date would be refunded.  
37. The representative of Brazil said that his country thanked the United States for its status 
report.  As had been mentioned, Brazil and the United States had concluded an "Agreement 
Regarding Procedures under Articles 21 and 22 of th e DSU" with respect to  the "Orange Juice" 
dispute.  As Members were aware, the United States had recently published a final rule modifying its methodology regarding the calculation of dumping margins and assessment rates in anti-dumping 
reviews, according to which "zeroing" would no  longer be used in these calculations after 
16 April 2012.  This new rule represented an importa nt shift in the US attitude and Brazil certainly 
welcomed it, recognizing also the work that ha d been carried out by the US Administration in 
eliminating an illegal practice that had lasted for decades.  The new rule, however, did not address all 
the findings in the "Orange Juice" dispute.  It di d not encompass the recalculation, without "zeroing", 
of assessment rates applying to past entries that re mained unliquidated at the end of the reasonable 
period of time.  Brazil understood that in order to fully comply with the DSB's recommendations and rulings in the "Orange Juice" dispute, the Unite d States was not only required to abandon the use of 
"zeroing" in the future, but must also stop coll ecting anti-dumping duties that had been calculated 
with the use of that illegal methodology.  For t hose reasons, Brazil had c oncluded a "sequencing" 
agreement with the United States, which preserved Brazi l's rights concerning future legal steps in this 
dispute.  This agreement reflected a spirit of compromise on Brazil's side.  While Brazil 
acknowledged the efforts made by the United States to abandon "zeroing" in future reviews, Brazil 
would closely monitor the implementation of the fina l rule in the next months.  Before the end of 
2012, Brazil and the United States would consult with a view to achieving a solution to the "Orange 
Juice" dispute. 
38. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
(g) United States – Definitive anti-dumping and countervailing duties on certain products from 
China:  Status report by the United States (WT/DS379/12/Add.3) 
39. The Chairman drew attention to document WT /DS379/12/Add.3, which contained the status 
report by the United States on progress in the impl ementation of the DSB's recommendations in the 
case concerning US definitive anti-dumping and count ervailing duties on certain products from China. 
40. The representative of the United States said that  his country had provided a status report in 
this dispute on 12 April 2012, in accordance with Ar ticle 21.6 of the DSU.  On 6 April 2012, the US 
Department of Commerce ("Commerce") had issued to  interested parties a preliminary determination 
with respect to certain issues in the countervailin g duty investigation of certain new pneumatic off-
the-road tyres.  On 9 April 2012, Commerce ha d issued to interested parties a preliminary 
determination with respect to certain issues in the countervailing duty investigation of laminated 
woven sacks.  Commerce had provided an opportunity for interested parties to provide comments on 
those preliminary determinations  and to provide rebuttal comments on any comments that had been 
submitted by other interested parties.  The United States said that it would continue to work on 
solutions to implement the DSB's recommendations and rulings.   
41. The representative of China said that her country  thanked the United States for its status 
report and statement made at the present meeting.  However, as the reasonable period of time in this 
dispute would expire on 25 April, China was very disappointed that the United States had not yet implemented the DSB's rulings and recommendations .  As the world's largest economy and trading 
Member, and the prime support of the establishment of multilateral trading rules, the United States  WT/DSB/M/315 
 Page 9 
 
 
should take seriously its responsibility towards the multilateral trading system.  However, it seemed 
that, while the United States was pressing other Memb ers to abide by the rules, it did not treat the 
DSB's recommendations and rulings with due r espect.  China was concerned that the delayed 
implementation of the DSB's recommendations and rulings would provide a bad example for other 
Members, it would open the door to protecti onism, and would undermine confidence of other 
Members in the dispute settlement system.  Thus, Ch ina urged the United States to expedite its work 
and fully implement the DSB's rulings and reco mmendations in good faith and without any further 
delay.  China reserved its right to take further action regarding this matter, in accordance with the 
DSU provisions.  
42. The representative of the United States said th at, in response to China's comments, the 
United States was aware that the reasonable period of time to which China and the United States had 
agreed would conclude on 25 April.  The United St ates was working to bring the relevant measures 
into conformity with the recommendations and rulings of the DSB as quickly as possible.  The United States had discussed this matter with Chin a bilaterally and stood ready to continue that 
discussion in order to proceed forward cooperatively to ward a final resolution of this dispute.  The 
United States further stated that, as China was we ll aware, the United States had explained to China 
the work that remained for Commerce to do in the implementation process, and had laid out for China 
a schedule for completing that work.  Finally, in response to China's comments that the US status 
report showed a lack of "due respect" for the DSB's recommendations and rulings, China's assertion 
was not well-founded.  China had presented its ow n status report earlier during the present meeting, 
and the United States was sure that China consider ed that it took its WTO responsibilities seriously.  
Similarly, the United States took its responsibiliti es in relation to this dispute seriously.  
43. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
(h) Thailand – Customs and fiscal measures on cigare ttes from the Philippines:  Status report by 
Thailand (WT/DS371/15) 
44. The Chairman drew attention to document WT /DS371/15, which contained the status report 
by Thailand on progress in the implementation of the DSB's recommendations in the case concerning 
Thailand's customs and fiscal measures on cigarettes from the Philippines. 
45. The representative of Thailand said that her count ry was pleased to provide an update on its 
progress in implementing the DSB's rulings and recomme ndations in this dispute.  As Members were 
aware, Thailand had already circulated a written stat us report pursuant to Article 21.6 of the DSU.  
Therefore, it would not wish to repeat in detail ever ything that had been stated in that written report.  
Thailand wished to note that the implementation process in this dispute involved three separate 
departments of the Thai government:  Customs, Exci se and Revenue and, with respect to many of the 
findings, required inter-agency coor dination.  These Departments had been working together on this 
task since the circulation of the Appellate Body Re port.  It was worth noting that their efforts had 
been disrupted for about a month due to the severe flooding in Bangkok that had shut many of the 
government offices towards the end of 2011.  Th e overall goal of the Thai government in the 
implementation process was to simplify and make mo re transparent the regulatory regime governing 
the importation and sale of cigarettes in Thailand.  Thailand expected that revised regulations would 
reduce the administrative burdens on both importe rs and domestic manufacturers of cigarettes and 
would be welcomed by importers.  Thai author ities in Bangkok expected that implementation would 
be completed with respect to each of the DSB' s rulings and recommendations by the end of the 
reasonable period of time previously notified to the DSB.  
46. The representative of the Philippines said that her country thanked Thailand for its first status 
report regarding the implementation of the DSB's ru lings and recommendations in this dispute.  His 
authorities had carefully reviewed the status re port and thanked Thailand for meeting with the WT/DSB/M/315 
Page 10  
 
Philippines prior to the present meeting to discuss th e report and for clarification of certain issues 
sought by the Philippines.  The Philippines look ed forward to receiving in due course further 
clarifications from Thailand.  The Philippines wa s closely monitoring Thailand's efforts to put in 
place the necessary implementation measures and hoped that the DSB's rulings and recommendations 
would be fully implemented by the e nd of the reasonable period of time. 
47. The DSB took note of the statements and agreed to revert to this matter at its next regular 
meeting. 
2. United States – Continued Dumping and Subsid y Offset Act of 2000:  Implementation of 
the recommendations adopted by the DSB 
(a) Statements by the European Union and Japan 
48. The Chairman said that this item was on the Age nda of the present meeting at the request of 
the European Union and Japan.  He then i nvited the respective representatives to speak. 
49. The representative of the European Union said that  the EU wished to inform the DSB that the 
authorized level of retaliation against the United States would amount to US$3,241,000 from 
1 May 2012.  The regulation had been published on  12 April 2012 and would soon be notified to the 
DSB.  As it had done many times before, the EU requested the United States to stop transferring anti-
dumping and countervailing duties to the US industry.  Every disbursement that still took place was clearly an act of non-compliance with the DSB's recommendations and rulings.  The EU, once again, 
renewed its call on the United States to abide by its clear obligation under Article 21.6 of the DSU to 
submit status reports pertaining to this dispute. 
50. The representative of Japan said that the CDSOA remained operational as the distribution 
process continued.7  Japan urged the United States to stop th e illegal distributions and repeal the 
CDSOA, not just in form but in substance, so as to  resolve this dispute.  According to Article 21.6 of 
the DSU, the United States was under obligation to provide the DSB with a status report pertaining to dispute. 
51. The representative of India said that his country  thanked the EU and Japan for bringing this 
issue before the DSB again.  India renewed its sy stemic concerns about the continued non-compliance 
by Members and the growing lack of credibility in confidence of the dispute settlement system.  India urged the United States to report full compliance without any further delay. 
52. The representative of Brazil said that his country  thanked the EU and Japan for keeping this 
item on the DSB's Agenda.  As expressed at previous meetings, Brazil was of the view that the 
United States was under obligation to submit status re ports in this dispute until such time as no more 
disbursements were made pursuant to the Byrd Amen dment.  Only then woul d the issue be "resolved" 
within the meaning of the DSU and the United States  would be released from its obligation to provide 
status reports in this dispute. 
53. The representative of Canada said that his count ry thanked the EU and Japan for having, once 
again, placed this item on the DSB's Agenda.  Ca nada shared the views expressed by the EU and 
Japan, that the Byrd Amendment would remain subj ect to the DSB's monitoring and surveillance until 
the United States ceased to apply it. 
                                                      
7 See US Customs and Bord er Protection 's website  at: 
http://www.cbp.gov/xp/cgov/trade/pr iority_trade/add_cvd/cont_dump/   WT/DSB/M/315 
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54. The representative of Thailand said that her count ry thanked the EU and Japan for continuing 
to bring this matter before the DSB.  Thailand urge d the United States to provide status reports on this 
dispute and to bring this measure in to compliance without further delay. 
55. The representative of the United States said that, as it had already explained at some previous 
DSB meetings, the US President had signed the Defi cit Reduction Act into law on 8 February 2006.  
That Act included a provision repealing the Contin ued Dumping and Subsidy Offset Act of 2000.  
Thus, the United States had taken all actions necessary to implement the DSB's recommendations and rulings in these disputes.  The United States recalle d that Members, including the EU and Japan, had 
acknowledged during previous DSB meetings that the 2006 Deficit Reduction Act did not permit the 
distribution of duties collected on goods entered after 1 October 2007, which was some four-and-a-
half years ago.  The United States, therefore, did not understand the purpose for which the EU and 
Japan had inscribed this item on the Agenda of the present meeting.  With respect to comments 
regarding further status reports in this matter, the United States failed to see what purpose would be 
served by further submission of status reports in this  dispute, or any other, repeating again that the 
United States had taken all actions  necessary to implement the DSB's recommendations and rulings in 
these disputes.  Finally, with respect to the meas ures announced by the EU, the United States would 
be carefully reviewing those measures.  The Unite d States recalled that the DSB had only authorized 
the suspension of concessions as provided in the Award of the Arbitrator.  
56. The DSB took note of the statements. 
3. United States – Measures affecting the cross border supply of gambling and betting 
services  
(a) Statement by Antigua and Barbuda regarding th e implementation of the recommendations and 
rulings adopted by the DSB  
57. The Chairman said that this item was on the Age nda of the present meeting at the request of 
Antigua and Barbuda.  He said that he had been informed that, under this Agenda item, Dominica 
would make a statement on behalf of Antigua a nd Barbuda.  He then invited the representative of 
Dominica to speak. 
58. The representative of Dominica, speaking on behalf of Antigua and Barbuda, said that, in 
November 2004, a WTO Panel had issued its decision in the DS285 dispute.  In its decision, the Panel 
had determined that US laws prohibiting the pr ovision of cross-border gambling and betting services 
by service providers located in Antigua and Barbuda  to consumers in the United States were in 
violation of the GATS.  That ruling had been uphe ld by the Appellate Body in February 2005.  In 
April 2006, to the collective surprise of Members, the United States had declared itself to be in 
compliance with the DSB's recommendations and ruli ngs, despite having done nothing in the interim, 
other than adopting yet another law further crimin alizing the cross-border supply of gambling and 
betting services.  In March 2007, a Panel establis hed under Article 21.5 of the DSU to assess the 
status of compliance had issued its report, making it clear that the United States had not complied 
with the DSB's findings, and in fact demonstrati ng that considerable remote gambling was permitted 
within the United States.  With no attempt being made by the United States to come into compliance 
following the report of the Article 21.5 Panel, in December 2007 a Panel of arbi trators had held that 
Antigua and Barbuda was entitled to resort to cross retaliation under Article 22 of the DSU in order to 
encourage the United States to comply with its obligations under international law.  
59. However, at the present time, the United States  was not in compliance with that ruling of 
eight years ago, and had not made any effort to do so.  During those years in which the United States 
had been out of compliance with the GATS, Anti gua and Barbuda had heard the US President and 
other senior officials of the US Administration insist  that other nations must observe their obligations 
under the WTO Agreements.  Antigua and Barbuda had heard how other Members, accused of being WT/DSB/M/315 
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in violation of their commitments under the WTO agre ements, must comply with their obligations to 
be considered within the fellowship of responsible nations.  In the meantime, in open violation of 
international law, the United States continued to cr iminally prosecute Antiguan-based remote gaming 
service providers for providing services to consumer s in the United States.  US Authorities had, 
without due process and in violation of international law, seized millions of dollars from Antigua and 
Barbuda's remote gaming service providers.  
60. WTO Members may recall that the US defence in the gambling dispute was that it had 
prohibited all remote gaming in the United States, and that remote gaming was so pervasive that it 
was incapable of regulation and had to be prohibite d.  While the Panel and the Appellate Body had 
been less direct in addressing th is issue as Antigua and Barbuda be lieved they should have been, both 
of those Bodies nevertheless had held that the United States had failed to prove that such was the case, 
in other words, it had failed to prove that it prohib ited all remote gaming to protect the public morals.  
Antigua and Barbuda had, throughout the course of the dispute, asserted that US law had not done 
what the US authorities had alleged it did, and that  while all cross-border gaming services from other 
countries to consumers in the United States were  prohibited, there were many opportunities for 
domestic remote gaming services.  Antigua and Bar buda, therefore, maintained that it was simply 
incorrect to say that all remote gaming was prohibited in the United States. 
61. Members would be aware that, in December 2011, in a decision that had surprised everyone, 
the US Department of Justice had formally admitted that Antigua and Barbuda had, in fact, been right 
all along, that remote gaming per se  was not prohibited in the United States, and that states and other 
operators within the country had been free to offe r those services within the confines of the loosely 
defined web of domestic law, whic h many were now doing.  This decision did not apply to Antigua 
and Barbuda's operators.  Lest its significance be lo st on anyone, with that announcement by the US 
Department of Justice, the entire defence of the United States in the gaming case had now gone away.  
During this long period of non-compliance, Antigua and Barbuda had not been sitting idly by.  To the 
contrary, Antigua and Barbuda had ex pended considerable effort in a ttempts to negotiate a settlement 
with the US authorities.  While Antigua and Bar buda had offered plenty of ideas, compromises and 
suggestions, it had nothing to show for its efforts.  Let there be no doubt, contrary to some reports in 
the media over the years, Antigua and Barbuda had ne ver been inflexible;  had never insisted upon 
full market access;  and had never rejected a compromise plan presented by the United States.  The reality was that the United States had never presente d a plan, had never worked toward a compromise, 
and had never conceded that Anti gua and Barbuda was entitled to anything at all.  In fact, sadly, 
Antigua and Barbuda had spent the last seven or eight years negotiating with itself.  
62. Some might ask why was it that Antigua a nd Barbuda had not taken advantage of the 
authorization it had received under Article 22 of the DSU some years ago.  Those Members who, like Antigua and Barbuda, had small, delicate economies that were overly dependent upon commerce with 
larger, stronger trading partners probably would not need an answer to that question.  It was no 
surprise to Antigua and Barbuda that, as soon as that ruling had been obtained in December 2007, 
there had been numerous public pronouncements from  sources in the United States that any attempt 
by Antigua and Barbuda to take advantage of th e suspension of concessions authorized by the DSB 
would make Antigua and Barbuda an  international pariah.  To Antigua and Barbuda, the implications 
had been clear.  At that point, particularly in light of the concession of the US department of Justice of 
December 2011, Antigua and Barbuda believed that fair considerati on was long due in this case.  
There had never been a reason for the United States to  fail to comply with its obligations, or at the 
very least, to engage with Antigua and Barbuda in a fa ir and constructive manner to settle this dispute.  
There certainly was no reason for that now.  Anti gua and Barbuda could no  longer negotiate with 
itself.  It was time for the United States to do wh at it asked of others, observe its international 
obligations in good faith and with due consideration for the rights a nd legal status of a fellow WTO 
Member, Antigua and Barbuda.  Earlier this week, Antigua and Barbuda had formally notified the US 
Trade Representative of its desire  to seek the good offices of the Director-General under the DSU 
provisions to join with it in seeking a mediated solution to this dispute.   Antigua and Barbuda  WT/DSB/M/315 
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remained hopeful that the United St ates would accept its invitation and move forward with alacrity to 
come into compliance with its obligations under intern ational law.  In accordance with Article 21.6 of 
the DSU, Antigua and Barbuda wished to forma lly request that this matter remain under the 
surveillance of the DSB and that the United States provide monthly status reports.   
63. The representative of St. Lucia, speaking also on behalf of the remaining member States of 
the Organisation of Eastern Caribbean States (OECS):  Grenada, Dominica, St Kitts & Nevis, 
St. Lucia, and St. Vincent & the Grenadines, said th at his country wished to be associated with the 
statement made by Dominica, on behalf of Antigua  and Barbuda, a fellow OECS member and a party 
to the OECS Economic Union.  St Lucia said that it was important to premise statements on first principles and foundational propositio ns established as the basis on which other related facts were 
founded.  It was fair to say that without first principles any system of thought or for that matter WTO 
law could collapse.  The WTO Membership of all members of the OECS was not incidental.  It reflected their belief that the preservation of their trade and economic interests would be best served 
and safeguarded through the rules-based multilateral tr ading system.  It was for that very reason that 
most trading countries subjected themselves to the process of accession to the WTO.  Many Members 
were attracted to the multilateral system because the system of binding rules and obligations was 
complemented by a robust system of redress.  It was this function contained in the DSU provisions which provided legitimacy to a system of multilatera l rules.  Without the dispute settlement system, 
multilateral rules would be reduced to a loosely held network of international norms and best practices 
at the mercy of the sovereign prerogative of Member s.  In other words, without a dispute settlement 
system respected by all, the entire multilateral system  would be put at risk.  The system of rules to 
which Members had committed themselves must be upheld .  It was that which took countries out of 
the state of nature in international trade and placed  them into a community of states where rights were 
tethered to obligations and where all Members resp ected their commitments.  The rules ought not to 
be seen as contrived instruments through which the mighty could find redress or enforce their will on others, while those of modest means and size were left foundering without a claim.    
64. While the facts of this dispute did not warrant re peating, the results of the action that had been 
taken by Antigua and Barbuda were clear:  the Unite d States had been found to be in violation of its 
obligations.  The Panel's finding had been upheld by the Appellate Body.  Furthermore, successive 
compliance panels had found that the measure which had resulted in the finding, adverse to the US 
interest, remained in place.  Me mbers would recognize that Anti gua and Barbuda's  economy relied on 
international trade.  Hence, Antigua and Bar buda could not seek redress through the suspension of 
concessions.  That would serve only to deliver anothe r crippling blow to the private sector and would 
place another burden on the peoples of the small island state.  If the first principle of the WTO was the 
establishment of a rules-based trading system, which ensured equality before the law, it was 
surprising that one of the main architects of this  system, a Member who relied heavily on the dispute 
settlement mechansim for trade enforc ement, could defy the rules that unified Members.  The painful 
defiance was aimed, by that one nation, squarely against one of the smallest members of the WTO.  In 
conclusion, OECS members urged that the WTO ru les, which remained the fundamental underpinning 
of its very existence, be observed, lest further damage to a system already reeling from successive failures to live up to its promise. 
65. The representative of the United States said that , as all Members were aware, this dispute 
involved the regulation of cross-border gambling.   The United States said that many Members, 
including the United States, view gambling as a sign ificant issue of public morals and public order, 
involving the protection of children and other vulnerable individuals.  Most WTO Members tightly regulated any gambling allowed within their borders .  Accordingly, most Members did not include 
any market access commitment for gambling in their schedules under the General Agreement on 
Trade in Services (GATS).  This had been the US  understanding of its own GATS schedule.  Indeed, 
no Member had ever raised the possibility that the US GATS schedule covered cross-border gambling 
– until Antigua and Barbuda ("Antigua") initiated this  dispute approximately ten years after the US 
schedule had been negotiated.  The Panel and th e Appellate Body ultimately found that the US WT/DSB/M/315 
Page 14  
 
schedule must be construed as including a market access commitment for cross-border gambling.  However, the Panel found that any commitment w as unintentional, and the Appellate Body found the 
US schedule to be ambiguous in that regard.   
66. As previously explained to the DSB, the Unite d States accepted the results of the dispute 
settlement process.  As the United States had prev iously notified the DSB and the Council for Trade 
in Services, the United States was responding to  these findings by invoking the established, 
multilateral procedures for modification of a Member 's GATS schedule of concessions.  In particular, 
in May 2007, the United States had initiated the modification procedure, provided under Article XXI 
of the GATS, so as to reflect the original US in tention to exclude gambling from the scope of US 
commitments.  Pursuant to the GATS procedures, th e United States had entered into discussions with 
those Members notifying that their interests coul d be affected by the modification to the US 
schedule.  The United States had offered compensatory ad justments, under which the United States 
would replace the gambling-related commitment with ot her commitments of equal or greater value.  
With the sole exception of discussions with Anti gua, those discussions had been successful.  In 
particular, by early 2008, out of the entire Member ship of the WTO, only Antigua maintained an 
objection to the modification of the US schedule.   
67. Since that time, the United States had entered in to negotiations with Antigua, with the goal of 
obtaining Antigua's agreement to the modification of the US GATS schedule.  In that regard, the statement read by Dominica at the present meeting on behalf of Antigua simply did not reflect history 
or reality.  The United States devoted substantia l resources to these settlement discussions and had 
met repeatedly with Antigua at all levels of gove rnment, from the ministerial level to the technical 
level.  The United States had offered real and substa ntial benefits, based on specific requests that had 
been made by Antigua, that would make important contributions to the further development of the 
Antiguan economy.  At times, the parties had see med on the verge of an agreement, and the 
United States continued to believe that an agreemen t remained within their grasp.  With respect to 
Antigua's suggestion that this matter be referred to mediation or good offices, the United States said 
that it would consider this matter.  Its initial reacti on, however, was that in light of the fact that the 
United States and Antigua had previously come very  close to a resolution of this matter, a serious 
effort to re-engage in negotiations would be more productive than referring the matter to a third party.  
In closing, the United States noted that it remained  ready for further engagement with Antigua on a 
resolution of Antigua's objections to completion of  the GATS Article XXI process.  The United States 
believed that that process was the proper foru m for further discussion of this matter.   
68. The representative of Jamaica said that his count ry wished to be associated with its fellow 
CARICOM members, Dominica and St. Lucia.  Jama ica noted that the WTO was seeking to be the 
champion of a rules-based multilateral trading syst em and Jamaica was proud of the record of the 
WTO dispute settlement process.  At the same time , Jamaica was mindful that small, developing 
states continued to face challenges in fully benefitti ng from the dispute settlement process.  Therefore, 
having followed the developments in this dispute, Ja maica urged both parties to continue to exercise 
all necessary measures to come to an early and a mutually satisfactory solution to this issue. 
69. The DSB took note of the statements. 
4. United States – Measures affecting the production and sale of clove cigarettes 
(a) Report of the Appellate Body (WT/DS406/AB /R) and Report of the Panel (WT/DS406/R) 
70. The Chairman drew attention to the communi cation from the Appellate Body contained in 
document WT/DS406/8 transmitting the Appellate Body Report on:  "United States – Measures 
Affecting the Production and Sale of  Clove Cigarettes", which had been circulated on 4 April 2012 in 
document WT/DS406/AB/R.  He remi nded delegations that the Appella te Body Report and the Panel 
Report pertaining to this dispute had been circul ated as unrestricted documents.  As Members were  WT/DSB/M/315 
 Page 15 
 
 
aware, Article 17.14 of the DSU required that:  "A n Appellate Body report shall be adopted by the 
DSB and unconditionally accepted by th e parties to the dispute unless the DSB decides by consensus 
not to adopt the Appellate Body report within 30 da ys following its circulation to Members.  This 
adoption procedure is without prejudice to the right of Members to express their views on an Appellate Body report."  
71. The representative of Indonesia said that his country thanked the Panel, the Appellate Body 
and the Secretariat for their hard work in this di spute.  In the context of the DSB's work, it was 
important to ensure that all Members had an opportunity to have their voice heard.  Indonesia was grateful for the opportunity to raise its concerns about  this dispute.  At the present meeting, Indonesia 
was requesting that the DSB adopt the Reports pertaining to this dispute.  With the adoption of the 
Reports, Indonesia looked forward to working with the United States to implement the Panel and the 
Appellate Body's recommendations.  Indonesia hoped th at the implementation could be completed in 
an expeditious manner, in accordance with the WTO laws and regulations. 
72. The representative of the United States said that his country wished to begin by thanking the 
members of the Appellate Body, the Panel and the Secretariat assisting them for their work on this 
dispute.  This dispute involved a US public health measure designed to reduce smoking in the 
United States by removing from the market cigarettes that were uniquely appealing to young people.  
Ninety-five per cent of addicted smokers in the Unite d States had started smoking before they were 26 
years old.  US public health regulators had recogni zed the tremendous benefit to the public health by 
preventing sweet and other unusually flavoured ci garettes, such as fruit, candy, and spice, from 
attracting new generations of smoke rs.  The US ban on cigarettes with characterizing flavours other 
than tobacco or menthol had targeted a specific type  of cigarette – cigarettes that were smoked by a 
small fraction of the population and predominantly  by young people.  The ban was not intended to 
completely remove from the market the cigarettes smoked regularly in the United States by tens of 
millions of addicted adults, that is, tobacco and ment hol cigarettes.  To be sure, the United States said 
that tobacco and menthol cigarettes are a serious pu blic health problem and the target of multiple 
regulatory efforts.  However, because of their exte nsive use by adults, these cigarettes posed different 
public health challenges from the flavours banned by  the measure at issue in this dispute.  The 
United States appreciated that the Panel had reject ed Indonesia's claims under Articles 2.2, 2.5, 2.8, 
2.9.3 and 12.3 of the TBT Agreement.  Importantly , the Panel had found that the US measure was 
consistent with Article 2.2 of the TBT Agreement because it was not  "more trade-restrictive than 
necessary" to fulfil the legitimate objective of reducing youth smoking in the United States.  In 
particular, the Panel had found that the measure re flected the overwhelming view of the scientific 
community that banning clove cigarettes would be beneficial for the public health.  A major reason 
was that the addition of cloves made the cigarette more attractive to young, inexperienced smokers.  
By banning clove and other "trainer" cigarettes from the market, the measure reduced the likelihood that young people would enter into a lifetime of nicotine addiction.   
73. Notably, at the present meeting, the DSB w as adopting these findings that a ban on clove 
cigarettes met the requirements of Article 2.2 of  the TBT Agreement and was thus no more trade 
restrictive than necessary to fulfil a legitimate public health objective.  Especially in light of these 
findings, which acknowledged that the US measure met a legitimate public health objective, the 
United States found it very hard to understand th e Appellate Body's conclusion that the measure 
resulted in a breach of Article 2.1 of the TBT Agre ement.  The United States did appreciate the very 
important recognition in the Appellate Body Repor t that Members may draw legitimate regulatory 
distinctions between like products, even where ther e was a detriment to the competitive conditions for 
the group of like imported products compared to the group of like domestic products.  However, 
several aspects of the Appellate Body's findings a nd analysis on Article 2.1 were problematic – most 
significantly the findings and analysis related to th e regulatory distinction between clove and menthol 
cigarettes.  In the course of the dispute, the Unite d States had explained that from the perspective of 
public health regulation, there was a clear differen ce between a product, such as clove cigarettes, that 
was smoked in the United States experimentally by  a small number of young people, but relatively WT/DSB/M/315 
Page 16  
 
few adults, and a product such as menthol cigarettes, that was not only used by youth during initiation, but also smoked regularly by tens of m illions of addicted adults.  These very different 
situations raised different regulatory considera tions, such as the burden on the US public health 
system of banning a product with tens of millions of  addicted users.  These differences thus warranted 
a different regulatory approach.    
74. The Appellate Body had recognized that the Panel had failed to e xplain its reasons for 
rejecting the US regulatory approach.  And in fact, due to the Panel's flawed analysis, the Panel had 
made no findings on the relevant factual issues.  In these circumstances, the Appellate Body should 
have concluded by overturning the Panel's conclu sion.  Instead, however, the Appellate Body had 
engaged in its own analysis.  And in doing so, the Appellate Body ha d rejected the US explanation for 
the regulatory distinction without citing to a single f act on the record that supp orted its apparent view 
that the public health basis had not been legitimate.
8  The Appellate Body had thus reached 
conclusions that had not been, as they should have  been in any dispute, based on Panel findings or 
undisputed facts.   
75. Instead, the Appellate Body had based its conc lusion regarding this critical public health 
matter on speculation.  In particular, the Appellate Body had stated that "it is not clear" that the 
potential risks associated with banning menthol ci garettes "would materialize … insofar as regular 
cigarettes would remain in the market".9  Thus, on the most critical pub lic health rationale for drawing 
a distinction between clove and menthol cigarettes, the Appellate Body did not point to any facts on 
the record to support its dismissal of that distinc tion.  Indeed, all the Appellate Body could say was 
that "it is not clear" the risks would materialize.  The United States did not think that this was an 
adequate basis for finding that a Member's public health measure breaches its WTO obligations.  In 
essence, the Appellate Body was stating that it ha d a different approach than US regulators for 
weighing the potential risks and benefits from including additional types of cigarettes in the ban.  In 
adopting this approach, the Appellate Body appear ed to have placed itself in the position of the 
regulator.  But that was not the function of a pane l or the Appellate Body, and they were not well 
suited for that role.   
76. To return to the passage previously  cited, the Appellate Body said that "it is not clear" that the 
public health risks would arise "insofar as regular cigarettes would remain in the market", but what 
factual or scientific basis was there to say that smokers addicted to menthol cigarettes would readily 
switch to regular cigarettes?  There was none in the Panel record and if the Appellate Body was 
wrong in that assumption, the consequences for public health would be severe.  The United States said 
that "it is the role of public health authorities, not  only in the United States but worldwide, to engage 
in the complex process of managing products that are harmful, addictive, and widely used".  In doing 
so, public health authorities must consider the types of harms that may result from wide-reaching 
regulatory actions.  Thus, the Appellate Body had erred in substituting its own judgment – instead of 
that of the regulator – with regard to whether add itional regulations should be adopted in the face of 
potential harms.   
77. As a result, the analysis applied in this dis pute was insufficient to allow for the type of 
legitimate incremental regulation commonly applied to  situations such as the one presented here.  The 
result in this dispute should be of grave concern to any Member regulating for the benefit of public 
health as, without the benefit of analysis based in any factual findings, it was decided that a public 
health regulation must be applied to additional ty pes of products, despite the potential harms of an 
extended ban.   
                                                      
8 See Appellate Body Report, para. 225 (fifth through ninth sentences). 
9 See Appellate Body Report, para. 225.  WT/DSB/M/315 
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78. Finally, the United States was disappointed with the Panel and Appellate Body's findings that 
the challenged measure's three month interval be tween publication and entry into force was not 
"reasonable" and thus was inconsiste nt with Article 2.12 of the TBT Ag reement.  First, the Appellate 
Body's treatment of paragraph 5.2 of the 2001 Do ha Ministerial Decision undermined the Appellate 
Body's own, and correct, finding that paragraph 5.2 was not an authoritative interpretation for 
purposes of Article IX:2 of the WTO Agreement.  The United States said that Article IX:2 provides 
the exclusive mechanism for author itative interpretations, and the carefully delineated procedural 
conditions established by Members in Artic le IX:2 were important safeguards for 
Members.  However, by treating pa ragraph 5.2 of the Doha Decision as a "subsequent agreement" that 
established the meaning of the covered agreements, the Appellate Body Report effectively eliminated 
the safeguards that Members included in Article IX :2 of the WTO Agreement.  Furthermore, there 
appeared to be nothing in the Appellate Body's a pproach to limit such a "subsequent agreement" to 
one by the Ministerial Conference or the General Counc il.  Second, in its analysis of Article 2.12, the 
Appellate Body found that all the complaining party needed to prove was that the interval period was 
less than six months, and that the burden of rebuttin g that element of the claim fell to the responding 
party.  The Appellate Body's interpretation effectiv ely reversed the burden of proof for Article 2.12 
claims.  But, as Members generally recognized, it must  be the complaining party's burden to prove all 
the elements of its legal claim.  This should in clude that the complaining Member's producers could 
not have adapted to the requirements within the inte rval period actually allotted and that a period of 
not less than six months would be effective to  fulfil the legitimate objective of the challenged 
measure.  The fact that Article 2.12 may have b een designed "to provide a degree of certainty", the 
United States stated "does not alter this fundamental concept".  
79. The representative of Norway said that her count ry thanked the Appellate Body, the Panel and 
the Secretariat for their work in this dispute, a nd welcomed the adoption of the Panel and Appellate 
Body Reports.  Norway noted that the Appellate Bo dy had clearly stated that regulatory concerns 
underlying a measure may be relevant to an analysis  of the "likeness" criteria under Article III:4 of the 
GATT 1994 as well as under Article 2.1 of the TBT Agre ement only to the extent that they had an 
impact on the competitive relationship between a nd among the products concerned.  In Norway's 
view, this was an important clarification.  More over, the Appellate Body had stressed that their 
conclusions in this case were not intended to prev ent Members from implementing policies to fulfil 
legitimate objectives, in this ca se related to health and the prev ention of youth smoking.  However, 
such measures must be taken consistently with the WTO obligations, including principles such as the 
national treatment obligation and the most-favoured-n ation treatment.  In Norway's view, these 
parameters, as clarified by the Appellate Body, left sufficient space for Members to pursue objectives for the protection of human, animal or plant life or health, or other legitimate interests.  
80. The DSB took note of the statements, and adopt ed the Appellate Body Report contained in 
WT/DS406/AB/R and the Panel Report contained in WT/DS406/R, as modified by the Appellate 
Body Report. 
5. Proposed nomination for the indicative list of governmental and non-governmental 
panelists (WT/DSB/W/478) 
81. The Chairman drew attention to document WT /DSB/W/478, which contained an additional 
name proposed for inclusion on the indicative list of  governmental and non-governmental panelists, in 
accordance with Article 8.4 of the DSU.  He propo sed that the DSB approve the name contained in 
document WT/DSB/W/478. 
82. The DSB so agreed. WT/DSB/M/315 
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6. Appointment of Appellate Body members 
(a) Statement by the Chairman 
83. The Chairman, speaking under "Other Business", said that, as announced at the outset of the 
present meeting, he wished to make a statem ent regarding the 2012 selection process for the 
appointment of a new Appellate Body member and the process for the possible reappointment of one 
Appellate Body member.  In that regard, he recalled that at its meeting on 22 February 2012, the DSB 
had agreed to the Chair's proposal  to launch a selection process for the appointment of a new member 
of the Appellate Body for the position left by Mr. Shotaro Oshima, and that this new member be appointed for a four-year term beginning 1 June 20 12.   At the 22 February 2012 meeting, the DSB 
had also agreed to set a deadline of 30 March 2012 for Members' nominations of candidates.  
Following the agreed deadline, five candidates had been submitted by four Members, namely, Japan, 
Kenya, Korea and Thailand.  The CVs of those ca ndidates had been circulated as Job documents and 
had been made available electronically.  Subsequen tly, Kenya had informed Members of its decision 
to withdraw its candidate.  A communication to that effect had been circulated in document 
JOB/DSB/CV12/1/Rev.1.  As a result, there were at present four candidates:  two submitted by Japan, 
one by Korea and one by Thailand.  Follo wing the withdrawal of Kenya's candidate, 
H.E. Mr. Tom Mboya Okeyo of Kenya, the Chairman of the Council for Trade in Goods, who had initially recused himself from the selection process,  would now participate in the work of the 
Selection Committee.  In that regard, he recalled that, as had been agreed by the DSB and based on 
the procedures set forth in document WT/DSB/1, the Selection Committee was comprised of the Director General and the 2012 Chairs of the Ge neral Council, Goods Coun cil, Services Council, 
TRIPS Council and the DSB.   
84. As had been indicated in the Chairman's fa x, dated 2 April 2012, the Selection Committee 
would interview the four candidates on 25 and 26 Apr il.  Subsequently, on 7 and 8 May, the Selection 
Committee would be available to meet delegations , upon request, in order to receive their views on 
the candidates.  Interested delegations were inv ited to contact the Council and TNC Division to make 
an appointment.  Alternatively, delegations coul d submit their comments in writing by no later than 
30 April 2012.  Any such comments should be addr essed to the Chair of the DSB in care of the 
Council and TNC Division.  As agreed by the DSB, the Selection Committee's recommendation 
would be issued by no later than 11 May 2012 so that the DSB could take a decision on this matter at its regular meeting on 24 May 2012.  Finally, he r ecalled that, at the 22 February 2012 meeting, the 
DSB had agreed to ask the Chair of the DSB to ca rry out consultations on the possible reappointment 
of Ms Yuejiao Zhang for a second four-year term be ginning on 1 June 2012.  He recalled that the 
previous Chair had started the informal process of consultations and, in her statement made at the 
March DSB meeting, she had invited any interested delegations with views on this matter to contact 
the Chair of the DSB by no later than 12 April 2012.   On the basis of the consultations undertaken by 
the previous Chair and the consultations that he  had carried out after the March 2012 DSB meeting, 
he wished to report at the present meeting that no Member had expressed any reservations regarding 
the reappointment of Ms Zhang.  In light of th is, it was his understanding that, at its meeting on 
24 May 2012, the DSB would agree to reappoint Ms  Zhang for a second four-year term beginning on 
1 June 2012.  
85. The DSB took note of the statement. 
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